On Principle

In the summer of 2017, a data breach occurred at Atlanta-based credit bureau Equifax affecting the records of more than 140 million consumers in the United States. The company announced the incursion in September, arguably one of the largest such breaches in history at the time, giving hackers access to private information—names, Social Security numbers, dates of birth, credit card numbers, even driver’s license numbers.

Into that scene, WashU Olin alumnus Paulino do Rego Barros Jr. stepped in as the company’s interim CEO, charged with managing the fallout from the situation. Employees were scared as they faced furious backlash—even threats from consumers. Systems were overloaded as consumers flooded the firm’s call centers and websites. “The building was on fire,” do Rego Barros said.

In this episode, we examine the steps he and his colleagues took to confront the situation and begin to restore trust among consumers, customers, regulators and policymakers. While avoiding the regulatory and legal issues—these won’t be relitigated in this episode—we focus on three primary decision points: Engaging with employees, engaging and reassuring consumers (e.g., individuals), and doing the same with customers (e.g., banks and other institutions).

The subject remains topical today as companies and institutions continue to be vulnerable to data breaches that expose private consumer information. What decisions had to be made in the immediate aftermath of the breach? What were the implications? How does a business re-establish trust with customers under those circumstances? Then, once the immediate fire is quelled, how do you propel the business into a better place?

The voices in today's bonus episode may be familiar to On Principle listeners. They're voices from previous guests, sharing stories about some major “Oh, shoot!” moments they confronted in their businesses. They came together for a special "On Principle Live!" event at WashU Olin Business School on September 1, 2022, called "Now What?" The event was the first of our Leadership Perspectives events for the academic year.

Featured Guests

• Alaina Macía. An Olin MBA alum and president and CEO of MTM, a nationwide non-emergency medical transportation service provider.
• Angel Likens, third-generation president of Bogey Hills Country Club, a St. Charles, Missouri, institution since 1962.
• Jason Wilson, an Olin Executive MBA alum, coffee entrepreneur and owner of Northwest Coffee Roasting Company.
• Gerard Craft, St. Louis chef and restaurateur and owner of Niche Food Group, with eight restaurants in St. Louis and one in Nashville.

Credits

This podcast is a production of Washington University in St. Louis’ Olin Business School. Contributors include:

• Katie Wools, Cathy Myrick, Lesley Liesman and Judy Milanovits, creative assistance
• Jill Young Miller, fact-checking and creative assistance
• Hayden Molinarolo, original music and sound design
• Mike Martin Media, editing
• Sophia Passantino, social media
• Lexie O'Brien and Erik Buschardt, website support
• Paula Crews, creative vision and strategic support

Special thanks to Ray Irving and his team at WashU Olin’s Center for Digital Education, including our audio engineer, Austin Alred.

In March 2013, the Normandy School District’s board hired Ty McNichols as its superintendent. By January 2015, McNichols was gone, resigned from the post after gaining what had been a career ambition—to lead a school district.

In the course of those 22 months, McNichol ran into a buzzsaw of state and local politics, financial crisis, plummeting morale, personal attacks and lightly veiled racism as he navigated the sudden loss of accreditation for the district. Oh, and by the way, McNichols and his team had to educate 4,000 students from pre-kindergarten through 12th grade.

The drama began to unfold within weeks of McNichols taking on the role offered by the elected school board for the north St. Louis County district. The chronically underperforming district needed a leader with ideas about improving student performance. The board thought McNichols might have the right ideas. By June, however, the state of Missouri had stripped Normandy of its accreditation, setting in motion a series of issues and unintended consequences.

That included accommodating hundreds of students given authority to flee the district for a neighboring, fully accredited district. Those moves came on Normandy’s dime—indeed, a lot of dimes Normandy didn’t have. And it put the mostly Black and brown students of Normandy in the crosshairs of a somewhat hostile reception from the mostly white district identified to accept them.

“What are the things I value? What was I willing to do and what not? Education is a political action for social justice,” McNichols said. “That's what drove me.”

Our story is about how a leader confronts wildly competing priorities when the stakes are high—arguably no higher than the education of children. Can you strive for great? Must you settle for acceptable? Is this about making the best of a bad situation?

RELATED LINKS

• Tyrone McNichols named Normandy superintendent, St. Louis American, March 14, 2013
• McNichols resigns as Normandy superintendent, St. Louis Post-Dispatch, January 22, 2015
• Saint Rice on LinkedIn
• Washington University’s Institute for School Partnership

CREDITS

This podcast is a production of Olin Business School at Washington University in St. Louis. Contributors include:

• Katie Wools, Cathy Myrick, Judy Milanovits and Lesley Liesman, creative assistance
• Jill Young Miller, fact checking and creative assistance
• Hayden Molinarolo, original music and sound design
• Mike Martin Media, editing
• Sophia Passantino, social media
• Lexie O'Brien and Erik Buschardt, website support
• Paula Crews, creative vision and strategic support

Special thanks to Ray Irving and his team at WashU Olin’s Center for Digital Education, including our audio engineer, Austin Alred.

