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Impact of Corporate Reputation on Organizational Performance

Dec 20, 2022 | 0 comments

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Dec 20, 2022 | Essays | 0 comments


Corporate reputation is quite an important aspect that is important in the performance of any organization. A good corporate reputation has a good effect on the performance of an organization. This will thus be the focus of this paper. Despite several research on the subject, there has been less empirical and inconsistent evidence to prove that corporate reputation impacts the company’s performance. This thesis argument will focus on this inconsistency by examining the body of research from previous studies on the subject.


Several academics and intellectuals have maintained that firms with a huge corporate reputation are more likely to improve organizational performance. Corporate reputation has been, in most cases, identified as an intangible resource that gives firms a competitive advantage. With it comes several benefits to organizations that include profitability in most companies. Some of the benefits include the ability to retain and attract staff to the organization. From this, it is clear that corporate reputation is important for the success of any organization. Despite the common belief that corporate reputation has a competitive advantage, there has been inconsistent evidence to back this up. This thesis will therefore focus on all the aspects that lead to this inconsistency in the body of research by examining past literature and studies on the subject.

Literature Review

This literature review gives a diverse overview of the dimension of corporate reputation. According to ( Bouffard and Charest 2015), corporate reputation plays a major role in organizational development. Electronic media had a major influence in digital media on organization managers and their reputation, especially across business initiatives on social media platforms. The process of doing so has led to an improved business model that embraces social media. As a result of this, social media marketing has emerged. From a commerce point of view, social media has led to several issues in using technology in commerce ( Bouffard and Charest 2015). The main focus is the negative assessment of managers and organizations by new media users, especially social media users. This contributes greatly to the organization’s overall brand image or product and its services. According to ( Claeys and Cauberghe 2015), organizations with favourable preparation before the occurrence of a crisis as a reputation to the public have less loss of reputation with the occurrence of a crisis. Comparatively, those organizations with a poor reputation for preparation for the crisis had a considerable loss in reputation with the occurrence of a crisis. This can be explained as reluctance by the consumers to alter their initial attitude towards an organization. Because of this, they accord less responsibility in a crisis to an organization that has a favorable reputation in a pre-crisis ( Claeys and Cauberghe 2015). There is a positive effect of an organization with a favorable pre-crisis reputation. This offers protection to the organization in the event of a crisis and helps them create a buffer in the event of negative publicity leveled against them.

The uptake and increased use of social media have led to an increase in the phenomenon of social media parody accounts. ( Pang et al. 2015) Point out that parody accounts can go from a publicly seen crisis threat to an online crisis threat to an organization or a person. Such accounts lead to increased negative attitudes toward an organization affecting its initiatives and efforts as they often mislead the public by posting information that is not authentic and largely baseless. Pang et al. recommend that the overall welfare of an organization will be in jeopardy if such dubious accounts fail to cease to exist. Parody accounts reflect they hinder organizational development due to the negative implication for the public ( Pang et al. 2015).

Social media has major effects on communication between consumers and different organizations in the nutrition and food safety division. After conducting a quantitative approach of interviews in the UK and Ireland, ( Shan et al. 2015) posit that social media play a crucial role in communicating nutrition issues and food safety. Social media is useful in analyzing complaints and queries, especially in organizations that require high response rates, such as the food industry. Organizations need to redesign their social media content to get more customer insights. The implication is that the increased role of social media has brought different opportunities to an organization ( Shan et al. 2015).

Management plays a critical role in determining the corporate reputation of organizations. According to (Arella, Bahamonde, and Feldman 2014 ), corporate reputation is now considered a major variable in improving the overall attractiveness of an organization, together with its capacity to retain both investors and clients. This can determine through the Kaiser Meyer-Olkin measure of sampling adequacy (MSA) and Bartlett’s test of Sphericity which both result in an index that allows most organizations to augment and improve their relationships with society (Arella, Bahamonde, and Feldman 2014 ). Social media helps a company to know the perception of their performance, compare it to their rivals, and follow up on the traceability of their impact on operations and budget.

The process of building a reputation as a company is quite elemental. (Emerald Insight 2014) states that the process is an all-around one that starts from the stakeholders through the chain and their role in an organization. The definition of reputation is an expectation by the stakeholders of the company. A good company will focus more on the stakeholders and their roles. This makes them quite answerable to the stakeholders in case of anything. The different social activities that an organization partakes in enhance its corporate reputation. Thus, companies must partake in such activities to build their corporate reputation. Examples of these social activities include participating in a marathon, a charity event, or helping the less privileged (Emerald Insight 2014).

