Sooner or later, a company is bound to encounter a challenge that becomes a crisis moment. It could be something slower like adapting to a changing market—or it could be lightning fast, like sorting out a product quality nightmare.
As HR folk, these are the times that try our souls and scare the stuffing out of us, because as much as we’d like to control the moment, we really can’t. These crises often strike from out of the blue, snowball quickly, and impact areas of our business we would never have predicted. We have no control.
Except that isn’t true. We actually have complete control over these moments. Not in the mission command sense, but because we are the curators of culture in our companies, and culture is what is really put to the test when things go haywire.
To be clear… I’m not talking about a crack publicity or damage control team. Sure, these types of moments are often remembered as PR problems, and it’s true that they make great PR pros shine. But the first, last and continual line of defense is your employees. And the only way to solve these problems well and quickly is to tackle them in the trenches—where they start. If your employees are not willing and empowered to immediately address the issue, then the best PR folks in the world won’t be able to.
Here are five company cultures that rose to the occasion, saved their proverbial bacon, and made their leaders proud:
1. The Red Cross Drunken Twitter Faux Pas
What went wrong: In 2011 one of the Red Cross’ social media employees accidentally sent a tweet (see below)—which was meant for her private Twitter account—and didn’t realize it. It stayed up for about an hour before the company’s social media director was alerted and took it down.
What went right: The staffer who made the mistake was not fired. Social media director Wendy Harman merely deleted the offending tweet —which had already been noted and widely retweeted—and replaced it with an amused and amusing tweet (see below), then followed up with a blog post. Dogfish Beer Company reposted the tweet and encouraged people to support the Red Cross, and the two companies embarked on a creative, impromptu partnership that encouraged many donations in the following days and weeks.
How culture saved the American Red Cross: Humor might not be one of the American Red Cross’ values, but compassion is. “While we’re a 130 year old humanitarian organization, we’re also made up of human beings” wrote Harman on the ARC blog, “Thanks for not only getting that but for turning our faux pas into something good.” This adherence to the company’s values of compassion and creativity, far from hurting the Red Cross, managed to turn the incident into a fundraising opportunity and spawned a whole host of tweets like the one below.
2. Xerox Back from the Brink of Bankruptcy
• We succeed through satisfied customers.
• We deliver quality and excellence in all we do.
• We require premium return on assets.
• We use technology to develop market leadership.
• We value and empower employees.
• We behave responsibly as a corporate citizen.
What went wrong: When former CEO Anne Mulcahy took the helm of Xerox in 2000, the company was $18 billion dollars in debt, and a one-day, 26 point stock tumble had advisors pushing for a declaration of bankruptcy. One customer suggested: “You’ve got to kill the Xerox Culture [to survive.]”
What went right: Mulcahy agreed that the Xerox business model was unsustainable, but her famous retort to that customer was “I am the culture.” According to a 2008 US News article “she met personally with the top 100 executives. She let them know how dire the situation was and asked them if they were prepared to commit. A full 98 of the 100 executives decided to stay, and the bulk of them are still with the company today.” Within 8 years, the company had paid off its debt, and revamped its product offering and business model.
How culture saved Xerox: Mulcahy was a champion of Xerox and its values—including that of corporate responsibility—and she believed in the loyalty of customers and especially employees. Those employees understood what was at stake and they did not let her down. “We wouldn’t have survived if we didn’t have that love and loyalty,” she told US News. “And it stems in some measure from our heritage as a good corporate citizen. So for us…our past behavior was like money in the bank. It gave us a reservoir of goodwill that we could draw upon in our hour of need.”
3. Chobani Exploding Yogurt Cups
• Giving Back
What went wrong: In 2013, Chobani cups started exploding off grocery shelves—literally. A small batch of product had acquired a bacteria that caused a pressure build up inside the cups—and—unfortunately—inside the bellies of quite a few customers.
What went right: The company immediately recalled all yogurt cups made in its Idaho plant, and staffers (including the CEO) jumped onto social media to apologize and to personally address every tweet that registered concern over the incident. According to the Wired blog, the brand replied to over 3,600 tweets in just 5 days. And AdAge reported: CEO and founder Hamdi Ulukaya “wanted to write a personal letter to each of the 150,000 people that had an issue with our product because he takes it very personally and very seriously, and he wanted to thank them for … sticking with us and standing by us.”
