morrissey reputation review 2010 year in review
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8/8/2019 Morrissey Reputation Review 2010 Year in Review
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2010 Reputation Year in ReviewTrust and Transparency From Morrissey & Company
Although the stories differ from year to year, reputation alwaysboils down to a handful of bedrock principles. Brands withhealthy reputations adhere to thefundamentals of acting honestlyand transparently. These actions
cultivate trust, which serves asthe foundation of reputation. Itsounds simple because it issimple.
However, be careful not toconfuse the concept of simplicitywith ease. Building a trustedreputation is hard work. It is alsoh a r d w o r k t h a t c a n b eundermined in mere seconds.
The rules in today’s informationage change at the speed of thenext new technology. Only a few
years ago, companies enjoyed
the luxury of time during emerging cr is is s i tuations.Executives could investigate andgather facts before making anypublic statements or disclosures.That luxury is no more.Response times have shrunken
from days to minutes due towidespread citizen journalism.
A journalist today can be anyonewith access to an electronicd e v i c e a n d a n i n t e r n e tconnection. A number of well-known brands found themselvesin these very public crosshairs in2 0 1 0 . B r i t i s h P e t r o l e u mstruggled through a massiveenvironmental crisis and atrusted healthcare stalwart in
Johnson & Johnson found itself caught in a speeding news cycle.
Many reputation counselors tendto focus on crisis situations, but itis equally important to note thereputation winners of 2010 aswell. Ford Motor Company,
Amazon.com, and Southwest Airlines continued to advance
their posi t ive reputationsthrough doing the simple, buthard, work.
The next few pages highlight 10reputation stories from the past
year.
In addition to the facts,Morrissey & Company offers oure x p e r t i n s i g h t o n e a c hreputation. Keep in mind – inthe end, reputation alwaysreturns to the foundation of trust.
The explosion of BP’sDeepwater Horizon oilrig in the Gulf of Mexico touched off anenvironmental disasterand reputationnightmare for theenergy company.
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US Coast Guard/AP Photo
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ToyotaRebuilding Trust
Toyota faced an extremely difficult yearin 2010, dealing with the fallout from asuccession of seven different car recallsbeginning in 2009, totaling over 10million vehicles. Faulty floor mats,accelerators, and leaking brake fluid
may have been the mechanicalproblems, but Toyota’s ability to makesafe and reliable cars is the bottom linefor consumers.
Toyota’s East Coast U.S. spokesman Wade Hoyt says they need to recommitto “quality, dependability, anddurability.” It’s no coincidence Toyotab r o u g h t b a c k t h e i r o r i g i n a l“Toyotaman”, actor Squire Fridell, in aseries of ads that ran in early 2010, inan effort to restore trust in the brand.
Toyota is showing recent signs of rebounding as earnings announced onNovember 4 showed quadrupled netincome from Q2 in comparison to last
year.
Morrissey Insight on Toyota Toyota provided the textbook exampleof what can happen when a company’saction does not match rhetoric. Thecarmaker’s famous reputation for bothproduct quality and customer servicesuffered a historic blow when Toyota’slack of action crippled its bond of trustwith customers. Toyota’s sluggish crisismanagement amplified negativesentiment, culminating with CEO AkioToyoda’s testimony and apology to acongressional panel in May.
Now working toward reputationrecovery, Toyota launched severalpricing promotions and highly-visiblesafety and quality initiatives todemonstrate an active commitment topositive change. The return of trusted
Toyota pitchman Fridell provided aninteresting subconscious reminder of the “good-ole” days at Toyota.
British Petroleum
Crisis Uncontrolled
British Petroleum’s infamous oil spill inthe Gulf of Mexico in April 2010shocked the global community witheco log ica l damage o f h i s tor icproportions.
As the crisis unfolded, BP’s reputationdeteriorated rapidly. Company leadersmade countless mistakes, f romdeflecting blame and accountability to
numerous damaging moves thatpervaded news coverage. Theseincluded former CEOTony Hayward’s early estimates thatenvironmental damage would be, “very,
very modest,” vocal wish of, “I wouldlike my life back,” to his reportedpetulance during a U.S. EnergyCommittee hearing, and a muchpublicized day off to go yachting.Hayward ironically had his best quote
when announcing his resignation:“Sometimes you step off the pavementand you get hit by a bus."
Morrissey Insight on BPThe BP oil spill was a situation where,in the public’s eye, there was clearculpability. The public wanted to seeBP act forthrightly, transparently, andquickly. From the outset, BP failed thoseexpectations. For that reason, BP willsuffer substantial injury to corporatereputation despite best efforts to
rehabilitate its image.
