Corporate missteps happen — but when they do, fallout can affect an organization years later.

While much attention is given to re-establishing trust with customers, companies that have steered off course must also rebuild trust with their employees. But how does an organization do that? Perhaps more importantly, how can a company tell that it's approaching the brink — and correct its course in time?

How could this happen here?

From Uber's sexual harassment charges to Wells Fargo's creation of false customer accounts to Facebook's data privacy scandal, missteps can occur in a variety of ways. In some companies, it's the culture of "win at all costs" that leads to downfall.

There's a connection between unfavorable business results and missteps, said Rob Seay, director of employee experience at Bonfyre. "Certainly I think there's a correlation that sometimes you see when results aren't going as well, so whether financials or forecasts or expectations aren't going as well as you planned, that can create anxiety, frustration," Seay told HR Dive. The desire to deliver positive results can lead to bad decisions, he said.

A corporate misstep does not have to be an intentional act of deception, David Shanklin, managing director of client delivery at CultureIQ, told HR Dive. But a misstep can arise when creating a positive culture is not a priority, he said: "Some folks are not intentionally managing culture at all." 

When that happens, a toxic culture can develop, particularly in organizations where employees are reluctant to speak up or share negative news; leaders have little regard for how results are achieved as long as goals are met; and high performers are allowed to operate outside the rules, he explained.  

But even a company that focuses on creating a positive culture can be shaken by the actions of one person, said Susan Taylor, co-founder and CEO of Generon International, a leadership consulting company. In one such case, a beloved senior leader in a company was accused of inappropriate behavior, Taylor told HR Dive. The company immediately addressed the issue with actions that were consistent with its values-based culture. Even though the leader left the company, the organization and its employees still had to cope with the fallout from the loss.

Regardless of the type of misstep, there will be consequences. For companies that recognize their mistake, the most immediate need is to start the healing process and re-establish trust with their employee stakeholders.

Recovery is possible

The revelation of Uber's questionable company culture in 2017 eventually resulted in its CEO resigning later that year. The company has since taken definitive steps to address its culture, and those steps seem to be working. In a leaked survey, 63% of Uber employees gave the company positive marks to how they were treated and Uber's new focus on social responsibility.  

Like Uber, other companies can re-establish trust with employees, enabling the organization to move forward. The first step is setting expectations to how long the process will take, Shanklin said. "It's easy to get frustrated because trust is very hard to rebuild," he said.

Seay agreed. "That's the one thing companies overlook; how much time it requires to rebuild trust with individuals," he said. 

To re-establish trust with employees, organizations have to take very specific actions that communicate their commitment to this change, he said. Those actions may include bringing on new leaders, making investments in training or programming and revisiting the promotion process to ensure the people getting promoted are living the values that you want and not the values that led to the scandal, Shanklin said.

After addressing the issue immediately, leaders must communicate with employees, even when the details of the situation must remain private. Taylor said that in the wake of the beloved leader's resignation, the company's board had to plan what to tell employees: "How are we going to put this out there in a way that represents our values but does not say what happened?"

Taylor said the leaders, working with HR and communications, shared with employees that this was a values-based misstep. Taylor and the company leaders followed up this conversation with more opportunities for employees to understand and adjust to the organizational change. "We worked with [leaders] on how do we engage, keep our doors open to continue the healing process and build new momentum on how we're going to move things forward," she said. 

Even as leaders understand that it takes time to build trust, leaders should use that time to prove their intentions, Seay advised. Make changes incrementally and deliver on those, he said. One way is to come in and say "Hey, our ultimate goal is to change this culture, but guess what, it's going to take us quite a while to do that. But here's how we're going to start the process and within the first 60 days, we commit to this — we're going to make changes to these things," he said. Then, 60 days later, leaders should follow up with employees, being transparent about the results of the change efforts and what the next steps will be. 

How to tell if progress is being made

While Uber used a survey as one way to measure progress, other metrics can be used to determine if change efforts are working, Shanklin said. Progress with diversity efforts in leadership and retention rates are other areas to look at. Don't be discouraged if you hear more complaints during this time. "It's almost counterintuitive — if you're hearing more about issues, that may indicate things are getting better," he said, since people feel more comfortable bringing up issues.

Avoiding the brink altogether

Even better than recovering from a misstep is not taking that wrong direction in the first place. Experts agree that nurturing a positive culture is key to staying on the right path and to helping a company determine the steps it should take if something goes wrong.

Signs that a culture may allow an organization to go down the wrong path include:

• Employees are discouraged from sharing bad news about the company or problems are swept under the rug
• The organization has frequent near misses, especially in the area of safety
• Leaders don't examine good results to determine how they were gained
• Culture is not on the radar of the executive board
• Individuals do not take accountability for creating culture in their area
• Leaders don't have a framework for addressing a misstep

"You've got to intentionally grow and develop your culture," Shanklin said. "If you don't manage it, it will manage you."