Friday, October 27, 2006

Weighing in On The Edelman & Wal-Mart Flogging Scandal: Insights from Organizational Communication

Like many others, I was very disappointed to learn of Edelman's role in the Wal-Mart fake blogging (flogging) scandal, especially since Edelman is a governing member of the Word of Mouth Marketing Association. This issue is especially salient to me, not only because I am a member of the WOMMA Advisory Board and Co-Chair of the Research & Metrics Council, but because I also conduct research in the WOM marketing space, consult orgnizations about how they should ethically and effectively manage WOM, and am an educator who teaches classes on the same topics.

There has been a great deal of discussion about what WOMMA's response should be. Broadly speaking, should it take more of an educational role or an enforcement role, or some combination of the two? Clearly WOMMA has an educational role to play and I struggle with what role an industry association should play in terms of enforcement. I'll speak briefly to this below, but for the time being, I would actually like to bracket (just for a few paragraphs) what WOMMA's role should be so that I can discuss what I would like to see from Edelman, or any company in this situation, but especially a company who is as well-known and respected as Edelman is in this space.

In one of the classes I teach at Northeastern -- Advanced Organizational Communication -- we study certain communication imperatives that any organization must follow in order to be ethical and effective. There are a number of imperatives, but two seem highly relevant to me: the notion of automatic responsibility and the institutionalization of dissent.

Automatic responsibility is the idea that each organizational member has the responsibility to solve a problem as they become aware of it (whether that problem be a difficulty a customer is having, or whether there is an ethical violation within the organization). If they don't have the technical knowledge or skill set to solve the problem, then it is their responsibility to make sure they find somebody in the organization who can address it.

The institutionalization of dissent is the obligation of an organization to build communication systems such that organizational members are encouraged to dissent, have that dissent be listened and responded to, and to be rewarded (rather than punished) for their dissent.

Upon learning of Edelman's complicity with this obvious and unfortunate violation of the WOMMA Ethics Code (for example, dishonesty about the bloggers' identities) I was left to wonder how this could have happened.

How could an organization who contributed to the creation of the ethics code and who has demonstrated leadership in the social media space commit such a transgression? What was the organizational decision-making process that led to this? Did anyone ever dissent and say this (fake) blogging program wasn't a good idea (it should have been the moral obligation of each employee to exercise their automatic responsibility and do so)? If there was dissent, what happened to this dissent? Was it ever encouraged in the first place? Was it ever listened to? Further, was it (or will it be) rewarded or was it punished?

I read that Edelman wants to make this situation right (see Rick Murray's comment on the WOMMA discussion list) and I sincerely believe that they do. A lot is at stake, as it represents a crisis of confidence for the reputation of their company, for WOMMA and the WOM marketing industry, and for the consumer/citizen.

So what should Edelman do now? A tough question and here's a start (see the WOMMA-faciliated discussion for other ideas): If I were advising them on what to do I would counsel them to conduct a comprehensive, independent investigation whose purpose would be to uncover the organizational communication and decision-making before, during, and after this scandal. Specifically, the goal would be to find answers to the questions above about where were the voices of dissent and if there were voices, why weren't they heeded? Fundamentally interrogating this issue of dissent is paramount in a media and organizational landscape where the dominant values are discursive engagement, openness, and transparency.

The board would include representatives from the following groups: consumer protection group(s), the FTC, academic expert(s) in corporate blogging and/or corporate ethics, member(s) of the WOMMA Ethics Council (and possibly other associations to which Edelman belongs), and of course, blogosphere netizen(s) or other consumers/citizens. The board would make the results of their investigation publicly available through a written report (electronically faciliated and with a public discussion board). Individual actors and the organizational system must then be held accountable in accordance with the findings of the report. The appropriate actions of holding individuals and the organizational system responsible cannot be further debated until after the investigation and the report is made public -- well the actions can be debated, but there's still too much we don't know at this time.

I feel this would be an appropriate course of action because it would be conducted in the spirit of openness and transparency that is highly valued and desired by not only the blogging community but by the principles of a democratic citizenry, it would allow Edelman to continue in the leadership position they have taken great strides to establish by showing they should be held to the same principles of openness and transparency they espouse, and it is a proactive move that would allow other practitioners and students to learn from this crisis.

I think the decision to initiate this investigation should be Edelman's while WOMMA (and again, other relevant industry associations) should continue to facilitate this process by continuing to host discussions on the matter, to contribute a representative of the Ethics Council to the investigation board, and to help with the educational effort based on the results of the independent investigation.

I would love to hear others' views on this matter through comment, but I would encourage that we make trackbacks and/or comments to WOMMA's discussion board as well.

Many of the principles discussed in this blog post were dervied from Phil Tompkins' book: Apollo, Challenger, and Columbia: The Decline of the Space Program (A Study in Organizational Communication) which I use as a textbook in my class.

Addendum: I should add that part of the investigative or auditing process I describe above needs to include Wal-Mart and what role they played in this. Working out the practicalities of involving Wal-Mart makes this more complex but it would be important to understand the systemic dimensions.

Update (11/1/2006): WOMMA has officially placed Edelman's membership under a 90-day administrative review. Edelman needs to take the following 6 steps (some of which appear to already be underway) in order to re-instate its full membership:

1. Provide assurances that all inappropriate programs have been stopped.
2. Provide a briefing to the WOMMA Executive Committee to fully explain the details of the incident.
3. Implement a training program to educate all employees on ethical practices and disclosure requirements.
4. Institute systems to prevent violations from happening in the future, and to correct them if they do.
5. Formally participate in upcoming WOMMA ethics programs and comply with all new ethics requirements for members.
6. Please provide detailed documentation of your compliance with the above requests.