Archive for the ‘Employee Relations’ Category

My Boss is a Sadistic Cockroach

December 6, 2011

The National Labor Relations Board has recently begun warning employers that restrictions on employee use of social media may violate labor laws for both union and non-union employees.  This is because the 1935 Wagner Act generally protects the right of employees to talk to each other to discuss employer conduct, wages and working conditions, so-called “concerted activity.”  According to legal experts cited in yesterday’s Wall Street Journal, name-calling plain and simple probably isn’t protected, but more than a 100 employers have recently been accused of improper application of social media policies as it relates to employee comments online.  The NRLB has so far left a number of areas unclear such as the relevance of an employee posting a rant from a workplace computer, but it seems clear to us that this is another case in which employers need to be very cautious about censoring or firing employees for anti-company or anti-supervisor statements.  The NLRB may yet deem that a posting on Facebook by someone with workplace colleagues as friends constitutes de facto “concerted activity.”  This is just another area in which social media has opened up a new avenue for potential reputational damage and a further reason why handling your “talent” well has become a critical brand strategy.


We Are the J Students! We Are Proud!

August 19, 2011

Yesterday’s news brings yet another tale of unanticipated reputational threat arising from the terminally outsourced world in which we currently live. We can, I think, confidently say that the Hershey chocolate company never in its wildest imaginings considered the possibility that employing international students through a government program would become a “sweatshop” flash point as reported in today’s New York Times 

This most recent example of the networked enterprise focuses our attention once more on the critical need for employers to have transparency in their supply chain.  Many years ago, energy companies tried to argue that because the tanker truck in the freeway pile up was operated by a contractor, they bore no responsibility.  That argument didn’t wash then and any suggestion that a long outsourced HR supply chain absolves Hershey of responsibility for work performed to get its own product to the end customer would be equally wrong.  The vigilence is all, and having ordinary managers who can spot an obvious disconnect when they see one.

The Market State

November 17, 2010

Last year, corporate executives spent a lot of time talking about the problem of headwinds in a difficult economy.  They never talk about tailwinds in a good economy but that’s another story.  What they have talked about this year is “uncertainty” by which they apparently mean excessive government regulation brought on by the global fiscal crisis. A McKinsey white paper published earlier this year suggests that companies would be better off preparing for much more activist national governments and the challenges they will present than whining about uncertainty.  The authors of the study suggest that the challenge for sovereign states in dealing with slower economic growth while still providing affordable safety nets will entangle the private and public sectors in the future in ways that are unthinkable in today’s developed economies.

While there are clearly financial and operational implications of this shift, there are also reputational dangers and opportunities.  If McKinsey’s predictions are correct, the term corporate social responsibility may take on entirely new meanings.  U.S. companies have long bemoaned the emergence in the 1950s of employer-supported health benefits.  If the market state is truly the wave of the future, they may have seen nothing yet.

Governing in Prose

July 13, 2010

On WNYC’s Brian Lehrer Show today, Newsweek’s Jonathan Alter and The Nation’s Katrina Van den Heuvel commented on the disappointment being expressed by Progressives that President Obama has not fulfilled his promise as the passionate evangelist for transformative change.  One of them cited Mario Cuomo’s adage that “we campaign in poetry but we have to govern in prose.”  Inevitably, the name of the “Great Communicator,” President Reagan, came up and we got to wondering about business leaders: how important is the silver-tongued CEO and how effective are powerful speeches delivered to internal and external audiences in today’s consciousness?

But first, back to Ronald Reagan. In the 1950s and early 1960s, Reagan spent more than 4,000 hours in front of a microphone on behalf of GE talking to workers, chambers of commerce, executive clubs and political groups extolling the importance of the free enterprise system.  It was pretty good practice, but he also had the advantage of belonging to the generation of Americans who could take credit for two victories — surviving the Great Depression and defeating fascism.  This made for simple and arresting images.  Here’s an excerpt from a campaign speech when he was running against Gerald Ford in 1976: 

“No one who lived through the Great Depression can ever look upon an unemployed person with anything but compassion. To me, there is no greater tragedy than a breadwinner willing to work, with a job skill but unable to find a market for that job skill. Back in those dark Depression days I saw my father on a Christmas Eve open what he thought was a Christmas greeting from his boss. Instead, it was the blue slip telling him he no longer had a job. The memory of him sitting there holding that slip of paper and then saying in a half whisper, “That’s quite a Christmas present”; it will stay with me as long as I live.”   Cue Tiny Tim.

