How do employees feel when their leaders let them down?

Organizations are blessed by having hard-working employees who take pride in their work. I recognize not everyone fits this bill, but hopefully an organization has more of those that do than not. Yet, what becomes problematic for these earnest employees is when their leaders let them down.

I am thinking of the hard-working Wells Fargo employees who day in, day out help their customers, who saw leadership create a culture of cross-selling that led to some illegal behaviors. And, when honest employees shared their concern, they were admonished or let go.

i am thinking of the hard-working employees of energy company Enron whose leaders pursued aggressive and fraudulent accounting approaches with various code names to hide profits and dress up earnings. They also told their employees not to sell Enron stock when they knew the price was artificially propped up.

I am thinking of the hard-working folks of Arthur Andersen, who watched client leaders for their Enron accounting team help Enron’s leaders mask inappropriate activities and not catch others. These leaders brought down an accounting firm with an excellent reputation.

I am thinking of the hard-working employees of Duke Energy whose leaders have been less than forthcoming about a significant breach in a retired plant coal ash site knowing for years a problem existed and not moving quickly enough on some current ash sites where seepage into neighborhood water systems were a concern. Duke’s employees were incredulous by these actions.

I am thinking of the hard-working employees of Marsh and McClennan Companies whose leaders set-up and turned a blind eye to a small part of the company that was steering business and not operating in the best interests of the clients. They paid a huge fine and leaders were asked to leave.

These hard-working employees deserve good, honest leadership. The loss in stock price and jobs wear on them, but also the deflated pride in their companies. I worked for a subsidiary of Marsh and McClennan and it embarrassed and upset me that our leadership would do what they did and not address the problem when it was raised. Plus, being a stock holder through a 401(k) plan, stock purchase plan and some options, I was hurt financially as were folks who also lost their jobs due to the resulting downturn. I knew innocent folks who were asked to leave because of downsizing due to the impact of the malfeasance of this small group.

We need our leaders to be strategic and cognizant of issues, but we also need them to be honest and supportive of their employees. When problems arise, they need to be swift and contrite in addressing the issues.  Johnson and Johnson quickly addressed a Tylenol tampering incident many years ago when a nefarious person was removing lids and poisoning the pills. They did what they had to do to weather the storm.

From reading and watching news, apparently more than a few hard-working federal employees are not taking much pride in their new boss. That is unfortunate as they deserve more. So do we, with all of our leaders.

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25 thoughts on “How do employees feel when their leaders let them down?

  1. Dear Keith,

    Treating your employees with respect and listening to their input to correct for problems in your organization should be part of any risk management plan. These companies pay a fortune on insurance but do not get that nurturing a positive, constructive work culture should be a key component of any plan. When a company’s malfeasance becomes public, it can devastate the company’s brand, cause a downward slide in its stock prices, decrease in clients/ customers and it opens the company up to class action law suits.

    Ciao, Gronda

    • Gronda, well said. I like the way you included better management communication with employees as a key part of a risk management strategy. Paul O’Neill, who turned around Alcoa, lived this example. Companies like Toyota, Takata, Volkswagen, Bank of America, Tyco, Adelphia, etc. failed to follow this example and it cost them. Keith

  2. When the “leaders” who lie, cheat, and steal actually go to jail when caught, I think we might see less of this behavior. I do feel sorry for those who are just trying to do their jobs honestly and get caught up in the outcomes of the criminal actions.

    • More leaders should have gone to jail. I have seen and read about too much malfeasance. What frustrates me is when a CEO walks away with a severance because the Board does not want to fire someone for cause. Roger Ailes is a prime example as he damaged his company’s brand, yet he walks with $38 million and now consults with the President.

  3. I can understand this all too well.
    My working life was spent in the UK Civil Service and from 1968-1979 it made a lot of sense.
    Then in came the Thatcher govt who were the first to spread the notion that people who had worked in profit making concerns could run a government public service (which is not in the business of making profits but serving the public and managing the raft of legislations – that’s why it was called The Civil Service).
    Since that era there has been a decline in the numbers of staff commercial strategies which might work well in the commercial sector have been shoe-horned into public service, while delicate and sensitive roles have been farmed out to companies with the lowest bid.
    And the public are fed the same old tropes through the press that public servants are idle and overpaid.
    Sad to say the Title of your post was just a day in the life of my career for 30+ years.

