Should you blame a crisis on a rogue employee or the system?
No communications strategy is complete until you have formulated a clear approach on how to meet the unexpected. Tony Jacques reminds us why doing nothing can cost your company everything.
Blaming a rogue employee or system failure is a pretty popular crisis strategy. But one of the most notorious cases of blaming a rogue employee for a crisis has just been turned on its head, with a court deciding the management system rather than the perpetrator was mainly at fault.
French derivatives trader Jérôme Kerviel famously went to prison after making €50 billion worth of unauthorised trades and committing forgery and fraud to cover them up.
Société Générale lost €4.9 billion unwinding his trades but, in a case which has come to exemplify failure to recognise and act on warning signs, a subsequent investigation found the French bank had ignored 75 red flags over the previous 24 months.
Kerviel consistently argued that managers had turned a blind eye to his profitable transgressions, and earlier this year a French labour tribunal seemingly agreed when it ruled he should not have been fired from the bank he had defrauded.
