Montieth
Montieth Illingworth

It’s a Silicon Valley denizen’s truism that ethics don’t scale. As tech companies grow and their products become more pervasive in our lives, in the eyes of many observers, key ethical considerations have taken a back seat. There’s a real debate in there. But the pattern also has parallels worth examining in any company’s growth trajectory.

When companies in any sector grow rapidly, what happens to their ability to manage, learn from, and prevent critical issues from evolving into full-blown crises?

And once crises happen, have these companies developed, at the level the urgency demands by their scale, the ability to manage them effectively, limit legal and regulatory risk and protect their corporate reputation?

Many rapidly growing organizations don’t put as much attention into scaling crisis preparedness as they do to scaling the rest of the business, let alone consider what it takes to manage a crisis once it hits. This gap limits an organization's ability to manage and protect its reputation. Best practices exist for closing it and they carry value in scaling ethics as well.

What Really Changes When Growth Happens

Rapidly growing companies, in any sector, face what can be called “high-class problems.” Hiring accelerates across every level, from the ranks doing the work up through the C-Suite. A governance structure is put in place. HR policies are written and socialized within the organization. The corporate culture takes shape and, over time, becomes more publicly facing as the organization engages more in its communities and justifies its license to operate.

Within that dynamic, the organizations build vital stakeholder relationships—employees, investors, customers/clients, and business partners. The communities where the company operates count as a stakeholder group too.

As companies scale rapidly, the need for a crisis management plan grows as well. Leadership sometimes builds a plan and then lets it gather dust.

Take a Beat, Start at the Beginning

This is when the organization needs to start at the beginning. A set of existential questions arise: when you started on this journey, was this the situation you thought you’d ever be in and the company you thought you’d become? Knowing what you know now, how would you approach scaling your crisis preparedness alongside the business, starting from day one?

Use a Jedi Mind Trick

Going back to the beginning takes a kind of Jedi mind trick: convince yourself that whatever the company has become is what was always intended—warts and all. Revive the original inspiration for creating the organization—the technology, product or service—as if it’s just as strong an idea today. Channel that energy into building an issues and crisis management architecture designed to adapt as the business scales. That sounds hard, but it doesn’t have to be. Here’s how it’s done:

“Move fast and break things” wasn’t coined by Google, but in fact was a Silicon Valley mantra that a young Mark Zuckerberg popularized. It means speed to market trumps caution about whether products work perfectly or have unintended (negative) impacts on people. The conceit here is that by the time those impacts are acknowledged in any way, the company will be large and powerful enough to evade responsibility.

That approach starts with neither values nor ethics. It’s a commercial zealot’s fever dream. You can’t create the foundation for scaling a crisis management capability, at whatever pace, unless its very footings are a defined set of guiding values and the points on an ethical compass that becomes embedded in the corporate culture from the very beginning.

Foundations

The first step in the embrace of origins is to get there through a frank assessment of what happened in these cases and to be sure they were learned from—not just swept under the rug. And there is no conclusive finality to most crisis events. They have roots, triggering events, impact and then outcomes. Each outcome is like a tail that, even invisibly, carries forward and sometimes becomes the roots of a new crisis—sometimes with the old one repeated.

Doing that archeology, we can call it, is essential. This will reveal not just how values and ethics played into the various situations, but whether corporate policies were complied with or not. Even more important is knowing what decisions were made in dealing with the crisis. The architecture and dynamics of crisis management decision-making are probably the most opportune and rich vein of learning to mine.

Decisions, Decisions

Did we really understand what happened and why? Were we too fast in making a judgment about taking a specific step, or making a particular public statement, in terms of what we reliably knew the facts to be? Did we probe enough to understand what the “unknown unknowns” could be before acting? If it was our own ethical breach—and one that involved a lapse in moral judgment, not just an error of skill or experience—that contradicted a specific core value of the organization, was that properly dealt with or swept under the rug, so as not to be repeated?

The list goes on. But revisiting these questions through the lens of the founding inspiration of the company means injecting new inspiration into being sure about the answers.

Do I Need a New Crisis Plan?

Much is made of crisis planning, but few such plans survive the first day of battle. Why? They are written a) without doing much of the above archeology, b) without a deep understanding of the likely impact of a crisis event on a core stakeholder group, and c) with inadequate strategic planning for the different scenarios that could arise, primarily because too many assumptions are made about what an opposing entity in the crisis will do or say.

The other factor here is being sure the plan encompasses the realities of scale. Sometimes, founding leadership and management think “small,” as it were, or are somewhat frozen in time in terms of understanding how scale changes so much in an organization, especially when it comes to communications.

The challenge here is how much growth has shaped identity within the organization. In large corporations, there is no one, single identity. There are more than nuances of difference between the sales and marketing unit, vs. the technology innovation team, and the customer experience group, and this is not even considering social and cultural differences for multinationals.

Think Within

Of course, how this messaging is received depends on who’s delivering it. There’s a phenomenon with quickly growing companies where an inner core of the leadership ranks develops, usually in close proximity to the founder CEO, and with tenure, becomes quite insular. Yes, in the command-and-control structure, there is a whole infrastructure of direct reports to that core, but a gulf eventually opens. It is almost a certainty that core will become isolated from what’s happening in the enterprise. The question is how isolated and for what reason.

Size and scale alone create that isolation. But so can a slow process wherein top and middle management begin to become selective about what the very top, including the CEO, should and should not know. As businesses scale, they need to prioritize what the focus should be on at every level.

Big Things Happen in Small, Dark Places

The prevention of waste, fraud and abuse is central to corporate compliance. These can be committed intentionally or unintentionally. Even the latter could suggest carelessness. But it could also mean a lack of training and proper management oversight. The fact is, big problems sometimes have their start in small, out-of-the-way places in the organization, even if they’re initially orchestrated by someone senior. How does a crisis plan find such things? It can’t. This is a classic "the problems with scale" issue in crisis management which has to be addressed in the planning and decision-making.

The Only Answer is Sound Decision Making

This is where decision-making becomes the most crucial management discipline in a crisis for large organizations that have grown rapidly. The CEO cannot be held responsible for a crisis whose origins are in a small room amongst a few employees in a faraway place in the organization. Or can she?

That depends on how the decisions are made in dealing with that crisis event, and of course, the outcomes. And then also how the outcomes of the outcomes are dealt with. The first most important decision—whether the CEO makes it or not—is diving deep into understanding precisely what happened, why, who was involved.

Enterprise Level Ethical Standards and Practices

Ethical conduct flows from and is largely shaped by modeling of behaviors from the top down. “Tone from the top” is a favorite phrase amongst well-managed companies. If it doesn’t flow from that origin, ethical standards and practices are probably still encoded as it were in some manual somewhere, but lack both the inspiration and policing, as it were, from the top down. That is the only way to scale ethical compliance.

Montieth Illingworth is the CEO & Global Managing Partner of Montieth & Company, a global communications consultancy.