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reputation

Brand Down: When Your Boss Gets The Boot

//  by Peter LoFrumento Leave a Comment

Sometimes in business the signs of things to come are right in front of us.

This was the case recently when I was asked to assist the communications department of a prominent lifestyle services company with the sudden departure of their longtime senior executive.  

Her departure followed a rash of similar unplanned high-profile transitions that seem to signal a period of waning CEO tenures. 

They included Kevin Systrom (Instagram), Indra Nooyi (Pepsi), Matthias Müller (Volkswagen), Lloyd Blankfein (Goldman Sachs), Les Moonves (CBS), John Schnatter (Papa John’s) and Brian Krzanich (Intel). 

Some of these chief executives were forced out, some exited having guided their companies to relatively solid success, and some simply retired.

But collectively, they serve as a useful wake-up call for board directors and managers who fail to appreciate the importance of having an effective plan to handle sudden executive changes. 

In the case of Instagram, Systrom’s puzzling departure not only disrupted the social media network, but also caused a leadership void in the Facebook-Instagram pairing because Systrom, along with co-Founder Mike Krieger, had shaped virtually everything about Instagram’s culture and product for the past six years. 

Where these cults of personality exist – companies whose reputations largely ride on one executive or a small group of them – the firm’s brand becomes particularly vulnerable following the sudden departure of a key executive (a.k.a key man risk). 

This is because the event itself creates a notion of instability that not only affects a brand’s trustworthiness among customers, but provides a window of opportunity for competitors to maximize. 

It’s much different when an existing CEO or key player announces ahead of time that he or she is exiting and their company has enough time to properly pick a successor and message appropriately for a smoother transition.   

But in the case of Instagram and numerous other companies where executive departures occur unexpectedly, there’s an immediate perception of a leadership vacuum, which stakeholders abhor. 

And the longer there’s a vacancy in leadership, the more likely the media and your competitors will control your company’s narrative and in turn, negatively impact your brand’s reputation.  

Just think about the stories that typically follow a leader’s abrupt departure which feature allegations of customer unrest, poor performance and declining employee morale. 

If your company is facing this difficult scenario, there are few steps you can take to avoid damaging your brand: 

boss

1. Communicate who is in charge. You need to reassure stakeholders that someone has their hands on the wheel.

That is, the company’s continuity remains uninterrupted. It’s business as usual messaging for stakeholders and the media.  

Also, keep in mind that an interim appointment can go a long way to ensuring a smoother period of uncertainty while you search for a new leader.

Setting the tone for an executive exit is as important as planning an entrance strategy for a new leader. 

2. Don’t forget your employees. They are your first and best line of defense, especially when dealing with your business partners, customers and social media.

Realize that they are getting calls, emails and texts, and are having social media interactions with your stakeholders and public as these situations unfold.  

Use this to your advantage by being proactive: meet with key department heads and managers to ensure they have the right messaging for their staffs. Supporting those most impacted by the change goes a long way to maintaining business continuity. 

3. Remember your brand. Your brand is not just the products it sells; it is also the image it creates in the minds of potential customers.

And more often than not, a CEO embodies the company image, and his or her departure can signal a major change in the brand’s promise.  

Remember what happened when Steve Jobs returned to Apple in 1997? Jobs’ success turning Apple around and making the brand synonymous with technical innovation also made it synonymous with him. When he fell ill, Apple’s sales and stock suffered with him. Since his passing, the company has struggled to recover in the areas of innovation, performance and public perception. 

To mitigate these effects, it’s important to remember that your messaging must be consistent with your brand’s tone and voice.  

At best, your messaging should: 

* be authentic and complement – not conflict with – the business brand;

* be as positive and affirming as possible given your particular circumstances; 

* be obvious both internally to the company and externally to the public. 

The Takeaway: Think Outside the Box 

When a CEO or key executive leaves your company, the likelihood that your brand takes a hit grows exponentially the longer you fail to address the situation.  

Instead of traditional reputation management practices, think outside the box by taking the offensive and immediately showing how your management team is actively engaging partners, customers and employees.  

Faceless organizations are easy to turn into piñatas for your competitors and the media.

However, when you demonstrate care, your brand becomes more human. And then you can better control the narrative and curtail a larger brand crisis.

Now that’s a sign of something!

Category: Blog, Branding & Corporate CommunicationsTag: branding, communication, instability, planning, reputation, trust

Nothing Stays in Vegas Anymore

//  by Peter LoFrumento Leave a Comment

Top 3 Brand Reputation Management Lessons Courtesy of United Airlines

It was the shriek heard around the world.

The seemingly mild-mannered Dr. David Dao being forcibly removed from United Airlines flight #3411 earlier this week.  It was a move that caused United Airlines’ stock to lose $800 million in value on Tuesday, and the company to suffer nearly a full week of severe reputational hemorrhaging.

If you’re like me, you’ve seen, heard and read enough about this sad incident, so I will spare you from any recap. Instead, let’s take a quick look at several lessons from United’s experience that brands should take note of in this digital age of reputation management:

1) Nothing Stays in Vegas anymore. 

If no news is good news, then bad news will travel globally and fast. As humans, we are wired to share stories. And with social media, any crisis can go viral in a matter of seconds. So if something happens, understand that the likelihood is great that someone will have pulled out their phone and recorded it. Brands should adapt their social media policies and practices to accommodate this fact — and this means being proactive on social media when something does go wrong.

2) Forget the lawyers and put people first.

Most crisis teams include attorneys. Rightly so, but there are situations, like in the case of United, where their counsel to refrain from admitting anything is less than useful.  Just re-read United CEO Oscar Munoz’s first statement on Monday. His corporate double-speak – “I apologize for having to re-accommodate these customers” – failed to address the most important part of his apology, which is acknowledging the violent behavior that led to Dr. Dao’s suffering.  

It only goes to prove that empathy and sympathy go a long way, and even saying sorry can quickly defuse a crisis-in-the-making.  Why? A heartfelt apology can reduce anger and importantly, provide your customers with the feeling that they are being heard.

3) Be Consistent.

If you recall, Mr. Munoz’s first statement was from a leaked internal email intended only for United staff. While it reassured employees, it did little to provide any comfort to an already outraged public. In the minds of United, they wrongly thought they could communicate different messages to different audiences. They forgot a simple truth: in our new world order, everyone is listening during a crisis. You have to assume that what you say internally will eventually become part of the public conversation. So please be consistent in your messaging.

Nothing stays in Vegas anymore, and that has put brands under intense public scrutiny. To avoid United’s reputational fate, own the issue by being proactive (especially on social media), putting people first and ensuring consistency in your messaging. This will enable you to bring any crisis to a resolution in the way you want it to be managed or resolved. 

Category: Blog, Branding & Corporate CommunicationsTag: management, management consulting, reputation, reputation management

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