Layoffs Planned at WeWork

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After a failed IPO and questions about its leadership and financials, WeWork is planning to downsize. New co-CEOs Artie Minson and Sebastian Gunningham warned employees to expect layoffs but said they will be handled “humanely.”

The new leadership had already prepared employees: "While we anticipate difficult decisions ahead, each decision will be made with rigorous analysis, always bearing in mind the company's long-term interest and health." The new information gives employees a better sense of what will come.

But news stories aren’t consistent. Fortune reports 2,000 layoffs or about 16% of WeWork employees affected, while Dice reports 5,000. Dice acknowledges differences in reporting.

Affected employees could be in business segments that will be spun off, so they may still have a job. WeWork may try to sell Meetup, Managed by Q, and Conductor brands.

Discussion:

  • Assess WeWork’s communications to employees so far. Even if the percentage were clear, the number of layoffs may change. Are the new leaders doing the right thing in giving an estimate now?

  • Employees know layoffs are coming “soon.” Should they have more specific dates? Consider whether this is a good idea.






https://fortune.com/2019/09/25/wework-new-ceos-memo-employees/


Forever 21 Files for Bankruptcy

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Retailer Forever 21 has filed for bankruptcy, and employees are not happy. In its Letter to Customers, posted on the website, the company explains the process:

This does NOT mean that we are going out of business – on the contrary, filing for bankruptcy protection is a deliberate and decisive step to put us on a successful track for the future.

Hundreds of employees are planning to unionize with United for Respect, which also represented employees from Sears and Toys R Us during their bankruptcies.

The Washington Post reports employees’ reactions to the Forever 21 decision:

[S]everal employees cited past instances where Forever 21 swiftly closed stores with little warning or explanation, which prompted their concerns over how the company would treat employees amid bankruptcy.

Unions are seeing opportunities in retail employees. Private-section union membership has been shrinking in the U.S. and is now only 6.4%, compared to 33.9% of government workers. As retail employees get discouraged by their employers, union organizing activity has been increasing.

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Image source here.

Discussion:

  • Analyze the Letter to Customers. Which principles of communicating bad news are followed? How could the message be improved?

  • Explain the ethics of a company filing for bankruptcy. Use an ethical decision-model, such as that in Chapter 1, to determine the effects.

  • What’s your view of retail employees unionizing? What are the benefits to employees and potential downsides of union activity and of forming a union?

CEOs Advocate for Gun Safety

CEOs are encouraging senators to pass stricter gun regulations, such as background checks and a “Red Flag” law that allows guns to be taken from someone who poses a threat. The leaders of 145 companies sent a letter asking for the following:

“That’s why we urge the Senate to stand with the American public and take action on gun safety by passing a bill to require background checks on all gun sales and a strong Red Flag law that would allow courts to issue life-saving extreme risk protection orders.”

The Trump Administration has implemented a ban on bump stock devices, which allows a shooter to fire in more rapid succession, and President Trump has supported more thorough background checks for gun buyers.

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Discussion:

  • What’s your view of CEOs taking on this activist role? What is driving them, and what are the potential risks?

  • What observations do you have about the companies that are represented—and perhaps about those that are not?

  • Analyze the letter by considering the audience, communication objectives, organization, writing style, and so on. What works well, and what could be improved?

United Air Kerfuffle

A United Airlines representative participated in an entertaining Twitter exchange about seat prices. The customer has a point: it’s silly to have empty seats on a plane. But United also has a point: the seats are more expensive, and this customer didn’t pay the extra fee.

The Lexus analogy is a curious one. The better analogy may be stadiums or theaters. In some cases, we will see people move closer to a field or a stage, but I understand (although I’ve never been) that this isn’t allowed at the U.S. Open.

Discussion:

  • What’s your view of United Airlines’ policy? What other examples are similar? Can you think of a better analogy?

  • What’s your view of the Twitter exchange? Is the customer right, antagonistic, rude, or something else? How about the United rep?

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Dorian News Conferences

Local officials are holding news conferences about the impact of Hurricane Dorian.

Miami Mayor Francis Suarez announced mostly good news for the city, but he also addresses the terrible impact on the Bahamas.

Bahamas Prime Minister Hubert Minnis announced worse news: five fatalities. Since then, the number has risen to 30.

Discussion:

  • Compare these two presentations, particularly the content and tone. What differences do you notice?

