There’s a lot of talk right now about Mitt Romney’s authenticity – how warm, personable, in-touch and likeable he is. Romney’s comment a while back that “corporations are people” added to questions about his true nature and personality.
I raise these points not to judge Romney, but because they got me thinking about authenticity in the corporate context: what does corporate authenticity look like, and why does it matter?
Many companies work hard to define, articulate and promote their corporate mission, vision and values – and rightly so, because these foundational concepts serve as a corporate moral compass for businesses large and small. Values are also a cornerstone when companies are under duress from rapid expansion, competitive threat, market pressure or business transformation.
As organizations expand and their workforces become more diverse, values be a social “glue” that binds their far-flung enterprises. In a flatter world operating around the clock, where command-and-control has been displaced by collaboration and empowerment, values can minimize cultural and language barriers, keeping companies aligned and unified.
No company exhibits perfect behavior 100% of the time. Even companies that instill a strong sense of shared values in their people inevitably run into problems. Acts of God (earthquakes, tornadoes, floods, etc.) strike every business from time to time. And even the most ethical companies are just one lapse in judgment away from a full-blown crisis – especially now, when bad choices can go viral in minutes via the Internet.
How do leading companies cultivate a reputation for authenticity? Among other things, they…
- Live their values – Authentic companies bring their values to life every day. Values are a major focus at orientation for every new employee. Values are regularly discussed in training and development programs, at town hall meetings, on intranet and internal blog posts, etc. Performance management tools reinforce behaviors consistent with the firm’s values, and only those who consistently act in line with corporate values get promoted.
- Are accountable for their values – In speeches, tweets, blog posts, CSR reports, advertising, publicity and other messaging, corporate values are either explicit or clearly implied. This creates greater accountability both inside and outside the enterprise; management and employees are more inclined to do the right thing when they know they will be rewarded when they do and punished if they don’t.
- Use candor and transparency – Authentic companies have a natural human voice in all of their communications. They have constructive, ongoing dialogue with stakeholders – including adversaries. They have an open, approachable manner that helps them earn trust and gain support over time. And when necessary, they are quick to acknowledge mistakes, fix problems and make changes to prevent similar issues in the future.
- Engage earnestly – Every business faces disputes over employment practices, strategic investments, financial performance, legal maneuvers, etc. The question is not whether these disputes will arise, but how the company will address them when they do. Companies that engage earnestly, finding common ground whenever possible, will earn a trust premium over time.
- Demonstrate consistency – Experience and reputation research show that companies which demonstrate the above behaviors in a consistent manner over time are more likely to get the benefit of the doubt and a second chance when they face a crisis. And in normal times, their authentic reputation contributes to competitive advantage through premium pricing, recruiting power, talent retention and more.
By keeping it real in both word and deed, companies can establish an authentic reputation that pays dividends for years.
