Rain, reality and rogue components
Beware the dangers of shifting the blame
It was, we were told, down to Storm Doris. Amid such difficult weather conditions, the “fact” that many supporters didn’t have cars surely went some way to explaining what happened.
“Of course that’s not the entire explanation,” conceded Labour front-bencher Shami Chakrabarti in the aftermath of the Copeland by-election. “[But] it’s a very rural constituency, public transport is not great.”
Given the vehement criticisms that followed the result, it’s safe to say not everyone shared Baroness Chakrabarti’s view.
Meanwhile, down Staffordshire way, similarly creative reasoning was at work following UKIP’s loss in the Stoke-on-Trent by-election. This seat was not a priority for UKIP, we were informed. Besides, with the party’s candidate only having been the party’s leader for 12 weeks, the public hadn’t had the chance to get to know the “real” Paul Nuttall.
Elsewhere, in the almost unimaginably different surrounds of Palo Alto in California, a titan of tech was finding the going tough explaining some tribulations of her own. Announcing another revenue miss and a sharp reduction in full-year revenues, HP boss Meg Whitman, according to MarketWatch, attributed the difficulties to: “an order shortfall from a large, unidentified ‘tier 1 service provider’; expensive and hard-to-get memory components; and currency fluctuations.”
Positing that the currency and component problems should have been dealt with, an unimpressed analyst retorted by asking whether the real problem wasn’t the company’s execution.
None of us is immune to the lure of making excuses. Faced with unpleasant truths or embarrassment, the animal instinct to deflect or dissemble can be little short of overwhelming. But in public pronouncements, not least when it comes to the world of investment communications, it is a compulsion worth resisting.
In business, the temptation to shift the blame when returns disappoint is at least as strong as – and perhaps even more understandable than – in politics. After all, can managers really hope to outperform on a quarterly basis, when the soundest businesses can take a beating for the most ephemeral of reasons?
But however justified it may be to explain away underperformance with the vagaries of the market, this approach is inherently dangerous. This is especially so when, as with our friends in the worlds of politics, it is so tempting to take the credit when things go well.
Investors are every bit as human as the managers that oversee companies. They know fine well that the most fastidiously researched and executed plans are as vulnerable to events as anything else.
But they also, not unreasonably, expect managers to understand and deal with those vagaries better than they can. Investors are also aware of the human urge to deflect blame, and, by and large, respect those willing to take it on the chin when things don’t go to plan.
So when communicating with investors, be careful when apportioning the blame to markets, foreign exchange, the weather, car ownership or anything else. If you don’t, you may find they are more sceptical about your value when things are going well.
Niels Footman is Head of Marketing at Copylab, an international communications agency based in Scotland.
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