  • How effectively did each government official convey the news?

  • What leadership character dimensions did they demonstrate?

Employees Pressure Walmart to Consider Role in Gun Violence

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Walmart is in a tough spot after recent shootings. Some employees are pressing the company to do more to fight gun violence, but no policy changes are planned. After previous attacks, Walmart stopped selling assault-style weapons and raised the minimum age to purchase guns and ammunition, but it’s unclear whether the leaders will do more. Employees are asking Walmart to stop selling firearms and to disallow customers from carrying guns into the stores.

The company seems divided about employees’ activism. Chief Executive Doug McMillon wrote, ”We are proud to be woven into the American fabric as a place for all people. We are more resolved than ever to foster an inclusive environment where all people are valued and welcomed.” At the same time, the company blocked two employees’ access to Slack, encouraging employees to use “more constructive ways for associates to offer feedback such as emails or conversations with leaders.”

A study recently published in the International Journal of Business Communication found that employees are more likely to “express dissent to managers and coworkers” when they are more socialized in the company and when they believe their company is “more ethical and reputable.”

A Wall Street Journal article explains the risk for Walmart to take more action against gun sales:

“[A]ny change to its gun policies risks alienating Walmart’s core customers, who often live in more conservative-leaning rural and suburban communities. The company faced some consumer backlash after raising the minimum age to purchase guns to 21.”

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Discussion:

  • How can the company balance employees’ and customers’ perspectives? What else, if anything, should company leaders say and do?

  • Did the company do the right thing by blocking Slack access? In what ways are email and conversations more or less “constructive”?

  • What leadership character dimensions are illustrated by this situation?

How to Deal with Being "Ghosted"

Too often, employers stop responding to candidates. Even after an in-person interview, candidates never hear back. The CEO of a job search platform advises people to follow up in a few ways:

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  • Send one email a week. Be thoughtful about your messages to express interest; maybe share new research about the company .

  • Try different channels. For example, send a LinkedIn message instead of email, but only once.

  • Reach out to others. Contact another recruiter or the hiring manager directly.

All of these actions come with risk, but the writer argues, and I agree, that the risk is worth it. None of these follow-ups are too annoying, and you may turn the tide in your favor.

Ghost cartoon image source.

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Discussion:

  • Why do you think employers ghost applicants? Consider what incentive they have to follow up.

  • What’s your view of these follow-up approaches? Which are you more or less comfortable doing?

Government Scandal in Puerto Rico

Gov. Ricardo A. Rosselló says he will not resign despite protests about private messages that included personal attacks and crude language. With 11 of his top aides, Rosselló participated in chats via the messaging app Telegram. Almost 900 pages of text are now public, and we see insults about other officials with references to people’s sexual orientation, gender, and weight.

The news comes after government corruption chargers earlier this week. The governor admitted, “I committed inappropriate acts,” but also said, “I have not committed illegal acts.”

In a news conference, Rosselló used the words “improper” and “shameful,” but didn’t agree with the reporter that the chats were unethical.

Discussion:

  • Should the governor resign? Why or why not?

  • What’s your view of the private chats? Should government officials be able to message each other freely? Why or why not?

  • How well did the governor respond to the reporter’s questions? Did he convince you?

Suicide Among France Télécom Employees

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Management couldn’t fire employees at France Télécom, so, according to critics, they harassed them hoping they would quit. But at least 35 committed suicide under the pressure, and some reports claim the number is closer to 60.

France Télécom was privatized and rebranded as Orange in July 2013. The company wasn’t keeping up with technological changes and, according to executives, were saddled with state employees, who are protected from termination. In 2007, Didier Lombard, the former chief executive of France Télécom, said they would get to their ideal number of layoffs “one way or another, by the window or by the door.”

A New York Times article describes the environment: “A grim universe of underemployment, marginalization, miscasting and systematic harassment was established at the huge company, according to testimony at the trial.” Managers tried changing job responsibilities for some workers, but employees were left without tasks or with tasks they couldn’t do.

With France’s high unemployment rate, employees felt they had few options. Union members, shown here, express their support during the trial in Paris. We’ll see whether the judges find company executives guilty.

Discussion:

  • How did management justify its practices? On the other hand, how could they have acted differently?

  • What experience do you have with international labor laws? Describe differences and how they might affect business decisions.

