GWSB Expertise header image

GWSB Expertise is a series of short articles on topical issues written by the George Washington University School of Business (GWSB) faculty. For our second article in the series, Dr. Herman Aguinis writes about how employees perceive and react to corporate social responsibility initiatives, in particular during the COVID-19 era.

title header for article by Dr. Herman Aguinis: Why Employees Can React Negatively to COVID-19 Initiatives

Amazon, Kroger, GW, and many organizations are implementing corporate social responsibility (CSR) initiatives to try to do the right thing during the COVID-19 pandemic. That is, they are focusing not just on financial results, but on the three “P’s” simultaneously: profits, people, and planet. Consider the case of Amazon, which drastically expanded online grocery delivery to provide an essential service for individuals affected by the pandemic. However, with the increased need for fulfillment centers to run smoothly and at full capacity, Amazon began facing backlash from its own employees who protested unsafe conditions such as not having adequate protective equipment.

From the perspective of employees, Amazon’s well-designed and socially responsible initiative required too much of them and, therefore, had negative effects on employees’ attitudes and performance — the opposite of what Amazon had intended! Our research adopting a behavioral perspective helps us understand why, when, and how well-intended CSR initiatives, such as the ones implemented by Amazon, can lead to desired positive outcomes or, on the other hand, unintended negative consequences.

Our research shows that the way employees perceive and react to CSR policies and initiatives are key determinants of how they are implemented and their ultimate success or failure. For example, responses to COVID-19 are more likely to succeed if they involve employee input (as opposed to being mandated by management top-down), are genuine (not just greenwashing), and part of an organization’s long-term strategy (as opposed to a tangential or peripheral temporary action).

A behavioral perspective allows us to understand that when firms do things right, top-performing employees are more engaged, satisfied, committed to their organizations, and less likely to leave. And, it is precisely these top-performing employees who will help companies to emerge from this crisis. Certainly, the last thing a company can afford now is for their best employees to leave as soon as opportunities become available.

 

Previous Articles
Build Your Expertise

title header for article by Dr. Larry Yu: The Resiliency of the Hospitality Industry

For our first article in the series, Dr. Larry Yu writes about the hospitality industry during the COVID-19 pandemic.

Leisure travel is a part of our culture and a way of life. Travel for business and conventions are essential business activities.

However, the hospitality business is most vulnerable to any major external shocks which are beyond the control of the owners and managers, the COVID-19 pandemic halted almost completely the mobility of people for business and leisure purposes.

The outbreak of the COVID-19 pandemic has since devastated the hospitality industry in the U.S.:

  • Eight in 10 hotel rooms empty
  • 70 percent of hotel employees laid off or furloughed
  • $400 million lost in room revenue every day

However, the hospitality business has shown its resilience when facing major crises in the past and it always bounced back with new innovative operations to address consumers’ concerns and expectations.

There are now signs of recovery for the hospitality business in other countries, primarily driven by local demand. There is a glimmer of hope for the hospitality business in the U.S. This is a time to plan for post-pandemic reopening as consumers’ expectations for hospitality services and behaviors will change to a certain extent, particularly consumers’ heightened expectations for safety and cleanliness protocols, amenities and standards. Hotel organizations have proactively implemented safety and cleanliness initiatives, including Hilton’s CleanStay, Commitment to Clean guided by Marriott Global Cleanliness Council, Global Care & Cleanliness Commitment by Hyatt, and Airbnb’s Cleaning Protocol Certification program for hosts. Airlines, such as Delta (Safe & Healthy Flying) and United (CleanPlus), have initiated safety and cleanliness programs to provide a healthy travel experience.

Furthermore, the first wave of demand will be driven by local and regional consumers. An actionable plan supported by management innovations will position hospitality organizations competitively in the post-pandemic market, such as the Pay-What-You-Can campaign to promote in-state travel by independent hotel and tour operators in Maine and the Press Play campaign by the Shreveport-Bossier Convention and Tourism Bureau in Louisiana to promote “nearcations” by locals and regional road trips by auto travel.