Killing them softly: The reputational threat of employee crises

Killing them softly: The reputational threat of employee crises

Charlotte Stoel

Charlotte Stoel

Amazon, Google… so many of the big guys have suffered recently. Amazon is accused of sacking a pregnant worker, raising more questions about warehouse working conditions. Meanwhile, Google has had a succession of incidents involving pay-outs to the executive accused of sexual assault, followed by a global walkout, and more recently, reports that the firm retaliated against two of the female employees who organised the walkout.

What is concerning when reading these reports is that these major international firms still seem to believe some things can be hidden behind closed doors. But they can’t: the truth will come out and a lot is still being learnt after the #metoo movement.

It could be that there are some issues internally that are still being ironed out. But it also could be that leaders have been at the top for so long that they’ve lost touch with reality on the ground. I was recently reading about cognitive distortion which is when our mind convinces us something is true and real when it is not. Common cognitive distortions includes polarised thinking, over-generalisations, disqualifying the positive, but in the case of these tech giants, there may be some minimisation going on. For example, the thinking that these employees don’t represent the bulk of our workforce, so we don’t have a cultural problem. If that’s how they’re thinking, there is a much bigger issue at play. And ignoring the situation and hoping it’ll go away will only lead to bigger problems down the line – brushing things under the rug really does make a mountain.

You may be thinking, “But, Charlotte, these companies are still being used by millions of people, this reputational damage is a drop in the ocean for them.” Well, yes, that may be true in the short term, but how much longer can they take reputational hits like these before users are turned off? Also, having a bad reputation as an employer means that you’re less likely to attract the best people, and without the best people you fall behind in producing the best products and services. Just this month, a report by CNBC revealed that Facebook is struggling to hire following recent scandals. Multiple former recruiters revealed that candidates are turning away job offers.

Character or Capability?

An organisation’s reputation is split between capability reputation and character reputation. Capability is the organisation’s ability to deliver a product or a service, whereas its character reputation is how it does this, and how it interacts with its stakeholders. Sometimes your bad character reputation is forgiven because you’re capable when it matters, but it’s easier to forgive a bad character reputation when it’s not constantly bad.

So, how do you stop your organisation from falling into that character/capability reputation trap? This means going back to the point on cognitive distortion and addressing self-awareness. As a leader, you must:

Surround yourself with people that challenge: It’s natural for senior people to surround themselves with people like them but this creates an echo chamber. Your personality will grow from your thinking being challenged and widening your views.

Give ways for employees to be honest with you: You may think an annual employee survey or your network of managers is enough, but it isn’t. You need to give employees a way to constantly feedback, as well as means to do this anonymously because it could be about a sensitive issue. The faster you can surface issues, the faster they are addressed and could actually improve your reputation as an employer rather than damage it.

Observe others: Take inspiration from others in how they address employee crises – what does their response tell you about them as an employer? Then think how you want to be perceived and either learn from what they are doing well, or by how they’ve handled it badly.

Think bigger: There’s a whole world beyond your organisation.  What could you be doing to help? And I don’t mean just for positive PR – stunts can backfire (just look at Elon Musk’s suggestion for saving the boys trapped in a cave in Thailand using a submarine!) Amazon’s Jeff Bezos was criticised for years for not using his wealth for a better purpose. Steve Jobs was regularly criticised for his apparent unwillingness to give any of his multi-billion dollar fortune to charity. Contrast that to Bill Gates’ and Richard Branson’s charitable work. Now, such huge scales may not be realistic, but there’s always something you can do for your community and earn you the benefit of the doubt when something unexpected goes wrong – even among your workforce.

The fall out of an employee crisis is longer lasting than a few bad articles. So, whilst the likes of Google and Amazon may not be feeling the pain of these reputation hits now, they would be naïve to think they won’t affect them in the long-term. Because neglecting your character reputation will eventually impact your capability reputation.

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