Driven by crisis, businesses increasingly weigh in on democracy and social issues. As we begin a new chapter of corporate engagement with politics, we need to explore how HR leaders, CEOs and board directors are navigating this new reality.
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Michigan is a microcosm of something much larger. Driven by crisis, businesses increasingly weigh in on democracy and social issues. Using examples from healthcare, hospitality and higher education, we'll look at this evolution in Michigan. As we begin a new chapter of corporate engagement with politics, we need to explore how HR leaders, CEOs and board directors are navigating this new reality.
In October 2019, a leader in Michigan's hospitality industry noticed a pattern. Chinese business travel linked to automotive industry suppliers had dropped substantially. This leader spoke to others who also wondered what this pattern meant. It was the canary in the coal mine. Four months later, we realized we were facing a worldwide health and economic crisis.
We don't need to wait for a crisis to take a stand. Sometimes we simply show up where we aren't expected. American Advantage Home Care is a Black-owned, skilled home health care provider headquartered in Dearborn, Michigan. "Considering Dearborn, Michigan's history of racial polarization in the mid-20th century, to currently being home to the largest segment of Arab Americans in the United States, our presence in itself is a planted flag. To be more specific about our agency, our core values are diversity, respect, integrity, patient-centrism, compassion and high-quality care", said CEO Cleamon Moorer. "Our stance on societal issues is quite clear. We serve all patients and we especially have an affinity to serve the underserved minority populations of patients in Detroit, Michigan. As related to political beliefs, going back to our name: American Advantage… our nation's advantage has been democracy, freedom, justice and civility. We have seen all four of those virtues challenged and compromised in recent years. Thus, we strive to embody those virtues coupled with our core values in all of our interactions with employees, patients, caregivers, referral sources and all other stakeholders."
No Playbook for Emerging Challenges
Within a few days after January 6, 2021, dozens of companies paused political funding to anyone who voted against certifying the election. "I can't think of any moment in history when corporations were called on to join in a crusade like this" acknowledged Jerry Davis, a business professor at the University of Michigan. "It's one thing to say, we're going to let Colin Kaepernick be a spokesperson or Chick-fil-A might once be against marriage equality, but this is about a core of democracy. This feels like a new chapter in the world of corporate engagement with politics."
Recently, many Michigan CEOs issued statements supporting free and fair elections as Republican legislators initiated 39 changes to state election laws. In his April 2021 interview with Bridge Michigan, Davis exclaimed "If there were a moment for corporate executives to act, this is it... Voting rights are so fundamental to democracy. It's like, speak now or forever hold your peace."
The pandemic, social inequality and divisive discourse has created an urgent need for a significantly different level of stakeholder conversation. Employees, consumers and investors are expecting corporations to be more involved in social change while meeting the traditional expectations of performance, resilience and sustainability. Recent headlines in business publications confirm our lack of direction.
Stories from the Front Line: Healthcare
Caroline Smith, Midwest HR Director at Elara Caring, described the conversations in her organization. Her CEO holds very transparent town halls, communicates with employees via Ask the CEO Scott Powers, and frequently visits the facilities where 35,000 caregivers are serving 60,000 patients in hundreds of locations in 16 states. This PE-backed, Texas-based home health, hospice, behavioral health and personal care giant is the result of a three-way merger in 2018.
One evening in early March 2020, Smith got an email directing her to have everyone stay home. Smith quickly communicated to her direct reports. The next day Smith and a few members of the team were the only employees at the Jackson facility putting plans in place to continue operations safely. Normally, 250 employees are at this facility. Besides the quick issuing of the directive to stay at home, a second challenge was alternate realities. Michigan was quickly heading toward stay-at-home orders and the crisis was not yet evident in Texas. By April, Michigan had the third-highest number of coronavirus deaths in the US. Challenges were fear of the unknown, creating a COVID playbook, and quickly developing employee policies related to testing, quarantine and obtaining personal protection equipment.
Stories from the Front Line: Higher Education
Figuring out how to deliver education safely required a rapid response. Emily Barnes serves as Interim President for Cleary University in Howell, Michigan, a role she assumed shortly before the pandemic. Barnes was well versed on the Cleary community having been part of the leadership team for several years as Provost and Chief Academic Officer. In Michigan, Governor Whitmer was quick to respond to the growing health concern issuing several executive orders. Barnes explained the immediate challenge was adapting to the speed of the information flowing from the Governor's office, often two updates per day. The daily news also needed to be digested with immediate communication to faculty, parents and students. Cleary was well positioned to move to remote learning given their robust course design and faculty expertise with learning management systems. Yet in addition to classrooms, there are dormitories and a stadium on campus. Ensuring the safety of residential students and student athletes added complexity to the challenge.
