NEW ZEALAND’S MOST REPUTABLE ORGANISATIONS : Reputation is everything

Reputation can be forgetful and unforgiving companion. Abuse it and chances are it will bite back. Leave it unattended and suddenly it has gone. Pay attention to it, and few marketplace strategies deliver so profoundly.

Air New Zealand, NZ Management magazine’s first Most Reputable Organisation, is living proof of how good reputation can create Kiwi icon. And similarly honoured in the study are Kiwibank, named our Most Reputable State Owned Enterprise; New Zealand Police, voted as New Zealand Most Reputable Government Department; and The Salvation Army, declared our Most Reputable Not-For-Profit Organisation.

The value of good reputation has, in the past year or so, become more apparent and shot to the top of the strategy agenda of many organisations. Many that attempt to cultivate reputation will fail, because at leadership level they don’t understand the commitment required to build an honest reputation.

In today’s interconnected world, the most painstakingly designed and manufactured reputation can blow out in an instant. BP, for instance, invested billions of dollars telling everyone that, when it came to safety and environmental considerations, it would stake its reputation on being the “most trustworthy” energy company around. Its reputation now looks like an empty well.

So, what, in New Zealand, identifies reputable organisation? What management and leadership insights does peer review of this scale and scope reveal? NZ Management and Hay Group combined forces to find out.

Every year in the United States, Hay Group helps Fortune magazine identify what it calls, The World’s Most Admired Companies. Last year, the consultancy started something similar with BRW magazine and generated Australia’s Most Respected Companies List.

Given NZ Management’s wider readership and the idiosyncrasies of New Zealand’s small and public sector-impacted economy, the researchers opted to seek opinions on more than just our companies. Directors and managers across the economy were asked to rate the reputational performance of our companies, state-owned enterprises, government departments and not-for-profit organisations.

They were then asked to nominate one organisation, across all categories, that they considered New Zealand’s most reputable. Air New Zealand flew in. An overwhelmingly high percentage of respondents chose our national airline.

Its high profile and sometimes inspirational management and leadership performance over the past two or three difficult years deserved to be acknowledged, said the respondents. And so it is, in this inaugural issue of New Zealand’s Most Reputable Organisations.

The research provides fascinating management, leadership and performance insights which are made all the more relevant, says Hay Group New Zealand’s chief executive, Ian MacRae, by the “outstanding” response to the survey.

“The response rate was dramatically higher both in quantitative and qualitative terms than we have achieved in other countries, particularly in start-up year,” he says.

“More than 70 percent of respondents were chairs, directors, CEOs, general managers or partners. The remaining 30 percent were senior managers, managers or similar level leaders. Given the response, we are confident that the findings are robust and reflect what leaders across the economy consider are reputational criteria relevant to today’s tricky market conditions,” he says.

Given the enthusiastic response, the survey will be conducted every year, according to NZ Management’s publisher Toni Myers. “It will help us build better understanding of what organisational reputation means and what it is built upon. We can then tell our readers what consistently resonates with directors and managers when they think about reputation,” she says.

Despite the diversity of the organisations surveyed, our top level respondents were surprisingly consistent about what constitutes key reputation-defining characteristics. Strong and effective leadership is one in particular. These are difficult economic and social times, so it is hardly surprising that the nation’s organisational leaders recognise the critical role strong leadership plays in delivering on survival, performance and success-focused strategies.

It stood out as the highest-rated characteristic of Air New Zealand’s reputation, and featured as the second-highest characteristic identified within Kiwibank and NZ Police, the country’s most reputable SOE and government department respectively.

Air New Zealand has, said one respondent, “strong leadership from the top through to lower-level management”. And its “strong leadership is open and honest (providing) high level of customer service, vision, communication and international recognition.”

Its chief executive, Rob Fyfe, was frequently singled out by respondents for his unique and motivational leadership style.

“He knows the business from the ground up, and has provided great internal and external leadership through what has been difficult time to be in the airline business,” said another respondent.

Home-grown businesses dominated in the Most Reputable Company category. Air New Zealand, Fonterra, global engineering consultancy Beca, Fletcher Building and F&P Healthcare took out the top five places. Overseas-owned multinationals did not rate.

Air New Zealand also rated strongly for being strategically innovative, having clear and compelling vision and because respondents believe it contributes significantly to the wider community.

“It is an organisation that puts New Zealand on the map and one which we can be proud of. Its CEO connects with wide stakeholder groups and represents New Zealand well in foreign markets,” said another respondent.

Footing it globally earned reputational brownie points. Dairy industry giant Fonterra ranked second, mainly for its clear and compelling vision, its well-developed strategic plans and objectives and for its effective organisation structure which, perhaps, says something about how Kiwi leaders rate the global effectiveness of co-operatives.

Fonterra was, said one respondent, New Zealand’s only true multinational “operating in highly competitive and regulated environment, earning $1 in every $4 New Zealand earns from exports”. There was also “sense of integrity in their approach to business”.

Kiwibank, the top rating SOE and New Zealand’s high-profile, home-grown bank earned the respect of at least one respondent for “taking the Australian-owned banks to task, challenging them” and thereby, “setting new industry rules”.

It rated highly because it was “New Zealand-owned, innovative, trusted and fun”. Respondents felt Kiwibank was customer-focused, engaged with the community and was equipped with clear vision of what it was established to do: “compete with the major banks and provide affordable banking services”.

Kiwibank’s birth mother, NZ Post, is the nation’s second most reputable SOE. Its perceived effective organisation structure and contribution to the community rated highest. Its effective implementation of strategic plans and objectives, coupled with “strong financial management and performance” also captured attention.

Energy companies filled the SOE category’s next three reputational placings. The ranking of Meridian Energy, Genesis Energy and Solid Energy probably says something about the nature of the state’s involvement in the New Zealand economy.

When it came to ranking the reputations of New Zealand’s government departments, NZ Police out-gun

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