reputation

Would you rather quit, or be forced to “pursue other opportunities?”

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When companies need to quietly get rid of executives, they often get creative in how they go about it in order to save face. Whether it’s early retirement, or announcing someone has “left to pursue other opportunities,” framing an exit is incredibly important as it impacts the firm, its employees and its brand -- not to mention the executive leaving his or her post.

So when Nikki Haley, the United States ambassador to the United Nations unexpectedly resigned earlier this week in a move that shocked many beyond the diplomatic circles of Washington and New York, many were wondering: was she pushed out, or did she make this decision all on her own?

While there is plenty of speculation about why she abruptly jumped ship, the way the former South Carolina governor handled the situation is something we can learn from when faced with either a self-imposed exit, or one that is ultimately imposed on us.

For starters, Haley announced she would remain in her post until the end of the year. Any time an executive resigns “effective immediately” it’s sure to arouse suspicion and spark rumours. By providing lots of runway until she officially vacates her position, the situation looks like it was coordinated by both the employer and executive. A smooth transition of this sort, viewed through a communications lens, can be a win-win. The long list of senior officials that have left the West Wing in less than ideal circumstances is proof that President Trump has no problem letting the door hit them on the way out. Not so with Ambassador Haley.

What makes her departure different than others (and yes, there have been many resignations), is she leaves with her reputation intact, despite working for one of the most polarizing presidents in American history. This is partly due to Haley not always toeing the party line. For example, she once shot back at Trump who accused her of being ‘confused’ over new Russian sanctions. She’s also defended women accusing the president of sexual assault, saying they deserved to be heard.

While this is purely speculation, the timing of her exit could be strategic. With the newscycle gripped by the now-confirmed Supreme Court Justice Brett Kavanaugh hearings, there’s been significant backlash to how both political parties handled the confirmation process, especially pertaining to the #MeToo movement that was very much front and centre. Even though Haley stresses she’s leaving because she needs a break, as one of the few senior women in the administration, some could interpret her departure as being influenced by these recent, turbulent events.

As we discussed a few weeks back, employees sometimes work for a boss or organization with such a toxic reputation that it can begin to impact their own. Although Haley is adamant she has no plans to run in 2020, some have speculated that if she stayed on longer, she’d be forced to follow policy directives she’s not comfortable with, which could negatively impact her image if she were to run again.

Our best guess would be that Haley’s departure was a decision she brought forward. In doing so, she has had much more control in shaping the narrative surrounding her exit. While this is much more important for executives in high-profile positions, it also serves as a lesson for junior and mid-level employees who want to ensure they are seen favourably by future employers. Just as is the case with making a great first impression, you only get one chance to depart well - don’t waste it!

How (not) to drive your reputation into the ground: lessons from Elon Musk

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Elon Musk, the eccentric billionaire behind Tesla, SpaceX and PayPal, has seen his reputation take a few significant lumps recently, following a series of big communications blunders that cost him much embarrassment and tens of millions of dollars.

To say it’s been a tough year so far for the South African would be a bit of an understatement. He accused a diver who helped rescue a Thai soccer team trapped in a cave a pedophile. He smoked weed and drank whiskey with podcast host Joe Rogan.

And then, there was his abortive bid to take Tesla private, via a Twitter announcement.

The incident resulted in the Securities Exchange Commission bringing forward fraud charges against Musk and ordering him and Tesla to pay $20 million in fines each. The SEC stated his tweet was misleading, and caused “significant market disruption.” The admittedly exhausted founder was also forced to step down as chairman, but will remain as Tesla’s chief executive officer.

Musk’s reputation from tech-visionary-billionaire to someone who seems on the brink of having a complete breakdown offers a cautionary tale for executives who have, or want to have, a high-profile public presence.

For starters, what you say has a material impact on the company’s finances. Musk’s decision to openly speak his mind and even vent his frustrations on Twitter has caused the company’s stock to roller coaster in recent months. The day he announced his intentions to take Tesla private, the stock shot up 11%, but later sank -- before rising again a few weeks later after admitting that keeping the company public was the best option. But the ride wasn’t over just yet. The stock then dropped 9% after video of him smoking marijuana on the Joe Rogan Experience podcast went viral.

Most shareholders prefer the price of their publicly traded Tesla shares to be influenced by sales of cars and overall company performance, rather than the social media musings of its CEO. I’d be willing to bet these sort of swings irritated more than a few investors, even though for day traders who quickly jump in and out of a stock, it could have been a great opportunity to make some money.

But back to Musk. His erratic behaviour has done more than just upset the share price. It has also been attributed to senior leadership leaving Tesla. Some 41 executives have left the company this year alone, including the firm’s chief accounting officer after only a month on the job. As we wrote a few weeks ago, sometimes employees have no choice but to leave after a leader of an organization acts out of line, and it seems as though Musk’s actions have contributed to some heading for the exits.