"Those first three weeks were living day-to-day," explained Barnes. "I was in touch with other college leaders as we shared what we had heard and what we were doing on our campuses." Barnes recognized the need for a flexible plan creating a roadmap with established phases, trigger points and detailed actions. Working with the marketing consultant, Barnes created a library of communications to address multiple possibilities. Now the university could pivot quickly as needed depending on what was happening in the external environment.
Stories from the Front Line: Hospitality
The largest hospitality management group in Michigan, Mid America Lodging Group, operates Hilton, Marriott, IHG, Choice and other brands and is recognized as a leader in hotel management, acquisition and development. As with American Advantage Home Care, the value of connection to community is clearly communicated on their homepage: Each hotel within our association carries common responsibilities of existing within a community as positively as possible by not only providing opportunities but also being ethically accountable to the surrounding neighbors. Libby Kasha, Operations Director, described the 2020 experience as having the rug pulled out from under their operation. As occupancy plummeted, Kasha explained her role was to quickly develop the operational response while the president insured the continued financial viability of the organization by securing the appropriate financing. Kasha explained "It's our obligation to lead by example." And now with the example set, the organization began working together to ensure the safety of employees while delivering high quality of hospitality to their customers.
Founded in 1982, Zingerman's is an institution in Ann Arbor. The co-founding partner, Ari Weinzweig, wrote Working Through Hard Times: Life and Leadership Learnings from 2020. Acknowledging 2020 was difficult for a myriad of reasons, Weinzweig reflected on the many lessons to be learned from the pain and hardship we all experienced. Weinzweig believes in the power of connection, even via the telephone. In describing a call with another restauranter, the two allies discussed layoffs, loans, furloughs and pondered how to make it through. Weinzweig acknowledged they didn't fix anything during that conversation yet they both agreed they felt much better.
Beyond the original Delicatessen, Zingerman's Community of Businesses includes Bakehouse, Creamery, Catering, Mail Order, ZingTrain, Coffee Company, Roadhouse, Candy Manufactory, Events at Cornman Farms, Miss Kim and Zingerman's Food Tours. As the pandemic hit, the organization was on track to earn $70,000,000 in sales with 700 staff members. The 2020 fiscal year finished at $50,000,000 and 550 staff members.
And Then This Happened
During the health crisis, divisive political discourse has been rampant. In May 2020, heavily armed protesters gathered at the Michigan Capitol angry with stay-at-home orders and closing down businesses. This was simply a precursor to January 6, 2021, when the United States Capitol in Washington, D.C. was stormed during a riot and violent attack against the U.S. Congress.
Jayson Boyers, President of a Catholic liberal arts college, immediately issued a statement: "What occurred yesterday on Capitol Hill was abhorrent… what I know of our Rosemont students affirms that what happened yesterday is not who we are as a country. In them, I see dialogue valued and the power of listening respected. In them, violence is not regarded as the way forward. In them, I see hope. Yesterday's events have inspired me to commit even more fervently to the values that a Rosemont College education imbues in our students: the development of open and critical minds, the ability to make reasoned moral decisions, the responsibility to serve others, and trust in and reverence for the dignity of each person. Today, I pledge that, as a college community, we will work to ensure that yesterday's events never happen again in our great nation."
Barnes also quickly messaged the Cleary University community: "While we are hundreds of miles from our nation's capital, the perspectives and rhetoric that led to the situation have been building across the country, including our community, for a very long time. …First, we must unequivocally denounce any act of violence, bigotry or malicious intent, without exception. Then…we must ask questions, explore the problems in our society and seek to understand how to move forward… I call on everyone in the Cleary community to seek civility and be the paragon of what it means to be American… expand our knowledge and through careful examination of sources, question, advocate and come together in civil discussion for the benefit of all."
Get Ahead of Divisive Debate
As evidenced by our stories from the front line, organizational leaders can get ahead of divisive debate by clearly communicating organizational values to employees, customers and other stakeholders. Leaders of the Michigan SHRM Chapter responded to their community of HR professionals with Blue Table Talk, an initiative to help begin discussions around difficult conversations. Blue talk is language or a topic which may be viewed as inappropriate for polite conversation. The invitation to participate acknowledged the 2020-2021 life-altering events, both professional and personal, as well as the need for HR professionals to lead change within organizations. Ground rules confirmed a safe haven and judgment-free zone to encourage personal vulnerability.
James Reid, State Director of MISHRM, explained the leadership team realized the need for HR professionals to facilitate difficult conversations. Small chapter in-person gatherings aren't a viable option given the pandemic. With available technology platforms, Reid recognized an opportunity for the Michigan Council to lead by example and start the conversation at the state level letting the local chapters then continue these much-needed conversations.
The leadership in our stories from the front line have clearly taken a stand on the importance of constructive conversation in education and business. Get ahead of divisive debate by communicating organizational values to employees, customers and other stakeholders. Lead by example and start these difficult yet important conversations.
