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On the very concept of reputation November 18, 2010

Posted by salla in Blogroll.
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When talking with people about our project, those who are not familiar with the concept of organizational reputation are often asking ”Why are you not talking about brands?”. Therefore I thought it would be useful to clarify the concepts a bit.

My favorite quotation on the differences between the terms comes from Pekka Aula and Jouni Heinonen (both of whom are actually involved in our project): Brands can be made, image can be built, but you need to earn your reputation. (translation from Finnish by the writer)

Another, more specific classification for the terminology comes from Brown & al (2006). In their article, the writers categorize corporate associations in four different categories. They begin with the concept of identity, which refers to the mental associations about the organization, held by the members of the organization. Next, they split the concept of image to two: intended image refers to the mental associations the organization wants its important stakeholders to hold about the organization, whereas construed image is the mental associations the organization believes the stakeholder’s hold. Finally, reputation is the mental associations the stakeholder’s actually hold.

Brand, for that matter, is a concept used mainly in marketing and marketing research. A company can have multiple brands; not only for the organization itself but also for its products. As image and reputation, brand also refers to the mental associations held by the customers, but  it also includes ideas of the functional appeal and general awareness of the product. A company can have strong product brands or a strong corporate brand, but can still have a bad reputation (see Fombrun & van Riel 2004). In fact, a brand can also have a reputation on its own  – and this reputation can be good or bad or anything in between, and it’s not equal to the brand being strong or well-known.

Reputation refers also to hearsay and therefore to narratives: what is said and heard and thought about the company? These associations can be different within different publics and stakeholder groups; therefore a company can actually have multiple reputations, each stakeholder group emphasizing the viewpoints important to them. For example, some people might be more interested on the durability of the company’s products, whereas another group might be extremely interested on social responsibility issues. This is why most of the reputation measurement tools use a variety of attributes to cover all different aspects stakeholders use to evaluate a company (see previous post).

Luckily, reputation is also a word used in common language and therefore is usually widely understood as such. The definition in Merriam-Webster is rather helpful: “a : overall quality or character as seen or judged by people in general b : recognition by other people of some characteristic or ability”. So it’s not only about stories and thoughts, but also about evaluation incorporated in them.

In sum, reputation is a concept and a meaning that is built and modified within the public, in their minds and in their narratives. Corporate reputation is based on the actual actions of the whole company. And importantly, the organization cannot fully define their reputation. It’s somewhat possible to push the associations to a favorable direction and thus aim to manage reputation, but not control it – that’s why the first quote about earning your reputation is very much in place.

Note: Besides corporate reputation there are some other scientific uses to reputation as well. Usually research on online reputation is talking about reputation and reputation systems used in online services to evaluate the trustworthiness of other users.  (see Wikipedia)