Category Archives: Reputation Risk

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“Brogrammers” Giving Silicon Valley a Bad Name?

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According to a recent article, Silicon Valley tech firms are using marketing tactics geared more towards fraternity brothers than programming savants. The problem? Not only is it sexist at times, but it is alienating a large chunk of qualified tech professionals. Here are a few examples:

Of course, this is only a snipet of what’s going on as many of the antics are never publicized. Barbaic events like these may not only cost companies money (several businesses pulled their sponsorship from the Sqoot event), but it alienates those who may be talented programmers, but don’t adhere to the frat boy mentality.

There’s also an audience that feels left out of the joke. Women made up 21% of all programmers in 2010, down from 24% in 2000, according to the U.S. Bureau of Labor Statistics. Anything that encourages the perception of tech as being male-dominated is likely to contribute to this decline, says Sara Chipps, founder of Girl Develop It, a series of software development workshops. “This brogramming thing would definitely turn off a lot of women from working” at startups, says Chipps.

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But is this really a serious problem in Silicon Valley or just young men being young men? I’ve heard both sides of the argument. Some companies that have taken this seriously, such as Etsy, have decided to do something about it. The e-commerce website is donating $5,000 to at least 10 women in an attempt to lure female coders to New York’s Hacker School this summer.

Whether this is an epidemic that should cause concern or merely programmers acting their age, one thing is for sure — having a working environment void of diversity is akin to siloed idea generation.

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Silicon Valley should know this.

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3 Steps to Managing Reputation Risks

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Henry Ristuccia of Deloitte has some good advice for companies that are still behind the times when it comes to managing reputation risk: identify potential threats and monitor them vigilantly. He also notes that companies should be sure to focus on the upside of reputation as well as the downside. Most companies already engage in marketing efforts to improve how stakeholders perceive them, and that’s key: studies have shown that, once a company’s reputation becomes rosy, it’s likely to stay that way.

Ristuccia explains.

A highly positive reputation is itself a tool in managing risks to reputation. The PR firm Edelman’s 2011 “Trust Barometer,” an annual survey that “measures attitudes about the state of trust,” found that, when a company is trusted, 51% of stakeholders will believe positive information about the company after hearing it once or twice. And only 25% will believe negative information after hearing it once or twice. Distrusted companies, however, fare poorly by comparison: only 15% of stakeholders will believe positive information about a company they don’t trust, and 57% will believe negative information after hearing it once or twice about such organizations. This study also linked trust to customer purchases, investor share purchases, and people’s recommendations to others.

Head over to RMmagazine.com to read the rest.

More Bad Press for Apple

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Here we go again.

In response to Apple’s bad reputation for its alleged unethical working conditions and treatment of employees at its manufacturing plants in China, users of Apple products are fighting back. Local customers are planning to deliver a quarter of a million petition signatures to Apple stores in headquarters such as Washington, DC; New York City; San Francisco; London; Sydney; and Bangalore. The petition demands that the consumer electronics giant make the iPhone 5 “ethical.”

This Thursday, February 9 at 10am, local consumers plan to deliver a signed petition to the Apple store in Manhattan’s Grand Central Terminal. The movement was started by Mark Shields and his site, Change.org.

“I have been a lifelong Apple customer and was shocked to learn of the abusive working conditions in many of Apple’s supplier factories,” Shields. “At Foxconn, one of Apple’s biggest manufacturers, there is a history of suicides, abusive working conditions, and almost no pay. These working conditions are appalling, especially for Apple.”

The conditions at Apple’s Foxconn plant are hardly news as the topic has been in the national press for several months (we covered the issue last year in Risk Management and have written about it extensively on this blog). It seems, however, that Apple is being less-than-forthright in correcting a wrong that has been made public and, in doing so, has scarred the company’s reputation. What will it take for Apple to get a hold of a risk that is affecting their image and, possibly to come, their bottom line? Their recent, minimalist damage control methods may not be enough.

Foxconn Workers Threaten Suicide

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Foxconn, China’s mega-manufacturing plant that supplies parts for Apple iPhones and Microsoft xboxes, is receiving more bad press for the alleged suicide pact that several of its employees were a part of this week.

Last year I wrote about a rise in workplace suicide at Foxconn, where 920,000 people live and work. In 2010, 11 employees had chosen death over working at electronics parts manufacturer, most of them jumping from the top of the highrise dormitories that house the workers. As the story goes:

This is not the first time the company’s worker conditions have come under scrutiny. In June 2006, the London Daily Mail published a story detailing the harsh conditions for the 30,000 employees at Foxconn’s Longhua iPod factory. Seeing a possible major reputation disaster looming, Apple dispatched several executives to investigate conditions at the plant. They issued a report detailing numerous violations of Apple’s supplier code of conduct.

Apple came under fire after these reports and reportedly made changes regarding the labor rules for the departments of Foxconn responsible for manufacturing Apple products. And now conditions at Foxconn are putting one of Apple’s biggest competitors in the spotlight.

Yesterday, dozens of Microsoft Xbox workers climed to the roof of one of the many dormitories on the Foxconn “campus” where they threatened to jump in a dispute over job transfers.

The dispute was set off after contract manufacturer Foxconn Technology Group announced it would close the assembly line for Microsoft Corp.’s Xbox 360 models at its plant in the central city of Wuhan and transfer the workers to other jobs, workers and Foxconn said Thursday.

Workers reached by telephone said Foxconn initially offered severance pay for those who wanted to leave rather than be transferred, but then reneged, angering the workers; Foxconn, in a statement, disputed that account, saying only transfers were offered, not severance.

Though Foxconn has apparently resolved the issues peacefully, 45 employees have resigned.

This is just another one for the infamous Foxconn record, a place that, for years, has received negative press for its harsh working conditions and low pay for employees. But as anyone in business knows, that negative press trickles down to its clients: Apple, Microsoft and Hewlett Packard. For these tech giants, its a reputational nightmare that will continue to make headlines unless more is done — and soon.