This document summarizes a presentation on managing corporate reputation in the era of consumer-generated media. It discusses how reputation is now largely out of management's direct control due to factors like social media and 24-hour news cycles. A new model is needed that recognizes reputation is in the hands of all stakeholders, can change quickly, and follows non-linear patterns. It provides a case study on the transformation of water bottles' reputation and offers advice like tracking issues smarter but understanding limitations, focusing on small emerging trends, and setting clear rules but letting the organization self-organize.

1. Managing Corporate Reputation in the Era
of Consumer Generated Media
“It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you'll do
things differently.” ~ Warren Buffett
Presented by:
Jason Voiovich
Ecra Creative Group
651.209.2778 or jason@ecracreative.com

2. Buffett couldn’t be more right…
• Collapse of Bear Stearns
• Best Buy’s “Peep Squad”
• Microsoft Vista revolt
• Starbucks’ coffee ranked below McDonald’s

3. Poll: Your View of Reputation
How do you view “reputation” in the business
context? (select the option that best describes
your view)
[1] Primarily a business risk to be avoided
[2] Primarily a business asset to be leveraged

4. Why is Reputation Important?
Reputation management (or the failure thereof)
presents tangible downside risk.
However, proper reputation management - at
the same time - presents significant upside
opportunity.

5. The Illusion of Control
The real conundrum? Corporate reputation is,
largely, out of management’s direct control.
Blogosphere & Insta-Pundits
Blackberry, iPhone, and Email
24-hour News Cycle

6. The Real Problem: The World
Changed
Years ago, PR professionals learned the
source/receiver model:

7. The Real Problem: The World
Changed
The 1990s saw the wide dissemination of the
feedback loop:

8. The Real Problem: The World
Changed
The reality is now clear: Reputation is created -
in large part - due to interaction between
people and groups.

9. Problems with the PR Model
Why are most public relations
departments failing to protect reputation
assets?
They are “marketing-centric”: There are too
many people now involved.
They are too slow: They just can’t keep up
They are not seen as authentic: We really do
live in a ‘Spin Zone’

10. A New Model is Needed
A new model for reputation management must
account for three basic truths:
1. Reputation is in the hands of all
stakeholders, not only management
2. Reputation changes quickly - it is
fundamentally unpredictable
3. Reputation follows a non-linear model

11. Poll: What percentage of plastic
water bottles are recycled?
More than 80 percent
20 to 80 percent communities with special
facilities
Less than 20 percent

12. Case Study: The Plastic Water Bottle
We’ll explore the transformation of the water
bottle from “health symbol” to “eco-disaster”
using three key techniques:
1. Identifying and clustering stakeholders and
issues into meaningful groups
2. Managing change in reputation over time
3. Non-linear analysis methods

13. Market Overview
Bottlers have reason for concern:
• $11 Billion US Market
• Average American consumed 28.3 gallons
of bottled water last year (lots of room)
• 2nd most consumed beverage in the US
(after soft drinks)

14. Step 1: Identification
• Establish a baseline for ongoing
measurement and analysis
• Try to hit the “high points” (not leave
anything out)
• Identify internal stakeholders, external
stakeholders, and key issues
• Begin to “Cluster”

15. Stakeholder Identification
Major Stakeholder Group Sub-Group Sub-Group Baseline RIF
Nestle
Coca-Cola
PepsiCo
Environmental Organizations
US Government
Waste Mgt/Recyclers
Major Media
Social Media
Minor Corporate Players
Petroleum Industry
Health Organizations

16. Stakeholder Identification
Major Stakeholder Group Sub-Group Sub-Group Baseline RIF
Nestle Corporate Communications
Employees/Staff (14K in US)
Corporate Marketing
Bottling Plants
Distributors/Fleet
Executive Management
Nestle Retailer Network
Corporate Sales
Purchasing
Company Operations
Legal

17. Stakeholder Identification
Major Stakeholder Group Sub-Group Sub-Group Baseline RIF
Nestle Corporate Communications Media Relations
Consumer Relations
Reseller Relations
Investor Relations
Government Relations
Employee Relations

