Your greatest leadership asset
Leadership and communication are inextricably linked with personal reputation. Your reputation as a business leader plays a crucial role in whether your company thrives or dies.
Reputation is undoubtedly your greatest leadership asset. Today I’ll examine what I call the ‘reputation phenomenon’. I’ll explore the overall impact of leadership reputation and how this influences corporate reputation. And I’ll suggest how to raise your individual reputation to boost the success of your company.
If you’re serious about enhancing your standing with clients, investors, analysts, employees, the media and the general public, I’m offering a unique deal on my Reputation Raiser program. The program consists of 12 months of leadership communication coaching, with support on-tap when you need it. If you’re one of the first three people to sign up after reading this post, I’ll complement the Reputation Raiser with a free one-month intensive coaching program for a colleague of your choice. If that sounds good, get in touch.
The public view of leadership reputation
Two thirds of consumers say their perception of a company leader affects their opinion of the whole company. This is supported by research examining the effects of news stories about individual business leaders. A report in the International Journal of Strategic Communication reveals that negative reports about a CEO can cause profits to drop, while favourable stories, which support a positive reputation, have a valuable long-term effect on company fortunes. The same report shows that the CEO’s personal reputation alone can account for nearly two thirds of overall corporate reputation.
The corporate view of leadership reputation
Businesses agree that the CEO’s standing with the media, investors, analysts, employees and the public has a huge influence on organisational prosperity and destiny.
An international survey of business executives suggests that the individual heading up the company must have a visible public profile for their organisation to be highly regarded. In other words the CEO must be seen to be publicly engaged to create a strong reputation. In today’s age of social media and 24/7 news it’s all about the conjoining of leadership and communication.
But what are the implications of this public profile? The survey shows that:
- Nearly nine out of ten executives are convinced that a leader with a positive reputation attracts more investors
- More than eight out of ten say a strong CEO reputation results in positive media coverage and crisis protection
- More than seven out of ten believe the CEO’s reputation plays a major role in attracting and retaining staff
Organisations with a strong reputation take this even further. More than half their executives say corporate reputation is closely linked not just with CEO reputation but also with the individual reputations of the entire senior management team.
Financial value of a shining corporate reputation
Corporate reputation is generally regarded as a company’s most valuable asset. High-reputation firms enjoy a market value premium, perform better financially and have a lower cost of capital. In other words they are less risky and are likely to be a good investment.
Let’s put some monetary figures on that. Last year, in the FTSE 350, corporate reputation accounted for nearly 40% of shareholder value, or £986 billion GBP. Reputation was even more valuable in the FTSE 100, where it equated to 46% of market capitalisation across the top 25 companies.
Research suggests that improving reputation by five percent could increase market capitalisation by more than two percent in the FTSE 100. That’s a serious amount of extra shareholder value. We’re talking many billions here.
Nurture your reputation
Reputation needs to be cultivated carefully. No media office or PR department can create it for you. They can promote it, but only you can develop it. Your reputation is based entirely on you: your authenticity, integrity and personality. People hear what you say, see what you do and notice the results. Only you can control your words and behaviour, and therefore only you can impact how other people perceive you.
Use leadership and communication to engender trust
The true currency of leadership and business is trust. Money is important, but you can’t make money without trust. Success and reputation are built entirely on trust. And trust arises from various elements which have to be communicated.
That’s where I come into the picture, helping individual business leaders raise their reputation by speaking in the right place, at the right time, to the right people, in the right way.
When trust is lost
The social media giant, Facebook, provides a timely example of what happens when people lose trust in a company. When the data firm Cambridge Analytica was accused of harvesting 50 million people’s Facebook data and using it to influence the 2016 US Presidential elections, Facebook shares plunged. The company lost $50 billion USD of market capitalisation in just two days and the long-term financial impact is likely to be severe – assuming Facebook survives, of course.
