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On April 27, restaurant chain Earls tweeted the following: "This is really big. Earls is the first chain in North America to source beef from Certified Humane farms in all its restaurants."
The fine print missing from the tweet was that its beef was going to be sourced from Kansas.
Customers, cattle ranchers and many others caught on quickly. Inundated by social media backlash – including hashtag boycotts – by May 4, Earls had seen enough: "We made a mistake. It was wrong to move away from #CanadianBeef." Through videos, press releases and other social media updates, Mo Jessa, president of Earls, announced a reversal in thinking and "committed to sourcing as much beef as possible from Alberta" while working with ranchers to build more of an ethically sourced beef supply.
What can we learn from this situation?
Your organization's culture and purpose will be put to the test when things do not go as planned, especially when your company makes the wrong choices or acts with an eye for short-term gains.
Earls developed a purpose statement several years ago as follows: "We believe in people living large purposeful lives, filled with fun." Company headquarters was clearly not having any fun during the crisis, but it was likely troubling for the hundreds of front-line servers, cooks and hostesses who now had to be dealing with an upset customer base in the restaurants. For a few days, it seemed as though Earls might have forgotten about its purpose statement.
The company was trying to do the right thing – after all, sourcing certified humane beef is a key part of its organizational purpose. But it should have pro-actively worked with its Canadian-suppliers to establish a mutual plan over a period of time. Instead, by going to the United States and bypassing its trusted partners, Earls ended up looking somewhat foolish in the about-face it had to take. It put its stakeholders – employees, suppliers and customers – in an awkward spot.
Some view Earls as caving to the pressure. Ultimately, the restaurant chain overlooked one of its most important partners: the cattle ranchers of Canada. It also overlooked consumers who believe strongly in a "Made in Canada" mantra. It overlooked its employees and the front line team members tasked with interacting with upset customers. In essence, it overlooked its organizational DNA that it had worked so hard to build.
In publicly admitting its mistake, however, Earls is coming full circle to its culture and its purpose. Sure, the company made a mistake and it may hurt them in the short-term. But its culture and purpose helped them right the wrong, and in the long-term the company will likely weather the storm.
This incident underscores a key lesson. When things go awry, it's easy to see that culture is any company's competitive advantage. And, organizational purpose will often act as its North Star.
Dan Pontefract is the author of THE PURPOSE EFFECT: Building Meaning in Yourself, Your Role and Your Organization. He can be reached at www.danpontefract.com or @dpontefract