With respect to BP leadership, here isone tactical suggestion: When you don’thave the answer, it is fundamental in acrisis to be honest and tell people justthat.
There are NoSecrets
Social networking giant Facebook endured heavy criticism in May of 2010 as new privacy settings andoptions went into effect, some of whichencouraged users to allow sharing with
outside websites. A Facebook groupprotesting the changes grew to morethan 2 million members at the height of the controversy. As a result, CEO Mark Zuckerburg, the 26 year-old founderand Harvard dropout, admitted, “we
just missed the mark,” and ultimatelyadjusted settings to make them simplerand more customizable.
In a strategic move, Mark Zuckerberg
appeared on the Oprah Show todonate $100 million to schools in New
Jersey, one day before the premiere of the film, The Social Network , whichrecounts the making of Facebook anddid not portray Zuckerberg the kindestlight.
Shortly after, new privacy breachesoccurred in October 2010, again, afteran investigation by The Wall Street Journal discovered all 10 of Facebook’smost popular applications transmitted
unique personal IDs, sending theinformation to advertising companiesand third parties.
Morrissey Insight on FacebookTransparency with customers is criticalas the information age involves moreand more personal information. Whiletechnology allows marketers to quietlycapitalize on customer intelligence, theFacebook issue demonstrates thatcustomers are savvy enough to knowbetter and, through social networks,have the means to communicate
broadly.
Bottom line: Basic honesty in businesspractices remains a cornerstone forlong-term success.
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“I myself, as well as
Toyota, am not perfect. I,
more than anyone, wish
for our customers’ cars
to be safe.
Congressional testimony of Akio
Toyoda, CEO of Toyota
Susan Walsh/AP Photo
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Johnson & JohnsonTrust: The Heart ofHealthcare
The pioneers of crisis managementendured a tough 2010, which includedmultiple recalls almost 30 years afterthey set the gold standard for working through multiple crises. In the past
year, Johnson & Johnson recalledmil l ions of consumer products,including chi ldren’s and infantmedicines (around 136 million units),adult medicine, tens of thousands of artificial hips, and millions of contactlenses in Asia and Europe.
McNeil Consumer Healthcare, adivision of Johnson & Johnson, is underinvestigation by the House Committeeon Oversight and Government Reformrelated to how the company handled
and communicated recall actions. Thecompany issued further recalls due tomanufacturing standards in bothOctober and November. While noserious health problems are reported todate, regulators and lawmakers areh o l d i n g J o h n s o n & J o h n s o naccountable, as serious issues of quality-control face the long-reputable brand.
Morrissey Insight on
Johnson & Johnson For a brand synonymous with prudent
crisis management, Johnson & Johnsonstumbled through a difficult year of quality and manufacturing issues.During the original Tylenol crisis of the1980s, the company demonstrated anunwavering commitment to customersand transparency, establishing Johnson& Johnson’s reputation as a trustedhealthcare provider.
By contrast, during the recalls of 2010,McNeil failed to communicate early andopenly, which could have the companyappear as if it were concealing safety
and quality issues. Fortunately, notragedies occurred as a result of theproduct quality issues. But J&J, andMcNeil specifically, missed severalopportunities to maintain its bond of trust with customers.
George SteinbrennerReputation for Winning
George Steinbrenner, “The Boss,” diedon July 13, 2010, just after his 80th birthday and on the same day as the
MLB Al l -Star game. Ever thecontroversial figure, known fordemanding excellence, he was alsorevered as a skilled businessman who
turned the New York Yankees into anempire. "Winning is the most importantthing in my life, after breathing,"Steinbrenner said often. "Breathing first,winning next."
Steinbrenner was banned from baseballin 1974 for 15 months, after pleading guilty to planning illegal contributionsto President Nixon’s re-election
campaign, and banned again for twoand a half years in a potential blackmailscheme.
Steinbrenner notoriously feuded withplayers Reggie Jackson, Dave Winfield,and Yankees legend Yogi Berra, nevershying away from criticizing players andmanagers publicly. While his reputationas a hard-nosed businessman was well-known, his softer side as a charitableman was not recognized by as many.
Morrissey Insight on “The Boss”Reputation is not always as meets theeye. On the surface, many viewedSteinbrenner as an incorrigiblecorporate tyrant; however, it is difficultfor critics (even Boston Red Sox fans) toargue with the results of his work.
The Boss maintained an equally strong reputation for success, growing the New
York Yankees brand from a $10 millioninvestment to an estimated $1.6 billionempire as well as making a significantsocial impact with his philanthropy.