Akeem Shannon was stressed. In three weeks, his Shark Tank episode would air, the episode where he’d pitch Flipstik—a novel cellphone attachment that doubles as a kickstand and a sticky wall mount.

He knew one thing with absolute certainty: Whether or not the “sharks” on the popular ABC-TV show offered him a deal, he was going to sell some Flipstiks. Probably a lot of them. And he didn’t have any. Or any money.

At the time, in mid-October 2020, Shannon’s startup was so young he sometimes sold only one Flipstik a day. One bright spot: He’d recently landed a commitment of $50,000 from Arch Grants, a St. Louis nonprofit that provides capital to startups willing to plant roots in the community.

With the Shark Tank air date weeks away, he contacted his manufacturer in China. “I need product. Lots of it. Right now,” he said. He mobilized his team to build a makeshift distribution warehouse. He upgraded his website’s software to handle the crush of transactions he expected. He maxed out his credit cards.

It wasn’t enough. Ultimately, he had to pick up the phone to Arch Grants, which was supposed to pay out its commitment in quarterly installments. “Is there any way I can get some cash up-front—right away?” Shannon pleaded. “I don’t have two weeks to wait.”

The cash arrived. The episode aired—with one more hitch. Ninety seconds into his segment, ABC broke in with news from the 2020 election. “I just cried when it happened,” Shannon said. But it didn’t matter. He’d set the hook. He reeled in Shark Tank fans, with orders totaling more than $100,000 in just a few days. When the episode repeated on January 1, 2021, sales spiked once again.

Ultimately, Shannon got an offer from one of the sharks—a deal that later fell apart off-air. Yet for Shannon, the episode was a turning point. The last-minute race to prepare, the 11th-hour request for cash, maxed out cards—it had paid off.

RELATED LINKS

• The Flipstik website
• Akeem Shannon’s segment on Shark Tank (including his rap)
• Akeem on Instagram
• Michael Wall’s faculty page at WashU Olin Business School
• The St. Louis Business Journal on the Inc. rankings

CREDITS

This podcast is a production of Olin Business School at Washington University in St. Louis. Contributors include:

• Katie Wools, Cathy Myrick, Judy Milanovits and Lesley Liesman, creative assistance
• Jill Young Miller, fact checking and creative assistance
• Hayden Molinarolo, original music and sound design
• Mike Martin Media, editing
• Sophia Passantino, social media
• Lexie O'Brien and Erik Buschardt, website support
• Paula Crews, creative vision and strategic support

Special thanks to Ray Irving and his team at WashU Olin’s Center for Digital Education, including our audio engineer, Austin Alred.

When her mother was diagnosed with breast cancer 11 years ago, Lauren Herring jumped in to help with projects and lead the global expansion for IMPACT Group—the firm her mother had launched in 1988.

In 2007, Herring led the work of incorporating an acquisition target of the company, an outplacement firm that doubled the company’s size. Two years later, she took over as the company’s CEO — right after the economic downturn.

But in her company’s line of work at that time, economic downturns are mother’s milk. With its focus at the time on employee relocation and outplacement services, IMPACT Group’s business was countercyclical: Bad economic times were good for business. The company had its best year ever in 2008.

And that is the crux of our story. As Herring put it, 2010, 2011 and 2012 were slow recovery years. The firm needed to restructure its lines of business to moderate the hot-and-cold nature of its business cycle.

The outplacement business was countercyclical and generally meant bad news for clients, which was good news for her business in a bad economy—like, during a pandemic. Meanwhile, IMPACT Group’s relocation services served a niche within a niche, focusing largely on the needs of the spouse in the relocation. It wasn’t enough to even out the rise and fall of revenue as economic cycles came and went.

IMPACT Group had some experience and modest success with leadership coaching, and that was the area where Herring saw an opportunity to build. But it wasn’t smooth sailing.

“Going into this transition, I thought we had great clients and partners, and we went into this with more hubris than is appropriate,” she said. “I thought this would be a snap. I realized it would be a difficult journey.”

She realized she had more of a sales job than she anticipated to persuade potential clients she had the expertise for the job. Even more, she learned she had to bring her people into the process, help them understand how to build client relationships, rather than sell transactionally.

“For the leadership, people do want that,” she said. “But I didn't understand the shift required over a number of years to confidently go to our clients and say we're really good at this.”

RELATED LINKS

• Listen to episodes of Lauren Herring’s podcast, “Take Control of Your Career”
• IMPACT Group’s website
• About Lauren Herring
• Books Lauren Herring has written: “Take Control of Your Job Search!” and “This side up: A Simple guide to your successful relocation”
• More about Markus Baer

CREDITS

This podcast is a production of Olin Business School at Washington University in St. Louis. Contributors include:

• Katie Wools, Cathy Myrick, Judy Milanovits and Lesley Liesman, creative assistance
• Jill Young Miller, fact checking and creative assistance
• Hayden Molinarolo, original music and sound design
• Mike Martin Media, editing
• Sophia Passantino, social media
• Lexie O'Brien and Erik Buschardt, website support
• Paula Crews, creative vision and strategic support

Special thanks to Ray Irving and his team at WashU Olin’s Center for Digital Education, including our audio engineer, Austin Alred.