How does the weighting of the reputation dimensions affect the success of a business?

Reputation is seen as the “Accumulated impression that stakeholders form of the firm” (Chun, 2005).

So what are the aspects stakeholders are basing these views on?

According to a model created by Markus Renner “the reputation of any stakeholder group of any organisation can be captured by a maximum of nine reputation dimensions” (Renner, 2011):

  • Quality of Products and Services
  • Innovation
  • Business Performance
  • Ethical Business Practice
  • Transparency
  • Marketing and Sales Effectiveness
  • Management Quality
  • Employer Attractiveness
  • Social Responsibility

These dimensions are weighted differently for each company, and all contribute to an overall reputation. However there is often a leading dimension that influences the stakeholders impression the most. For example, the reputation of Virgin is based largely on the celebrity-like reputation of Richard Branson, which falls under ‘Management Quality’, and therefore what he does personally has large consequences on the reputation of Virgin (Renner, 2011). 

Screen Shot 2015-11-21 at 16.20.43
Figure 1: A table to show the top 7 benefits for a reputable business (‘Virgin crisis mangement’, 2014).

A great reputation can have huge benefits for a company, as seen by the table on the right.

Having read the news about the findings of part of MH370 on reunion island a few weeks ago, it made me think about Malaysian Airways’ (MA) reputation. Although reputation is deemed to be “generally stable and enduring rather than changing with each event or new piece of information” (Smets, Morris, & Harvey, 2013), it is clear that the converse is true if an event occurs linked to the dimension with the largest weighting. The double tragedy of MA in 2104 resulting in 537 total deaths is a prime example of this. The public immediately lost trust in the airline’s ‘Quality of Products and Services’, one of their most important dimensions. Resultantly the average weekly bookings steeply declined by 33% and multiple flights were cancelled (BBC, 2014). This shows the strength uncontrollable factors can have on a company’s reputation if they’re linked to a dimension people value highly.

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