Recently, I had a conversation with the CEO of a 500-person biotech company. She posed an interesting question to me:
“How do I address widespread employee complaints about a problem that doesn’t even exist?”
I asked her to share some background so I could make sure I truly understood the question. She gave me permission to share her story as long as I change key facts so she won’t be identified. Here’s what Jenna told me:
Jenna’s organization has been growing at a slow and steady pace for more than a decade.
Yet they’d been losing money since their founding, and relied heavily on institutional investment. So to ensure healthy future growth, their leadership decided to move toward profitability.
That meant making some unpopular changes. One of those changes involved closing their San Francisco office - which was located near much of the US-based biotech community, but cost almost three times more per employee to maintain than their other four offices.
Before shutting the doors, Jenna gave all San Francisco employees the opportunity to move to another office… with salaries adjusted down in alignment with the living expenses of the cities they’d move to. Few were willing to make the change.
From a business perspective, leaving San Francisco was the right decision. Without the exorbitant expenses, Jenna’s company quickly balanced their books and saw its first profitable quarter - a requirement for continued growth and success.
But from a culture perspective, it caused immediate havoc. Just two days after the move was made, Jenna received an email from an employee with the subject line: “YOU DON’T CARE ABOUT DIVERSITY!” That was just the beginning.
Over the coming weeks, she faced angry or upset employees via email, phone, in the hallways… who all shared similar feedback: they didn’t believe Jenna or her company valued employees from diverse backgrounds.
It was devastating for Jenna.
She felt like she understood better than most, as a female CEO in an industry dominated by male peers, the value of diverse backgrounds. She had built her organization with a desire to dissolve unfair power structures that impacted her and so many others.
But sometimes our best intentions have unintended consequences.
It turned out that San Francisco, while prohibitively expensive to operate in, was also by far the most racially diverse city that her organization had offices in; by extension, it was by far Jenna’s most racially diverse office. Closing that office meant the share of Asian, African American, and Hispanic employees in her company tumbled practically overnight.
So while Jenna understood that she’d shut down an office that, if left operating, could have caused her business to fail… many employees sensitive to long-standing imbalances in power now believed Jenna and her company didn’t value diversity.
“We’re in a crisis,” Jenna told me. “Key people are angry, and I don’t know how to respond… because I’m angry too. They must see that we’re on the same team, that demographic changes in our teams reflect a shift in our geography… not a shift in our values.”
Many employees believed Jenna and her company didn’t value diversity.
“How can I help?” I asked.
“We obviously care about diversity. It’s embedded in our organizational story. Shutting down San Francisco was about saving jobs… not whitening our company. Is there anyway you can help me show my employees that they are wrong?”
“No,” I said.
“Well, for starters, they aren’t wrong,” I said.
I heard Jenna’s breath catch, and she took a minute to share a response.
“They may not be wrong about the numbers,” she said. “But they don’t have any of the context surrounding those numbers or our business needs. And they are assuming bad intent on my part… when the truth is exactly the opposite.”
“I agree,” I said. “I know you well. You are one of the most good-hearted, inspiring leaders I’ve ever met. And I know, also, how much you value diversity. I know how much it must hurt for employees not to see that.”
I noticed Jenna seemingly begin to breathe again.
“But your employees aren’t wrong for sharing their lived experiences. They see an organization with less diversity today than yesterday. And for some of them, it creates real pain and fear. And they are letting you know.
“If you tell them they are wrong, they won’t forget what they feel and thank you for enlightening them. The opposite will happen. They will feel that you’re not listening and that you don’t care about their experiences, and you’ll lose even more trust.
“I know this from personal experience. I’ve made this mistake before. And upon reflection, the impact was predictable: instead of recapturing trust I believed I rightfully deserved, I lost more trust with people I cared about. That trust was difficult to rebuild.”
“Listen to the people who care enough to share. Then work with them to co-create solutions.”
Jenna and I were quiet for a few moments. Then she said, softly, “So what do I do?”
I shared the same message a mentor shared with me when I’d faced that similar kind of situation years before… after I’d failed to recapture the trust of my employees and, like Jenna, felt confused, angry, disillusioned:
“Listen to the people who care enough to share. Let them know you hear them and they aren’t wrong or bad for speaking up. Share what you’re hearing and learning, and share your own experiences and context too. Then work with them to co-create solutions.”
“That sounds easy enough,” Jenna said, smiling. “But how do I help them to see the amazing work we’ve done to steward diversity in our organization? That’s really important to me!”
“Instead of showing them, ask for stories about where diversity is working. Offer a forum to share those stories of success and, also, stories of learning. When people have space to express what they feel - rather than be told what to feel - the results are real and lasting.”
“Huh,” Jenna said, furrowing her eyebrows but still smiling. “I can do that.”
I smiled too, reflecting on my own moment of realization when my mentor had shared that same message. I remember feeling perplexed that the answer could be so simple; but also grateful that I might help fix what I’d accidentally broken.
—Daniel Jacobs, Avanoo CEO & Co-founder
Daniel Jacobs is a husband, father, inventor, and storyteller. His work has been featured on Fortune, Inc. Magazine, Business Insider, Apple News, HuffPost, and most major news publications in the United States. He is CEO and co-founder of Avanoo, which uses the power of stories to drive connection, belonging, and performance in the workplace.
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