What law firms can learn from the CEO of Airbnb

Lessons in Leadership and Communication – What law firms can learn from the CEO of Airbnb

Given the current economic outlook, law firms have been attempting to manage their expenses via salary freezes, cuts and reduction in benefits. Some firms, for example Goodwin Procter and Faegre Drinker, have also conducted layoffs. 

Similar to the legal industry, other sectors have also taken measures to manage their costs. Of note is the impact on the travel industry, and the recent announcement by Airbnb’s Co-Founder and CEO Brian Chesky impresses as a lesson in both leadership and communication during a crisis. As you may have read already, on May 5 Airbnb announced the 25% downsize of its workforce due to the COVID-19 outbreak. Around 1,900 employees will be made redundant, a figure considered to be the largest layoffs of Silicon Valley so far. In a message addressing this to employees, Chesky teaches us how to talk to our team during hard times. The media responded very quickly commending Chesky on his approach.

Meanwhile, in the legal media, comments about BigLaw firm partner’s emails around Covid-19 have been described “at the most generous, be termed as tone deaf” with “complete lack of empathy.” (Click here for the full article) Chesky’s email is a good reminder for law firm leaders to be thoughtful about their tone when delivering negative information.

It’s never easy for an organization to make a decision that personally affects a large number of its team members, and we encourage everyone to read Chesky’s email in full. Law firms can apply the following lessons from Chesky’s message as they deliver bad news in a respectful, compassionate, and pragmatic way during the pandemic.

1. Be Transparent

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Chesky was upfront about the company’s financial status, then continued to mention how the company came to the conclusion of reducing the size of its workforce. He explained why it was necessary to restructure the business. 

Instead of relying upon the supervisors in close proximity with the affected staff, Chesky advised his employees directly of the context, the process, and details (severance, equity, healthcare, and job support) so that everyone is fully aware of the situation. The message also prepared departing employees for one-on-one meetings with their supervisors and provided a clear action plan.

Being transparent helps eliminate confusion but is also vital in building trust and creating a healthy work environment where people want to stay during a crisis.

2. Clear Action Plan

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Uncertainty can cause anxiety, and can also lead to rumors spreading amongst the staff. Instead of keeping information about the layoffs confidential, Chesky outlined a clear breakdown of what will happen next:

  • When employees will be informed of their employment status (timeslots for the US and Canada, Asia Pacific, Europe and Middle East)
  • How employees will be informed of their employment status (calendar invite, meeting invite, world@meeting)
  • Who will inform employees of their employment status
  • A scheduled CEO Q&A session on 7 May Thursday at 4pm pacific time

Any announcement without a concrete, actionable step-by-step course of action, is at risk of falling on deaf ears. After Chesky had announced the layoff plan, he further provided a clear action plan covering specific milestones with dates and technicalities of further communications. A clear plan is essential for bringing together individuals who are being affected and staff who are knowledgeable in the area of work, to achieve a particular goal. For any major project announcement like Airbnb’s layoff, a clear action plan of the rules, roles, and channels also prevents backlash.

3. Be Thankful & Compassionate

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A public “thank you” note from the CEO/Managing Partner would be comforting and positively received by departing employees. Chesky addressed employees with thanks and respect that made each one feel valued as individuals and simultaneously part of the Airbnb family. From the message it also shows Airbnb is a company which understands and values its employees so that staying employees and talented people will feel appreciated. The way this situation was handled maintains the goodwill between Airbnb and the departing staff. Undoubtedly, Airbnb will have an edge in future recruitment. 

4. Go Beyond

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Chesky showed us a powerful lesson to promise the provision of substantial support for their laid-off staff. As the saying goes “actions speak louder than words”, and by providing continued support taking into account severance, equity, healthcare (including mental health support), Chesky showed his compassion and thoughtfulness to his departing staff.

The message further illustrated the details of job support to show that the company cares about the departing employees as they look for a new job.

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Showing appropriate level of generosity and compassion to departing staff is strategically important. First, that prevents the departing staff from bad mouthing their former employer (and with social media these days, anything can go viral). Second, the company’s image is intact among its staff, clients, and users. Lastly, staying staff are more inclined to stay loyal to the company. 

5. Be Encouraging

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It is always sad to make such a decision that affects such a large number of employees, but an encouraging ending will give hope and direction. Chesky provided a glimpse of the future, even in hard times. He reinforced that Airbnb will rise again and continue their mission. He reminds his departing staff that at the center of belonging is love. His words further encourage the staying teams to focus on the mission and purpose.

6. Personalized Sign-off

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Simple, conversational language. No full name, no title, but just – Brian. There were no airs and graces. Chesky showed vulnerability in his closing message with a personal, heartfelt apology.  

What makes a good leader into a great one is the ability to connect people. Dr Brené Brown describes “vulnerability and authenticity as lying at the root of human connection.” People feel more comfortable around someone who is authentic and vulnerable. Successful leaders know when to show their real and authentic selves to relate with staff. When the staff feels connected with you, it builds trust between you and your staff and can create some of the most potent connections you will have at work. The trust will also decrease the tension when you release bad news. 

Layoffs are tough. Chesky demonstrated what it means to be good leader when announcing bad news during uncertain times with transparency, thoughtfulness, compassion, generosity, encouragement, and authenticity.  Each of these traits is communication tools for law firms today trying to make it through one of the most difficult times in history. We look forward to reading more positive reviews of firms’ approach on legal media.  

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