At LinkedIn and Carrier, videos, jobs, and trust in a crisis
Recently, the CEO of LinkedIn, Jeff Weiner, explained the company’s future in the wake of a 45% drop in the company’s shares. At around the same time, an executive at Carrier air-conditioner factory explained that 1,400 people would lose their jobs. It’s clear from the videos that the LinkedIn leader was successful, while the Carrier executive was a failure. Why?
Why LinkedIn’s employee communication is a success
Let’s start with Jeff Weiner, whose video you can see below. LinkedIn’s 9,200 employees are mostly white-collar professionals. For many, their futures are likely tied up with stock options or stock grants. A 45% drop in the stock price is devastating.
What you can’t see in this video, though, is Weiner’s ongoing communication with his workers. He communicates regularly about market conditions (the label on the video is “bi-weekly meeting”). More importantly, he is sharing information about the company’s goals and its future. As a result, for these employees, this setback takes place in a broader context. Weiner does this:
- Lead. Articulate something worth following.
- Tell the truth. Don’t shy away from the facts.
- Provide context. Explain why this is happening.
- Explain the future. Weiner shows how the world is changing and what it means for LinkedIn.
- Share a plan. Weiner goes on to share the company’s plan (although we don’t get to see it on the video).
In my opinion, LinkedIn’s future is still in doubt — the site and app are a mess. But with a reasonable plan, the company can mobilize its workforce to solve those problems.
Why Carrier’s employee communication is a failure
We don’t have the full context for the Carrier video, shown below. But it’s clear that 1,400 people, many of them in the room, are going to lose their jobs in the next three years, starting in mid-2017. This situation is not comparable LinkedIn — the employees are blue-collar, represented by a union, and they’re going to experience job loss, not just a loss of stock option value.
The employees in this video appear to have an adversarial relationship with their management. If I were at Carrier, here’s what I would have done differently:
- Keep employees educated. Keep them in regular touch with market conditions, so they understand the context. You can’t do this in one announcement, it has to happen over time.
- Express some sympathy. There is no “we” in this room. The announcement would have gone far better if the executive and union representative had made it together. Instead, the executive treats the employees as if he is the principal and they are unruly children.
- Immediately explain next steps. Carrier has a 3-year timeline for the shift and will doubtless provide outplacement services. That explanation deserved to be at the center of the announcement.
- Don’t spend time justifying yourself. The executive refers to why this is the best decision for the company. That justification helps shareholders understand, but for workers losing their jobs, it just creates anger.
What it means for leaders and communication
If you’re a leader, you’re going to have to share bad news. You should prepare now. Here’s what to do:
- Start a regular employee communication. Use written and video communications to explain the company’s situation to employees. Ideally, you’ll also be in a position to answer questions and take suggestions as well.
- Put a plan in place now for crisis communication to employees. If something goes wrong, what will you do? Think it through now, not when the crisis happens. Speaking to staff is just as important as speaking to the public and customers.
- When you communicate the problem, start with a clear explanation. Tell the truth, as briefly as possible.
- Express empathy, and use “we.” Be sympathetic, not defensive. Do this quickly, don’t dwell on it.
- Explain what it means for the workers, and for the company. People want to hear about their futures. This should be the focus of what you say.
- Include written materials. In contrast to in-person announcements, with written materials you can get feedback and make impreovements, even if you must act quickly. And workers are far less likely to misinterpret and misremember what you’ve written. Post explanations that match what you’re saying.
As someone who has managed in a union environment, I’d just point out how difficult is to do the things you suggest. Everything from communication to collaboration changes. I think it is unfortunate that unions and leadership cannot find a way to create a more cohesive and collaborative relationship.
Like most companies, Carrier is trying to find ways to cut payroll costs, and telling people this is the only way to survive. I find this incredulous when the company made a $2.8 BILLION profit last year, which was UP a whopping $310M from the year before. The company I’m contracted to just made an 8% (specifically white-collar) cut at the end of last year, blaming market conditions, but they made a $1.4 BILLION profit last year.
Screw this noise of what color your shirt’s collar is, it’s really tough to explain to PEOPLE that you can’t afford to pay them market wages when you are simulataneously bragging about these kinds of profits to Wall Street. That’s going to be tough to explain to ANY group of impacted people. At least the Hostess situation (again, here in Indiana) was more clear: the union had to accept payroll cuts or the company was going to fold. They wouldn’t, and it did. (Good job, union!)
Every annual statement these days likes to brag about “corporate reposposibility,” defined as recycling, using CFL lights, and donating time to United Way. These are “responsibilities” to shareholders to absolutely maximize profitability, so other suckers want to buy the shares for more money than they currently cost. I propose a new definition of corporate responsibility; one that defines responsibility with respect to the people who got you where you are: pay market wages to keep jobs in the US when you can clearly afford it.