It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently. Warren Buffett
Why don’t more organizations listen to Mr Buffet’s word? RBC’s leadership should be thinking about Mr Buffett’s words long and hard as with social media, it takes about 30 seconds to ruin a reputation.
Since the story broke about the Royal Bank of Canada hiring foreign workers, all I could hear and read about is how upset Canadians are – Understandably. The media has picked up on it really fast and RBC leadership has complied to the rounds of interview to try to reverse the negative public opinion. The problem is that People just don’t buy it. The biggest backlash comes from online and social media channels ranging from outraged Twitter updates to angry and militant comments on Websites. A Facebook page calling for the Boycott of the Royal Bank of Canada went up and has been successfully rallying people around this issue.
The “issue has been blown out of proportion” according to CEO Dixon in an interview with CBC. He goes on to say “There aren’t as many people as you might think” when told about the social media and online uproar. Awkwardly, he admits that the bank had answered to everyone who had complained on email. (Minute 8:30 is priceless)
RBC poorly managed this announcement. And it goes beyond social media.
1 – Whether one person or more complain, he/she is still a client.
2 – CEO Dixon is perceived to underestimate the people who complain online. Those thousands of updates on social media channels will remain forever as part of RBC’s digital legacy.
3 – CEO Dixon and RBC seems to believe that the few people who complain don’t count. Hasn’t he heard of the Arab spring and how social media has helped the demise of governments. That might be an extreme example but with this crisis, headlines include political ties.
Letting go employees and replacing them with cheaper labour is a standard business practice. Nothing new there. With the economic downturn, the majority of organizations want to reduce their cost at the risk of damaging the corporate culture and infrastructure. The shareholders are anxious to make profit and will do whatever they can to achieve that. It is not surprising really. So why the violent backlash against RBC?
Because today, corporate social responsibility is very important. “CSR is a process with the aim to embrace responsibility for the company’s actions and encourage a positive impact through its activities on the environment, consumers, employees, communities, stakeholders and all other members of the public sphere who may also be considered as stakeholders. “
RBC’s response on Social media channels
RBC has a plethora of social profiles. They came out with an official statement on their Facebook page – and at the time of writing, there are 2,867 comments, mostly from outraged customers intending to take their business elsewhere.
On their Twitter RBC_Newsroom account – notice the description – RBC Newsroom is designed to provide the media with timely and accurate information about RBC – the official statement was also posted.
The RBC Twitter account, the one designed for their clients, the one that matters the most in this instance, has been inactive since April 5. Mum, nothing. Perhaps, RBC believes that their clients doesn’t deserve to be addressed outside of major networks.
Business strategy and processes
RBC is in business because it manages Canadian’s money : Clients.
RBC manages their own employees’ money : Clients.
RBC manages to keep former employees’ funds and pensions : Clients.
Yet, they don’t feel clients deserve an authentic, relevant and honest response, regardless of which channel they are using to communicate.
While the government and opposition, the third-party vendor and RBC are blaming each other, at the end of the day, the clients are being taken for a ride.
Although CEO Dixon dismisses the online conversation, it is taking part and growing at a rapid rate. Big influencers such as Margaret Atwood are questioning the legality of RBC’s decision, the opposition is chiming in and journalists are giving commentaries.
Within less than 72 hours, the Boycott Royal Bank of Canada Facebook Community page already reached 6500 likes and is massively active. People are outraged and intend to let the government and RBC know that they will take action. A Website BoycottRBC.com is being built, at the time of writing of this post.
What could have RBC done differently
1 – Corporate social responsibility:
RBC should have walked the talk. As Customers, we mostly do business with those we like, respect and relate to. The same applies to bank. Customers want to be proud of who they interact with, even more when it comes to the institution that manages their money. RBC employs over 50 thousand people, reported records-profits and paid its CEO over 12.6 millions. By letting go 50 employees in what is perceived as a sneaky way, the bank looks as if it has very little interest in Canadians and their prosperity.
The bank should have shown it really cares about its employees. Giving back to the community seems to be a strong commitment amongst organizations, but is it only because it looks nice in a brochure?
With this move, RBC is just showing a cognitive dissonance.
By having integrated this essential practice in their business, they would have looked at the impact in the community.
2 – Social media as part of the Business strategy :
RBC could have anticipated how the story would be shared online. Social media should have been part of their strategy. From experience, I know that leadership rarely involves the right people when discussing sensitive issues. Legal and HR are definitely there, but the Communications department is often brought in at the last minute, beyond the point of crisis management. Digital and social media is seldom consulted at a strategic level.
In reality, RBC is trying to control the damage. They are beyond Crisis management because it implies that they would have prepared for it.
RBC’s stance is massively passive. They probably think that they’ve done their job – appeared on tv, posted official statements and kept quiet.
Make no mistake, this is not a social media crisis. It is an ill-prepared damage control operation. They probably never expected one of the axed employees to go to the media.
The organization has underestimated people’s reaction and memory. The brand is probably damaged and the story deeply impacts people’s livelihood and ability to care for their family, Canada’s future. It is major.
As many Canadians, I am profoundly disappointed by the business practices of the RBC and the likes, I am concerned the trends will put in jeopardy the future of the country – my kids, if I was a client of theirs, I would probably want some answers. As a social media professional, I am mostly unraveled interested as how they manage the public online anger and what they could have done differently.
Would love to hear what you think about this issue. Chime in!