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The scientific heritage No 6 (6),2016
7. Рынок ТЛУ в условиях экономической рецессии: прогноз до 2017 г. [Электронный ресурс] / РБК.research - Электрон. дан. - Режим доступа: http://bc.rbc.ru/2015/log/materials/585/EuSQht.pdf (дата обращения: 02.02.2016).
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Sharova K.
Postgraduate student, Plehanov University of Economics, Moscow, Russia
METHODS FOR EVALUATION OF THE CORPORATE REPUTATION OF A COMPANY
ABSTRACT
Study of intangible assets and their use for strengthening company's position on market became a vital component for modern Russian companies. Reputation is becoming a weapon in a battle to achieve steady and positive development of an organization on market. And regulation of a reputation is becoming a process that is necessary for forming of a positive trend and winning positions in contrast with competitors. This paper contains main methods for evaluation of corporate reputation and ways of using it for improvement in companies practice.
Keywords: corporate reputation, reputation stability, reputation ratings, marketing research
Valuation of a successful operation of a modern company can not be based only on material factors (profit growth, stepping up the rate of production, winning products in comparison with competitors). Since middle 70-s corporations have started to aim at the social factors i.e. intangible assets, which also include concepts such as reputation of a company, image, brand, mission and etc.
Consumers pay attention not only to the price and quality of the product, but also to the respectability of a brand, the ecological compatibility of production, the popularity of the manufacturer, his position on market and other social characteristics that didn't have any great significance before.
Study of a corporate reputation is a common occurrence for the majority of international and domestic companies. Large-scale enterprises that exist on a market for a long time and need to keep up their reputation tend to pay more attention to this aspect. For small enterprises study of a corporate reputation cannot be that relevant, but for establishing firm positions of an organization in the field of its activity and maintenance of loyalty of the interested parties it is necessary to secure a decent level of a corporate reputation.
The process of formation and maintenance of a proper level of corporate reputation stability is a strategically essential asset and has great significance in a forming of the company's activity as well as it acquires urgency and necessity of increasing investment of capital into intangible assets of a company.
For the most foreign companies reputation is one of the most valuable assets, in so doing, company's management isn't always able to determine the level of the corporate reputation. It is often connected with the fact that intangible assets take very small part in the structure of accounting balance in comparison with the value of equipment or immovable. In Russia, the phase when either leaders of the company or employees don't pay enough attention to the corporate reputation is still happening. But it is necessary to consider that reputation can have an immediate impact through opinions of concerned parties and increase company's profit by attracting new stakeholders and keeping and maintaining positive relations with current ones.
The necessity of the evaluation of company's corporate reputation is connected not only with situations when company management wants to understand how costly will the financial regulation of a company be or when company image is damaged. The main reason is the situation when there appears an interest in comparison of company position with competitors in one particular sphere of business. Existence of this sort of information will let determine what kind of reputation company has at the moment to understand in which directions company should develop and change in order to keep its place in a market and try to become a leader. In that regard, a company will require not so much a quantitative evaluation i.e. an evaluation received by financial calculations as a qualitative evaluation received by sociological analysis.
There are a lot of different ways to determine the level of a corporate reputation in an organization. In general different ways are divided into quantitative and qualitative measures of evaluation.
Two main groups of quantitative methods are:
1. Direct methods. They are used in assessing directly the cost of the reputation without accounting the rest of company's property.
2. Indirect methods. Goodwill is determined as a difference between the cost of the whole company and the cost of its net assets.
I would like to grant a detailed attention to qualitative methods of the corporate reputation evaluation. Group of qualitative methods consist of expert methods and methods of sociological questioning. As G. Dowling said "qualitative analysis - the best method for exposure of characteristics used for description of an image and a reputation".
Among the expert methods of corporate reputation evaluation rating and recommendatory methods stand out. The base of the recommendatory method is a discussion of corporate reputation by PR analytics and recommendations about its modification. The result is descriptive adjectives of company's reputation, which often do not include comparative analysis with other companies in the industry. Results of the analysis are synthesized in analytical summaries, which are used by
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company management for effective regulation, necessary coordination and perspective planning of the future activities of the company.
Rating method is based on company activities in combination with relations of stakeholders towards a company and is an indicator of its activity, level of development and final results.
Renowned consulting firms behind which lies serious work of groups of analytics, who use the authority of world's leading publications make ratings. It is important to understand that ratings are also business products and business community is orientated on them. It means that these products are the most important indicators of stability and investment appeal of a company.
In foreign practices they use intangible assets to increase stability of a company on a market. Different ratings about the evaluation of company's reputation are very valuable. If in the 90s there were approximately 30 agencies and mostly in USA, now there are more then 100 of them in the world.
Nowadays ratings are very popular on the world stage. The first rating was compiled and published in 1995 by Fortune magazine, in that at first information was meant for internal purposes. Then the idea of ranking companies in accordance with different indicators appeared. Today Fortune company publishes annually rating "World's most admired companies", which is one of the most known world ratings in the sphere of reputation study. Key attributes of corporate reputation according to the rating are: innovations, personnel management, use of corporative assets, social responsibility, quality of management, long-term investment cost, quantity of goods and services, global competitive ability and financial viability. According to the information of the latest rating top-3 world companies with the best performance are three A: Apple, Alphabet (Google) and Amazon. Apple takes over the first place 9 years in a row. In Russia, rating of company reputation is made be Expert magazine.
Another qualitative method of the corporate reputation study is sociological questioning. It is impossible to assess the level of a company corporate reputation and to regulate it without consideration of stakeholders' opinions. It is the use of sociological method that will give an opportunity to get full understanding of a corporate reputation and show stakeholders attitude. Among sociological methods content analysis, reports (expert and in-depth interview, focus groups), questionnaire stand out.
Questionnaire is also a qualitative method. It allows analyzing information and making a statistical total. Questionnaire can include mass consumer questioning about corporate reputation of a company. Consumers as another group of interested parties are questioned to compare the company image with competitors, evaluate activity by certain characteristics, which influence the level of reputation stability. As result we can get general attitude of consumers towards the company and its place on a market.
Also questionnaire can include opinions of another group of stakeholders, who have an impact on assessment of the company reputation - employees. Questioning of employees is anonymous and presents an opportunity to tell your attitude towards the company, evaluate advantages and disadvantages, compare the company with its competitors. Similar researches are made to improve relations between an organization and its employees and corporative culture.
Definitely, it is better to use a combination of methods to assess corporate reputation. In author's opinion, in order to provide full and clear outlook about the level of corporative reputation and relations of all interested parties in the first place it is necessary to carry out a content analysis to reveal possible advantages and disadvantages people pay attention to. Then expert interviews will follow to determine main characteristics of a reputation evaluation and show experts opinions, which influence management solutions and attitude to the company. The last stage is questionnaire of consumers and employees to expose strengths and weaknesses, to compare a company with competitors and form an attitude of the most numerous group of interested parties.
Corporate reputation plays an important role in development, modification and profiting of any company. While crating stable corporate reputation it is important bear in mind that all interested parties should take part in strategy development to varying degrees i.e. the alteration of the corporate reputation can be depended on them, but also influences their activity.
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