    • Roger, it is painful. When a leader slams people who are doing their job, without knowing what they do, they do a disservice to many. What I find, people paint with a broad brush the perception they have based on a small sample size. One of my favorite examples is when politicians cut budgets and staff, so that a social worker has 160 clients, not 16 or 32. So, when a child slips through the cracks, the politicians say how could you let that happen? 160 clients is an impossible task. Keith

      • Indeed Keith, that’s been happening over and over again in the UK, and of course it is great ‘meat’ for the attack dogs of the tabloid press.
        Politicians had a ‘great’ get out phrase ‘Mistakes have been made but lessons have been learnt’. I suggested we could use that in the office I worked in…it was never taken up officially.
        My parting words on retirement day:
        “You folk achieve not because of the political decision makers but INSPITE of them,”

  4. Note to Readers: This next story is hearsay, but my source is a trusted friend and terrific consultant. So, I won’t mention the company, but the CEO was eventually convicted of accounting shenanigans. Before the business went under, the CEO had an all employee meeting at the HQ. After apprising the employees of the problems, he had all senior executives stand up and face the audience. He then said it is their fault. Class, real class. Reminds me of someone in the news on a regular basis.

  5. It generally boils down to a single word: greed. I see it more and more in the past two decades. I worked for a 140-year-old publishing company that had always treated their employees like family, encouraged their ideas and rewarded hard work. When I started there, many people of retirement age had been with the company since graduating from college. Eventually the company was sold, and the new management deemed the employees were of less value than a piece of equipment. Those who could, left, the rest just did their job, went home and grumbled. No longer was it a fun, productive place to work. I retired when I was asked to fudge some numbers to make the bottom line for one month look better, and within a few years, the company was no more. When employers fail to realize that their employees are their greatest asset, they make a grave mistake. Excellent post!

    • Jill, great example. Your last line says it all. There is an intrinsic knowledge about the company that comes with loyal long term employees. You need people to know how to get things done. Keith

      • An interesting update here. Last night, my daughter (a nurse-supervisor for a local urology group) came home in tears. Apparently the company decided that they no longer need supervisors, but will offer her a job as a ‘coordinator’, at $1 less per hour. Exact same level of responsibility, just less pay! Needless to say, I was steaming … that amounts to nothing more than a pay cut. Sigh.

      • Jill, she and other supervisors who were similarly treated, should track their duties. If she is still doing supervisory duties {performance reviews, goal setting, scheduling, etc.} per her old job description, she may have a future issue of contention. Keith

  6. Note to Readers: I have written before about unassuming Paul O’Neill who turned around Alcoa. His initial focus was to make Alcoa the safest company possible. Analysts were baffled by this focus, yet O’Neill knew that was the only issue labor and management could agree on. As a result, communications between line managers and employees improved. Further, these newly empowered employees starting sharing productivity improvements with managers. The company results took off. It is sad that O’Neill’s modus operandi is more the exception than the rule.

  7. Absolutely love your insights Keith, an inspirational leader sets the standards for their team, their actions and attutude shape their team and the results they get. For a leader to listen, encourage and privide their team with oppotunitys and pathways to grow and expand builds great respect and personality that drives a great team to success 🙂

  8. Note to Readers: My friend Jill notes it is all about greed, when CEOs act poorly. I have shared the true story of the greediest CEO I have encountered in my consulting. The following are all true, but are limited to a few highlights:

    – the CEO and COO wives argued over use of the corporate chauffer, when he was not being used to ferry the bosses to and from work and meetings. The solution – hire another chauffer.
    – the CEO invited customers to his daughter’s elaborate wedding so he could have the company pay for it.
    – the CEO had more perquisites than anyone I have ever seen and had three supplemental executive retirement plans that leveraged off each other.
    – the CEO had the largest severance benefit I have come across which included a gross up for taxes.

    When the Compensation and Benefits Manager was describing a broad based benefit to all employees to the CEO, the CEO stopped him and asked “what’s in it for me?”

    This is not representative of most CEOs, it just representative of the greediest of them. I have witnessed self-serving CEOs in my consulting, but none are at this man’s level.

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