Public Relations and Reputation

All organisations, regardless their size, depend on their reputation and image for success and survival. The impact of the external and internal community on the success or failure of an organisation cannot be underestimated or overlooked. In particular, the business community (suppliers and customers), investors, regulatory authority, journalists/media, and employees powerfully influence the future of a corporation. Their opinion and perception of any organisation they interact with often count either wrong or right, good or bad. The perception of these groups of persons drives their decisions on whether or not to consume a product of the organisation, or seek services from this organisation (Grunig, Grunig, & Dozier, 2002, p.45). Given the nature of the competitiveness in the global marketing environment following economic and financial liberalization, companies depend on their reputation and image as the building blocks for competition and their main asset that gives them a competitive edge over other firms in the same industry.

Companies with the desire to succeed in the global market must, therefore, invest resources on efforts to build a positive and acceptable image, brand, and reputation. Thus, it is important for a corporation to consider the interest of the shareholders and the general public’s opinion about the organisation. Positive image of a corporation among the public is a representation of success and potential of growth. Besides, the views and perception of customers, buyers, and suppliers on an organisation has the potential of developing brand imaging and customer loyalty, as this form is one of the preferred marketing strategy for any corporation (Richardson, & Laville, 2010, p.74). For a corporation/organisation to establish itself as one of the most reputable organisation, effective public relation is essential in managing reputation through building good relationship with all the partisans. This paper, therefore, aims at investigating the role of public relation in reputation building and the surrounding theories.

According to the CIPR, public relation is about reputation: the result of what you do, what you say and what others say about you’ (Richardson, & Laville, 2010, p.71). Public relations, as a discipline, focus on reputation and image branding, with the main objective of commanding support, understanding, and recognition by influencing behaviour and opinion of the public. Public relation is often described as planned efforts aimed at establishing and maintaining mutual understanding and goodwill between the organisation and the stakeholder, including the public. An organisation under this category may be a business entity, professional service provider, the state, or any corporate institution, while the public may represent a large section of the community that depends on the organisation, either for services/goods or information, or both. To understand its clients, an organisation must listen to personal opinions of its clients and also provide reliable information that would bar propaganda from interfering with the effectiveness of the communication process.

Reputation is defined as “the overall quality or character as seen or judged by people in general (good name), the beliefs or opinions that are generally held about someone or something” (Richardson, & Laville, 2010, p.71). Reputation is also defined as “the collective representation of an organisation’s past performance that describes the firm’s ability and potential to deliver valued outcomes to multiple stakeholders. Expressed in plain terms, reputation is the track record of an organisation in the public’s mind” (Grunig, Grunig, & Dozier, 2002, p.56). 

Public relations take different forms in different institutions with the titles given to it varying. Some of the most commonly used terms while referring to PR include public information, public affairs, customer relations, marketing, corporate communication, or investor relations. PR provides to the public detailed information about organisation/institution, helping to shape the work structure of the organisation. The process of PR evaluation and communication entails conducting a research, communicating the publics’ feedback and evaluating the expectations and concerns of the public about an organisation. The organisation relies on the information and feedback of the public on matters deemed important for the success of the organisation. Therefore, it is paramount for any organisation with the aim of succeeding to keep in touch with the public and the community, because the views, opinions, and concerns presented by this group of persons are indications of reputation and image of the organisation. “Public relation is the management function that establishes and maintains mutually beneficial relationships between an organisation and the public on whom its success or failure depends” (Toth, 2007, p.65).

PR is conceptualized as the process of managing relationships between all the parties involved in the process of organisational transformation and management. In other terms, PR is an optimized relationship that focuses on how well an organisation co-ordinates its operations and management services in a competitive environment to enhance effectiveness in the delivery of services and improve the quality of the products. According to Grunig, Grunig, & Dozier (2002, p.42), 'the notion of relationship management is consistent with major concepts such as systems theory and the two-way symmetrical model of Grunig and Hunt'. It is, therefore, worth conceptualizing PR as being a relationship management that all the firms must maintain with their clients and the public. The importance of PR in an organisation is explained by a number of theories. One of these theories is the “excellence theory” which explains the value of PR to the society and the organisation itself. The theory is founded on the quality of the management relationship with the public and the corporate social responsibilities. According to this theory, an effective organisation must act in a way that solves the challenges of the institution and in accordance with the interest of the leading stakeholders and the management. The process of meeting the demands of the shareholders and the stakeholders is often described as stakeholder theory of PR. If the organisation fails to establish a strong relationship with the stakeholders, then, being the owners, stakeholders will pressure the management of the organisation to make adjustments to their policies and regulations, a move that would increase the cost and risk factors associated with the success of the organisation (Toth, 2007, pp.67-9).

In order to maintain a good public reputation and image, an organisation must recognise the role of public and compensate its involvement in the success of the organisation by behaving in a socially responsible and acceptable ways. This is followed by a symmetric communication with the public (taking into account the interest of the public and the organisation), so as to cultivate long-term, high-quality ethical relationship with all the interested parties (Toth, 2007, p.63). An interview with senior PR officers and the CEO of leading global organisations revealed that effective communication is the major approach of building strong public relations. Besides, right and positive PR is of great value to the organisation through reduced costs related to litigation, legislation, regulation, and negative publicity costs (resulting from poor PR); increase in the profitability and revenue index of the organisation (Heath, & Vasquez, 2001, p.82). Based on the above theoretical framework on the value of PR, excellence theory of PR outlines the principles of maximizing on the revenue and income through PR. One of the fundamental characteristic of excellent PR is strategic management roles. As in the case of all organisations, PR officials are involved in strategic and management decisions in dominant coalition.

In conclusion, PR is all about reputation and image that the organisation presents to the public. Effective PR is essential in helping businesses achieve their organisational goals and objectives to ensure a success. Through public relations, an organisation aims at increasing its understanding of the public by seeking the publics’ opinions and views regarding the behaviour of the corporation. It is, therefore, important for the organisation to build good public relations in order to deploy effective communication technologies and establish strong links with the stakeholders. PR is also a planned and sustainable effort by an institution to create and maintain mutual understanding and goodwill with the public.

The reputation of a firm influences the volume of the sales, public’s perception and the interested parties about the company. While making the sales, a firm’s reputation and image are the most critical marketing aspects that influence the loyalty and the behaviour of the potential customers. In the service and commodity market, reputation of an organisation serves as a prerequisite for sale of products/services. An excellent reputation of a corporation is a strong salesmanship that reaches the consumers before the actual sales are completed. Good organisational reputation and positive image are the aspects of the public relations that enhance the value of the organisation: its products, personnel, and services. On the contrary, poor PR and reputation is a magnet for deterioration that results into devaluation of products and services offered by the firm (Toth, 2007, p.71). A good reputation (unlike firm’s image) is totally owned by the public and depends on the acts of the organisation covering its products, services, and treatment of the working staff. Corporation’s reputation and image are influenced by personal experience and exchange that one develops with an organisation. It is, therefore, the representation of impression of a firm among the public and it is different from organisation image, which depends on the image of a corporation in the general public (Heath, & Vasquez, 2001, pp-81-3). In order to create a strong positive reputation, an organisation must emphasise on reputation building activities, such as economic performance, corporate social responsibility, quality products, and the ability of the firm to deliver valuable products and services to the interest of the stakeholders.