Today, a company’s reputation drives nearly every aspect of the business. A good reputation can boost your stock value, open new markets and buy you enough goodwill from your clients and customers to weather a crisis situation. A bad reputation, on the other hand, can quickly spiral downward into decreased stakeholder engagements, lower sales and loss of revenue.
This is a reality that has been understood for some time, but many executives have continued to be reluctant to dedicate resources to such an intangible asset. So to this day, public relations professionals tasked with growing and maintaining reputation often find themselves fighting an uphill battle to obtain the necessary resources to enact the strategies and plans they know will move the needle.
However, a recent survey of CEOs indicates that they are beginning to see the true business value of investing both time and money in reputation building. CEOs are acknowledging the fact that good PR can positively impact a company’s reputation, but it will still require a significant amount of work on our end to translate that recognition into action.
In the “Business Case for PR” survey, conducted by Wakefield Research for PRSA New Jersey, 85 percent of New Jersey CEOs acknowledge that building and maintaining corporate reputation is a critical objective of their PR program. This is a significant step forward and indicates that executives are starting to appreciate that in today’s reputation economy, an emphasis on programs that enhance their company’s standing among all stakeholders is a must-have. Unfortunately, this macro-level understanding is not accompanied by an increased awareness of the specific functions of PR and has not yet translated to an increase in necessary resources.
Our survey found that while over 80 percent of CEOs believe that driving reputation and increasing brand awareness are critical functions of PR, a substantially smaller number consider corporate social responsibility (25%), executive positioning (18%), or crisis management (12%) to be important elements of the same program. This indicates a fairly one-dimensional understanding of PR’s function and diminishes the impact that a good PR plan can have.
To further complicate matters, 87 percent of CEOs feel they already have a solid understanding of the PR function, so educating them on its true scope and potential could prove challenging. However, as our survey indicates, this is a challenge worth accepting. For CEOs planning to increase their PR budgets for 2015, 74 percent indicated the decision was due to the obvious value PR adds to their company, and 64 percent said they would likely commit increased resources if they better understood the goals and strategies of their PR program.
The potential here is clear. By better educating our executives (or empowering our clients to educate theirs), we can increase the level of understanding around the broad potential impact PR can have across a company’s functional areas. This heightened understanding translates to increased resources, better enabling the PR team to do its job and drive a company towards an improved reputation.
It’s a win-win, but only if we take the initiative to educate at the very top.