One of the most important elements of organization management is to create a respectable and credible corporate image. An organization’s corporate image will affect the rest of its activities ranging from product sales to market stock. Every organization worth its salt must weigh its options for delivering a suitable corporate image carefully (Guth & Macmillan, 96). If the organization intends to create a discrete image with a low public profile then it may be forced to be accustomed to small and simple organization structure and knowing its customers extremely well. On the other hand, if the organization intends to create a large and renowned public image, it must create a structure used to new faces and larger public context. There is no perfect corporate image as the ideal situations in the corporate world are difficult to achieve. However, realizing a favorable corporate image for the organization may be dependent on several factors that are integral to choosing the right image.
American Apparel has suffered a great blow in its public relations within the last few years following an extended public lawsuit against the company’ CEO. The sexual harassment lawsuit had immediate side effects on the company’s image. Therefore, organization is affected by a great deal because of long-term effects to its public image. A bad press suggesting questionable personnel preferences negatively affected the company reducing its positive stand in the public. It also opened the doors that led to a massive employee lay-off after an immigration probe in the company’s employee structure. These problems coupled with a poor public relations profile in the company had immediate effects on the profit margins of the company. In 2009, the company had registered a profit of one million US dollar, but one year later it posted a loss in the tune of 86 million US dollars. Furthermore, the company’s shares have plummeted into an all-time low with little hope of improvement in the near future. In the recent past, the company was in threat of bankruptcy following its reduced manufacturing ability due to massive lay-offs for employees.
In its efforts in establishing a better image, the company has embarked on an extensive program of creating positive public relations by providing educational opportunities for its employees whom the company has recruited all over again. The firm also pays higher than normal wages as compared to the past and with other similar companies, and producing most of their goods in the US, contrary to the past practice of coordinating its activities in other subsidiary branches. These efforts can be lauded, as they are important in re-igniting the company’s new image. Secondly, the efforts are useful in recapturing the lost attention of the public since the attention received affects the company image. However, the critical factor here is whether the company can sustain these efforts in the long-run. Choosing a bold move to re-create a new image is important but it can become a barrier to the company’s redevelopment considering the financial implications of such a move (Nicholas, 08). In the grand scheme of things, American Apparel ought to evaluate these efforts before embarking on a step-wise process of establishing a new public image.
As to whether the company could have avoided the negative publicity is a matter of discussion. While some sectors of the stakeholders feel that it was in the company’s hands to control the public image it is justifiable for a company to cite the influence of the legal external factors, which the company has no control over. At a time when organizations are focusing strategic management for development, good corporate image will be a bright source of light in an array of spheres of interest for growth and development.
Guth, W., D. & Macmillan, I., C. Strategy Implementation versus Middle Management self-interest. Strategic Management Journal, 1996.
Nicholas, T. Ethical Landscape of Contemporary Conflict, Cambridge Royal Corporate management, 2008.