The holidays arrived early for crisis communication fans. There was no shortage of stories to peruse. All featured ghosts of crises past, whose protagonists we’ve covered in Crisis Insider.
With few exceptions, all these crises were mishandled in some way. Only the first one, where the owner of a sports team attacked a budding difficulty directly, refusing to issue an anonymous statement, was handled well. Nonetheless, the best teacher sometimes is a mistake. The crises of this last month of 2021 had plenty of them.
First was the Jacksonsville Jaguars’ Dec. 16 firing of rookie coach Urban Meyer. In October, we wrote about Meyer, a legendary college coach, after he failed to fly home with his team, winless after five games. Instead, after a loss in Ohio, he remained to ‘visit family.’
That ‘visit’ included interactions with a young woman, who was not his wife, at his restaurant. Some of the visit was caught on video, which went viral.
As we said at the top, notable was that team owner Shad Khan eschewed an anonymous statement from a team spokesperson.
Instead, he approached the situation directly and relatively quickly, whacking Meyer’s “inexcusable” conduct. In his statement he added, “Now, [Meyer] must regain our trust and respect.”
A subsequent lack of on-field success (the Jaguars had two wins, 11 losses when Meyer was fired) didn’t help the coach regain trust or respect.
More important, though, were off-field issues. Meyer’s first hire had to depart quickly after reports of racist remarks. On top of that, rumors circulated that Meyer belittled his assistant coaches and kicked a former player, who, ironically is a kicker. The kicking incident proved too much for Khan. Still, his initial handling of Meyer is the best example of crisis response on this page.
Open Your Wallet
Next was the crisis about the CEO of McDonald’s. No, not the current one; Chris Kempczinski, who, in text messages to Chicago’s mayor, blamed parents for drive-by shootings of their small children. We’re talking about Kempczinski’s predecessor, Steve Easterbrook.
A clean-cut Harvard MBA, Kempczinski was hired in 2019 to erase the unsavory culture of Easterbrook’s late-night parties and sexual episodes. Kempczinski was doing that until those text messages were unearthed last month. But back to Easterbrook.
A year after Easterbrook’s ouster, McDonald’s sued its former CEO, alleging he didn’t merit his generous departure package.
On Dec. 16, the day coach Meyer was fired, Easterbrook settled with McDonald’s, agreeing to return $150 million.
And December brought more crisis-resolution magic. The legal ordeals of two of crises’ most infamous women, former billionaire and Theranos founder Elizabeth Holmes and Jeffrey Epstein pal Ghislaine Maxwell, concluded, almost precisely at the same time. It’s up to the juries now. Will they find Holmes and Maxwell naughty or nice?
A Stitch in Time Doesn’t Save 900
A far less festive event, though made all the more bitter because of its proximity to the holidays, was the firing of 900 employees en masse earlier this month.
Even worse, Vishal Garg, the CEO of Better.com, a start-up mortgage firm, conducted the firing on Zoom.
“If you’re on this call, you are part of the unlucky group that is being laid off,” Garg said. “Your employment here is terminated effective immediately.” The empathy-less video lasted three minutes.
Worse, later Garg confirmed he’d posted messages on a site, Blind, blasting some of the fired employees, complaining they were working just two hours daily instead of eight. In a subsequent call to staff, Garg said he should have fired the employees months ago.
As the story of this modern-day Scrooge went viral, Better.com CFO Kevin Ryan attempted to rescue the company’s image. He noted layoffs always are difficult, but the company was preparing its balance sheet for a difficult 2022.
A few problems with that non-apology apology. One is that it doesn’t track with Garg’s blasting of employees for not working hard. In addition, the optics were awful. Days before Garg’s video, $750 million was placed on the company’s balance sheet. Better.com was flush with cash when the 900 were cut.
Eventually, Better.com’s board acted, putting Garg on indefinite leave as it “reassesses” company culture and leadership. Will Garg become former employee 901 on the termination list?
For Dr. Kerry O’Grady, faculty director and associate professor of practice at Georgetown University School of Continuing Studies, this crisis is definitely not averted.
“It’s going to take many, many years, if at all, to resolve itself,” she says. “They’ll have to make substantial changes…not just putting [Garg] away in a box for a while.” The 900 former employees will talk about this for a very long time. “And that video will never go away,” she says.
O’Grady advocates “a substantial apology” from Better, where it should say clearly, ‘We handled this badly.’ Moreover, the apology should include firing Garg, something for the 900 former employees and “a whole bunch of ethics and sensitivity training for leadership…and all this needs to be public.”
Peloton’s ‘Big’ Ride
For many, the company’s ad, starring Chris Noth, was a brilliant rejoinder. Not for O’Grady.
“You never respond to celebrity with celebrity,” she says. Better to emphasize facts about the benefits of exercise, she says. O’Grady spoke to us a week before Peloton was forced to drop the ad owing to sexual assault allegations against Noth. Peloton may have sacrificed vetting Noth in favor of producing a quick response. It’s not Peloton’s only issue.
Our last crisis contains elements of the McDonald’s incident. In both cases a leader hired to reform a scandal-heavy culture committed mistakes.
Here, Credit Suisse chairman Antonio Horta-Osorio admitted he broke Swiss quarantine rules. He left the country three days after returning from a trip to Lisbon. At the time, Switzerland had a 10-day quarantine rule.
Worse, reports emerged that Horta-Osorio tried to evade conditions of the quarantine before breaking it just days later. Adding to the poor optics, he also apologized saying he unwillingly broke the quarantine.
“This is a great example of not walking the talk,” O’Grady says. Indeed, Swiss media is questioning Horta-Osorio’s ability to resuscitate the bank’s reputation if he can’t follow simple rules.