Hershey’s Reputation Crisis

Hershey's Syrup, circa 1950s

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Hershey’s has a crisis. It erupted Thursday. Since then over 600 articles about it have appeared online, including this New York Times editorial. It is a legal quagmire that no one appears to want to take responsibility for.

Background: A group of  international college students came to the U.S. this summer for a cultural/work experience.  The State Department arranged it. They paid up to $6000 for the opportunity to work and travel here during their summer off from engineering, medical and other foreign universities.

Coming at a time when the U.S. faces an economic crisis of its own, the summer job many got was sweat shifts at a Hershey vendor’s plant for wages of $7.25 to $8.35 an hour. Disturbed by the labor conditions and encouraged by local labor leaders, they staged a public protest now heard around the world.

Six hundred articles and one New York Times editorial later, Hershey’s has said little except that the responsibility lies with their vendor.

Hershey’s has deep reservoirs of reputation capital: goodwill and brand loyalty from millions of multi-generational Americans. Historically, long-established companies with excellent reputations have been able to withstand such crises. Toyota did, after a 2009 recall created a massive reputation crisis for the company. (This Harvard Business Review study explains how.)

Hershey’s needs to demonstrate leadership — and concern for the students’ complaints. The longer it waits to address the crisis, the worse it will get.  Whether or not Hershey’s was directly responsible doesn’t excuse the company from stepping forward and taking steps to rectify a situation that never should have happened in the first place.

Starbucks CEO Howard Schultz Shines as Citizen Activist

Starbucks founder Howard Schultz has called on American CEO’s to provide the economic leadership that our government is unable to.

As founder of one of the most popular companies in America, Schultz has proven to be an effective agent of change. With millions of loyal customers, Starbucks is also an influencer.

No wonder Schultz made headlines last week when he called on fellow CEOs to boycott Washington by stopping all political campaign contributions. “The CEO of Starbucks wants Washington to wake up and smell the coffee,” reported Huffington Post writer Dan Froomkin. His August 15th piece explains why.

On Piers Morgan last night, Schultz showed more decisive leadership than any elected official in Washington has in recent months. He was calm, focused and respectful toward Washington leaders as he presented solutions to address the growing crisis.

Estimating that “a third of the states are facing a crisis of insolvency,” he said that Washington’s  political infighting is causing great damage and harm to business in America.

He also warned that businesses are “going to have to do more to provide the kinds of services to the communities we serve, and a safety net for the people that we employ, because the federal government is not going to have the resources.”

Howard Schultz shines in his new role as citizen activist. Starbuck’s popularity reflects it.

Authenticity: Here to Stay?

Authenticity is the new buzz word.

It’s everywhere you look. Lucky Peach, David Cheng and McSweeny’s wildly popular new food magazine, devotes an entire article by Todd Kliman to it.

Last week Chris Brogan blogged about it. Brogan is a widely-respected business constant and co-author of the New York Times bestselling book Trust Agents: Using the Web to Build Influence, Improve Reputation and Earn Trust.  He thinks attempts at authenticity are heavy-handed (inauthentic?). Instead, he suggests people aim to be helpful.

“Present your most helpful side to the people who need it and do so with as much genuine interest in other people’s success as you can possibly muster,” he said. “Be clear and disclose [biases that influence your opinion].” That can apply to businesses, too. His full post is worth reading.

In 2009, Seth Godin described authenticity as doing what you promise, “not being who you are.”

In our online reputation management glossary, we define authenticity as “the quality of being genuine; a valued quality among bloggers and the larger online community.”

Trustworthiness is another definition of authenticity. Post debt-debacle, that is something we all would welcome more of now, wouldn’t you say?