Everyone loves a good viral video, unless the fallout of popularity is pure embarrassment and your CEO is to blame. Cue an increase in empty chairs in the MillerKnoll
Earlier this week, a leaked video from furniture company MillerKnoll featured CEO Andi Owen lecturing an employee audience on staying motivated in the wake of tough business times and potentially cancelled bonuses. The now infamous video racked up almost six million views as the company scrambled to respond, and then did so reinforcing that the video shouldn’t be taken out of context.
Owen’s numerous quotable moments included telling employees to leave ‘pity city’ instead of complaining about not receiving bonuses.
The company, a result of a merger between Herman Miller and Knoll in 2021, earned almost $4 billion in revenue in 2022.
A former Knoll employee who asked not to be named felt disappointed upon seeing the video but not shocked: “it wasn’t a surprise from Knoll’s culture but I hoped for my colleagues that the merger brought improvements,” he said.
Not only was the commentary from this employee town hall meeting shocking, but embarrassing too. When the leader of the organization where you work behaves this way, it destroys trust, de-motivates the workforce, and is downright humiliating for employees.
As online reaction to the video spread, commenters were quick to chastise the company, its potential response and the CEO. Regardless of what action MillerKnoll actually takes, the long-term damage is done.
Requests to MillerKnoll for comment or an updated statement have not been returned.
Employees Are More Vocal Than Ever
At the most basic level, jobs put a roof over our heads and food on our table, so employees take their employment relationship seriously. Get it right, and employers earn confidence and commitment. Get it wrong and the backlash can be fast and fierce.
“Owen’s comments show a tremendous lack of empathy for her most important stakeholder, her employees,” says Lee Bussell, APR, Chairman of Chernoff Newman, an integrated communications firm. “Until she is able to walk back the comments with both authenticity and empathy, repairing the damage to MillerKnoll’s culture simply cannot take place.”
In 2022, Ford learned this lesson the hard way after employees learned that bonuses for lower level employees would be paid out at a 60% lower rate than payouts for senior managers and directors. After backlash from employees, the company walked back their decision, vocalizing their commitment with Ford CEO Jim Farley saying at the time: “this change is all about serving our employees.”
But leadership teams shouldn’t have to walk back comments or deal with these controversies in the first place. In many cases, they are avoidable, and can be both time-consuming and costly. Companies with ineffective responses to PR crises have been shown to lose over 20% of their stock value over a year. While many corporate PR teams are practiced in handling reputation-related crises, they’re not experienced in the impact of a crisis on employment.
The strength of the employment relationship is what drives recruitment and retention and for MillerKnoll, Owen’s comments damaged the relationship at multiple levels. Employees will lose trust in the organization, respect for their leader, and will have a hard time caring about their work.
“I wouldn’t be surprised if recruiting and retention became an issue for MillerKnoll as it appears the relationship with employees is financial and transactional,” says Carey Goldberg.
Goldberg, the former CHRO for both JBG Smith and The Ritz-Carlton, is practiced in the importance of the employment relationship. During challenging times for a business, she advises executives to lead with a ‘one mission, one team’ message and share specifically what senior leadership is doing to support the team in enabling them to meet their goal.
“One of the most important things for any leader to remember,” says Goldberg, “is the need to understand and lead communication by addressing what matters most to their teams—in this case, annual bonuses—and speak with that in mind.”
Planning for Employee Crises Is Essential
This is where planning and partnership come into play. When a company crisis involves or impacts employees, a specific and nuanced approach is required.
- Be prepared to act fast: every PR team should have a specific plan in place for employee-related crises and be trained on how to communicate differently for these audiences, align with their HR peers, and influence C-Suite leaders.
- Lead with an employee-first mindset: executives are notorious for being out of touch with their employees so putting yourself in their shoes is key. Employees don’t have the same lens as executives. The loss of a bonus could mean a cancelled family vacation, a missed mortgage payment, or childcare challenges.
- Anticipate and plan for employee reaction: document scenarios for how employees may react to a viral event or impactful news, and be prepared to bring in stakeholders from PR, legal, and HR to align on the right response and action plan together.
- Create an integrated plan alongside HR and employer brand: this includes talking points for HR business partners and recruiters, as well as guidelines for employer brand leaders and recruitment marketers who may be running internal and external communication and marketing campaigns.
- Teach executives how to talk: teach your C-Suite how to communicate to employees. Let them hear their own voices back pointing out key phrases and tone changes that may leave a lasting impression.
- Change your thinking on employee communication: every interaction with a candidate or employee is a chance to brand or market the employment experience. Include internal communications as a part of an integrated employer brand team to align all communications and marketing across the candidate and employee experience.
For MillerKnoll, they’ll want to get their recruiting teams ready to address candidate communications and prepare for more open roles to fill.
Says the former Knoll employee: “I’m guessing people are updating their LinkedIn profiles as we speak, not leaving ‘pity city.’”