2012 Reputation Checklist

The new year presents many challenges and opportunities for reputation-observers. If a fortune cookie that could actually tell the future were handed to me this coming New Year's Eve, I'd expect it to reveal the following:

1. Reputation's inflection point is here. Reputation will always continue to matter but for reasons that are less financially-based than in the past. As Geoff Colvin, Fortune's senior editor said, "Previous major scandals were mostly financial; the numbers were lies. Not this time. The damage so far derives entirely from behavior...." How companies behave, act and respond will impact reputations this year more than quarterly numbers. The kind of company behavior that will matter most will, of course, be how leaders manage crises. It will matter even more than the actual crisis itself. Just think about BP's Gulf of Mexico oil spill or News Corp.'s phone hacking scandal.

2. Reputation whisperers will outshout traditional channels. Reputations will increasingly be established through customer reviews online, not just through family and friends. These reputation-makers will quietly pass along positive and negative reviews about products and services that will make and break reputations with increasingly greater impact.

3. Reputation blackmail will rear its ugly head. We will hear more in the coming year about threats to reveal private e-mails unless people disclose corporate secrets such as confidential information or network security codes. Reputations of the vulnerable will increasingly become the bargaining chips of the malcontents.

4. Reputation defense goes to the movies. Increasingly, both companies and activists will turn to video, documentaries and even movies to further their goals. Companies will increasingly hire well-known film makers to educate their employees about either corporate culture or a reputation-changing incident in their history. Activists too will increasingly take to the silver screen, video-sharing or social media sites in an attempt to promote change.

5. Forget internal versus external. Reputation goes holistic. Many Fortune 500 companies hire different professionals to handle either internal or external communications. The distinction between the two is practically artificial. What is said internally to employees is now instantly external. What is said externally to the public is now instantly internal.

6. Reputation fixers will be in great demand. Companies as well as individuals are increasingly hiring firms to help cleanse damaged or dinged reputations. The surge in online reputation firms and the number of firms with online defense in their names mounts daily. Even the medical profession has joined the trend. Reputation.com, for example, services medical professionals who want to know what their patients might be saying online about them and their bedside manner.

7. Reputation rankings are not letting up. With the race for reputation red hot and the crush of information tiring us all out, people need fewer choices. Top 10 lists made our lives simpler. They served as filters that let the so-called best product or most reputable company rise to the top. But being among the top 10 is no longer good enough. In the coming year, being among the top three is where companies must be if they want to get on customers' consideration lists.

8. Social contributes to reputation. In our recent research, we learned that nearly one third of a company's reputation is attributable to the quality of its online presence. Perception that a company is interested in communicating and engaging online adds a favorable dimension to how people perceive reputation. Lack of online presence sends a signal that a company's preference is to be anti-social. Business will turn increasingly and impressively social, for sure.

9. Brand and reputation will continue to merge. Companies will increasingly realize that their corporate or enterprise reputations provide credible assurance to consumers that their products are desirable and safe to purchase. As consumers find it easier to learn about a product's lineage, the parent brand or family name will be more critical in the purchase-decision process.

10. Face to Face becomes the precious commodity. As the entire world increasingly interacts online, face to face communications, particularly among CEOs and top executives, will build relationships like never before. Going out of one's way to meet one-on-one will evidence the importance of discussion. It will become the gold standard in building reputations. The more that CEOs engage in person with employees, customers, legislators, investors and top tier media, the more credibility that they will be able to accumulate and the more that they will be able to minimize reputation loss when setbacks inevitably occur.

11. CEOs will be more social. Expect to see more CEOs use video for their websites and corporate YouTube channels. They might not be on Twitter or Facebook, but an increasing number of CEOs will adopt video to humanize their reputations. They will recognize that being social, like the rest of humanity, is a reputation plus.

12. Inoculate or evaporate. Leaders must and will increasingly employ all the resources they have at their disposal to inoculate themselves against crisis or issues that shatter their reputations. They must admit mistakes, build allies, listen to detractors, create great cultures and protect themselves from reputation antagonists that lurk in the shadows. Building a great reputation is not for the faint-hearted.