Deck 19: The Public and Corporate Reputation

Question 1

What are the benefits and costs to JPMorgan Chase's reputation given its use of a stakeholder question-and-answer session on Twitter? How do its various stakeholders now think of JPMorgan Chase's image?

Answer 1

Case summary:
Company J is a notable financial institution in Country U. It was strong enough to withstand the crisis in 2008. It also bought two financial institutions that were on the edge of bankruptcy. Magazine B published a report about the crisis, which stated that Company J was behind the crisis.
This was a serious blow to the reputation of Company J. It opened an account on Website T to know the perception of customers regarding the report. Company J received negative comments from the public. Later, the company formulated new policies to rectify its mistakes and reestablish its goodwill.
Opening an account on Website T helped Company J in the following ways:
Company J opened an account on Website T to know the perception of customers regarding the report. It received negative comments from the public. Thus, the company was able to know the public's opinion. Now it could undertake corrective measures to reestablish the goodwill.
The following is the cost of opening an account on Website:
Company J opened an account on Website T to know the perception of customers regarding the report. The public reacted and gave negative comments. Many unknown users of the site came to know about the allegations against Company J. This further decreased the reputation of Company J on a social site.
Currently, the stakeholders of Company J have the following opinion:
The stakeholders of Company J were disappointed, as the allegations were against the company. Later, the company formulated new policies to rectify its mistakes and reestablish its goodwill. It provided reports to its stakeholders regarding the internal governance. This has helped the stakeholders to rebuild their confidence in the company.
Conclusion:
Company J is a notable financial institution in Country U. Company J was criticized for its activities that caused the crisis. Later, the company formulated new policies to rectify its mistakes and reestablish its goodwill. This has helped the stakeholders to rebuild their confidence in the company.

Question 2

Develop a reputation management strategy for JPMorgan Chase to combat the bad publicity it encountered.

Answer 2

Case summary:
Company J is a notable financial institution in Country U. It was strong enough to withstand the crisis in 2008. It also bought two financial institutions that were on the edge of bankruptcy. Magazine B published a report and blamed Company J for the crisis.
This was a serious blow to the reputation of Company J. It opened an account on Website T to know the perception of customers regarding the report. Company J received negative comments from the public. Later, the company formulated new policies to rectify its mistakes and reestablish its goodwill.
Company J can adopt the following reputation management strategy to overcome the lost reputation:
• The company should create an identity of its own in the market. Company J should publish an article carrying its history and achievements.
• Company J should publish a report that accepts its mistakes during the crisis and it should include the measures taken to rectify the mistake.
• Company J should reestablish its business standards.
• The company should re-launch its brand name with improved quality and internal control.
• It should sponsor programs for the public.
Conclusion:
Company J is a notable financial institution in Country U. The company opened an account on Website T to know the perception of customers, but it ended up receiving negative comments from the public. In order to regain the reputation, the company should adopt a reputation management strategy.

Question 3

Would you define this incident as a crisis? Assume you are JPMorgan Chase's CEO and are conducting a press conference: what main points about the incident should you emphasize to the media and convey to the public?

Answer 3

Case summary:
Company J is a notable financial institution in Country U. It was strong enough to withstand the crisis in 2008. It also bought two financial institutions that were on the edge of bankruptcy. Magazine B published a report and blamed Company J for the crisis.
This was a serious blow to the reputation of Company J. It opened an account on Website T to know the perception of customers regarding the report. Company J received negative comments from the public. Later, the company formulated new policies to rectify its mistakes and reestablish its goodwill.
Corporate crisis:
It is a situation where the company faces a serious trouble that triggers media coverage. The coverage may be in news or social networking media. In this situation, the company faces serious allegations and negative comments from the public. The management of such a crisis is called crisis management.
Determine whether the situation faced by Company J is a corporate crisis:
Company J faced a corporate crisis. Magazine B published a report that blamed Company J for the crisis. The company ignored the report and opened an account on Website T. The allegation triggered among website users and Company J received negative comments from the public. Hence, it is a corporate crisis.
Company J's chief executive officer (CEO) should make the following statements during the press conference:
• The CEO should state the intention behind opening an account on Website T.
• He should express his apologies for being a part of the 2008 crisis.
• He should try to answer some of the questions raised by the public on Website T.
• The CEO should also mention the measures taken to improve the internal control system.
Conclusion:
Company J is a notable financial institution in Country U. It faced a corporate crisis that received wide media coverage. Company J received negative comments from the public. Hence, it is the duty of the CEO to address the public and defend the company against the allegations.

Question 4

What other tactics mentioned in this chapter could JPMorgan Chase use to improve the public's opinion of their products? Should it use Twitter again and, if so, how can it avoid a repeat of this embarrassment?