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    June 2013
    M T W T F S S
    « May   Jul »


    Corporate Betrayal

    Mark Borkowski

    One of the very first principles we all learn in business is the concept of betrayal.

    There are three major areas of malfeasances. Firstly, violated rules and agreements – people state that their organizations lost their trust when incompetent managers got promoted, when promised salary increases or added benefits failed to materialize or jobs were cut when promises were made to the contrary. Secondly, violated honour – most managers and employees get really irked when their companies allowed people to shirk their duties or betray their private confidences. And finally, abused authority – many good corporate soldiers get upset when companies tolerated bosses padding their own expense accounts or abused power by flying first class when everyone else flew economy.

    Often, though, it is the organizations themselves that not only encourage but also reward betrayal and other survivor behavior by employees. In too many corporate cultures, one can easily recognize the factors that promote these behaviours: incongruent goals, shifting coalitions, excuse making, finger pointing, and a history of tolerating violations of trust. The concept of “whistle-blowing” has made this behaviour prevalent.

    There are even parallels between the real corporate world and television.
    For example, downsizing is the corporate version of the TV hit, “Survivor Island.”
    Downsizing pits employees against each other—not everyone will survive, some may even will. Downsizing also promotes kingdom and coalition building, and it encourages false or misleading communication to hide the real fact of the layoff that follows. Companies that downsize have a difficult time building effective teams, and getting workers to cooperate. They are also the companies that often complain that workers are no longer loyal to their employers. Why are these types of companies so surprised?

    There are usually three types of betrayal in most corporate environments.

    Unintentional betrayal is violating trust without meaning to do so. For example, a worker may inadvertently reveal confidential information during friendly or boastful talk over coffee or a beer after work. This is the classic slip of the tongue.

    Premeditated betrayal is entering a trusting relationship to betray the other person. Spies and saboteurs are good examples of premeditated betrayers. In my experience, premeditated betrayal often happens during corporate mergers. For example, managers in the acquiring company assure staff members in the acquired company that they have indeed jobs in the new organization. However, these managers hide the fact that that once they gain sensitive information from the employees, or the employee’s complete critical short-term projects, the acquiring company will fire them.
    Opportunistic betrayers intend to betray the other party but do not enter the relationship for that purpose. The right circumstances and the belief that they will gain more through betrayal than by acting with integrity cause the opportunistic betrayer to weigh the odds before falling to temptation. The opportunistic betrayer assesses the potential benefits of betrayal, the probability of getting caught, and the severity of the penalties they will suffer if someone catches them.

    Organizations experiencing lack of trust by employees usually commit unintentional or opportunistic acts of betrayal. Poor delegation, bad communications, continuing shifting priorities, abusive management styles, and recurring reorganizations to cover up mismanagement are examples of behaviour that employees may perceive as betrayal of their trust. Although the actions seem minor in isolation, they quickly add up to create a culture characterized by lack of trust and feelings of betrayal. When a trust is betrayed, what is the price of that betrayal?

    One of the most serious consequences is reduced productivity simply because betrayed individuals pay more attention to protecting themselves than actually working for the company.

    In published reports, it estimates that about twenty percent (20%) of betrayed individuals chose to seek revenge on their attacker. But, when they do, the do so with a vengeance, causing more havoc to the company’s fortunes than almost anything other personal activity.
    Revenge seekers are more motivated by the fact of their betrayal than by the scale or type of betrayal and thus the vengeance takes on a more serious magnitude that usually ends up costing the company many more times than if the betrayer, regardless of his or her position of importance to the company, had just simply been fired.

    By: Mark Borkowski is president of Toronto based Mercantile Mergers & Acquisitions Corporation, a brokerage specializing in the sale of mid market companies. He can be contacted at (416) 368-8466 ext, 232 or or

    The MONEY® Network