Wayfair Learns the Cost of Doing Business Can Include a Damaged Reputation and Loss of Employee Faith

By Nora Jacobs, Hennes Communications

The recent employee protest at home-goods retailer Wayfair involving furniture sales to a company that will outfit a new migrant detention center in Texas has generated national media attention. It also prompted a discussion with one of our clients who is about to embark on a vulnerability audit with us in advance of creating a crisis communications plan.  “Wow.  How do you possibly plan for something like that?” the client asked.

Good question.  As this article in The Atlantic points out, more and more companies are being pressed by employees, customers and shareholders to defend the ethical choices they make in their sources and their sales.  Thanks to social media, it doesn’t take long to galvanize outrage, boycotts or political pressure when a partner in the supply chain is accused of ignoring poor working conditions, using child labor, committing environmental abuses or engaging in political corruption – to name just some examples.

In reality, the more far-flung, complex and large an entity is, the harder it becomes to make sure the organization adheres to its values.  Even the most exhaustive vulnerability audit can fail to uncover some of the potential threats a multi-national corporation might unwittingly face due an employee’s unintentional – or intentional – decisions on the job.

How to provide some insulation against the problems Wayfair now faces?  A good place to start is to make sure your organization has a formal set of clear-cut values and a code of ethics that management both walks and talks. All employees need to be briefed on these the day they start work and be reminded of on a regular basis.  They need to understand that there are clear consequences for violating organizational values and ethics, and they need to be aware of the process they can use to flag issues and behavior of concern.

Beyond this, organizations that believe they might be vulnerable to issues they can’t readily predict should consider establishing a formal issues management function made up of a small group of managers and leaders with various responsibilities and different perspectives on how the company operates and does business.

While the identification of every possible threat – and specific preparation for that threat – might be somewhere between daunting and possible, the creation of an early warning system to identify and respond to emerging issues certainly provides the distinct advantage of time and perhaps the opportunity to resolve something before it erupts into a full-blown, headline-grabbing crisis.