  • Should France reconsider its lifetime employment protections?

  • What leadership character dimensions are illustrated by this situation?

Harvard Rescinds an Offer

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Harvard withdrew an admissions offer after discovering racist comments by the applicant online. The applicant, Kyle Kashuv, posted his version of events, including Harvard’s withdrawal and his responses before and after the final decision.

Kashuv became an activist for gun rights after he survived the school shooting in Parkland, Florida. He joined Turning Point USA, which The Chronicle describes as “a right-wing organization with chapters on many college campuses.”

Despite his explanation and apology, Harvard decided to rescind the offer. ]

Harvard College image source.

Discussion:

  • Read Kashuv’s account of what happened as well as news articles. What’s your view? Did Harvard make the right decision? Why or why not?

  • What, if anything, could Kashuv have done to prevent the withdrawal? Could he have been more persuasive in some way?

Restaurant Owner Forgives Manager for $4,710 Mistake

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The manager of Hawksmoor Manchester steakhouse accidentally served a $5,000 bottle of wine when the guests ordered one priced at $290. The owner forgave her publicly, on Twitter.

Naturally, the conversation doesn’t end there. Jokes abound, one announcing that the manager has since been placed in an “on-site incinerator.”

Others pounced on the expensive wine and criticized the restaurant, to which the owner responded in a tweet:

I’m sure you’re all getting tired of this now, so one last thing, to the people who put homelessness in Manchester next to ‘£4500 wine?!’ and suggesting we have no values: we’ve raised well over £1m for @ACF_UK, work with @WoodSt_Mission and @notjustsoupMCR. We have values.

Discussion:

  • What leadership character dimensions are demonstrated by this story?

  • How well did the owner respond to criticism?

Leadership Challenge at Uber

A New York Times article describes discomfort among Uber’s leadership as the company plans to go public. Founder and former CEO Travis Kalanick wanted to join the company to ring the opening bell at the New York Stock Exchange, a tradition for IPOs. Kalanick still holds a seat on the board and, as founder, he wanted to participate in the company’s joyous moment—and to bring his father.

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Current CEO Dara Khosrowshahi denied the request. For two years, Khosrowshahi has been trying to shed negative public perceptions of Uber, partly attributed to Kalanick’s leadership style and the company’s “bro-culture.”

The article describes a fractured board that didn’t fully support Khosrowshahi and a company that has yet to turn a profit, losing revenue on almost every car ride. Uber follows Lyft’s recent IPO, which has lost about $26 per share since its IPO in March.

Uber image source.

Lyft image source.

Discussion:

  • Did Khosrowshahi make the right decision? Why or why not?

  • Consider Kalanick’s perspective. What’s his point of view? Should he have asked at all?

  • What leadership character dimensions are illustrated by this situation?

Boeing's Crisis Response

At a shareholder’s meeting, Boeing CEO Dennis Muilenberg addressed 737 Max safety concerns following two fatal crashes. He started, as predicted, with an apology and sympathy for the “loss of life,” acknowledging the “devastation.” He contrasted these losses with the many Boeing flights that run safely—”roughly every 1.5 seconds.”

Muilenberg didn’t explicitly address issues raised in the past couple of days, particularly a Wall Street Journal article the previous day accusing Boeing of failing to report the safety feature shut-off to airlines (including pilots) and the FAA.

When asked during the Q&A about accountability, Muilenberg spoke mostly about plans going forward. When asked whether he would resign, he talked about his and his employees’ commitment to safety.

At about 9:00 on the video, a reporter asks about whistle-blowers at Boeing, referring to recent reports that employees tried to alert senior management and the Federal Aviation Administration (FAA). Muilenberg says the question is “fair” but doesn’t quite respond to the accountability issue. At about 14:15, a reporter asks, “Can you admit that the design was flawed?” This is after Muilenberg skirts the previous question, blaming a “chain of events.” Still, he would not admit to a design flaw.

And then he ends the news conference, as a reporter shouts, “Sir, 346 died. Can you answer a few questions here about that?” Earlier, another reporter noted that this was the first time they had a chance to meet with him to ask questions.

Discussion:

  • Assess Muilenberg’s delivery skills. What does he do well, and what suggestions would you have for his future news conferences?

  • How well did Muilenberg address reporters’ questions? What, if anything, could he have said differently?

