The $440,000 ill-timed retreat

October 16, 2008

OK, I have to comment on this. It’s all about trust, you know. When the taxpayers are moaning and groaning about huge government bailouts of private companies and fearing greatly that the big time executives will just run off with multi-millions of taxpayer dollars, it is really really really stupid to do anything like this retreat. Oh, I’m sure it was planned well in advance. And it is an incentive tool I’m sure for high producers. And they probably deserve the kind of luxury treatment for their outstanding performance. Doesn’t matter one whit. The only smart thing to do under the circumstance would be to kill it, delay it or find some other way to recognize the performance.

Here’s further info from PR Week.

Did they think no one would notice? Did they think no one would care? It’s about transparency folks. You can’t hide in this environment, you can’t do things to violate the public trust. I’ve been saying for some time we live in a time of public franchise–the public ultimately gets to decide if you deserve to stay in business. But when the public, as in taxpayer, now has bailed you out, or owns stock in you, the day of public franchise has just gotten a whole lot more intense. Could be a good time for crisis managers and reputation management experts.


3 Responses to “The $440,000 ill-timed retreat”

  1. Josh Morton Says:

    I’m not sure all the reputation counsel in the world could have changed the culture over there. The most difficult part of our business sometimes is when a client says “Thanks, but no thanks” when given solid strategic advice and then goes and gets themselves into a pickle.

    By the way, Gerald, regarding your comment on my blog, I’d love to check out PIER at some point. I’ve heard wonderful things, but have never seen it in action.

  2. Ken Says:

    Are we really surprised. The beauty of the AIG meeting, and yes the company had the reward meeting booked in advance, however, the hotel would have worked with them in rebooking the meeting. AIG may have lost a deposit, they could have utilized the cancellation as a positive PR move making the cancellation made public.

    This human behavior gives all of us job security and somethng for us to write and talk about.

  3. davefleet Says:

    Shel Holtz and Neville Hobson, over on the For Immediate Release podcast, took a different view of this situation. In their view, AIG’s mistake wasn’t continuing with the event, it was not explaining why they were doing it or preparing the ground for the story in the media.

    In their view, cancelling an event to reward their top salespeople – the people who brought in big money for the firm – would be likely to drive many of them away as the event was likely dangled in front of those salespeople as an incentive at the beginning of the year. In a time of recession, they say, those top performers are the people you need to hang on to.

    On reflection, they may have a point, although I think it would be an immensely difficult communications challenge to avoid negative coverage of the event.

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