Molding perceptions

How to break bad news

When bad news needs to be shared, management scholars have shown that the response is influenced in particular by how bad the news is, what is said, and who says it. New research by management associate professor Terry Cobb focuses on what makes such communications effective or successful.

Terry Cobb
Terry Cobb, management associate professor

Social accounts: explaining tough choices

Leaders sometimes have to make tough choices that can result in loss and disappointment to their followers, Cobb says. “Such decisions undermine the commitment and cooperation that leaders need from their followers to be effective.” Negative reactions, however, can be mitigated by the explanations given for those decisions — explanations that scholars term “social accounts.”

Social accounts, Cobb says, can be viewed as a form of persuasive communication designed to affect the perceptions, attitudes, and behavior of the message recipients. “They can be seen as devices not only for accounting for one’s action but also for helping message receivers to understand the situation and the players involved and convincing message receivers to think better of leaders.”

Social accounts “can increase employee perceptions of fairness and mitigate adverse reactions to downsizing and layoffs, unfavorable changes in benefits, negative feedback, and undesirable behavior,” he adds. “They can also increase the willingness of customers to do business with a company, repair trust following a violation, help facilitate organizational change, and help the leader maintain a more positive image.”

Factors in account acceptance or rejection

Research on social accounts, Cobb says, suggests that at least three factors play important roles in account acceptance or rejection: the message content; “source factors,” or characteristics related to the account giver, such as sincerity, sensitivity, and expertise level; and the degree of harm accounts are attempting to address. Various studies have demonstrated the extent to which different kinds of explanations work in different situations, he says, but none have yet to fully address a fundamental issue: why do accounts work or fail?

In a recent study, Cobb and his co-author, Francis Frey of the University of Virginia’s College at Wise, focus on what makes accounts effective or successful by examining the effects of the specificity of the message, the expertise of the source, and the level of loss. Their research produced two findings, one of which reflects the unanticipated consequences accounts can produce.

Specificity improves reception

First, Cobb says, message specificity has a direct impact on account acceptability — regardless of whether loss results from the individual’s own performance or from group-wide action (such as general layoffs, departmental change efforts, or organization-wide policy changes).

“We found that when managers give an explanation for decisions that have caused loss, they need to be more specific in addressing the concerns of their followers and the reasons behind their decisions. Being vague or dismissive can actually make things worse.” And the greater the loss incurred, the greater was the need for specificity.

Expertise can be a liability

The second — and perhaps surprising — finding was that, in some cases, “leader expertise can actually make acceptance of their explanations more difficult — under conditions of higher loss, expertise actually becomes a sizable liability.”

Elaborating on this “accounting conundrum,” Cobb says “followers expect good leaders to be knowledgeable about their area of operations and what goes on in it. That image of expertise generally serves managers well in developing confidence in their leadership. That very expertise, however, comes with some expectations. An important one is that knowledgeable leaders should be able to foresee and forestall problems that will cause loss to their followers. Thus, he says, leaders seen as having more expertise have “a higher hurdle to jump in getting their explanations accepted.”

Recommendations to leaders

What should leaders do? “Start by remembering that in an adverse situation, subordinates look to you to help them make sense of things,” Cobb suggests. “When bad things happen to good employees, the first thing they do is see who is responsible and why things turned out the way they did. Even if the larger organization is responsible for their loss, employees count on their direct leader to help them understand what is going on.”

Next, he says, explanations don’t really cost much and have high potential payoff — use them. “Of course, there are times when accounts are less important. In a crisis, followers expect leaders to take immediate action; explanations can come on another day. But most of the time, when followers experience loss, they want to know what compelled leaders to take the actions they did and why they chose the path they took. The more leaders can help followers make sense of their loss, the more readily followers can begin the process of healing and moving forward.”

Avoid shifting blame, focus on shared values

Cobb, who specializes in organizational politics and organizational justice, also notes that although explanations given by leaders can be powerful, they can also redirect anger from the account giver to other leaders in the organization or to other organizational policies. Leaders, he says, should consider a more thoughtful approach to the delivery of bad news beyond blame shifting or the essential details that justify a decision. “Leaders should consider positive ways to frame a social account and use rhetoric that speaks to shared values. Indeed, social accounts can be an opportunity to enhance leadership efforts through building trust in leadership and commitment to organizational goals.”

In summary, Cobb notes that research on social accounts has consistently shown that they can help reduce the criticism and moral outrage managers face when they make unpopular decisions. “Our study supports emerging research, however, that accounts can produce predicaments of their own. Leaders may well face a kind of accounting conundrum when developing and delivering their accounts.

“In our study, we saw that if a leader wants to maintain an image of expertise, he or she may be assuming greater liability for producing acceptable explanations. On the other hand, professing naïveté or ignorance, while increasing the likelihood of account acceptance, can undermine a leader’s image by creating unfavorable impressions of their competence to lead.”

Still much more to learn

His study demonstrates that there is still much more to learn about social accounts “and the processes that underlie their acceptance, rejection, or, worse, an increased negative reaction to them,” Cobb says.

“What we don’t know about social accounts can hurt leaders in their use of them. Although accounts can mitigate negative reactions to disappointing outcomes, they can also enhance those negative reactions and produce undesirable side effects of their own. The downside of social accounting has received very little attention.”

Cobb’s study, “What matters in social accounts? The roles of account specificity, source expertise, and outcome loss on acceptance,” was published in the Journal of Applied and Social Psychology, 2010, volume 40, issue 5.

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