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Reputational risk – the human factor

January 26, 2011 Jonathan Hemus

News about Steve Jobs’ health-enforced absence from Apple and its impact on the continued success of the business shows just how important the human element is in reputational risk management.  The problem is that too many businesses choose to ignore it.

It’s relatively easy to contemplate operational risks – fire, flood, IT failure – especially if they are seen to come from outside the business (“Acts of God” are especially easy to countenance).  Risks related to people – and in particular those that are internally generated – are much more uncomfortable.

The idea that people in our business could engage in corruption, fraud, sabotage, harassment or unethical behaviour is tough to think about, let alone plan for.  It’s almost as unpalatable to consider the absence of a key executive, whether through illness or sudden departure to a rival (and of course, solutions to this problem are not readily available).

But organisations that fail to account for human risks in their crisis communication plans leave themselves seriously vulnerable to reputational damage.  Internally generated crises are often the most challenging to deal with, and the most harmful to confidence in a business, as Apple may find out to its cost.

Acts of God are by their very definition unavoidable whereas human crises can often be prevented – or at least mitigated – with effective management.  Businesses that want to ensure that their reputations are well protected need to make sure that their people-related risks are managed just as thoroughly as their operational risks.

Jonathan Hemus

  • Jonathan Hemus, Insignia Communications
  • Follow Jonathan on Twitter @jhemusinsignia

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