The Reputation-Reality Gap

Reputation is a matter of perception. The Reputation-Reality Gap is where our reputation doesn’t match reality. Reputation is distinct from the actual character or behavior of the company (or individual) and may be better… or worse.

When the reputation is more positive than its underlying reality, this gap poses a substantial risk. Eventually, the failure to live up to its billing will be revealed, and its reputation will decline until it more closely matches the reality.

A strong positive reputation among stakeholders (investors, customers, suppliers, employees) will result in a strong positive reputation for the company overall.


(Image by Fleishman-Hillard)


Here’s an example: Diversity hiring continues to be an issue that everyone gets behind on paper, but few actually follow through with. This is highlighted in Deloitte’s 2017 Human Capital Trends report, where 69% of executives rate diversity and inclusion as an “important” issue, while only 12% of organizations have a mature level of inclusivity.

In other words, there’s a reality gap.

Maarten Schäfer
Founder CoolBrands People


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