Re-evaluating image
Now in its fifth year, the annual Top Companies Reputation Index (TCRI) compiled by Plus 94 Research and partly funded by the Mail & Guardian reflects challenging economic conditions in South Africa negatively impacting corporate reputation.
“We have seen overall scoring across sectors going down during the past three years. South African consumers are not as buoyant about the country and conditions as they were four or five years ago,” says Sifiso Falala, chief executive of Plus 94 Research.
He believes that the country is only now starting to feel the brunt of the global recession that began in 2008: “From challenges around inflation and high levels of unemployment, South Africa is faced with a number of socio-political developments that are impacting corporate reputation. Couple this with protest action linked to [lack of] service delivery and general discontent around the standard of living, [and] you have an environment which needs business to become more visible in helping overcome these challenges.”
For Falala, one of the biggest concerns when it comes to managing corporate reputation in the country is that companies are not driving innovation.
“Innovation is a critical component of reputation. In general, local companies replicate or reproduce trends from elsewhere and not doing anything uniquely African.
“While we are not saying they should be involved on a political level, they need to find innovative ways of addressing specific South African issues pertaining to unemployment, the disadvantaged, the disabled, and youth to name but a few. We need to embrace a South African way Tamra Capstick-Dale, managing director of Corporate Image, says corporate reputation is more important today than ever before.
“Consumers are more savvy than they were 10 years ago. They are more engaged with companies because of who they are, instead of what they pro- who embrace it and have fun with it. Sure, there might be hits and misses but they take the bad with the good. And then you have those companies who are more concerned about what employees and their stakeholders think.
“They adopt an ‘old school’ approach with their reputation, with responses become much more marketingfocused instead of conversational,” she says.
Depending on who you ask, social networking might be the best or worst tool for management reputation.
“Social media is underplayed by certain companies who underestimate the power of it. There are others who take it too seriously. If people are really enraged about something they will not just click like or share a post. It all depends on how companies react to it,” says Capstick-Dale.
She feels that companies should not fall into the trap of getting social media users to dictate their organisational strategy.
“You need to make decisions based on the business, consumers, and the supply chain. Anything other than that and you are only doing what is popular and not good for business. Social media outrage moves on very quickly, and it has a very limited impact on the bottom line.”
Jaco Pienaar, chief knowledge officer at market research and analysis firm Professional Evaluation and Research, feels that social media is placing focus on how top brands handle crises.
“In the past year we have seen several companies facing numerous scandals including retrenchments, strikes, and the like. How they manage these dictate how strong their brand remains. From our research we have seen that the companies who come out on top are generally the ones able to manage their reputation very efficiently and be ahead of the consumer.