November 30, 2010
What if you came into work one day and discovered that overnight your company lost its ability to pay you. The entire company bank account had – poof! – disappeared, a victim of outside financial fraud. Would you chip in and see what you could do, or would your last day of pay, be your last day?
Bob Gutermuth, President of Dialog, found out on February 19, 2009 that all of his company—and personal—assets were frozen. The company funds had been held in the Stanford Financial Bank—which was discovered, on that fateful day in February, to be the second largest Ponzi scheme after Madoff. This subject, of course, is near and dear to my heart since I too was hit with the same financially catastrophic news. What I learned is that we all react differently to adversity—some fall victim to it, while others use it to come out stronger. It’s a fascinating subject that inspired my next book called, The Whammy. But I digress…
With every dime frozen indefinitely and faced with having to close its doors, Dialog was in serious trouble. Bob called everyone together and outlined the situation—in detail. For an undetermined period of time, Dialog couldn’t pay its lease, its vendors or its employees. In the spirit of democracy, he opened the books and invited communication. And everyone chipped in to help. Some employees went weeks without pay, while others decided to take time off. The crisis took months to resolve, but Dialog was able to make it through. It’s a great testimony of an organization of people who openly chose to endure financial hardship by rallying together. And it worked.
So the question for today is this… How many of us work for a company that would inspire us to make a choice to go weeks, or months, without pay? How many leaders would dare to be so straightforward and open? And how many employees would choose to be so loyal? What is the difference between a company like Dialog and a company like… (well, I’ll let you fill in the blank!).
I often write about leadership best practices and am pleased to add this example of how democracy in the workplace—along with open communication and open books—saved a company from imminent financial ruin. Not only did this marketing consulting company come back, but it came back stronger. Congratulations Dialog!
To see a related video about Dialog and its democratic practices, click here.