One of the most difficult situations in crisis management
Sometimes, operational concerns mean difficult decisions have to be made. Layoffs may be the case to demonstrate this. No matter how necessary cutting numbers from your workforce may be, the personal impact on the lives of those who have served your company makes any communications related to the situation difficult.
The announcement this week from Deutsche Bank that it would be closing thousands of positions and exiting entirely from 10 countries is a tough one, but its wording was also a terrific example of how to share such a decision:
Deutsche Bank (XETRA: DBKGn.DE / NYSE: DB) today announced details of the execution of its strategic plan, known as “Strategy 2020,” including information on the Bank’s strategic goals; management actions in its business divisions, infrastructure functions, and regions; and updated performance targets for 2018 and 2020.
John Cryan, Co-Chief Executive Officer, said: “In April, we announced Strategy 2020. Since joining the Management Board in July, I have been working together with my colleagues to draw up plans to stabilise the bank and to turn around its long-term performance. Now, it’s all about executing on our plans to build a better Deutsche Bank.”
He continued: “We have four strategic goals. First, to become simpler and more efficient by focusing on the markets, products, and clients where we are positioned to succeed, leading to greater client satisfaction and lower costs. Second, to become less risky by modernising our outdated and fragmented technology and withdrawing from higher-risk relationships and locations. Third, to become better capitalised, so that we are no longer playing catch-up with regulation and market expectations. Finally, to run Deutsche Bank with greater discipline and purpose based on delegation of responsibility, personal accountability, and a reward system which is aligned to good performance and conduct.”
He concluded: “Sadly, this also means closing some of our branches and country locations, and reducing some of our front-office and infrastructure staff too. This is never an easy task, and we will not do so lightly. I promise that we will take great care in this process, moving forward together with our workers’ representatives.”
Jürgen Fitschen, Co-Chief Executive Officer, said: “Deutsche Bank’s country network is among its strongest credentials for clients. That network, however, has never been static. We adapt it over time, sometimes expanding the number of countries in which we operate and at other times consolidating. In either scenario, one aspect endures: our commitment to serving clients around the world as Germany’s global bank.”
Competence, confidence, and compassion, our Three C’s of Credibility, were all found in good measure in this statement, and Deutsche Bank gave its words even more validity by going into greater detail regarding the entire restructuring on a designated website. This is an excellent start, but that doesn’t mean the path ahead is clear of possible hurdles. Now that Deutsche Bank has set expectations it needs to meet them, or a whole new set of issues will be spawned.
Running an organization means making tough calls from time to time. It’s inevitable, but you can reduce the long-term impact on your reputation (and bottom line) by speaking plainly about the rationale behind the decision and delivering your message with the Three C’s in mind.
The BCM Blogging Team
www.bernsteincrisismanagement.com