Managing goodwill as an asset

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A good description of public relations is “the process of managing the reputation and goodwill of a business as assets”.

Almost everything an organisation does contributes to its reputation and the way it is seen. Consequently, all organisations have ‘public relations’ whether they actively manage it or not.

Those organisations that do nothing are leaving control of their image and reputation in the hands of others – including competitors.

We like to describe what we do for clients as managing their goodwill as an asset, because everything we do for them should add to it, enhancing their reputation and image.

For organisations in the financial services industry this has become critical as the more goodwill a business has, and the better its reputation, the more others will trust it.

Trust has become a key issue in the industry and those that have the trust of investors have a head start in business development.

It was McDonald’s that developed a concept of a Trust Bank – which put simply is recognising that an organisation needs to make deposits of goodwill through its actions and communications to build the trust of others that can be drawn on when needed.

Public relations should be seen as the strategic management of reputation and goodwill. It is more than media relations, although this can be a very effective part – arguably the most effective.

Public relations can include activities as diverse as delivering speeches, preparing newsletters, holding seminars, and sponsoring community events – everything that will help inform and influence the company’s audiences (or ‘publics’).

Most organisations undertake these types of activity, but those that do it strategically gain better penetration.

What does this mean? There are several elements which will enhance the effectiveness of an organisations’ communication program. These can include defining how it wants to be seen, identifying ways that improve understanding, developing messages that will support its aims, and not getting side-tracked with communication activities that don’t deliver by knowing the publics it wants to reach.

While it is true that large organisations have more resources at their disposal, this doesn’t mean that smaller businesses should do nothing. Even the smallest effort can pay off if the organisation is constantly saying the right thing to the right people.

Indeed, smaller organisations can often achieve more for less, especially in media relations, because they can be nimble, are often less constrained by a bureaucracy in what they say, and can react quickly to journalists.

Building relationships through personal contact is a most effective communication approach, but many organisations waste their networking programs by not focusing on the reputation building opportunities they offer.

Again, this is particularly true in media relations where company executives who do not always focus on agreed company messages, or are not sensitive to the needs of journalists, can waste opportunities.

This is generally true of all contact programs undertaken by organisations from answering the telephone (don’t get me started) to client relations and how they are managed.