How executives interact with the media is also incredibly important, not just to the individual’s reputation, but that of the company he or she leads. Musk has had a testy relationship with reporters, and has found himself in hot water over the past year. He lashed out at Reuters and other outlets, accusing them of publishing false, defamatory stories designed to hurt Tesla. Picking fights with the media is rarely a good idea, and the proverbial honey almost always triumphs over vinegar.

Having good relations with the press is invaluable, especially for high-profile executives. It’s also important for leaders to know the rules and guidelines for interacting with reporters. As we always stress to our clients in our media training programs, it’s a best practice to assume that all conversations with a reporter should be considered “on-the-record,” meaning the journalist is free to use the comments made in any story he or she writes. Speaking “off-the-record” or on “background” is only appropriate when it’s mutually agreed upon by both parties. Simply prefacing an email to a reporter with the words “off-the-record” doesn’t make it so. Musk learned this lesson the hard way, when he wrote one such an email to BuzzFeed. Of course, his comments were published, this time on the subject of a British rescue diver allegedly being a pedophile. That diver is now suing Musk.

Even though Musk is probably one of the world’s most famous billionaires and whatever he says is bound to generate headlines, the fact is that what happens to him can happen to anyone in a position of influence. With social media ready to massively amplify any blunder, what leaders of organizations say has a bigger impact on the bottom line than ever before.

So, how to proceed? Think before you speak. Think before you tweet. Have an issues and crisis communications plan in place if necessary. And whenever you can, be nice to the press.

Bad company: when your organization’s reputation starts to hurt your own

Earlier this summer, there were a number of stories about current and former White House staffers complaining about not being able to date in DC thanks to their boss, President Donald Trump.

Many vented their frustration, saying they’re on a social blacklist because of their boss and his controversial (to put it extremely mildly) public profile. While the vast majority of these individuals probably never met Trump himself, or even supported all his policies, their association with such a divisive person negatively impacted their reputation.

Not being able to land a date is one thing. But what happens when staying on with your employer means tarnishing your professional reputation, perhaps permanently?

There are instances when public figures cross a line that is just too far, and require immediate action. Wanda Sykes, who was a consulting producer on hit show Roseanne, quit before ABC Entertainment had a chance to publicly comment on the racially-charged tweets sent by Roseanne Barr, which ultimately caused the sitcom to get cancelled.

The same can be said for top staffers in former Progressive Conservative Leader Patrick Brown’s office. When news broke of allegations of sexual misconduct against him, many of his closest advisors took to Twitter announcing their immediate resignation before Brown even held his press conference. They full well knew that in the court of public opinion, especially in politics, they needed to distance themselves from Brown’s now tarnished reputation.

Since quitting one’s job on a whim is not a choice many can afford, there are options for employees who find themselves being tarred with the same brush as the C-suite, or even the organization’s brand.

We spoke with Evangeline Berube at Robert Half Management Resources, the world’s first and largest specialized staffing firm, to gather some insights on what to do when your organization’s negative brand threatens your own.

Provident: At what point does a company's or a senior executive’s negative reputation begin to affect that of their employees?

Evangeline Berube: That really is dependent on the individual ideals of an employee. On one hand, they may not consider their leader’s reputation as having much of an influence on their day-to-day; on the other hand, a professional may feel their leaders’ reputations are representative of the work they do, and a reflect on their own.

More often than not, people want to support and work for companies that serve a larger purpose and help their communities. They want leaders who demonstrate a commitment to something bigger than themselves and may get disenchanted or disengaged with their own work when they feel that their manager doesn’t live up to their own vision of the organization. They may not feel proud of the work they do and start looking for an organization that better represents their professional and personal principles.

Successful businesses make goodwill, philanthropy and engaging corporate involvement part of their culture. This includes giving employees time and resources to dedicate to charitable and community activities and aligning leadership goals with individual goals.

P: Do employees have any options to help protect their personal reputation other than quitting?

EB: Everyone influences culture, whether they proactively try to or not. The best way for employees to protect their reputation is by entrenching a positive reputation for themselves among colleagues and within their network.

Lead by example, and embody the type of corporate culture you seek for your company. For instance, you can foster a culture of recognition by acknowledging colleagues’ work and celebrating their successes. Additionally, you can:

  • Talk to your manager about the culture you think is right for the company. If you’re looking for changes, don’t gripe. Talk about how the company can benefit and ways you can help.

  • Thank colleagues for their help.

  • Build rapport with coworkers, and take an interest in their well-being and that of the people network.

  • Be a resource for your colleagues and peers, including by offering to help when possible.

