Risk strategy
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Importance of reputation
Reputation is fundamentally important to organizations. In fact, it is often said that
the reputation of an organization is the most valuable asset that it possesses. Because
reputation is so vitally important and can so easily be lost, organizations should make
sure that they understand the basis of their reputation. Reputation is based on the
size, nature and complexity of an organization, but it is useful to put more structure
into what makes a good reputation.
There have been many attempts to identify the components of reputation.
Table 20.2 shows the components of reputation and these are also illustrated as
a spidergram in Figure 20.2. The four main components of reputation (CASE) are
as listed below:
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Capabilities, including purpose and resources;
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Activities, including processes and finances;
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Standards, including services/products and support;
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Ethics, including values and integrity.
Reputation is a component of the FIRM risk scorecard and is generally considered
to be a consequence of other events that occur. The importance of a good reputation
is that customers or clients will have a desire to trade with that organization.
20.2
Components of reputation
Component
Comments
Capabilities
Does the organization have a clear purpose or resolve,
together with the commitment, vision, capabilities and
resources to deliver that purpose?
Activities
Which sector and what activities does the organization
undertake and does it have the financial resources and
stability to support those activities?
Standards
What range of services or products does the organization
offer and what are the standards of quality, delivery, support,
execution, innovation and investment?
Ethics
Does the organization adhere to appropriate CSR, integrity,
values and governance, and continuously monitor
performance to learn and achieve improvements?
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