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Lookin' good

How you are perceived matters – and in the changing world of pharma it has always mattered a lot. So are you content with your corporate reputation and, if not, what can you do?

Close up of a man's face wearing sunglasses"The pharmaceutical industry develops life-saving medicines, is a major employer, brings millions of pounds of revenue into the UK – and everyone hates it!" These are the words of a British GP, spoken in a focus group several years ago. They appear to sum up a conundrum that many people working in the industry feel. The contribution the pharmaceutical industry makes to society is often not recognised and many distrust it.

But while the quote above may strike a chord with many of us, when the topic of corporate reputation was explored a bit further, a more interesting picture emerged. When asked about individual pharmaceutical companies, the group all expressed admiration for the companies, their research and brands.

Who cares?
Reputation is an intangible, yet valuable asset that is shaped by the views of others. It depends on the perceptions of a number of audiences on a company's performance in several areas. These audiences do not exist in isolation and when communicating with any one audience, it is important to understand the implications to others.

Your customers: doctors, nurses, consumers or payers will be influenced in their decision-making by their perception of a company. For example, early adopters of innovations are more likely to try new products developed by a company they respect and have had positive experiences with before.

Financial community: Links between corporate reputation, sentiment and share price have been widely studied and a number of methods for measuring impact of reputation proposed. Whether formally measured or not, the views of financial analysts and media can have a significant impact on a corporate reputation well beyond the investment community. Doctors, regulators, employees and patients may all be among the readers of the financial pages of their newspaper.

Your employees: Your own people are perhaps the single most important audience for managing reputation. If they have positive opinions of the company, then this will come through in their dealings with customers and even in informal settings, creating a positive environment that reaches well beyond your corridors. The converse is also true.

Your community: Finally, there is the broader community in which you operate including government/regulators, non-governmental organisations, advocacy groups, local communities and suppliers.

Each of these audiences has different concerns, but in broad terms reputation is built on perceptions of the following:
• Vision and strategic direction
• Quality of management
• Products and services for both quality and perceived value
• Innovation
• Financial performance
• Behaviour with customers and the community
• Ability to attract and retain talent.

An outside perspective
With these criteria in mind it is clear that reputation cannot simply be built through communications strategies alone. Reputation depends on how a company behaves at every level. However, communications still have a key role in building reputation, and preserving it in difficult times.

Communications, whether in-house or through an agency, should provide input on how a company's actions are likely to be perceived by its audiences. For example, while management and shareholders might recognise the benefits of moving manufacturing to a different location, employees, communities, government and potentially customers may have very different views.

Similarly, while a company and leading physicians may have a good understanding of the clinical trial environment, others will have limited knowledge. But in the era of social journalism, these individuals, whether through blogs or other commentaries, can have a significant influence.

This outside perspective can also be seen in terms of the 'red face' test – how will a decision stand up to scrutiny, for example on the front page of the Daily Mail.

The outside perspective is not just simply about minimising risk. Listening to your audiences and understanding their concerns and priorities helps shape corporate and brand strategies that may provide competitive advantage.

When considering proactive campaigns, companies need to answer a few fundamental questions.
• What are your goals for this campaign?
• Who are you trying to reach and what perceptions are you trying to form?
• Who are your priority audiences?
• What implications are there for your other audiences?

Corporate reputation can then be built in a number of ways. For example, many companies build a leadership platform in a specific therapy area by communicating regularly on both their licensed products and research and development pipeline. Others may develop campaigns around a broader topic such as scientific leadership or access to medicines. Whatever the goals, they should be aligned both with the company's commercial ambitions and the interests of your audiences.

Protecting yourself
Reputations are generally built over many years, but can be severely damaged overnight. It is therefore critical that companies not only think about how to build their reputations across their audiences, but also put plans in place to protect those reputations when things go wrong.

Reputation is influenced by the manner in which a company handles itself during  a crisis or issue. Johnson & Johnson is still held up as a model based on the approach it took to managing the Tylenol tampering crises over 25 years ago. However, companies that are perceived to be handling a situation poorly from the beginning will always struggle to get on the front foot and can suffer reputational harm for years.

Crises can broadly be divided into two types – crises of safety and crises of confidence. Crises of safety are situations where people's health or safety may be at risk, eg, adverse event reporting, negative studies, or manufacturing issues.

Crises of confidence can have far greater impact on reputation, if management is perceived either not to care, or not to be in control. At its worst, criminal or unethical activity many be involved, but companies' reputations can be irreparably harmed as a result of simply being slow to react.

What precautionary steps can companies take?
Ensure you are in a position to respond rapidly to crises and issues and thereby protect your reputation.

Know your vulnerabilities: Identify where things can potentially go wrong in advance and put plans in place either to pre-empt or rapidly respond.

Culture of alertness: It is impossible to identify every possible issue, so it is essential to build a culture within the company of alertness to potential situations and an understanding of how rapidly to escalate an issue internally.

Monitor: Track the areas of most concern to you, analyse developments and adopt appropriate strategies. With the explosion of social media, which the FDA is currently looking at closely, monitoring has never been more important.

Issues preparedness systems: Have effective systems in place with clear roles and responsibilities and a team of people, at both national and international level, empowered to make decisions when needed in a timely manner.

Testing: Ensure that the company is prepared by pressure testing the systems and people responsible.

Building corporate reputation has significant benefits in terms of improving access to decision makers, attracting employees, building confidence in management and acting as insurance for when things go wrong. Proactive campaigns need to be well-planned, with clear goals aligned around the company's ambitions.

Communications, both in-house and through partner agencies, have a central role to play in understanding the environment, shaping the strategy, understanding all audiences, adapting the story to be told, recognising and preparing for any vulnerabilities. When thoroughly planned, and executed consistently, companies can be highly successful in building enviable reputations that support their business goals.

The Author
Ralph Sutton is managing partner of Axon Communications and can be reached at

To comment on this article, email

21st June 2010


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