1. Introduction
“There is only one thing in the world worse than being talked about, and that is not being talked about (The Picture of Dorian Gray, Oscar Wilde, 1890, cited in Genasi, 2002). Genasi explains citation in the following way:
As the quotation .. clearly shows, caring about what people think of you is nothing new. It is a fundamental human trait and people have been managing their reputations since history began.
After all, social acceptance is one of the essential human desires expressed in Maslow’s hierarchy of needs, after food and water, shelter and a mate. Being well thought of, having a good name and being admired are all important in societies across the world, and always have been and probably always will be (Genasi, 2002).
Understanding of reputation in public relations’ (PR) field is relatively new and unexplored understanding in Baltic region. The study will indicate why corporate reputation is important to organization and prove or disapprove thesis statement, that corporate reputation is an intangible asset of any company. The aim of the study also is to illustrate that corporate reputation has practical use therefore it should be studied and exercised.
Summarizing views and opinions of benefits of good corporate reputation would give a new insight of the subject to professionals of the field, as well as indicate the awareness of the benefits that corporate reputation and reputation management can give to the company.
This study will look only at the corporate reputation as an asset of a company or firm with regards to corporate image, culture and behavior of it as a commercial organization. It will not explore benefits of positive personal or personality image, therefore it will be significant only to business practitioners and academics that study or practice PR and marketing on organizational level. As mentioned earlier, PR and corporate reputation and management of it is a relatively new understanding for business executives in Baltic region. For business executives of the region this study will help to understand the reasons why some companies have better business performance than other although the practice of business operations themselves are similar.
Good reputation does not depend on the quality of products or services provided, but on how well-known the name of the company is, as PR practitioner Chris Genasi writes, “Those that believe that good reputation will occur naturally for those people who simply do a good job are missing significant opportunities” (Genasi, 2002).
Benefits of reputation management of different professionals of the field will be summarized by reviewing different publications about the subject. It will involve textbooks, press publications and online resources; the method selected for the study is qualitative research. Practitioners and academics of the field and their works selected to summarize and identify the most valuable assets and benefits of corporate reputation are professionals of the field, with considerable academic or practical experience and recognition among other professionals. Mostly texts by founders of Reputation Institute Charles Fombrun and Cees van Riel as well as public relations practitioner Chris Genasi will be used.
Hypothesis: good corporate reputation is an intangible asset of every organization, but it is problematic to capitalize it.
Research questions:
What is corporate reputation? How is it formed?
How corporate reputation is measured or identified?
What are the benefits of good corporate reputation for a company and for society?
Does corporate reputation have any practical meaning in business world and how can it be measured?
Definitions:
1) Corporate reputation – “a corporate reputation is a perceptual representation of a company’s past actions and future prospects that describes the firm’s overall appeal to all its key constituents when compared with other leading rivals” (Fombrun, 1996).
2) Organization – business corporation, firm or company
3) Intangible asset – elusive value of organization that cannot be measured in figures (money), but has significant meaning for organization and adds value to its stock price, market value and sales of the product or service.
4) Benefit of corporate reputation – advantage of corporate reputation that has a practical meaning for business by rising value of the company as well as competitive advantage that keeps organizations ahead of its competitors in the eyes of consumers and in terms of financial gains
5) Reputation quotient – method of measuring corporate reputation
Abbreviations:
PR – public relations
RQ – reputation quotient
RI – Reputation Institute
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