Unpacking the halo effect: reputation and crisis management

Abstract

Purpose: Crisis managers believe in the value of a favorable, pre‐crisis reputation. The prior reputation can create a halo effect that protects an organization during a crisis. The prior reputation/halo might work as a shield that deflects the potential reputational damage from a crisis. Or the prior reputation/halo might encourage stakeholders to give the organization the benefit of the doubt in the crisis (reduce attributions of crisis responsibility). Oddly, researchers have had little luck in producing a halo effect for prior reputation in crisis situations. The purpose of this paper is to present two studies designed to test if the halo effect could occur and which of the two dynamics of the prior reputation halo best serve to explain the benefits of a favorable, pre‐crisis reputation. Design/methodology/approach: The research focuses on a set of studies conducted to illustrate the halo effect and to explore how it serves to protect an organization during a crisis. The implications of the findings for post‐crisis communication are discussed. Findings: The halo effect for prior reputation in crisis was created. The halo operated in a limited range for organizations with very favorable prior reputations. The data also supported the halo as shield dynamic rather than the halo as benefit of the doubt. Originality/value: The paper provides insight into the area of reputation and crisis management.