This is an excerpt from an article posted on Medium on October 31, 2020, by Michael Toebe. In this article, Logos president, Helio Fred Garcia, is quoted sharing key insights and best practices in crisis management, and how McDonald’s can utilize these practices for greater long-term success.
McDonald’s clearly doesn’t see it yet but in its zeal to defend itself in different lawsuits filed by Black franchisees about alleged discriminatory and exploitive practices, it is talking down to and possibly gaslighting minority owners.
This reactive strategy will only serve to escalate media scrutiny, invite more investigative reporting and quite likely confirm beliefs in the Black community about alleged predatory inequality towards people of color.
A $1 billion class action suit was filed in August by 52 former franchisees. Now, another suit has been filed by two brothers, James Byrd, Jr. and Darrell Byrd.
The lawsuits have alleged that McDonalds restricted plaintiffs to stores in poor or crime-ridden areas of town, with lower sales and higher costs, which included higher security and insurance expenses, according to Reuters. Other claims by both former and current owners are of “harsher inspections and renovation requirements.”
These particular stores and opportunities were labeled by some franchisees as ‘financial suicide missions.’”
Business Insider investigated in 2019 and the findings, drawn from 2017 data from the National Black McDonald’s Owners Association, show the average company store location earned $60,000 more per month on average than those locations of Black franchisees.
McDonald’s is offended and must realize how this will look in court and more so, in the court of public opinion and has taken the surprising, if not shocking approach of communicating in a manner that is condescending of the plaintiffs, especially considering the strength of social advocacy in 2020.
“Plaintiffs offer nothing in support of this extraordinary theory beyond vague and conclusory assertions, self-serving speculation on ‘information and belief,’ and a handful of personal anecdotes,” the company has communicated.
This is, however, not unprecedented communication in scandalous conflicts.
“There are predictable patterns in crisis response,” says Helio Fred Garcia, president of Logos Consulting Group. “One such pattern of ineffective crisis response is for organizations to say and do things that feel good to them, but translate as uncaring, defensive or dishonest to those who matter, which in effect prolongs the crisis and causes self-inflicted harm.”
The behavior, arguably arrogant, is a common response before court proceedings.
“The lawsuit remains in its early stages and it is common for corporate defendants to, at least publicly, focus on the their legal arguments and defenses,” says Robert C. Bird, Professor of Business Law at the University of Connecticut and an Eversource Energy Chair in Business Ethics.
“As the lawsuit progresses, some claims may be dismissed while others may proceed onward to trial. While this happens, each side learns more about the strength of the other’s case, creating a background framework for a possible settlement between the parties,” Bird adds.
McDonald’s reactive, unrestrained and demeaning communication and posturing will be remembered negatively by the plaintiffs and critics, stoking the fires of resentment and feeding confirmation bias.
“McDonald’s voiced desire for every operator in its system to thrive while attacking a subset of its operators falls short of demonstrating the care necessary to effectively resolve this crisis,” Garcia says.