Research Design


The participants in this study will be the customers, employees, and suppliers of the 100 best companies in Fortune’s ranking in the United States. The reason behind the choice of these participants will be owed to the fact that to obtain accurate results that can be used in policy recommendation; this research will need a sample that is conversant with social media and the relationship between social media and the cooperate world. This sample is representative, which is a key factor behind accurate results. Nevertheless, the choice of these participants would be based on the fact that they often meet the experience of new technology in the cooperate world. The customers, the employees, and the suppliers are part and parcel of the cooperate world. It will thereby be very imperative to understand the role played by each of them and their consequent relation to media. Customers are often involved in online purchases; suppliers, on the other hand, are involved in general supply and distribution. The employees receive important cooperate updates concerning the organization through certain media. This is why all these three groups of persons collectively create a representative sample for the study.

Materials of Data Collection

The materials for data collection will be questionnaires and interviews. The interviews will be informal and open-ended. The choice of these materials for data collection will be based mainly on the fact that the study will consist of a very diverse group of individuals. The questionnaires will have semi-structured questions. This will be the main objective of giving the respondents a chance to give comprehensive data. This will justify the selection of this research instrument. The merits of questionnaires in this research will be a couple. For instance, they will give the respondents room to consult documents, thereby increasing the accuracy. Besides, they are handy since they use lesser resources on time and finance. The justification of the use of interviews will be based on the fact that with interviews, there is a high response rate, the interviewer will have a chance of probing ambiguous responses, they are convenient for the respondents, they take care of the problem of illiteracy which could be a problem in this case and finally, interviews are bound to cover a wider area. Questionnaires and interviews will therefore be convenient to use in this study.

Method of Data Collection

The research will use a quasi-experiment design. The independent variables will be media influence and impressions of target corporations. The Sampling frame is meant to consist of 200 respondents. The appropriate method to use in this research will be Simple Random Sampling. In this method, the sample will be selected, and each unit will have an equal probability of sampling. In essence, the 200 respondents will include the employees, suppliers, and customers. This means that each employee, customer, and supplier will have an equal probability of being selected. The method is efficient to use and can be justified through several reasons: It will save on resources such as time and money, has a high degree of accuracy, it is convenient to use, and the problem of bias is minimized (this is because each element will have an equal probability of being selected hence the method gives unbiased results). With this, the method of Simple Random Sampling will be the best for this study.

Validity of the Method

The validity of the method employed, which is, in this case, interviewing as the use of questionnaires, will be established through an evaluation of whether the methods of measurement or the materials of data collection will indeed measure what they are supposed to measure. In other words, the researcher will need to ask him or herself: Does the questionnaire measure what it is supposed to measure? Do the interviews determine what they are meant to determine? The questions in the questionnaires will relate media to the cooperate world. This will meet the objectives of the study sufficiently since it is this relationship that the research will seek to establish.

Concern about addressing internal and external validity

The validity and reliability of the data collection procedures and instruments will be determined by assessing whether the instruments will give the same results if they are used repeatedly. In other words: Will the questionnaire yield the same results when used repeatedly? Will the interviews give the same results when used over and over again? Internal and external validity, however, will be ascertained through a series of strategies. For instance, the research will prepare callbacks if validity is questioned. The research personnel will also need to undergo training to improve the degree of precision of the results. Finally, the research materials will be tested against a certain hypothesis to establish whether they will give the same results if used repeatedly. These will be the ways to address the concerns of internal and external validity.


From this study, it is clear that there is little knowledge of different aspects of corporate reputation and how they play a great role in improving the organization’s performance—the current body affected by mental or physical health disabilities. However, research evidence and research have focused on quite a casual relationship between corporate reputation and organizational performance. From this research, it is evident that corporate reputation is dependent on intangible aspects of the firm. It, therefore, highlights the need for organizations to focus on this intangible thing that enhances corporate reputation in an organization. Organizations need to focus on this intangible aspect to have a long-lasting sustained corporate reputation.


Bouffard, Johanie , and Francine Charest. “The characteristics of the e-influence of CommunityManagers: Issues for the e-reputation of organizations.” Public Relations Review, 2015.

Claeys, An-Sofie , and Verolien Cauberghe. “ReviewThe role of a favorable pre-crisis reputation in protecting organizations during crises.” Public Relations Review, 2015.

Pang, Augustine, Andrew Ong, Regina Koh, and Sarah Wan. “ReviewParody social media accounts: Influence and impact on organizations during a crisis.” Public Relations Review, 2015.

Shan, Liran Christine, et al. “Interactive Communication With the Public: Qualitative Exploration of the Use of Social Media by Food and Health Organizations.” Journal of Nutrition Education and Behavior, 2015: 104-109.

Arella, Rolando, Bahamonde, and Percy Marquina Feldman. “A NEW APPROACH FOR MEASURING CORPORATE REPUTATION.” Revista de administração de emprêsas, 2014 : 54.

Emerald Insight. “Building a corporate reputation.” Strategic Direction, April 2014: 21 – 23.

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