Welcome to the 4th edition of the Friday Morning Marketing Quarterback.
It’s a look at what happened during the past week in the world of all things marketing (including PR, social media marketing, search and inbound marketing).
PR fail: RBC takes the heat for outsourcing Canadian jobs
Canada’s largest bank, RBC, is in hot water this week.
It’s a big PR fail as they try to stick-handle a flurry of negative media reports after being caught out-sourcing jobs to foreign workers.
The bank contracted iGate Corp., a successful multinational outsourcing firm based in India, to provide IT services. Now iGate is bringing in foreign workers to replace 45 RBC employees.
According to media reports the bank is misusing the Federal Temporary Worker Program that allows companies to fill Canadian jobs when labour shortages exist.
There’s nothing new here. And the Royal Bank of Canada certainly isn’t the only large company that’s shipping work offshore.
So why is RBC taking it on the chin?
One big reason is the sympathetic whistle-blower who went public with the news. Dave Moreau, one of the affected employees, appeared in media interviews to tell his side of the story.
It’s hard not to feel for the guy. He’s articulate, sincere, authentic and believable. He’s talking our language—straight-forward and jargon free.
He questions the legality of the move:
“They are being brought in from India, and I am wondering how they got work visas. The new people are in our offices and we are training them to do our jobs. That adds insult to injury.”
And sympathizes with the other employees affected:
“There are a lot of angry people. A lot those people are in their late 50s or early 60s. They are not quite ready for retirement yet, but it may be very difficult to employ them.”
Then comments on his own personal situation, which is devastating:
“I am going to be broke. I don’t have enough money to live on. I have some RSPs. I have very little in the pension plan at RBC….I have a wife that works part time at a very low wage.”
Another RBC employee facing unemployment compared the situation to being “fleas on an elephant.”
Take a look at Moreau’s interview here.
The corporate spokesperson
The story continued to unfold with Zabeen Hirji, RBC’s chief human resources officer, taking the hot seat to address the situation. In one interview, she explains:
“What is important here is that RBC has not hired temporary foreign workers to replace our employees. Really, as we look at this particular situation, we’re working with a supplier, as companies do with many suppliers, and we’re now going through the transition process as the work transitions over.”
The foreign workers’ story
Stories about the plight of the foreign workers also surfaced. Two contractors from India who once worked at RBC said their multinational employer constantly threatened them with deportation.
RBC CEO Gord Nixon quickly came forward, appearing on select news programs to contain the damage. As I write this post (Thursday evening), he’s issued an apology, as well as a promise that all 45 employees will find comparable employment within the bank.
This issue won’t have a permanent impact on RBC’s business results (in 2012 the bank pulled in $7.5 billion in net earnings). But their reputation has taken a big hit, a scenario all organizations prefer to avoid.
So what could RBC have done differently to minimize the public relations backlash?
#1 Avoid corporate speak
The whistle-blowers in the snafu were better prepared than RBC’s corporate spokesperson, speaking a language the average Canadian could understand. They used quotable quotes that quickly painted the sad story of their situation with a few simple words.
#2 Don’t split hairs
While RBC is correct in saying they’re not hiring temporary workers, it’s a technicality. The fact is they hired iGate. And now iGate is hiring temporary workers. While these subtleties might play well in the boardroom, they don’t play well with the public.
#3 Explain the rationale
Denying the allegations stoked the story about the foreign workers. A better approach would be to accept responsibility and explain the rationale behind the business decision.
#4 Be selective about your spokesperson
While the chief human resources officer was the obvious person to speak publicly about the issue, she wasn’t the best choice on this particular issue.
She appeared strained on TV, smiling tightly when welcomed to the program. A more experienced individual would have been a better choice, especially in light of the whistle blowers’ natural media skills.
What other steps do you think RBC could have taken to avoid this PR fail?