The other day, a colleague asked me about how to deal with an organization that had displayed a lack of integrity.
I recalled a situation from my past when I worked as an advisor to a firm that ran into financial difficulties. There, when faced with the company’s collapse, the CEO met with each of the staff and begged them to remain working in unpaid roles in the hope of saving the company by delivering on outstanding commitments. To demonstrate his commitment, he advised them that neither he nor his partner would take any compensation until the crisis passed but that once receivables were collected, those who pitched in would be compensated going forward. However, it was also made clear that, regardless of the outcome, everyone would be unpaid for the next month. Some staff left to pursue alternative employment, while others opted to stay without pay. I was a contracted advisor who had looked at their detailed financials, and to help them, I waived my outstanding invoices.
As I was leaving the office that day, I saw the owners issuing themselves regular paycheques. When I questioned them, they replied, “Well, we need it.” They felt no remorse for deceiving anyone; it was deplorable.
Trust, respect, and integrity are the foundation of any relationship. In the workplace, when management’s actions erode staff confidence in leadership, it becomes almost impossible for that team to restore. When management mishandles communication in a crisis and loses the staff’s trust, the organization’s survival will involve a change in key members of the management team.
Even if the correct decisions are taken, how actions are communicated is the most important factor. A mistake in judgment will be forgiven, but to be mistreated or disrespected is a cardinal sin.
As discussed in Assholes Matter, prioritizing mental health and well-being to prevent toxicity must be a primary concern for any management team to ensure the organization’s overall health. This is especially crucial when facing turmoil caused by organizational distress. How management tackles these challenges either plants the seeds for toxicity and self-destruction or unites the team around a higher purpose, distinguishing the survivors from the truly successful.
Every organization faces challenges. When managed appropriately, an organization will emerge stronger, even after unpleasant news. However, if a tough situation is poorly handled, the resulting feelings become a ticking time bomb. To recover, key individual(s) often find themselves in an untenable position and must be let go. To prevent this from happening, companies enlist outside teams to implement the difficult changes, as a demoralized team is more likely to result in compounding troubles over time.
Leaders help organizations endure tough times by addressing challenges with integrity and transparently communicating all the steps in any process. Clearly, failing to communicate, or worse, deceiving the staff, will have the opposite effect.
Unfortunately, some management teams make the mistake of approaching organizational issues from a top-down perspective. In contrast, a bottoms-up approach that contemplates others first is key to reducing the negative impact on mental health and is the best option for long-term gain and staff proactively. Properly addressing challenges also reduces stress, which is one of the leading causes of workplace absenteeism.
When facing tough times, management must lead by example and take on an excessive share of the burden to foster an environment where employees feel valued and supported. Making organizational cuts is one thing, but when senior management also communicates that they are reducing their own compensation for a period, it shows a sense of fairness and dedication to the organization and the team, ultimately contributing to both individual and organizational success.
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