There are few PR disasters currently brewing worse than what’s happening at Toys R Us. To many, it would seem elementary that compensation should reward production, but even in the midst of Chapter 11, Toys “R” Us has won approval to pay $16 million in bonuses to 17 top executives if the company hits financial targets during the holiday shopping season.
As of late April 2017, Toys R Us was $5.2 billion in debt. It’s more than a little irregular to be shelling out that kind of money to failing leadership when a company is vastly in the red. A stunt like this is miserable for the company’s already sinking PR – people trust and want to do business with organizations that reward leadership and employees for a job well done. Not surprisingly, CEO David Brandon blames others for the fall; according to NorthJersey.com, “During a 40-minute talk, [he] at times blamed the company’s sudden collapse on uncooperative vendors, customers who weren’t supportive enough, lenders who live by their spreadsheets, and media outlets who made liquidation a ‘self-fulfilling prophecy’ with their reports.” Failing to take responsibility and then going a step further and attempting to REWARD that total lack of ownership is never a good look for anyone, professionally or even personally, for that matter.
How your executives and employees relate to your business or organization is a significant element of public relations. Executives and employees that are rewarded for producing feel good about you and your company. They want to work there, they tell their friends, etc. Local media often recognizes which organizations are the best workplaces. That can provide some fantastic PR. It encourages good people to want to work for you. Likewise, if you hold accountable the non-producers it sends out a strong message and also creates a very productive environment.
Create community relations you can be proud of using the basic principles of public relations. You will create a happy workplace with happy employees, which ultimately means happy customers. How much did this non-performing CEO pay himself, I wonder?
- It marks the end for a company that sold toys. “Toys ‘R’ Us Will Close or Sell All US Stores.”CNNMoney, Cable News Network, money.cnn.com/2018/03/14/news/companies/toys-r-us-closing-stores/index.html.
- Many employees told CNN the shutdown caught them surprise. “31,000 Toys ‘R’ Us Employees: No Job and No Severance.” CNNMoney, Cable News Network, money.cnn.com/2018/03/16/news/companies/toys-r-us-employees/index.html.
- The bankruptcy court trustee Judy Robbins. “Bankrupt Toys ‘R’ Us Wins OK to Pay $16 Million in Executive Bonuses.” CNNMoney, Cable News Network, money.cnn.com/2017/12/06/news/companies/toys-r-us-executive-bonuses/index.html.
- “Private Equity, Not Amazon, Killed Toys ‘R’ Us.” Seeking Alpha, 20 Sept. 2017, seekingalpha.com/article/4108364-private-equity-amazon-killed-toys-r-us.
- Verdon, Joan. “How Toys R Us Chief Dave Brandon Broke the Bad News to Employees.”North Jersey, NorthJersey, 16 Mar. 2018, www.northjersey.com/story/money/2018/03/16/how-toys-r-us-chief-dave-brandon-broke-bad-news-employees/430672002/.
- Bomey, Nathan. “Toys R Us Liquidation Marks Bitter End for CEO David Brandon.” USA Today, Gannett Satellite Information Network, 18 Mar. 2018, www.usatoday.com/story/money/2018/03/15/david-brandon-toys-r-us/427347002/.
- Smaller toy stores are able to offer more personalized shopping experiences. They’re places where everybody knows your name. And that’s a good thing. “Local Toy Stores Are Thriving as Toys ‘R’ Us Is Dying.” CNNMoney, Cable News Network, money.cnn.com/2018/03/16/investing/toys-r-us-local-toy-stores/index.html.
- true, It’s. “Amazon Didn’t Kill Toys ‘R’ Us. Here’s What Did.” CNNMoney, Cable News Network, money.cnn.com/2018/03/15/news/companies/toys-r-us-closing-blame/index.html?iid=surge-story-summary.