If managing people is the biggest challenge in business, as Stefan Stern comments in his column in today’s Financial Times, is there in fact a role for great business leader/communicators motivating and inspiring employees through in- person and videotaped speeches?  We think there is, but in today’s global economy it can’t be “Morning in America.”  The effective CEO needs to speak to the aspirations of employees all over the world for satisfying work, economic betterment and improvement opportunities.  The call to employees must be to ask for their help not only to innovate and solve difficult challenges, but to become co-stewards of the world’s resources.  To be ingenious in response to our dwindling natural assets.  These are messages that could resonate with Reaganesque vibrancy anywhere in the world.  Perhaps, after all, we can manage in poetry.  President Obama could, too.

The King is dead! Long live the King!

July 2, 2010

The orderly succession planning  recently announced at JPMorganChase stands in stark contrast to the unanticipated executive departures and botched successions that crop up routinely at many American corporations.  This contrast accentuates the dual nature of the succession/replacement issue.  A well-run company needs a contingency plan to ensure that there is a back-up in case of  the illness or departure of a key executive. It also needs a credible narrative to support a transition even when unexpected.  The need for this narrative becomes especially acute when a company suffers from a string of what are almost always unrelated senior exits, but in the marketplace are construed as that noxious form of negative momentum — the mass desertion.  Once established, this storyline can be very hard to eradicate.  Naturally, it strikes hardest in those organizations where much value resides in individual players — technology, health care, professional and creative services.

There are limits to the available mitigation strategies.  The research genius or marketer with true flair can have an enormous impact on a company’s fortunes.  However, there are some prophylactic measures available to head off the threat of negative momentum.  The first of these is to have agreement in advance about what you would say if a key executive left to join a competitor or retired unexpectedly and have a narrative that explains why the departure, while regrettable, does not throw the company off track.   This usually involves pointing to the strengths of the overall team and the credentials of executives moving into new positions.  This is hard to pull off convincingly in the heat of the moment which is why it needs to be agreed upon before it happens.

 The companion piece is for the CEO and his or her senior communications counselor to keep a quiet watch on the publicity generated about individual performers in successful business units.   Some executives like the limelight more than others, and publicity for the individual is usually also good for the firm in the short-term.  What communicators need to ensure, however, is that  there is a good balance of visibility amongst key executives both internally and externally.  Enlist lots of them in company thought leadership.  Reach down into the middle ranks for executive profiles whenever possible so that dark horse replacements, when needed, aren’t quite so dark.

No solution is fool-proof but a few steps like these can help deter the negative narrative.  Perhaps if Saul’s publicists had hyped their favorite Pharisee just a little less, the conversion of St. Paul would have been nothing more than an HR problem.

Human Costs of the Global Supply Chain

May 26, 2010

According to The New York Times, Foxconn, the Taiwanese company suffering from an unexplained spate of employee suicides, has 420,000 employees at just two manufacturing sites in China.  An eleventh victim took his life just hours after the company apparently announced that it would ask employees to sign a contract promising not to harm themselves or others.

In a sign that American companies grasp the reputational ramifications of events in their extended supply chains, Business Week reports that Apple and Dell are investigating Foxconn’s strategy for dealing with the problem.  This is a crucial step forward and goes significantly beyond the passive monitoring schemes that have been the conventional response.  Certainly, many American companies have switched suppliers found guilty of  ethical lapses, but intervening directly in this manner represents, we would argue, a qualitative shift.  The speedy response is admirable and it will be fascinating to see whether there are collateral effects.  What about the workplace practices of the suppliers to the suppliers and how far down the supply chain do American companies need to be alert?  Will IPhone customers tolerate learning about factory cities of 200,00 in which 22-year olds much like themselves work on assembly lines that move every seven seconds, as one worker quoted by Business Week stated?  We can only hope that other electronics brands for whom Foxconn manufactures smartphones have their statements at the ready.  You know who you are.

M&A in Social Media

April 7, 2010

The recent merger of The Stanley Works and Black & Decker brings into elegant focus the new challenges a social media presence creates for merging organizations.  Or perhaps one should say presences, because once you add up corporate Facebook fan pages, product line Facebook fan pages with corporate and product line Twitterfeeds things start to get messy.  And we haven’t even mentioned corporate and product web pages.

