Hard earned reputations are easily lost, says David Mansfield, visiting professor at Cass Business School. We all know that. There are many aspects within our control to ensure we maintain and enhance how others see us. Yet sometimes it’s too easy to grab an opportunity without thinking about how things might turn out.
Particularly if you’re under pressure for profitable sales. It can be easy, or convenient, to ignore the dangers of what might lie ahead. Or worse, to ignore how the reputation of a business partner will impact on you, if they slip up. Because you’ll be damaged by association, even if the situation was not of your making. If you hang out with bad people their reputation will tarnish you and your business will suffer, be in no doubt.
There are two British companies which have recently decided to work together. Both have had moments of great glory and hold a special place in the hearts of many. Yet over the last few years both have struggled to hang on to their enviable past reputations. One has suffered from numerous strikes and operational issues, the other has been in a constant state of turn around.
I have no inside knowledge but I wouldn’t mind betting the conversation went something like this:
British Airways CEO ‘I wish we didn’t have to serve food on our planes. We’re not a catering company and we don’t make a great job of it. But the customers get hungry and our competitors seem to make it work.’
Head of Inflight Catering ‘I agree, it’s tricky. How about teaming up with a company with a great reputation for food and selling theirs instead? If we get the right brand we’d sell more and gain a great reputation for inflight catering’
CEO ‘You could be on to something here. Who could we speak to? Have you a suggestion? Get back to me by the end of the week with a proposal.’
The Head of Catering went back to his desk and called a team meeting. ‘Let’s list food companies with good reputations whose products we could serve inflight. And then sound a few out.’
After all, what a great proposition. The contract would be worth millions and whoever won the race would be selling huge volumes to thousands of people.
Back in the office the CEO’s team had assembled to reveal their plan. ‘We’ve drawn up a short list but the recommendation is our overwhelming favourite and we know how interested they are.’
‘A company whose quality and reputation for food innovation are probably second to none – it’s M&S!’
I imagine the response at M&S was also made out of adversity. Here’s what might have taken place at their headquarters at Marble Arch:
CEO ‘Once again clothing sales are down. We’ve blamed Easter, leap years and the weather. I feel we’re running out of excuses. Food, however, is going like a train. If only we’d jumped on the home delivery wagon sooner. Mind you, no-one seems to make a profit doing that. We need to find more outlets and sell more volume.’
It was, of course, at this point the call came from BA. And shortly the deal was sealed. M&S would be an exclusive airline to supplier to BA. In return they would receive a multimillion pound contract and feature heavily in both inflight and external marketing. The perfect fit.
Unfortunately, my recent experience of this exciting new deal fell a long way short. In the rush for sales it would appear that M&S have some way to go in ensuring their high product standards can be met at 36,000 feet. On a trip, back from Italy, my wife was served with a hot savoury product. Impossible to eat because it had congealed within the packaging and looked extremely unappetising. The cabin crew swapped it instantly, very much giving the impression this had happened a few times before. But two reputations took an instant hit.
M&S, because the product fell way short of what we experience at our local branch. And BA for serving food that couldn’t be eaten. No doubt things will improve. They both need to work really hard before long term reputational damage sets in.
What can we learn from this story? My quick analysis goes like this:
When you lend your brand to someone else be sure you can control the quality and service.
Don’t risk your reputation on their delivery.
Don’t sacrifice reputation for the lure of short term revenues and profits.
Their reputation will stick to you and yours to them.
When two companies come together it is the reputation of the worst that prevails.
Do sufficient testing, due diligence and build in safe guards.
Make sure the contract has an exit clause for under performance.
So, if you have arrangements like those described I would urge you to take note and ensure both sides are doing what it takes to build, not destroy, your reputations together.
On a final note, I am (hopefully) traveling to Canada with BA in matter of hours. Yesterday they cancelled all their flights as their IT system collapsed. From the media reports it didn’t seem to be handled too well. I’ll report back.
David Mansfield, is the founder of The Drive Partnership and visiting professor at Cass Business School