Blog: Crisis Management

Reputation management is a cornerstone of business, regardless of how big you get

Google will pay a $7 million fine to settle a multistate investigation into a snoopy software program that enabled the Internet search leader to intercept emails, passwords and other sensitive information sent several years ago over unprotected wireless networks in neighborhoods across the world.

The agreement announced Tuesday covers 38 states and the District of Columbia, part of the area where households and local merchants unwittingly had some of their communications on Wi-Fi networks snatched by Google Inc. from early 2008 until the spring 0f 2010.

This quote, from an AP News article by Michael Liedtke, hosted on, ironically, Google News, is yet another in a string of rulings against Google for bold, widespread invasions of privacy.

We’ll leave the legal particulars to the judges and lawyers, what we’re interested in is the effect these findings are having on Google’s reputation. Already, the label of “serial privacy violator” is being used by critics, just take a look at this quote from the same AP article:

The penalty won’t be enough to prevent Google from continuing to be a “serial privacy violator,” according to John Simpson, privacy project director for Consumer Watchdog, a frequent critic of the company. “It’s clear the Internet giant sees fines like this as just the cost of doing business and not a very big cost at that.”

Is Google choosing the same path that many pharmaceutical companies seem to be taking, i.e. factoring fines into the cost of doing business, and reputation be damned?

If so, it’s certainly a risky strategy. It is true that when you dominate your market to the degree that Google does you gain a certain amount of wiggle room in terms of reputation, basically because no one mistake is going to create enough of a dip in users, customers, etc. to knock you off of your pedestal.

So what’s the big deal?

The danger for organizations like Google, Apple, Microsoft, and their ilk is in the slow buildup of negatives. At some point, especially in a society that is increasingly conscious of the practices and philosophies of the organizations they give their money to, unchecked negative sentiment will reach a level where it spills over and creates a crippling enough loss of reputation that a competitor is able to step in and take the lead.

The takeaway here? Even if you’re on top and the competition’s so far behind it’s not even in the rear-view mirror, your reputation counts. It almost brings to mind the image of a modern tortoise and the hare. The hare, knowing it’s a dominant leader, stops putting in the daily care and effort that’s required to stay on top. Meanwhile, the tortoise is creeping along, throwing its every effort behind building its reputation and waiting for that golden opportunity.

Google is certainly looking like the hare in this situation, and the tech world is no stranger to sudden upheavals of opinion that results in the replacement of a formerly dominant force.

Your reputation is, without a doubt, your most valuable asset. Protect it.

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[Jonathan Bernstein is president of Bernstein Crisis Management, Inc., an international crisis management consultancy, author of Manager’s Guide to Crisis Management and Keeping the Wolves at Bay – Media Training. Erik Bernstein is Social Media Manager for the firm, and also editor of its newsletter, Crisis Manager]