The divergent desires of creating a unified new front for investors while at the same time maintaining brand intimacy for customers of the legacy brands are laudable.  However, when each social media encounter with a company offers a different experience, stakeholders might be permitted a minor twinge of confusion.  Stanley Black & Decker has a relatively broad use of social media which is admirable, but when some of their platforms mention the merger and others don’t, when some tweets enthusiastically embrace the merger and Facebook fan pages respond to queries and yet the YouTube channel ignores comments, one is left with an odd feeling of dislocation.

One suspects that the primary reason for this is the logistical challenge of coordinating platforms managed by different entities inside the two organizations within a brief timeframe, but clearly this is a skill that companies will need to acquire.  We believe that it is this kind of muddle that will ultimately drive companies to create strategic content for all stakeholders in every social medium rather than living on in the vain hope that they can use Facebook for recruitment, the web site for investors and Twitter for customer complaints.  As the economy heats up and M&A returns in force, more than a few companies will have to figure out a process for managing their social integration.

Vale of Tears

March 11, 2010

Today’s Financial Times’ story about Vale’s acquisition of Inco, the Canadian nickel mining company, perfectly captures the cultural quagmire created when emerging economy companies take over developed economy companies.  The arrogance and the condescension from employees of the acquiree, miners of the finicky metal nickel (the PhDs) towards the prickly Brazilian miners of “mere” iron ore (High School Diplomas) were, it appears, a perfect match for each other.  It was utterly predictable that the Brazilians would resent (and abolish) some very large Canadian bonuses and that the Canadian unions would treat these (newish) bonuses as non-negotiable entitlements.

Precisely because similar transactions (and struggles) will be playing themselves out repeatedly in the coming decades (“if you’re so smart, why did we take you over?!”), we should agree on some basic principles to make these marriages more successful:

1) Leaders of the acquisition target should start talking up the benefits and the potential sacrifices with employees early on, before the hatchet man from the acquirer arrives.

2) The acquirer’s representative should be a diplomat first and a technician second, with the skills to make a meaningful effort to get the target’s unions and workers on board as much as possible by inviting their input and advice.

3) The acquirer should avoid acting as if the acquisition is a conquest (even when it is) and resist the temptation to lash out when condescended to.  Flattery and firmness are not antitheses.

4) The acquirer should clearly communicate goals but be flexible about implementation wherever possible.

Are these guarantees of success? No, but now the shoe is on the other foot, it wouldn’t hurt the Brazilians and the Chinese to learn the “local” culture.  It’s so much easier that way.

Corporate Chauvinism

December 11, 2009

Much has been made of the trenchant language in Jeff Immelt’s speech at West Point about how “toughmindedness, a good trait — was replaced by meanness and greed — both terrible traits.”  He followed this statement with a powerful acknowledgement that few corporate leaders would have made that “the bottom 25 percent of the American population is poorer than it was 25 years ago.”  He deserves our applause for this candor.

Yet the bulk of the speech is dedicated to making a commitment to rebuilding manufacturing in America, a personal commitment by Immelt himself.  I have no doubt that GE can pull this off, but the speech should be a warning to other corporate leaders who may be tempted to tread in the “build American, buy American path.”  Leaving Chinese complaints of preferential treatment aside, the commitment to rebuilding American middle class jobs while competing in the global export market will be much easier to talk about than execute.  Those speechwriters warming up their quills to provide CEOs with a seasonal hot toddy of  patriotic good feeling need to think carefully how they pen words that could come back to bite their masters.  In the area of U.S. job creation, better to let actions speak for themselves.

Iron Laws of Demographics

December 9, 2009

As predictably as planetary orbits, pundits are now saying that the economic crisis has transformed the employment strategies of Millennials.  You remember yesterday’s meme about this cohort: no fixed career path, multiple employers, frequent job hopping, zero loyalty.  Today, research shows (of course) that the number of 20 somethings who expect to spend a lifetime with a single employer has risen sharply.  In the snapshot in time department, this definitely falls into the “oh, really?” category.

None of us particularly loved the war for talent (1997-2001) and certainly the basketball court in the cafeteria phase stands out as ludicrous, but employers who think they can take the nurture of employees off  their priority list would be making a big mistake.  That’s because nothing has abolished the iron laws of demographics.  Yes, Baby Boomers may stay in the workforce longer than they had planned, but we are fast approaching the point where the available supply of Gen Xers with talent is overwhelmed by the number of  leadership positions vacated by departing Boomers.  Since leadership talent correlates strongly with corporate performance, now is definitely not the time to roll back performance-based compensation, career-pathing and effective employee motivation and communications.  In fact, it might even be worth looking at your benefits package to see how well it serves the 35-45 year old life stage of your employee base.