Don’t turn on your brand problems

In November 2013, JP Morgan Bank was in hot water and all over the news as it came under criminal investigation for manipulating global financial markets. Someone on your marketing team decided to open JP Morgan to get good publicity, and it went wrong.

The tweet read: “What professional advice would you ask of a leading executive at a global company? Tweet a Q using #AskJPM. On 11/14, a $JPM leader takes over @JPMorgan.”

The hashtag #AskJPM was created, and the purpose was for JP Morgan to serve as a thought leader for genuine questions from the public. The company had been fined nearly $1 billion a couple of months earlier for its “London Whale” and then reached a $13 billion settlement with the Justice Department the month before the infamous bad-mortgage-loan tweet. JP Morgan needed a makeover, but his tweet was deaf to the fury unleashed against him.

The bank was exposed to a public flogging on social media as consumers criticized them for their questionable business practices. Some of the responses to JP Morgan’s tweet included this: “Did you always want to be part of a vast corrupt criminal enterprise or did you turn bad?” and also this one, “When Jamie Dimon eats babies, are they served rare? I understand that anything above medium rare is considered clumsy.”

Transparency is not for everyone

The reality is that transparency is good for business. But if he’s in a branding mess, controversy, or if there’s been bad rumors about his business (that could be true), the last thing he wants to do is shine a light on his Achilles heel. First, he must think hard about all the potential benefits and liabilities.

In the case of JP Morgan, that tweet opened them up to more public scrutiny than they were already experiencing because it seemed to the public that they were simply overlooking the issues that were most important to people. At the time that JP Morgan made the tweet to engage the Twitter audience, there was a lot of public anger towards the company.

When transparency doesn’t work

As the JP Morgan story illustrates, transparency can backfire. But it doesn’t just happen in the midst of a brand crisis. It can happen at other points of the business.

• Before baking the idea. If you sell consulting services, for example, you want to perform at the highest level and be useful to your client. However, one of the mistakes associated with transparency is delivering too early, before you’ve had a chance to fully develop an idea. Sometimes, as much as you would like to provide your customer with information and transparency about the early stages of the work you are doing, it may be better to wait and give them the full menu with all the items at a later time. . If you present a concept that isn’t fully developed, they might make decisions based on those first impressions (without having the full picture), and you’ll quickly go back to the drawing board.
• Blaming the culture leads to mistrust. in a Harvard Business Review article, on transparency, the authors pointed to an example of how full transparency can be detrimental. A Dutch energy provider was rigorous and transparent about its standards in handling toxic waste. One day, the security office of the company, which had created the rules and criteria, was found dead, having violated what he created. The company became almost exclusively focused on the fact that it had broken the rules, rather than investigating why or how it could have happened. The rest of the team was left with the impression that the company wanted to blame the victim rather than understand the more nuanced details surrounding the situation. Employee morale plummeted and distrust of the company increased.
• Radical transparency fails. A couple of years ago, it was reported that radical transparency at Bridgewater, the world’s largest hedge fund, had become a serious problem. An employee of the firm filed a complaint with the Connecticut Human Rights and Opportunity Commission. The employee claimed that there was continuous video surveillance, including recording of all meetings and security guards patrolling the offices. This had a chilling effect on the company. There were other charges of sexual misconduct and harassment. Bridgewater operated on a day-to-day basis with everything monitored, including personal cell phones that were locked away at the start of each day. The sweeping transparency, intended to ensure none of its trade secrets ever left the Bridgewater offices, earned it unwanted scrutiny, hurting the money it was receiving from investors and hurting its bottom line.

Businesses today have to be much more transparent than a generation ago. However, even transparency requires consideration to make sure you don’t end up in a situation that favors your brand or your business with the public and your customers setbacks.