Abraham Lincoln once famously said: “Character is like a tree and reputation like its shadow. The shadow is what we think of it; the tree is the real thing.” While Lincoln surely referred to people rather than organisations, it would make good sense to extend this allegory to the business world. And with the recent proliferation of the concept of corporate reputation and the role corporate communicators play in defending it, it seems fair to ask ourselves this: are we dealing too much with the shadow and not enough with the tree?
In other words, and using more common business terminology, the question is about perceptions vs. reality: how much can be achieved by “managing” perceptions rather than reality, or better yet – how can we once and for all eliminate the gap between the two?
Let’s start with some definitions:
“Reality” (or “the tree” according to Lincoln) can be described as the way a company actually behaves: the way its employees perform their work and experience the company in the workplace; the way customers experience it when using its products and services or when coming across other touchpoints; the way suppliers experience it in their business relationships; and so on. Typically, the larger the company is, the more complex and multi-layered its reality is.
“Perceptions” (or “the shadow”), on the other hand, are what people think and feel about the company. Since by “people” we refer to the same stakeholders who experience the company, one would expect that their perceptions would be close to the reality they experience. However, perceptions are not just based on personal experiences – they are also based on what people hear, see or read about the company, whether from the company’s own communications or from third parties like the media, experts and regulators. That, and the fact that reality can often be well-hidden (ask anyone who thought they knew Volkswagen before September 2015), lead to an often-wide gap between the two.
These reality-perception gaps are detrimental to companies: when they’re in the company’s favour, meaning that perceptions are in fact better than the reality, they represent a substantial risk – when symptoms of reality come out (and they always do in the current world of transparency and scrutiny) the company’s reputation and business will suffer tremendously due to people’s disappointment – as in the case of VW. If the gaps go against the company, and reality is better than perceptions – then the company is not getting the levels of preference and advocacy it should.
So what’s a communicator to do? It’s true that the communications and corporate affairs functions are already changing dramatically these days, going from reactive to proactive communication and stakeholder engagement, and adding new skills and competencies in the areas of strategy, organisation, digital media and data analysis. These changes are important and substantial, and will undoubtedly make the work of corporate communicators more strategic and professional. But they’re still more about the shadow than the tree.
To really make a difference, communicators need to start dealing with the tree – the company’s character. Increasingly, communicators need to start seeing themselves as initiators and facilitators of company-wide efforts to shape the reality of the company in line with its stated ambitions and the stakeholder perceptions it wishes to have. This responsibility ultimately lies with the CEO – but in most businesses today it’s the corporate communications team, and the person heading it, who are the natural drivers of this effort – as the ones “responsible” for the company’s reputation and for managing its stakeholder relations.
"If reality is better than perceptions – then the company is not getting the levels of preference and advocacy it should."
This means a deep transformation in how communicators work. More than anything else, it calls for much stronger internal alliances and collaboration within the corporate environment:
- With HR: to help shape a culture and behaviour that support the company’s character
- With marketing and sales: to ensure the way products and services are defined, promoted and delivered is consistent with the company’s character
- With strategy, finance, technology and legal: to allow the company’s character to guide decisions on growth, budget allocation, systems and procedures
- With operations, R&D and supply chain: to include the company’s actions across geographies, business units and supplier relationships, in the effort to behave “in character”
- With public affairs and CSR: to connect the company’s sustainability strategy and activities, and its stakeholder relations, to its character
- With senior management: to help bring it all together, and provide endorsement, oversight and commitment
Without achieving real alignment and collaboration with these departments and respective executives, the task of chief communicators to eliminate the company’s reality-perception gap is virtually doomed. Yes, they can do a lot to try and impact perceptions through communications, but at the end of the day the shape of the tree will always cast its true shadow. And while there’s no doubt certain formal processes and management tools are required – such as CEO endorsement, collaboration forums, KPI systems etc. – it’s communicators’ “soft power” that will enable them to work with others in the organisation and forge strong and effective alliances. These abilities are critical for the success of tomorrow’s communicator.
Corporate character, a term advocated in recent years by the Arthur W Page Society, is not just a new buzzword that aims to replace brand or reputation. As Lincoln observed, it’s what actually matters. And communicators cannot build and shape the company’s character on their own – they need the help of other teams, executives and departments in their companies. Communicators need to get better at building these relationships – and business leaders need to get better at helping them. It’s time for businesses to realise that if they want a beautiful shadow, they need to grow a spectacular tree.