Rogelio Segovia: Which company do you want to work for?

Although this happened at the beginning of 2020, when we already knew about the existence of a previously relatively unknown disease called COVID-19, we still did not fully understand it and the lockdown had not yet begun.

Shortly before the Mexican government decreed the restriction on carrying out non-essential work, under the motto “stay at home”, a major Mexican restaurant company and franchise operator began to cut its workforce.

At the time, one of the statements mentioned that it did so to ensure the financial viability of the company and maximize shareholder value.

More or less around the same time, although a little later, that is, when the lockdown had already begun, one of the main cinema chains in our country faced a collapse in its income.

Initially, the company tried to keep its workforce, and then offered a couple of options to employees: carry out a job termination, with the corresponding compensation, or suspend salary payments, but maintain Social Security and Infonavit payments.

Once the pandemic was over, the big challenge for many organizations worldwide came: rehiring enough workers to restart operations. But even today, many organizations still have a backlog in staffing their workforces.

Sectors such as aeronautics and tourism, which were relentless in their layoffs, continue to face significant challenges that directly affect the quality of their services and, therefore, income generation.

Of the two examples mentioned at the beginning, the restaurant and franchise chain remains, to this day, an organization in which people do not feel proud to work, and is a clear example of how to destroy an employer brand.

The cinema chain, on the other hand, received recognition from its employees for its efforts. Although it is not exempt from the pressures of the labour market, it is a company where people are happy to look for work.

I was reminded of all this because last week I invited the director of human resources of a major financial institution in the country to give a class to my students, and she posed a key question: What company do you want to work for?

The question did not use the conditional tense of the verb “to like,” but rather the first person singular of the present indicative of the verb “to want.” She pointed out that when she graduated from college, there were only a handful of companies in Nuevo León where people “liked” to work. Today, the executive stressed, people have the possibility of deciding where they want to work: that is, they have the upper hand.

That is why it surprises me that in a world as complex as today's, with an ever-decreasing availability of labour (and I don't mean this in a pejorative way), companies continue to make these obvious mistakes, thus damaging their employer brand.

And let's not think that these behaviors that damage the employer brand were left in the distant 2020. They still happen. Multiple companies with headquarters in the United States and operations in Mexico, especially in Nuevo León, are eliminating or reducing to a minimum their diversity, inclusion and labor flexibility programs (such as the possibility of hybrid work schemes).

In other words, they are responding to a political whim of the new resident of the White House. By maximizing the monetary value of their actions, they are destroying the long-term value of their employer brand.

Let us not forget that, despite the great advances in automation and artificial intelligence, companies will still require the essential human being in the short and medium term.

Recently, and also driven by the political actions of Donald Trump, a notable controversy has been generated in the United States due to the divergent decisions of two retail giants with operations in Mexico and that will surely damage their employer brand: Walmart and Costco, in relation to products of Latin origin on their shelves in that country.

On the one hand, Walmart has caused controversy by removing Latino products from its shelves, which has generated a negative reaction in the Hispanic community, which represents a significant part of its customer base. This decision has been interpreted as a lack of sensitivity towards Latinos. Employees have also expressed frustration and concern.

As a result, Walmart has experienced a drop in sales due to a decrease in Latino customers, and images of stores with empty shelves and fewer Hispanic customers have gone viral on social media.

On the other hand, Costco has adopted a different strategy by promoting Latin products in its stores. This decision has been well received by the Latino community, which has shown its support for the chain.

Costco employees have also expressed satisfaction with the inclusion of Latin products, which has improved their work experience. Financially, Costco has seen consistent revenue growth and increased customer satisfaction.

It is clear to me that these are not easy decisions, and that there are high levels of interest at stake. However, experience has taught us that short-term business decisions, driven by political factors and focused exclusively on maximizing shareholder value at all costs, to the detriment of other stakeholders such as customers and employees, do not usually bring good long-term results.

Business history is full of examples of companies that sacrificed their reputation and their relationship with employees and customers for short-term decisions. The question is: how many companies are willing to take that risk just to satisfy a momentary political agenda?

The author holds a PhD in Philosophy, is founder of Human Leader, Managing Partner of Think Talent, and Professor at ITESM.

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