Stakeholders and Crisis Management

Summary of Crisis 

Goya Foods, an American food company, is one of the companies which experienced a crisis in 2020. A crisis is a situation that threatens the firm's ability to effectively operate its business (Ndlela, 2019) . Goya's CEO praised former President Trump, and this situation threatened the company's ability to effectively operate its business due to boycotts. At the beginning of July 2020, Robert Unanue, the CEO of Goya Foods, attended a white house event to celebrate the Hispanic Prosperity Initiative. Unanue mentioned that America was truly blessed to have a leader like the former president, who was labelled a builder. He compared the former president to his grandfather, a Hispanic immigrant who established Goya Foods in 1936 (Reyes, 2020). The comments made by Unanue spread quickly and outraged the Hispanic community. Goya Foods billed itself as the biggest Hispanic-owned food entity in the US. During his tenure, Former president Trump was criticized by the Hispanic community due to his negative treatment of Hispanics. He had imprisoned Latinos in concentration camps and offended hurricane survival victims in Puerto Rico. In addition, the former president issued frequent racist comments about Mexicans. The former president was viewed as a face of hate towards the Hispanic community. Goya Foods' customers took to Twitter and criticized Unanue while calling for a boycott. Hashtags such as #BoycottGoya and #Goyaway dominated the social media platform (Reyes, 2020). Even the CEO of Latino Victory, a political group, called for a boycott of the entity’s products. Other renowned Hispanic politicians such as Julian Castro and Alexandria Ocasio-Cortez also called for the boycott. Various Latino groups such as the Hispanic Federation and LULAC issued statements indicating that Unanue’s comments were insulting and insensitive. The Boycott Goya movement gained momentum in the following months after Unanue made his comments with several Latino customers avoiding the entity’s products completely. 

Analysis of Company’s Responses 

Goya Foods initially responded to the crisis through reaction and defense. According to Weiss (2014), the first two response phases to crises include reaction and defense. In the reaction phase, a response made publicly to address the crisis is required. It is an essential stage for corporations, given that it provides an opportunity for stakeholders, including customers, the media, and the public, to see how the firm reacts and what the message is. After the crisis, the CEO responded to the issue by defending his comments. In an interview with Fox News, Unanue postulated that his critics were contravening his right to free speech by disputing his comments and calling for ramifications (Reyes, 2020). Unanue made it clear that he was not apologizing. In the defense stage, the entity receives significant public attention, and its reputation is at stake. Unanue's failure to apologize exposed Goya Foods to further attention and backlash. The entity's reputation was at stake, and, as a result, the company had to react positively. A few days after Unanue made his comments, Goya Foods announced that it was giving two hundred thousand pounds of food to Mexican families affected by the coronavirus pandemic. This act was a way of managing its stakeholders, specifically the media and Hispanic customers. Stakeholder management is geared towards fostering favorable relationships with stakeholders who have the largest impact on the business (Weiss, 2014). Goya Foods’ move to donate food to Mexican families was aimed at improving its relationship with Latino customers. The food donation was a way of appeasing Hispanic customers who it had offended. In addition, the entity wanted to reduce the negative backlash from the media. 

Recommendations 

In handling the crisis, the CEO should have adopted a sympathetic and transparent leadership style. The CEO of Goya Foods should have apologized to the public as soon as possible to receive forgiveness from the Latino customers. Unanue should have been sympathetic towards the needs of Hispanic customers. He should have recognized their feelings of disappointment as soon as he made his comments praising the former president. In addition, he should have been transparent by explaining that his comments were not meant to infuriate the Hispanic customers. An effective leadership style can allow an individual or entity to manage a crisis effectively. For instance, Captain Sullenberger, the pilot who landed a plane on the Hudson River, employed an effective leadership style that was focused on calmness, intuitive accuracy, and creativity (Weiss, 2014). As a result, he was able to manage the crisis effectively by avoiding the loss of lives. Unanue's adoption of a leadership style focused on sympathy and transparency could have allowed Goya Foods to effectively manage its crisis. 

Goya Foods could have used its philosophy or mission statement to respond to its crisis. The entity’s mission is to be the brand of choice for Hispanic cuisine while maintaining a family-based approach to customers in the food traditions of Latino customers. In this respect, the entity's mission is focused on respecting the needs of Latino customers. Goya Foods should have used this mission to respond to the crisis. It could have attended to the needs of Hispanic communities by making up for the comments made by the entity's CEO. For instance, it could have issued a statement doubling down on the comments made by the CEO. In this case, the Latino customers could have given the entity a second chance rather than continue to criticize it on social media. 

References 

Ndlela, M. N. (2019).  Crisis communication: A stakeholder approach . Cham, Switzerland: Palgrave Macmillan. 

Reyes, R. (2020).  Latinos boycotting Goya say it’s not about politics. It’s about standing against Trump’s ‘hate’ . NBC News. https://www.nbcnews.com/news/latino/latinos-boycotting-goya-say-it-s-not-about-politics-it-n1234052 . 

Weiss, J. W. (2014).  Business ethics: A stakeholder and issues management approach . Berrett-Koehler Publishers.