More Pressure To Speak Out
More Pressure To Speak Out
Over time, as purpose became a critical part of organizational identity, some companies began using their voice to support or oppose certain political issues. But after the murder of George Floyd, what was a trickle became a flood as corporate websites filled with passionate denunciations of the tragedy and statements connecting change to their own internal efforts.
The statements were mostly well-intentioned—but also opened up companies to criticism if they opted not to speak out about other situations. Why would a cosmetics company speak out against animal testing, but then ignore a law that affects women, who account for most of their consumer base? Who decides what is worth responding to and how? What is the definition of a crisis?
As the speed of events—and the even faster speed of public backlash from some of those events—accelerated, companies had to move from an ad-hoc process to a much more formalized approach. Said Jano Cabrera, chief communications officer at General Mills: “If you look at any company, they speak on some issues and not others. The filter they should have is, ‘Does this align with the company values? Is our voice expected to carry weight? Are we speaking on behalf of all employees or some?’ It’s like solving a Rubik’s Cube; you need to line up different sides to make it work.”
Even with a great process, the situation remains fraught, and many executives shared their concerns about how hard it is to strike the right balance. Leaders must also prepare for a possible hit to the bottom line, as highlighted by Disney’s struggles in Florida after the company at first did not react to and then spoke out against the “Don’t Say Gay” bill. It’s no surprise that members cited “brand” as the second most important factor when making complex decisions, after the employee response, according to the survey (Figure 4).
Others see the current period as a slippery slope but think they have a responsibility to act. Said D.G. Macpherson, CEO and chairman of industrial supply company Grainger: “People in general don’t have trust in government, so they are looking to business leaders to help them understand. I had to get smart about what was going on. Being a calming but factual voice is important.”
Medtronic:
Operationalizing a Crisis
When COVID-19 wreaked havoc in March 2020 and companies scrambled to adapt, medical technology company Medtronic had just updated its approach to crisis management. It seemed like good luck, but it came out of bad luck. The company, the largest employer in Puerto Rico other than Walmart, had suffered massive damage to its facilities due to Hurricane Maria. The disaster pushed the Medtronic team to build out a robust crisis-response function that has been able to act on the multitude of challenges facing business today. Said Anita Tuch, vice president of enterprise risk & facilities: “It took crisis planning from the back room to the front room.”
Unlike many other companies, which often run their crisis response teams out of HR or communications, Medtronic decided to put its team under the operations function, dividing it into three segments: enterprise risk, crisis management, and business continuity. “Enterprise risk is higher-level—what gets reported at the board level,” Tuch said. “Inability to deliver on the portfolio or missing out on game-changing developments are examples.” Crisis management consists of coordinating responses among people, operations, and reputation teams. Business continuity efforts focus on the identification of critical operations, the order of restoration, and recovery strategies. All of these groups now report to Tuch.
But what qualifies as a crisis? That determination is made by a crisis filter team—typically Tuch and a fellow vice president—which uses a list of criteria and has two executive sponsors. The two sponsors are executive committee members: Medtronic’s CHRO and executive vice president of global operations. The actual crisis management team includes communications, security, HR, employee relations, and supply-chain representatives. Together, they make decisions with input from each of these groups. The regional team focuses on providing consistent corporate and site support whenever needed, but the local team takes the lead by keeping operations going on the ground while engaging with the corporate team.
When a crisis emerges—be it the war in Ukraine or another COVID-19 outbreak—the lead is given to one of these three groups, starting with a core group of 10 people that can be scaled to 40 as needed. This team hierarchy creates a clear chain of command while at the same time enabling “great collaboration across the business,” explained Tuch.
The plan was activated during the recent lockdown in Shanghai, where Medtronic has a presence. The corporate team worked with local crisis leadership to find ways to support employees as well as patients during this critical time, while the reputation team presented a statement to the executive committee. According to Tuch, it worked because of the formalized collaboration. “You have people who are giving this more mindshare because it’s part of their daily responsibilities,” she said.