Southwest AirlinesService Above All
Southwest Airlines continues to carveout a growing niche in the airlineindustry, distinguishing itself fromcompetitors through exceptionalcustomer service and employeerelations.
Through its corporate culture andsteady performance, the airlineconsistently enjoys favorable placementon Fortune magazine’s Most AdmiredCompanies list. In 2010, when airlinessought new revenue sources to mitigaterising energy costs, Southwest enacted aunique no-fee policy for checked bags,positioning the company as thepassengers’ airline.
Now the largest U.S. domestic airline,Southwest’s September 2010 acquisitionof AirTran Airways positions the airline
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“Has this been one of the
most challenging times
for me personally?
Probably. I think this has
been a very substantial
challenge. It really hits at
the core of what Johnson
& Johnson is and whatJohnson & Johnson
stands for.”
William Weldon, CEO of Johnson &
Johnson
“Winning is the most important
thing in my life, after breathing.
Breathing first, winning next.”
George M. Steinbrenner
Mark Wilson/Getty Images
Jim McIsaac/Getty Images
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for long-term growth, as it will beexpanding its reach throughout theU.S. , adding more flights anddestinations. Eventually the entire
AirTran fleet will merge under theSouthwest name, which will take astrategic branding effort to streamlineoperations and management.
Morrissey Insight on Southwest AirlinesStaying true to corporate ideals andfollowing through on a plan is atraditional path to success. But, to staytrue, a company (and its leadership)needs to know and understand itsidentity, ethos, and mission. Southwestbegan with the simple mission to be aneconomy airline focused on customerservice.
Despite its rapid development into anational brand, the airline continues tofocus on the fundamentals of economyand service. Southwest’s discipline to itsmission serves both as a compass forbusiness decis ions and a sol idfoundation for a strong corporatereputation.
Amazon.comThe Hard Work BehindReputation
Amazon.com, the world’s largest online
retailer, blazed the trail for retail e-commerce. With an aggressive agendafor growth and service improvement,
Amazon continues to raise the industrybar. Only 15 years old, Amazon is anestablished Fortune 500 company with areputation as an industry growth leader.
With CEO Jeff Bezos in the corneroffice, Amazon distinguishes itself in the
online shopping sector by offering awide variety of products in virtuallyevery retail category imaginable.
A vast network of third-party vendorscompete to provide lowest prices for
Amazon’s customers, cultivating a vibrant marketplace that benefits bothsellers and buyers. In addition toservice and value, Amazon alsodevelops its very own innovations,leading the industry with its Kindle e-reader technology.
Aside from several organic growthinitiatives, Amazon acquired shoeretailer Zappos for approximately $900million in 2009 and recently announcedplans to buy Quidsi Inc, the parentcompany o f Diapers .com andSoap.com for $540 million. InNovember 2010, Amazon dipped its toein the movie business by forming
Amazon Studios, an online incubatorprogram to help filmmakers attract theattention of major Hollywood studios.
Morrissey Insight on Amazon After 15 years of innovation, Amazoncontinues to impress key stakeholders.
Customers enjoy the service, variety,and most importantly, the deals. Evenamidst a major economic recession,investors continue to flock to Amazon,citing its growth opportunity.
Over the past five years, Amazon’s stock price grew nearly 300 percent. Amazonprovides an excellent example of acompany that grinds out the hard work required to advance corporatereputation. With the vis ionaryleadership of a dynamic chief executive
like Bezos, Amazon will continue tomake large strides with both itsperformance and its reputation.
Ford Motor Company Hangin’ “Ford” Tough
After surviving one the darkest periodsfor the U.S. auto industry, Fordcontinues to thrive by producing high-quality, American-made automobiles.The only major U.S. automaker toavoid both bankruptcy and publicTARP funds, Ford managed therecession through belt-cinching and re-focusing on the fundamentals.
Recent research revealed that morethan 50 percent of customers weremore likely to buy a Ford because thecompany declined federal bailout funds.On Wall Street, shares of Ford reachedtheir highest level in six years in earlyNovember 2010, increasing its marketshare (16.7 percent) for the first 10months the year over 2009 (15.2percent). And, on the quality front, J.D.Power & Associates recognized Ford asthe top U.S. brand for quality and atop-five brand overall for the first timeever.
As a communicator, Ford takesadvantage of a wide range of socialmedia tools and online platforms toengage with current and prospectivecustomers. “Share Your Ford Story”provides customers with a forum toshare photos, videos, stories, andproduct suggestions about its cars. Tactics from the past year includeutilizing Facebook to unveil the 2011Explorer and partnering with Hulu and
The Amazing Race to launch a web-based reality show featuring Ford cars.