P: Does working for a company with a bad reputation impact future employment opportunities?

EB: In our experience, it has more of an impact on the business itself rather than the employees who work for them. It makes it more difficult to recruit top talent, and keep top talent.

When employees or job seekers feel that their leaders aren’t living up to the ideals of the business, or misrepresenting the values of their teams, they run the risk of their workers becoming disengaged, unmotivated, resentful and ultimately ready to leave.

When looking for future employment, how workers handle the way they left a company or leader they no longer related to may actually say a lot about them to future employers. Leaving on a positive note while maintaining their individual ideals, shows a strength of character and a commitment to professionalism.

P: Should employees speak out publicly against their employer to distance themselves?

EB: Sometimes silence speaks volumes. Ultimately, leading by example and living the ideals you want your leadership to embody says more about what you represent as an individual and as a professional.

As the famous saying from Warren Buffett goes “It takes twenty years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.” At Provident, we couldn’t agree more and have seen first hand just how fast things can change. That why it’s important to have a plan in place to not only respond to potential crisis, but also recover and rebuild any reputational damage sustained. We’d also like to thank Evangeline for taking the time to share her insights on this issue, and we hope you found it as beneficial as we did.

Why ‘no comment’ is never an option when your company’s values are on the line

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Giant companies with tens of thousands of employees aren’t typically known for their speed and agility when it comes to making decisions. Corporate bureaucracy can often bog down a company’s ability react quickly to an impending issue that needs immediate attention. And when that issue that has the potential to erupt into a full-blown crisis, speed is of the utmost importance.

That’s exactly what happened after an employee of Sonoco, the U.S.-based packaging company, was accused of racially profiling a black woman at a private community pool. A man approached the woman and asked for her ID, before calling the police. The incident was filmed by the woman, and the video was uploaded to YouTube and has amassed millions of views. It also quickly drew widespread condemnation and sparked calls for Sonoco to intervene after the man, Adam Bloom, was outed as an employee. Given how news travels at breakneck speed, Sonoco recognized that the actions of a single employee could have major negative repercussions for the company’s brand.

Realizing there was very little time to act to mitigate the damage this could have on its brand and reputation, Sonoco enacted their crisis management plan, which all companies must have in place in order to respond quickly. Had Sonoco not had a plan in place, you can imagine just how long a response might have taken.

Shortly after learning of the incident, Sonoco put out a well-written open letter from its CEO that touched on three key points that all company’s should do if faced with a similar situation:

  • Show decisive action has been taken, such as termination of employment;

  • Draw attention to the company’s values; and

  • Issue an apology on behalf of the company.

It’s of course important to note that even though the incident occurred outside work, the company’s values were at stake -- after all, a refusal to act or acknowledge the incident would have set a vastly different tone than the open letter from the CEO. Sonoco’s response clearly underscores the reality of today’s business world: companies must be ready to be held accountable for their employees’ actions both inside and outside work.

The manner in which Sonoco managed this particular issue is a lesson to firms big and small -- when a company’s values are breached, action must be swift and direct. ABC and Disney make for another example in their decision to cancel Roseanne Barr’s show because of her racist tweets. What not to do? A slow, plodding internal review or a refusal to comment are almost guaranteed to cause further reputational damage. Being open, transparent and willing to put actions behind corporate values is what the public expects, and what all companies must deliver.

Here's what to do when your company is facing its first reputation crisis

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No matter what industry they operate in, large companies sooner or later find themselves on the receiving end of customer anger. Regardless of whether the grievance has any merit, a chance also exists that a simple complaint could snowball into something larger, either through social or traditional media. At other times, a more significant event like a privacy breach, power outage, product recall or fraud can end up in the media directly, putting companies in a reactive or defensive position from the start.

The damage that a crisis can inflict on a brand can be significant and is well recognized. In fact, reputation damage ranked as the top risk in Aon's global risk management survey last year. Part of this is a recognition that reputations are built over the course of years and decades, but it can take just a few news cycles to do them serious harm.

As a result, big companies have sophisticated plans, information networks, crisis committees and various contingencies to help them quickly and effectively respond to a reputation issue. Most also routinely retain external experts to run simulations, audit their plans with an eye for constant improvement, and train leaders on how to respond to media inquiries when crisis hits.

But what happens when you're a startup or a mid-sized company which has enjoyed rapid growth with few hiccups, and you haven't spent a lot of time planning for a potential crisis? What do you do when the first headlines hit, the phone starts ringing and customers, suppliers, regulators and investors are demanding answers which you don't readily have available?

Speaking from experience with crises both large and small, getting external advice from a level-headed crisis management expert is a smart move. But over and above that, here are three basic, practical things you should do right away when your company faces a crisis for the first time, or you're unprepared. 