  • What leadership character dimensions are illustrated by this story? How well did Muilenberg demonstrate them?

New Zealand Announces Weapons Ban

Following a shooting at a mosque in Christchurch that left 50 people dead, New Zealand Prime Minister Jacinda Ardern announced a ban on certain types of weapons:

“Today, I’m announcing New Zealand will ban all military-style semiautomatic weapons. We will also ban all assault rifles. We will ban all high-capacity magazines. We will ban all parts with the ability to convert semiautomatic or any other type of firearm into a military-style semiautomatic weapon. We will ban parts that cause a firearm to generate semiautomatic, automatic or close-to-automatic gunfire,” she added. “In short, every semiautomatic weapon used in the terror attack on Friday will be banned in this country.”

She said the decision would accomplish one goal: “to prevent an act of terror from happening in our country ever again.” In a press conference three days prior, the prime minister had promised that the Cabinet planned to take action.

The New York Times compares the process for buying a gun in 16 countries, showing the United States as having the fewest steps.

Discussion:

  • What’s your view of the decision and how Prime Minister Arden communicated it to the public?

  • What leadership character dimensions does the Prime Minister demonstrate in this situation?

  • Watch Prime Minister Arden’s press conference and one or two others. How would you describe her delivery style?

HBO CEO Departs

HBO CEO Richard Plepler is leaving the company. His announcement came shortly after HBO’s chair of the board spoke with the WarnerMedia CEO about possibly taking over HBO and Turner.

Here is Plepler’s email to employees:

My dad always gave the best advice. Whenever there was a difficult decision to make, he counseled that since no one could ever have perfect visibility into the future, the best thing you could do was trust your instincts. It has been a touchstone for me throughout my life, and I have found myself returning to it again recently as I think about what is an inflection point in the life of this wonderful company. Hard as it is to think about leaving the company I love, and the people I love in it, it is the right time for me to do so.

In the past weeks, I’ve thought a lot about the incredible journey of this company in the nearly 28 years that I have been blessed to be here. It’s a journey of great pride and accomplishment because so many of you, and many others before us, have made HBO a cultural and business phenomenon. Thanks to all of you, we are today churning on all cylinders both creatively and as a business. Thanks to all of you, I can move on to the next chapter of my life knowing that the best team in the industry remains here to carry on our continued progress and success. As I have said before, this is the team of teams.

It has been the great joy of my professional life to share this ride with you over these many years. And the great honor of my professional life to be your CEO. I don’t have the words to express my gratitude for the support and talent that made our success together possible. But suffice it to say, my love for this place, and for all of you, is deeply a part of me and will last a lifetime. I look forward over the coming weeks to thanking as many of you as I can for the thousands of contributions big and small that have made “this thing of ours,” to quote Tony Soprano, so special. I have told John, who has been nothing but gracious since we spoke, that I would work closely with him to assure a seamless and organic transition.

We’ve created a great and unique enterprise and I know that you will protect its legacy and do all to enhance its future in the years to come.

Know that I will always be cheering loudly, even when I am outside this building, as HBO continues to thrive.

With respect, admiration, and gratitude,
Richard

Image source.

Discussion:

  • Assess Plepler’s email. Who are his primary and secondary audiences? What are his communication objectives?

  • What principles of business communication does Plepler follow, and how could he improve the email?

  • What, if anything, does he give as the reason for his decision? Should he say more about this? Why or why not?

  • What leadership character dimensions are illustrated by his email?

Interview with Delta CEO

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In a LinkedIn interview, Delta CEO Ed Bastian discussed the decision to revoke the National Rifle Association (NRA) discount after the Parkland, FL, shootings, one year ago. The discount was for NRA members, and only 13 took advantage. But the real loss was in $40 million in tax benefits, which Georgia Governor Cagle fought to strike after the company’s decision.

Bastian admits that the loss was significant. But he concludes, “Our brand is worth so much more, and our values are not for sale.”

Bastian refers to the NRA’s “divisive rhetoric” and says that he didn’t want “to be seen as advocates” of the organization and its views. He also describes what we might call authentic or purpose-driven leadership:

"If you know who you are, you can make those decisions. And that you can make those decisions and sleep well at night.”

Discussion:

  • What leadership character dimensions are demonstrated by this situation?

  • Do you think Bastian did the right thing for Delta? Why or why not?