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“We are convinced that not
charging for bags wins us
more customers, and
therefore more revenue
and profits, as compared
to doing what everybody
else does, which
customers universally hate. Charging for bags
goes against everything
we stand for.
Gary Kelly, CEO of Southwest
Airlines
Southwest Airlines image
Image from Amazon.com
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Morrissey Insight on FordGet back to basics. Ford’s focus on thefundamentals continues to paydividends. A renewed focus on building quality vehicles turned customers’ eyesback to Detroit. A practical, but strict,approach to improving Ford’s financesallowed the company to survive a
vicious economic downturn. Finally, an
enthusiastic effort to engage customersthrough socia l media channelsdemonstrates vibrancy and willingnessto dialogue with Ford’s most importantstakeholders. By getting back to basics,Ford continues to advance i tsreputation.
Research in MotionReliable Execution
Competition in the telecommunicationsindustry is cutthroat, but the BlackBerry
brand by Research in Motion (RIM)stood its ground in 2010, maintaining acoveted place on Interbrand’s bestglobal brands list.
Much like the Google and Xeroxbrands that worked their way into ourdaily business vernacular; BlackBerrypervades nearly every aspect of corporate culture. The nickname“Crackberry” ( for the device’saddictiveness) is a testament to thebrand’s strength, particularly among theexecutive crowd. RIM stakes its healthy reputation on itsability to introduce cutting-edgetechnology to the business enterprise.Leading the way with business-orientedhandheld innovations for the enterprisesetting, BlackBerry enjoys global successin the smartphone market.
Growing consumer demand in Chinaand an upcoming introduction of a newoperating system have analysts feeling bullish about the Canadian company.
Although RIM competes in a crowdedmarket with Apple’s iPhone andGoogle’s Android, its reputation forinformation security and bandwidthefficiency keeps BlackBerry as a choicetechnology for large enterprise clients.
Morrissey Insight on RIMResearch in Motion’s key to reputationsuccess is its dedication to and focus onthe corporate user. While Applecontinues to dazzle with design, RIM’stechnology hones in on the enterpriseand the myriad of CIO concerns:security, ease of use, bandwidthefficiency.
RIM focuses on this core valueproposition with every new release,device or service. For RIM andBlackBerry, reputation excellence isbuilt from consistent execution on the
things that matter to customers.
The New “Tea Party”Rallying Discontent
After decades of two-party gridlock onCapitol Hill and in state capitals aroundthe nation, the Tea Party popularmovement emerged in early 2009 tochallenge the establishment with protestevents throughout America. Protesting populists adopted the “Tea Party”moniker to remind citizens of the
historic 1773 Boston Tea Party where American colonists protested tariffsimposed by the English Crown. Bornf r o m w i d e s p r e a d p o l i t i c a ldissatisfaction, the effects of economicrecession, and frustration over massivepublic bailouts of financial institutions,the contemporary Tea Party movementespoused a mixture of conservative andlibertarian ideals – limited governmentand commonsense public policy.
The national influence of themovement became readily apparentduring the 2010 mid-term electioncycle. From Massachusetts to Kentuckyand countless other states, “Tea Party”candidates upset party favorites andfrustrated pollsters from all ends of thepolitical spectrum. With high-profilepersonalities like Sarah Palin and GlennBeck , the movement a t t ractedsignificantly more mainstream andsocial media attention than theDemocratic or Republican parties.
Dismissed at first by political insiders,
the Tea Party became one of the mostinfluential forces of 2010.
Morrissey Insight on America’s
Tea Party MovementThe Tea Party movement illustrated thepower of combining circumstance anda simple, compelling narrative. The
financial crisis of 2008 led tounprecedented public bailouts of majorbrands, explosive growth in publicspending, incredible burden on thefederal budget, and skyrocketing unemployment.
While these circumstances continued todepress the American psyche, politicalstrategists – led by veterans like formerHouse Majority Leader Richard Armey
– developed messaging directed atgeneral American discontent. With asimple platform that attacked thegrowing influence of government, themovement sprouted from local rootsacross the nation, demonstrating thepower of the right strategy at the righttime and solid execution. Themovement may die over time, but theyhave sent a clear message.
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“So are we enterprise or
are we consumer? Most
things that try to do both
don’t do either of them
well. The BlackBerry has
built its reputation for the
last nine years on being
very much enterprisefocused.”
Mike Lazaridis, President and co-CEO
of Research in Motion
Simple Message,
Perfect Timing
Tea Party populists rallied in
cities throughout America in
2010, with the simple
message of smaller
government and lower taxes
in the wake of the recession.
Research in Motion image
Steve Bloom/The Olympian/AP