Donald Trump is a threat to your company’s future.
Companies that align themselves with the resistance, though, may come out ahead.
Huge changes often hit hardest where we assume little change is possible.
For three decades — despite the widespread undermining of the economic prospects of the American middle class — the U.S. political landscape for business has been very stable. I want to share a few quick thoughts about why I think that’s no longer the case.
Sure, there was blowback from the great looting of the Subprime Crisis, like Occupy Wall Street. Consumers have demanded higher ethical standards on some goods (consider, for instance, boycotts against Nike and Apple for the atrocious labor practices of their overseas manufacturing partners). Unions have made a modest comeback. Co-ops, credit unions and other alternative institutions have grown.
But let’s face it, for the last three decades, businesses have had it easy in American politics. There’s been a formula for business participation in public affairs, and it has been (if odious) predictable: hire lobbyists and PR companies, give bipartisanly and in sufficient amount to buy access, avoid open scandals and hire crisis management teams if one emerges, and generally try to avoid getting labelled as the enemy by any particular large group of American consumers. Keep your head down, your message smart, and the bribes flowing, and politics should not be a major bar to business success.
I wonder how many sensible business leaders realize how seriously Trump has poisoned that well? How dramatically he is altering the political landscape for business in a way that could be to their profound detriment, even in the relatively near-term?
I see this happening in three ways:
First, mobilization. The largest factor in maintaining a favorable business political landscape over the last three decades has been — if we’re being honest — the apathy and inattention of almost all Americans. This is really obviously not the case now: in fact, younger progressive Americans, especially, are now politicized to a degree we haven’t seen since the 1930s. Remember, we just saw the largest protests in U.S. history after Trump’s inaugural. Memberships and donor bases for nonprofits like the ACLU, Sierra Club and Mother Jones magazine are through the roof. The motto “Saturdays are for fighting Fascism now” should tell you something about the degree of outrage and anger in the land.
Second, transparency. It has never been easier to discover who’s involved with what, and with social media, it’s never been easier to get people angry about it. Expect a geyser of leaks, exposes, hacked servers and tell-all stories in the coming years — from the Trump gang, sure, but also about business, business ties and political corruption across the board. A certain portion of those will turn, unpredictably, into national news. The only real historical comparison is the Watergate scandal, and the host of business scandals that erupted in its wake.
Third, open political conflict. I suspect it will become increasingly impossible for business to stay neutral in this fight. Bipartisanship is less and less a viable business stance. This means that the tried-and-true formula for business public affairs no longer works.
Some huge businesses don’t care, of course. They’re partaking in wholesale corruption — whether that’s gutting financial regulations to benefit their Wall Street firms, snagging lucrative procurement contracts for weapons or prisons, or pumping up the Carbon Bubble. They’re already at the table, looking for their cut of the lamb. Hundreds of billions of dollars will be changing hands. This is graft on a nearly unimaginable scale.
But most businesses — even some fairly large corporations — are not big enough (or ruthless enough) to get a seat at that table. They’re still the government’s retail clients. For these companies, things in D.C. have never been worse.
Where companies can retreat to nonpartisanship — to get out of politics altogether — that will protect them, but it looks to me that the defining move of this administration is vindictive punishment for those who don’t offer allegiance — and as Congress’ pay-to-play donation model becomes a mud wallow of outright corruption, it will be harder and harder, I think, to get things done in D.C. without getting covered in muck. I don’t think the GOP will let companies stay above the fray.
At the same time, the radical craziness of the White House and many in Congress makes the benefits of supporting them extremely unreliable, and the costs of doing so openly potentially huge. It’s still pay-to-play, but the game may turn out to be Russian roulette.
The usual response to this kind of risk — bipartisan campaign contributions to display neutrality — won’t work. Support for Trump and the GOP is not business as usual, it’s participation in an attempt at regime change, and those who oppose those attempts will rightly regard businesses paying to play as businesses working against their fundamental interests. Bipartisanship is collaboration now.
Look at the Uber boycott — responding to the company’s ethical and labor practices but triggered by their CEO’s ties with Trump — which has reportedly cost the start-up 240,000 customers in one week. I think we’ve only just begun to see the backlash this election has set in motion against business as usual. In fact, I’d make a modest bet that affiliation with Trump will be instrumental in an American business going bankrupt within the next six months.
Which leaves the trickiest proposition of all: edging quietly towards opposition to Trump — making as few waves as possible, while securing a long-term position as a supporter of American institutions and the interests of regular people.
I’m sure this is the smart strategy for anyone who plans to still be in business in five years. Unless Trump succeeds in destroying American democracy, there will be consequences to those who’ve backed him: companies’ brands will be trashed; executives’ careers will be tarnished; people will go to jail.
More widely, I strongly suspect that Donald Trump has single-handedly destroyed the political stability of the business environment in the U.S. for a generation, and in the new politics that are emerging, businesses seen as compromised by collaboration will have much less power to resist changes to their strategic environments.
What I’m not sure about at all is what this looks like for established businesses. (I also suspect most conventional political consultants have very little insight into this situation.) We’re in undiscovered country here.
One last thought: this same set of factors creates an amazing opportunity for businesses in a position to play the divide and to come out (openly or winkingly) against Trump. A brilliant play in this regard was Lyft’s announcement of a $1,000,000 donation to the ACLU just an Uber was floundering in scandal. Expect to see more of that, in bolder strokes. Another was Starbuck’s announcement it would hire 10,000 refugees.
Companies that openly ally with people who want change, after all, can tap into their passion for change. And we’re talking about millions of passionate customers (and younger, urban, more sought-after customers at that). For companies that aren’t trying to lobby actively for government support, showing open resistance to Trump could be a gigantic business advantage, and drive market awareness and customer loyalty as never before.
Personally, I would prefer it if companies actually joined the resistance to Trump, actually took strong actions to defend American democracy. But speaking solely as a strategic observer, I think being seen to be on the right side — even through symbolic gestures — will go a long way.
Adaptation is the essence of strategy in fast moving times. The most important adaptation for American business right now is not adapting to the Trump regime itself— which is temporary — it’s adapting to the landscape it will leave behind.
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