Q: How I can win the trust of investors, future partners and suppliers?
This is part of a larger question: What’s your most valuable possession? When people ask me that, they often expect me to name some expensive artifact. However, my most valuable possession is also my most valued possession. It costs nothing, and everyone has one: my reputation.
“I don’t give a damn ’bout my bad reputation!” Joan Jett sang in her classic hit single. It’s a great song, but I disagree.
For entrepreneurs, a bad personal reputation will extend to your brand’s reputation as well. If you do anything to damage either your own reputation or your company’s, you could destroy your business. When you make a promise to your customers, you need to walk the walk.
While a good reputation precedes you, a bad reputation will follow you for a long time – it takes years to build a strong rapport with people and just seconds to lose it. Those in your industry, from potential investors to suppliers to prospective employees, will take note.
When we started our brand, the Virgin name was perceived as so risque that we weren’t allowed to register it with the British Patent Office for three years, because the officials there thought it was rude. My personal reputation for standing out from the crowd of ordinary, stuffy businessman helped too.
As a young, long-haired entrepreneur in the 1970s, I got some funny looks when I went into the bank barefoot the first few times. But after a few years, if I suddenly turned up at the bank wearing a suit and tie, they knew something was up!
Soon, our move from punk rock to aviation – Virgin Music to Virgin Atlantic – enhanced our reputation as risk-takers and innovators, giving us a competitive advantage over other companies. This came in handy: Virgin became known as the brand that could go into sectors with troublesome reputations and shake them up by applying our values.
When we bought our first plane, air travel was considered very expensive, extremely frustrating and awfully dull; more recently, the banking sector has been held partly responsible for the recent financial crisis and global recession, so we used our reputation to instil some trust and, as Virgin Money’s slogan says, “make everyone better off,” as we expanded the company from credit cards into banking.
The world is becoming ever smaller, and thus maintaining your brand’s reputation is more important than ever. These days the Virgin brand is trusted globally, so if we set up a venture in a new country, progress is swifter than in the days when we had to win over customers one transaction at a time.
But improved communications also mean that any negative story about a Virgin company anywhere can become a global event with the click of a mouse.
As an entrepreneur, you need to keep a close eye on all the chatter about your business on social media channels and online – Twitter, Facebook, and all their competitors. This doesn’t mean micro-managing and treading on your employees’ toes, or attempting to stop customers from expressing their opinions about your brand.
Rather, to build your company’s reputation online, you need to hire people you can trust not only to excel in their day-to-day jobs, but to be the public faces of your business. After all, a brand is only as strong as its people.
Everyone makes mistakes. If you or someone in your company does, it is important to own up to it and move on. Sometimes the CEO must step in personally. For example, when a marketing agency hired by an American company Virgin is associated with went too far recently in an ad, I took to Twitter and my blog to apologise for any offense this caused.
In terms of their personal conduct, some entrepreneurs launching their first start-ups may try to mimic the stereotype of the tough businessman and bully who gets his way. I don’t think that this leads to lasting success. You need to treat people as you would wish to be treated in order to gain respect.
If you develop a company culture based on mutual understanding and respect, your employees are more likely to enjoy their jobs and become ambassadors for your brand and reputation. Likewise, customers will put their trust in your company and purchase more of your products; investors and potential partners will consider your proposals seriously; and vendors will want your business.
One of my overall points in writing this column is that building a business is not rocket science; it’s about having an idea and seeing it through with integrity.
This basic formula means that as an entrepreneur or business leader, you can’t compromise on your principles when dealing with your staff, your customers, your suppliers, or anyone else connected with your business. Because if you treat people fairly and well, they will reward you with loyalty and dedication. If you fail to do so, the repercussions will follow, and eventually impact your bottom line.