18. Stakeholder Identification
Major Stakeholder Group Sub-Group Sub-Group Baseline RIF
Nestle 6
Coca-Cola 6
PepsiCo 6
Environmental Organizations 5
US Government 4
Waste Mgt/Recyclers 7
Major Media 4
Social Media 6
Minor Corporate Players 2
Petroleum Industry 2
Health Organizations 3

19. Poll: Who have we left out?
What major stakeholder(s) can you identify that
have been “overlooked” in this chart? (choose
all that apply)
[ ] Water resource management
[ ] General public opinion
[ ] Sports organizations

20. Issue Identification
Major Issue Group Sub-Group Baseline RIF
Environmental degradation Basic “littering” 8
Landfill space
Wildlife poisoning/harm
Plastic “nodules” in the oceans
Geologic timescale decomposition
Misconception of bottles as non- 7
recyclable
Use of petroleum in the process 4
New research on “unhealthy” plastic 2
effects on health

21. Step 2: Tracking & Data Collection
• Deploy the data collection system to a wide
group of internal and external stakeholders
• Integrate traditional and social media data
inputs
• Track “emergent” stakeholders and issues
• Begin to see patterns of interconnection

22. Tracking & Data Collection
Stakeholder Baseline RIF Adjusted RIF Tagged Issues Conn. Vector
Group Strength
Waste 8 9
Management/
Recyclers
Nestle 6 4.5
Social Media 7 8.5
Major Media 4 3.5
Health 3 6
Organizations
Environmental 5 7
Organization

23. Tracking & Data Collection
Stakeholder Baseline RIF Adjusted RIF Tagged Issues Conn. Vector
Group Strength
Waste 8 9 Basic littering 7 +1
Management/ Landfill space 8 +2
Recyclers Wildlife harm 3 –3
Ocean pollution 8 –5
Decomposition 1 0
Nestle 6 4.5
Social Media 7 8.5
Major Media 4 3.5
Health 3 6
Organizations
Environmental 5 7
Organization

24. Tracking & Data Collection
Basic
Littering
4.00
Landfill
Space
5.5
Waste
Decom-
Management /
position
Recyclers
1.25
9
Wildlife
Harm
Ocean
Pollution 6.25
4.25

25. Step 3: Non-Linear Analysis
• The nature of this data lend itself to chaotic
analysis techniques
• Attempting to predict one event from a
trend-line belies an underlying
unpredictability in this type of complex
system
• Key concepts from non-linear analysis can
help us (even if the math eludes us)

26. Concept 1: Attractors
• We see this in “clustering” around issues in
our initial identification
• New data points tend to cluster around
existing issues during data collection
• Rule of 256
A “strange attractor” - one of
the four non-linear attractors

27. Concept 2: Self-Similarity
• Self-similarity shows us a way to look at the
“small picture” to spot larger trends.
• What are the small trends? Health effects
of water bottles.
A common mathematical example of self-similarity

28. Case Study: The Plastic Water Bottle
In the end analysis, who has done well/poorly?
Nestle’s “less-plastic” bottle
Primo’s “corn” bottle

29. Advice for CI professionals
• Track and measure smarter, but understand its limits
(allow MANY more people in the organization into the
tracking process - collective wisdom works here)
• Sweat the small trends - help your clients understand
this and plan for it (counter to quot;executive opinionquot;)
• Set clear and simple rules (executive wisdom works
here - creativity of a single quot;headquot;), let the rest self-
organize throughout the organization (you can't
quot;controlquot; it; don't try - let people interpret the vision as
they see it needs to - thinner plastic bottle)

30. Contact Information
Jason Voiovich
Principal
Ecra Creative Group
651.209.2778
jason@ecracreative.com
www.stateofthebrand.com
Additional reading:
Deep Simplicity, by John Gribbin, © 2004 Random House
Complexity Explained, by Peter Erdi, © 2008 Springer