1. Find out who has the facts, and get them in front of your seniorleadership team as soon as possible.

It's absolutely crucial to immediately figure out who inside your business is the closest to the issue at hand and has the relevant facts. That's because factually accurate information is the bedrock of any crisis response strategy. Until you have at least some of the facts, there's little you can say externally, other than acknowledging you're aware of a problem and are looking into it.

In addition, if you prematurely make a comment which ends up misstating the facts, it can come back to bite you. Even if it's just an honest factual error, you could later be accused of trying to mislead your stakeholders, which can create another negative storyline for you to manage.

Once you've found the issue owner, get that person or team in front of your company's senior leaders - fast. This is not a time for sticking to a slow hierarchy before booking a meeting for the following day. Social (and, increasingly, traditional) media move in real time, which means you need to do so as well.

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Instead of waiting, meet immediately, hash out what you know and how you will find out what you do not. Make sure your communications team is at the table, as well. They'll be your main pipeline to external audiences, and the more plugged in they are early on, the faster you can respond. They should also be closely be monitoring social media sentiment and early media coverage online.

2. Formulate your first response

As soon as your leadership has all the early facts, agree with your communications team on who should respond to the issue, and how. It's most likely that your starting stance will be very factual and neutral in tone. Just as there are no second chances to make a first impression, this first public response will set the tone for how you handle the issue going forward.

Equally important: who will be your spokesperson? The reality is that organizational seniority of the spokesperson typically reflects how much attention the company is paying to the issue. In a fairly significant crisis, with a stock-price impact, your CEO likely would be the one to respond, at least to the top-tier media outlets in your industry covering the story. Meanwhile, your communications team should draft the messaging storyline, handle your response on social media, prepare written statements for customers, and line up media interviews. They should also quickly run your CEO through a mock interview to prepare her or him for the most likely questions.

If it's clearly obvious the crisis is due to your company's actions (or a failure to act), you should strongly consider a prompt and transparent apology. Sincere apologies garner good will with impacted stakeholders, and have been seen as a potential lawsuit deterrent. Lawyers sometimes counsel against apologizing, lest it later be seen as an admission of guilt in a court of law. That's a discussion to have with your legal team, but various laws now exist - depending on your jurisdiction - which protect apologies from being treated as an admission of fault or liability.

I've also seen a number of instances where companies refused to apologize for to their customers because they believed the fault was with a third-party supplier. That's a mistake. The customer is your customer, not the supplier's. 

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You should also be prepared to admit you don't have all the answers. During my communications career, I sometimes would hear crisis advisors say, "you have to control the story on your terms, so always stick to your messages, regardless of what you're being asked." Sometimes that works. Often, it does not. You will rarely be faulted for plainly stating that the situation is moving rapidly and that you're working as fast as you can to obtain the relevant information.

3. Keep the information flowing internally and externally

If you've promised you will do everything you can to get answers, then you should absolutely make sure you do it. That means that when your company's initial leadership meeting described in point No. 1 has concluded, the group should have already agreed to reconvene for a series of future updates. This is a critical time, and one where companies often lose control of the storyline. If the gap between your first response and follow up is too wide, you run the significant risk of letting other voices recast the crisis and tell the story for you.

As soon as you have more facts, and your leaders and internal advisors (legal, investor relations, compliance, and others) have had a chance to weigh the information and develop an update, you should share it externally across your social channels, and reach out proactively to the reporters covering the story. Don't wait for the phone to ring. If the media aren't calling you, you can bet they're calling someone else who might be providing them with inaccurate or biased information, intentionally or otherwise.

You should also consistently be going back to fact check that everything you're sharing internally and externally is verified as accurate before you disseminate it. It takes a lot of effort to pull back wrong information or to correct media reporting errors which you created with inaccuracy, so it really pays to double- and triple-check.

Here's something you likely won't be thinking about while dealing with the crisis, but should be: your decisions and actions should be recorded. When you have a moment, write down what you've done and how you've done it as it's happening. That will make any post-mortem of the crisis much more valuable and help prepare you for the future.

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Advice, perspective and experience

The three points above will help you cope with the initial impact of crisis. But if this is your first time at the rodeo, you really should enlist someone with experience in the arena. Perhaps you have a veteran executive on your advisory board, or maybe your head of sales chaired the reputation risk committee at the last company where she worked. In addition, outside advisors with crisis management experience can be brought in to help.

Lastly, you have to ensure that this is a learning experience for you and your company, and that you invest in preparing for the future. Proactive planning can drastically reduce your response times when the next issue hits, and there's no better time for it than right after a crisis.

I hope you enjoyed the post and if so, that you’ll take the time to like, share and comment!