Internal Reputation Assessment

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2 index Introduction 1 Problems with current tools 3 Why is internal reputation important? 4 What is Assessmen and what are its benefits? 4 How does it work and what does it measure? 5 Map of the dimensions and drivers of the 6 Why are corporate networks important in the process? 6 What are the requirements of enterprise social networks for the implementation of the process?

3 In an economic context such as that of today, companies are facing the impact of the interests and needs of employees with more intensity, given that they greatly influence productivity, costs, sales, customer loyalty, collaboration and retaining knowledge in the organization, among many other aspects. Organizations need to measure and analyze their strengths in order to adjust them to their own needs and objectives. It is common for companies to use one or several techniques satisfaction, skills and abilities of employees, and relationships and the working environment; proof of this are internal branding techniques, satisfaction, work climate and performance surveys, and coaching. Problems with current tools By Marta Carrió. Doctor of Corporate (UPF), she has an Executive MBA from ESADE, an Official Master s in Social Communication (UPF) and a Master s in Marketing Management (UPF). A technical analyst of behavior in social networks (COLPIS) and a graduate in Political Science (UPF), she is a partner in Plan, a consultancy company specializing in the measurement, analysis and management of corporate reputation in on and offline environments. Despite the benefits that these tools individually provide, they are generally applied separately, which affects the real impact they have on how the organization operates. Similarly, using indicators it is difficult to create objectives and quantify the effect they have on important business variables such as productivity, cost reductions and the improvement in sales. At a time when companies and all of us are watching our wallets this is a crucial aspect. Likewise, these tools focus exclusively on the employee, missing out on the information regarding the effect that external forces have on perceptions, behavior and values. 1

4 At the same time, the majority of these techniques do not sufficiently analyze the organization as a social network, or how this network affects satisfaction, motivation, commitment and the development of tasks and functions. Some data on the impact of a favorable internal reputation of the business imply an increase of up to 16% in sales, 33% in profits, 50% in productivity, 56% in customer loyalty and a decrease by 60% in absenteeism, among others*. This data illustrates that influencing employees in the framework of the internal reputation of the organization is a determining aspect in order for them to achieve their objectives more easily. Source: Gallup/PhD R. Chun (IMD, Switzerland). 2

5 The internal reputation of a company is based on how employees perceive and feel about the company s behavior. This is important because in turn these perceptions affect the behavior of external groups and individuals with which the organization has relations, such as customers, suppliers, investors, partners, etc. Why is internal reputation important? Research, such as that done by Dr Chun (IMD, Switzerland), on a sample of 4,700 customers and employees from 63 business units of 500 companies, shows that when the corporate reputation perceived by employees is lower than that of customers, sales fall by around 20%. It also shows that companies with a good internal reputation tend to provide a better service, whilst those with a negative internal reputation have employees who are less satisfied and committed to the organization, which translates into lower levels of service. Similarly, customers have higher expectations of the companies with a positive internal reputation. A good example is Samsung, which has recently displayed a collective unity and passion that has enabled the company to beat Sony, the leader of the sector for many years. Indeed, today Samsung is the industry leader in terms of reputation, brand strength and economic and financial results. At the other end of the scale we find the case of Arthur Andersen, an example of how damage to a favorable internal reputation can harm the survival of a large company, as occurred after its involvement in the Enron scandal. 3

6 What is and what are its benefits? How does it work and what does it measure? methodology is used with the objective of improving basic aspects of the business such as sales, productivity, profits, and retaining, promoting and attracting talent. Research shows that influencing the organization s internal reputation, contributes to: Increasing sales. Increasing customer loyalty. Increasing profits. Improving collaboration and contribution of ideas. Improving retaining and attracting talent. Reducing absenteeism. Improving productivity. Simplifying the resolution of conflicts. Improving the identification and pride of the entity. The measures and acts in a complete and integral way on the different drivers that affect perceptions, behavioral patterns, and formal and informal relations, which have an affect on key day-to-day aspects of the organization. This enables the improvement of both work flows and processes within the company and the levels of satisfaction and commitment of the workers. It also enables the objective control of the investment that companies make in this field and the costs associated with this investment. In order to meet these objectives 5 dimensions, which influence the perceptions, values and behavioral patterns of employees, need to be analyzed: 1. Employee satisfaction, determined by: Corporate identity (the company s corporate culture and philosophy). The organizational support perceived by employees Quality and characteristics of leadership. The environment in which members of the company develop their activity. 2. Employee commitment to the company, determined by: La integridad de la organización. La confianza que genera la compañía. 3. Quality and scope of communication implemented by the organization, which influences: Satisfaction Commitment to the company. 4. Formal and informal relations existing in the organization, which enable short-term work flows to improve, leading to improvements in terms of productivity, costs, collaboration and level of conflict within a short period of time. 5. The organization s reputation, which has an influence on external variables and a significant impact on the levels of identification of the company s employees. 4

7 Map of the dimensions and drivers of the internal reputation satisfaction commitment Corporate Identity Perceived Organizational Support Leadership Trust Integrity communication 5

8 Why are corporate networks important in the process? What are the requirements of enterprise social networks for the implementation of the process? Enterprise social networks contribute to and facilitate the application of an process, because they allow: Questionnaires on the dimensions of the company s internal reputation to be sent and managed. The importance of participating in the process to be communicated integrally throughout the company, creating alignment and confidence. Informing at all times as to how the process is being implemented, its participants, stages and results. Acting as a platform for feedback, on which employees can provide their perspectives as to how the process is developing, ask questions or make suggestions that allow its implementation to be improved. Design mechanisms for communicating that the process is built on values and a shared vision. Encourage two-way communication, in such a way that both managers and employees have the opportunity to exchange perspectives and knowledge, to listen and for their problems to be dealt with. Free from manipulation. Representative of all of the members of the company. No commitments are communicated that are not going to be fulfilled. Create spaces so that issues detected can be included in decision-making. Acting as a tracking space, sharing the company s internal reputation, which motivates members of the company different dimensions analyzed. 6

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