What Business teaches us about reputation

Sometimes all I can do is shrug and shake my head when I watch people being rude and selfish.  They are unafraid to be offensive to others because they don’t care what anyone thinks.  “Me First” seems to be their motto and they operate under the false notion that there is no downside to behaving this way.

How long do you think a company would last acting that way?  Companies work long and hard, spending millions of dollars, all to build the best reputation possible.  Why?  Because people do business with people they know, like and trust.  Businesses work diligently to build the perception of likability and trustworthiness.  Businesses with good reputations can attract higher caliber employees, as well as more loyal customers. My Sales & Marketing teacher called it corporate Goodwill.

Robert Eccles, Scott Newquist and Roland Schatz published an article in the Harvard Business Review called Reputation and it’s Risks, where they stated that “In an economy where 70% to 80% of market value comes from hard-to-assess intangible assets such as brand equity, intellectual capital, and goodwill, organizations are especially vulnerable to anything that damages their reputations”.

70 to 80% of market value comes from the perception of goodwill associated with a company brand?  That’s a remarkable truth.  What is one of the first things you think of when you think about Toyota and Honda? If I spent some time, I might remember the first time I saw a little Toyota.  It was the mid 70’s and it was about the size of a cereal box, but it’s not the first thing that comes to mind. Instead, the first thing that comes to mind is reliability.

Ford, GM & Chrysler have had a tough time convincing the public that their cars are as reliable, even though they have mostly closed the quality gap between the Japanese car companies since about 2001*.  Their problem comes from the way they used to handle quality problems.  If a quality issue raised its head, they would just fix it on recall.  The problem with this solution is that even though they did ultimately fix it, they first allowed it to get in front of the customer.

A couple of years ago my daughter was looking to replace the laptop we bought her for graduation.  She had been saving for this and didn’t want just any laptop, she wanted a fast laptop.

I had been watching for deals and found one online.  We bought it through a company called Woot in Texas but it was shipping refurbished from Hewlett Packard, somewhere in New England.  When this laptop arrived, it looked like it had been dragged behind a car.  No joke.  It was severely scratched and dented.  I started it up and it seemed to work find, but it had been abused.  So I called Hewlett Packard customer service.

Aside from the poor cosmetic condition that the computer housing was in, it also had a core I5 processor but was advertised as a core I7, which was the main reason we bought it.  Once the customer service guy heard that, he wouldn’t speak to me about it anymore.  He said that the company in Texas had falsely advertised it and it was their responsibility to correct this problem. I brought up the condition two more times, but he would not talk to me about it at all.  He had found his “out” and all he would say was that I needed to contact the company in Texas because they falsely advertised the processor.

To make a long story short, Woot.com made quick work of the return and refund.  Because of their excellent customer service, I still check Woot daily and have bought from them on several occasions.  In contrast, I have not since, nor do I plan to buy another Hewlett Packard product.  There are too many options that have better customer service.

I said all that to say this. Even on a personal level, whether or not you realize it, you’re selling.  You’re selling yourself.  We all do it.  We do it in the way we dress, the teams we root for and the causes we support.  We’re trying to fit in somewhere because on some level, we all realize that we NEED others.  We need love, help and acceptance.  While some people may try on the surface to convince us that they don’t care what we think, if you watch them long enough, you’ll see the truth.

It helps me to keep in mind, when building and influencing my own reputation, how companies think.  I can easily find guidelines for my personal life from observing them because I want the same things.

  • I want people to know, like and trust me.
  • I want all their experiences with me to be positive and memorable.
  • I want everyone to walk away from every interaction with me feeling like it was a Win-Win, that neither of us won at the other’s expense.
  • I want my words to rock solid and unshakable.  I want people to be able to count on what I say every time without fear.  I often ask myself the question How many lies do I have to tell to be a liar?

Unfortunately, I can also remember times when my actions didn’t line up with any of this.  In hindsight I can see times when my weak character actually worked against these aspirations.  The Bible says in Ecclesiastes 10:1 that an act of foolishness can destroy a good and well built reputation.

I want you to have a better understanding of how connected our reputation is to the quality of our life.  We should do our all to build the best reputation we possibly can.

I don’t want people to look at me and see a fool. I want people to see Christ in me, and be drawn closer to God because of His love in me. I want a reputation for walking in love, standing in faith, Living in honor, integrity, humility and faithfulness.  These are things that we run the risk of losing if we don’t act intentionally.  The world will not help us to be this way.  We’ve got to look to God and His word.  The Bible says in Romans 12 that we transform when we renew our minds with His word, and we prove His will.
*Reputation and its Risks.  Robert G. Eccles, Scott C. Newquist and Roland Schatz. Harvard Business Review. Feb 2007.

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