The Leader's Playbook
Business leaders seek best practices. This is often a fool's journey. Best practices work when the link between cause and effect is obvious. When the link is not obvious, the relationship between cause and effect requires analysis and expert knowledge. We accept this and have these skills in our toolbox.
When we move beyond simple and complicated problems, we struggle because there is no right answer. Margaret Heffernan, author of Uncharted: How to Navigate the Future, explained complexity is not simply complicated on steroids. Complexity is not linear or predictable. Complexity is fluid. We need to increase our ability to recognize patterns plus develop skills in navigating an unclear path. Get comfortable with complexity. We are competing on our rate of learning. Our ability to compete via our rate of learning is the relationship between employers and employees.
The Changing Employer-Employee Contract
The foundation for our rate of learning is the talent we engage. Our contract with employees has been quietly changing for well over 50 years. In the 1950s, Drucker coined the term "knowledge worker" underlining the need to move from employing bodies to engaging minds. Deming, highly influential in the quality movement beginning with his work in Japan in the 1970s, called for a transformation of western management practices. Changes in the contract escalated in the 1980s with globalization, outsourcing, and white-collar layoffs. In the 1990s, Drucker argued that competitive advantage and leadership in the world's economy will move to countries and industries that best improve knowledge worker productivity. And Senge introduced the learning organization.
We must now accelerate these changes in relationships with talent, consumers and investors. Realize relationships are the foundation for any leader's playbook to best address critical and increasingly complex challenges. And because this is complex, we need to engage all members of our organization in learning. 2020-2021 offers several examples of leaders learning from relationships and informal knowledge-sharing to create new ways of working together to solve complex problems.
Share Knowledge and Build Relationships
Trust is widely accepted as an important enabler of knowledge sharing. Consider the role of trust between doctor and patient when obtaining critical information for the patient's health and future. The emotional dimension between our leadership and employees plays a similar role in the health and future of our organizations.
Beyond integrity, trust reflects competence and good intentions. Research confirms the key to prosperous organizations is knowledge shared through relationships. Leaders should focus on the inclination to share knowledge via relationships rather than the technological approaches of sharing knowledge. The technical ability to share knowledge is either diminished or enhanced by the inclination to share knowledge.
Knowledge-sharing relationships are interpersonal relationships with the ability, as well as the inclination, to share knowledge relevant to organizational performance improvement initiatives. The emphasis in the phrase knowledge-sharing relationships is on relationships and the informal nature of the knowledge sharing that occurs during dialogue and other personal connections.
Think and Act Together
Senge defined dialogue as the ability of participants to think together. Beyond thinking together, dialogue also promotes acting together to seize opportunities by reaching agreement and making decisions to create the desired results. For example, a major challenge for the healthcare industry is staffing. Thinking and acting together is what allowed Elara Caring to develop an innovative approach to securing nurses. The HR team decided to try a boomerang approach by contacting nurses who were past employees. This initiative was highly successful.
Earlier in her career, Barnes was mentored by Boyers when he served as President of Cleary University. During the challenges of 2020-2021, their mentoring relationship became one of peers. Barnes and Boyers shared insights as they thought and worked together to address the challenges for the two institutions they serve. When Barnes developed her plan for campus safety, she understood the value of connecting with the local hospital and partnered with a doctor to think and act together when communicating with faculty and staff via a Zoom meeting.
Let Values Drive Your Social Issues Stance
During the pandemic, Amazon doubled headcount to 1.3 million. In Birmingham, Alabama, roughly 6,200 full-time and temporary workers cast ballots to unionize in late March. In addition to the politics of the employer-employee contract, climate change has become a political issue. Many companies have publicly set ambitious goals for moving toward zero or near-zero emissions. A critical part of fulfilling these goals is to guide supply chains toward reducing their own carbon footprint.
Until recently, few companies paid much attention to Black Lives Matter. In the wake of the George Floyd protests, major companies including Apple, Amazon and Facebook have endorsed the movement. Businesses have pledged millions of dollars to fight racism and vowed to do more to end discrimination in their workplaces.
Davis feels politics will be inescapable as companies navigate these issues. Davis' recommendation is for CEOs to be consistent as social issues evolve. With diverse workforces impacted by racial justice and voting rights, not taking a stand that reflects corporate values could impact the organization's ability to attract and retain top talent. Business leaders should consider their employee base and location. Organizations can choose where to locate their facilities.
The Leader's Journey
Unionization, carbon footprints, supply chains, racism, voting rights and unpredictable reactions to corporate moves from legislatures. The fool's journey would be to seek best practice or become paralyzed by analysis. While best practice and analysis are part of the exploration, the findings are simply the beginning of the leader's journey.
Leaders need to prepare for surprises during our move from a complicated world to a complex one. With flexibility, open mindedness, responsiveness and curiosity, we can move beyond traditional management processes. By embracing complexity as well as considering the options, leaders in any industry can recognize and seize opportunities to build resilience as well as improve and sustain superior performance for their organization.
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