Gary Friedman is apparently the latest in a long line of CEOs whose relationship decisions –or indiscretions– put them in the unemployment line.
The chairman and co-CEO of Restoration Hardware is in a consensual relationship with a [now] former co-worker and that led to the board firing him for violating company rules. Today this seems a tale about just another CEO who can’t seem to find love, sex and relationships outside the office. He’s divorced, she’s single, [with an angry, whistleblower ex-boyfriend] but the boss-employee aspect ended his job.
All that said, the issue we’re tackling here — thanks to its flagging from EMA CEO Eric Mower — is that the company’s board and Friedman missed great opportunities by sending out proxies to leak the whole mess to the New York Times, and then saying no comment. Even if both sides agreed to a non-disclosure agreement, at least say that.
But in the absence of any comment whatsoever, we all think: “Bad, guilty, stupid.” And I think, ‘ouch, blew that chance.’
Which may be entirely accurate. The point is that if the company, or Friedman, were to say those words, they would have a shot at turning their mutual crisis into transformative leadership.
If someone in crisis leaves a vacuum of comment, it will be filled either by uninformed public speculation or by critics. This is magnified by social media. Anyone can say anything they want about you and if you have nothing “out there” on the record, you risk becoming whatever people say you are. Neither option really protects you if you have a corporate, or an individual, reputation to maintain.
No one is crying about Gary Friedman. He likely is extremely well-paid — he’s credited with turning around his company — and will get a golden sendoff. But one of these days he’s going to say ‘sure’ to a head hunter and put his hat back in the ring of turnaround CEOs. He’d be especially smart if today he thought about his future and commented. Something like:
“I had an adult relationship that outside of work is perfectly acceptable. [Yes, she’s 24, he’s 54, but they’re adults.] My mistake was dating an employee and I know that violated company policy. I apologize to the board, my fellow employees and to our many clients and customers. I take full responsibility, accept my firing and I wish all my colleagues nothing but success.”
The board could and should say something similar. People see this for what it is. Why not treat them as adults and admit as much? We all make mistakes. Mostly Americans are a forgiving group [or, increasingly, a forgetful one] and we will give someone the benefit of the doubt for their first offense.
What we really want to see is corporate leadership and responsibility. That’s how you generate transformative leadership from a crisis. Speak. Be honest and transparent.
The content of this blog is about crisis management and mismanagement in a digital age. It originates with Steve Bell, who spent 30 years as a journalist for the Associated Press and in four top editor positions at The Buffalo News. He is now Partner/Director of Public Affairs at Eric Mower + Associates, one of the nation’s largest independent advertising, integrated marketing and public relations agencies, with seven offices in the Northeast and Southeast. Learn more about EMA at www.mower.com. Steve’s blog is based on his own opinions and does not represent the views or positions of Eric Mower + Associates.