In terms of personal trust, the prize for instantly massacring his own reputation goes to BP’s CEO Tony Hayward, after the 2010 oil rig explosion in the Gulf of Mexico. 11 workers were killed and nearly 800 cubic metres of oil flowed into the sea, with catastrophic results both to the environment and to marine-based industries. Many people lost their livelihoods and local communities suffered immeasurably. But Tony Hayward was thinking of himself: “There’s no-one who wants this thing over more than I do,” he told the media. “I’d like my life back.” He then proceeded to take a break, mid-catastrophe, to go sailing with his son. Unsurprisingly he lost his job.
The building blocks of trust
So you know what can go wrong, but what do you have to do to get it right?
You can encourage trust by demonstrating four significant leadership qualities:
- Competency: ensure your actions always demonstrate your capabilities
- Character: stick to your values, especially when the going gets tough
- Commitment: fulfil your promises, particularly in times of adversity
- Consistency: ensure your actions are constant, reliable and dependable
But trust isn’t just built on what you do, it’s also founded on how you communicate what you do – how you mix your leadership and communication skills. Your communication needs to match your behaviour, and there are also four elements involved:
- Contribution: communicate your actions and the resulting benefits
- Connection: communicate with a focus on others, to create strong relationships
- Compassion: communicate with true concern for others
- Clarity: communicate clearly and openly at all times
If you are open and thoughtful you will be more respected and encourage input from others, leading to faster problem-solving and creative strategic thinking. If you demonstrate respect for other views, you are more likely to build a culture that promotes engagement. Authenticity speaks volumes.
Lead happy, connected people
A survey about CEO reputation shows that the greatest business leaders talk openly to their employees and customers. They are passionate, honest, genuine and transparent.
The CEO who tops the US reputation list is Tony Hsieh from Zappos. He runs a massive clothing and footwear company and is the best-selling author of a book called “Deliver Happiness”.
His principle is that “experiences are more important than stuff” and that delivering happiness involves four things:
- Giving people a sense of control
- Perceived progress
- Vision and meaning
There’s a great article in Entrepreneur magazine which explains each of these, and the most important in terms of CEO communication is connectedness.
Everyone has a fundamental need to connect with other people. When we are engaged and connected we work harder and we’re happier. Zappos’ core values support this principle. The company aims to build open and honest relationships through communication, and staff are encouraged to use social media for casual communication.
Some of Tony Hsieh’s tweets have definitely shown the human touch – one of the classics coming just before he delivered a conference speech: “Spilled Coke on left leg of jeans, so poured some water on right leg so looks like the denim fade.” For some reason, however, he seems to have stopped tweeting these days.
Recognise your strengths and shortfalls
How do your leadership and communication compare with Tony Hsieh’s? Do you show your human side at work? Or is your professional business person always to the fore?
- Do you always demonstrate competency, character, commitment and consistency?
- How well do you explain your contributions? Is there room for improvement?
- Do you always communicate as clearly as you might? Do people ever ask you to explain again? In a different way? More?
- How deeply do you connect with people? With everyone? All the time? Even in a dull meeting? At a large conference?
- Do you always show an appropriate amount of compassion? How would you feel if you were the other person? Could you do better?
- How does your standing compare with that of Mr Hsieh? And what reputation do you want? The sky’s the limit!
Develop brilliant leadership and communication skills
Communicating with absolute brilliance can make a huge difference to how you are perceived. And that, as we’ve seen, can have massive effects on everyone connected with the business, resulting in a sought-after corporate reputation and an increased company value.
If you’re keen to make a positive impact and see your reputation soar, you’ll certainly benefit from my Reputation Raiser program. In this program I help business leaders make their mark on the world.
Together we will enrich your leadership and communication skills, increase your impact and raise your reputation as far as you want it to go. It’s all perfectly possible. It just needs my specialist guidance, your personal commitment and a sprinkling of time for you to hold your head up high among the best of them.
Raise your reputation: invest in your future today
As I mentioned earlier, there’s a unique offer for the first three people to sign up for the Reputation Raiser program after reading this: a free intensive program for one of your colleagues, to complement your own 12 month program. I’ve never made this offer before and I’m unlikely to do so again. So if you want to give yourself a gift that will last forever, drop me a line or give me a call and let’s chat. I can’t wait to meet you and help you make it happen!