  • How well does Bastian address the interviewer’s question? Overall, how do you assess his delivery?

Walking Meetings: "Take a Hike"

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According to a Wall Street Journal article, employees have had enough of “walking meetings,” typically initiated by a manager who wants to get some exercise. Employees cite exhaustion, bug bites, overcrowding, uncomfortable height differences, crashing into things, and losing people along the way.

On the plus side, people say it boosts creativity and energy, as this infographic shows. Some say it reminds them of college, when their professor held class outside in nice weather. (Do people still do that?)

Comparisons to “The West Wing” abound, but it’s not quite the same without the cameras following you.

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Infographic image source.

Discussion:

  • What’s your view of walking meetings? Do the benefits outweigh the costs?

  • Should managers be more sensitive to people who have physical challenges or just prefer to meet inside? How should managers handle these situations?

More About Failure Resumes

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Two years ago, a Princeton professor’s “CV of Failures” went viral, encouraging all of us to admit our misses and view them as learning experiences. This week, The New York Times popularized the idea in an article, “Do You Keep a Failure Resume?

The author advises a strategy:

“When you fail, write it down. But instead of focusing on how that failure makes you feel, take the time to step back and analyze the practical, operational reasons that you failed. Did you wait until the last minute to work on it? Were you too casual in your preparation? Were you simply out of your depth?”

Of course, what he’s proposing is self-reflection. But the approach is rationale: to think through what happened. Research tells us that a more emotional approach—allowing yourself to actually feel negative emotions from a failure—leads to greater learning and makes it less likely that you’ll make the same mistake in the future.

We may avoid failure because we feel shame. The graphic above shows the difference between failing and “being a failure.” Experiencing failure instead of feeling like a failure helps us be vulnerable instead of feeling what could be debilitating shame.

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Being a Failure image source.

Discussion:

  • How do you typically view failure? Do you try to forget about it? Are you harsh with yourself? Or something else?

  • Do you have a process of regular self-reflection? What could you do on a daily basis to learn from both your successes and your failures?

Emails to International Duke Students Sparks Controversy

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Faculty at Duke University Medical Center have been criticized for asking international students to speak only English. The controversy started when an administrator of the biostatistics program sent an email after hearing complaints from faculty members that Chinese students were speaking “VERY LOUDLY” in their native language in “student lounge/study areas.” The faculty expressed concern that students “were not taking the opportunity to improve their English and were being so impolite.”

Also in the email, the administrator said that faculty asked for students’ names so that they might deny them job and project opportunities.

Students took offense and started a petition. In response, the administrator of the program stepped down from her position, and the university posted a letter to students in the program.

Discussion:

  • What’s your view of international students speaking in their native language at an American University?

  • Was the administrator out of line? Why or why not?

  • How do you assess the university’s response to the controversy?

  • What leadership character dimensions are at play?

Lawsuit Charges Purdue Pharma Family with Instigating Opioid Crisis

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In a 312-page complaint, Massachusetts lawyers detail how members of the Purdue Pharma family contributed to the opioid epidemic. The complaint shows the company’s aggressive marketing strategy, including how it convinced doctors to over-prescribe drugs.

One argument in the documentation shows how representatives were trained to encourage doctors to prescribe medication to what the company called “opioid-naive” patients:

Purdue also promoted its drugs for opioid-naive patients using the receptive term “first line opioid.” “First line” is a medical term for the preferred first step in treating a patient. Opioids are not an appropriate first line therapy. Nevertheless, Purdue’s internal documents and testimony from sales reps shows that Purdue repeatedly promoted OxyContin as “first line” — “the first thing they would take to treat pain.” (Sic: “first-time opioid” should include a hyphen.)

A 2001 email written by Richard Sackler, whose family owns OxyContin, blames victims:

“We have to hammer on abusers in every way possible. They are the culprits and the problem. They are reckless criminals.”

The lawsuit also charges the family with claiming that opioids are addictive to only one percent of the population, although they had no evidence for that claim.

This lawsuit follows others in Washington, Ohio, and Alabama. Last year, the company did stop promoting opioids.

Purdue image source.

Discussion:

  • Read more in the legal complaint. According to the documentation, how did the company wrongfully use persuasive communication?

  • In some of the documentation, we see ads and tactics that any company might use. Which do you find to be typical examples, and which cross an ethical line?