How culture saved Chobani: The company’s focus on integrity and people saved the day here. So did direct participation and leadership by the company’s CEO, who led the charge. The company’s direct and forthright handling of the matter meant that Chobani did not even suffer a sales hit –according to AdAge.
4. PepsiCo The Syringe in the Pepsi Can
• Care for our customers, our consumers
and the world we live in
• Sell only products we can be proud of
• Speak with truth and candor
• Win with diversity and inclusion
• Balance short term and long term
• Respect others and succeed together
What went wrong: In 1993, a man in Washington State allegedly found a syringe needle in a can of Diet Pepsi. Within days, reports were bubbling up from across the country. Claimed discoveries included a wood screw, a bullet, a crack vial, a broken sewing needle, and a mysterious blob of brown goo.
What went right: PepsiCo denied the reports immediately and vehemently. Across the company, employees spoke with one voice to quickly proclaim the assertions false and defend the company’s quality. The company’s employees immediately released videos and other documentary evidence to support its innocence. They were vindicated when the claims were easily revealed as hoaxes.
How culture saved PepsiCo: PepsiCo had the strength of its convictions because of a strong culture of quality, respect, loyalty and transparency, and a fierce pride of ownership in the quality of its product. Because employees were so closely tied to their culture, and because they had the sort of transparency that imbued them with trust, they were able to easily take down the false claims and maintain their position as a market leader.
5. Johnson & Johnson The Cyanide in the Tylenol Capsule
• The Johnson & Johnson Credo, set down by the company’s founder Robert Wood Johnson II in 1943, puts the company’s responsibilities in the following order: doctors, nurses, patients, mothers and fathers first, employees second, communities third and shareholders last.
What went wrong: In 1982, the home health care giant was rocked when seven people in Chicago died after consuming Extra-Strength Tylenol capsules laced with potassium cyanide. According to CEO at the time, James Burke: “Innocent people were killed. Industry analysts and advertising experts told us that Tylenol was finished.”
What went right: McNeil Consumer Products, the subsidiary of Johnson & Johnson which made Tylenol, immediately pulled 31 million bottles of Tylenol product off the shelves nationwide (a loss of $100 million in revenue) and halted all advertisement for the product.
How culture saved J&J: This is the textbook case that is taught in schools. Johnson & Johnson’s former CEO, James Burke, has credited J&J’s quick and thorough response to the Johnson and Johnson Credo. The decision to pull product off the shelves was made—not by the CEO—but by a brand manager. Which shows how thoroughly J&J’s credo had saturated its culture, and how thoroughly the company empowered its employees and subsidiaries to live its values. Thanks to their approach to the crisis, the best-selling brand of painkiller remained the best-selling brand.
So how do you build the kind of culture in your company that can save your bacon when it gets tossed into the frying pan? Here are five important principles for future-proofing your culture:
- Empower your employees – Keeping your culture securely in the hands of your employees, and empowering them to understand and act on that culture, is instrumental in preventing a melt-down when crisis hits. Build a culture where employees feel ownership and are encouraged—even obliged—to participate as stakeholders.
- Trust your employees – Of course it isn’t enough to teach your employees how to drive—you have to be willing to hand over the keys and trust them to steer. Tylenol survived not because senior leaders acted quickly, but because the brand manager acted quickly, and with faith that the right action would be supported. And it was.
- Embed your values – Values are useless unless employees know exactly what it means to put them into practice. In each of the cases above, employees understood exactly how to act on their company’s stated values, and that made the difference. Get your values off the wall and make them actionable.
- Create emotional infrastructure – Xerox would never have survived without the strong emotional ties among its employees and between employees and the company. Offer opportunities for employees to strengthen those ties.
- Build resilience – The best culture in the world will avail you nothing if everyone is paralyzed by trauma. Make sure you build resilience into your culture by making available resources, relationships and emotional support to help them recuperate from stress, conflict, failure, or changes in responsibility.
Cultivating your culture through these simple principles will help your company successfully weather any storm, and come through stronger than ever!