Developing “narratives”, which is the new phrase for “spin”, is a balancing act between what is credible while at the same time developing a position on an issue or matter in a world which is now overloaded with information.

Just the change from the word “spin” to “narrative” is an attempt to give spin credibility. It is still spin.

Over the last ten years it has been estimated that there has been 50 times increase in information. Predictions are this will increase to 100 times over the next three years. If you consider that the internet has opened the door to a mass increase in access to information, getting cut through for your message can be difficult.

We are beginning to see people try and shift definitions and play semantics to change a narrative from a negative connotation. I call this super spin.

The most recent example is the definition of a recession in the United States. The traditional definition of a recession is two quarters of negative growth. But the US administration is now saying that the technical definition of a recession is not two quarters of negative growth rather defining it as “a broad-based decline in economic activity and that should show up in lots of different measures, not just one, even one as important as GDP.”

So why are they changing the definition?

The administration clearly does not want the big “R” word in circulation in the run up to the mid-term elections in the US. It does not fit the narrative, or spin, that the administration wants circulating prior to elections.

Enter the media. The media’s role in society is supposed to be keeping government and society in check and report what is really happening. One side of the US media over is running the administration’s line that the economy is transitioning with the other side of the media are saying it is a recession as it fits the technical definition.

So can we rely on the media to provide clarification? Enter the fact checkers who say the administration has not changed the definition. This is even though they continually say there is not a recession, yet there has been two consecutive quarters of negative growth.

Let’s unpack this further. Stepping back from the intellectual debate taking place through the administration, media and playing out on Twitter, the underlying issue is clearly a psychological one.

As soon as the big “R” word becomes the lexicon, people begin spending less and start to save. With inflation, tax and interest rates increasing, consumer funds are going towards non-productive areas of the economy.

If the psychology goes too far to the negative it becomes a self-fulfilling prophecy.

Now let’s look at the facts.

Yes, there has been two negative quarters of growth. But they are past quarters and may not reflect what is happening today. If societies mindset gets too negative, then managing out of a recession will be difficult.

Let examine some other examples where semantics have changed and undermined trust. The pandemic period is a classic example.

Through mid 2021, the narrative became “this is the pandemic of the unvaccinated”. The strategy behind the government narratives, and heavily supported by pharmaceutical companies, was if you get vaccinated you won’t get COVID. Move on a year, the data does not back this statement.

So, the narrative shifts to get vaccinated and the symptoms won’t be as great. It changed. The consequence of the change is decrease in trust in our government officials and pharmaceutical companies. But obviously people took the benefit of the doubt as there are high vaccination rates in most countries.

What we are seeing here is what I call narratives that breach the credibility gap. In Australia we ask ourselves the question, “will it stand the pub test?”. In other words, is what they are saying plausible and credible and will it stand up to the test of time.

So how do we relate this to business?

I have been developing narratives for businesses for almost three decades. There are some basic principles I have applied which have stood the test of time.

Principle 1 – Plausibility

Is the company’s narrative to its customers and its people plausible?

A recent example of questionable plausibility was in a legal firm’s mission statement. It read “Together, we create the extraordinary.” The statement was criticised in the financial media which pointed out that legal firms have an overriding purpose to “protect their clients’ interests.

This garnered a response from a third party (not independent) suggesting the financial media outlet do better.

The mere fact that a non-independent third party felt compelled, or was asked, to write to the paper brings into question the plausibility of the statement “Together, we create the extraordinary.” Obviously, we all like to believe we are extraordinary, but what does that mean? What does it look like? How do you measure it? What if you make a mistake, you have no room to move?

Another example is where a company which was restructuring and cutting employees by one third and had conflicting narratives. On the one hand they were saying to their employees we need to cut costs and on the other they said they were investing for the future. The narratives were in conflict and not plausible in the mind of the employees. It led to very low employee morale.

So, the first check point is plausibility.

Principle 2 – Validation

The next check point is how do we validate our narrative? In other words what are the proof points?

It’s one thing to develop and release a narrative to you employees and customers, it is another to demonstrate the journey to deliver against that narrative. In developing a narrative, it will probably not stand the test of time if it is released in a vacuum. The narrative needs to be grounded in validation so people can be measure success against the path the messaging has defined.

One company I worked for used to undertake annual 360-degree surveys of its people measured against the company’s values. It went one step further. It published the results of each survey in its Annual Report to shareholders. It was very bold and was recognised by third parties as leading the way.

The CEO of that company was validating the company’s stated strategy and operating values on annual basis. It was cutting edge at the time if you consider this was done 25 years ago.

Which brings us to the third principle. Bring in the data without fear or favour.

Principle 3 – Consistency of data

After a company has developed how it is going to validate its narrative, the data needs to be developed to support the validation. If the data bears no relation to the validation, then a credibility gap will develop.

The other key to data is consistency. In the same way when you switch a computer on, the expectation is it will boot up. People get used to seeing the same data interpreted the same way. When customers and employees see constant changes in information presented to them, they get confused and stop engaging and ultimately switch off.

I have seen company’s inconsistently present data. For publicly listed companies it begins to impact the trust towards the information being presented which ultimately can show up in the share price trading below its peers.

In a world where information must be absorbed and analysed more quickly, presenting an argument or information in a consistent manner will improve reputation over time.

Inconsistent information, or worse, trying to change the meaning of the information presented leads to a breakdown of trust and people begin to focus on the motive for presenting information in that manner rather than the issue at hand.

Crisis situations are good example where these principles come into the foreground very quickly. By following the three principles of plausibility, validation and consistency closely during a crisis, the impact of the event on reputation can be minimised.

Often during highly stressed periods associated with managing a crisis, people are inclined to want to respond to matter too quickly and release information that is neither plausible or can’t be validated and changes quickly as new facts emerge. This can be very damaging to a company’s or individual’s reputation and can often lead to a change in CEO or ruin an individual’s reputation overnight.

By using the three principles outlined above, the probability of losing trust in your narrative or messaging will be minimised and reputation can be built over time.

Remember, it takes a lot of time to build a reputation and it can literally be ruined overnight.

Mark Gell is a Founder and Partner of Reputation Edge. He has provided counsel to political leaders, CEOs and Boards for almost 40 years, www.reputationedge.com.au.