April 20, 2023
Photo: MillerKnoll Townhall
What Happens When a CEO Tells Employees to Skip The Trip to Pity City?
Andi Owen, CEO of MillerKnoll, which designs office chairs and home furniture under the Herman Miller, Knoll and Design Within Reach brand names, has gone viral–and not in a good way.
Ms. Owen, who has led MillerKnoll since 2018, was recorded last month on a virtual town hall meeting responding to questions from employees on various topics, including bonuses.
She took issue with questions that came through regarding how workers could “stay motivated” if they knew they would not be receiving performance bonuses. She characterized the questions as some being “nice” and others and “not so nice.”
Ms. Owen said employees needed to stay focused on things they could control.
“None of us could have predicted COVID. None of us could have predicted supply chain. None of us could have predicted bank failures, but what we can do is stay in front of our customers. Provide the best customer service we can. Get our orders out of our door, treat each other well, be kind, be respectful, focus on the future, because it will be bright,” she said. “It’s not good to be in the situation we’re in today. But we’re not going to be here forever. It is going to get better. So lead. Lead by example. Treat people well. Talk to them. Be kind and get after it.”
Ms. Owen followed those words with a return to the topic of bonuses.
“Don’t ask about what are we going to do if you don’t get a bonus? Get the damn $26 million (internal sales figure). Spend your time and your effort thinking about the $26 million we need and not thinking about what you are going to do if you don’t get a bonus, all right?”
Staying on the subject, she later added, “I had an old boss who said to me one time, ‘You can visit pity city, but you can’t live there.’ So people, leave pity city, let’s get it done.”
Ms. Owen earned $4.9 million last year, including a $1.29 million performance bonus. Her remarks led to a swift reaction on social media with accusations that she was out of touch with the realities of employees who earn significantly less than she does.
MillerKnoll’s CEO emailed an apology to workers after the video of her remarks went public.
“What I’d hoped would energize the team to meet a challenge we’ve met many times before landed in a way that I did not intend and for that, I am sorry,” she wrote.
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Mark Ryski
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Jeff Sward
Founding Partner, Merchandising Metrics
Neil Saunders
Managing Director, GlobalData
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Discussion Questions
DISCUSSION QUESTIONS: What is your assessment of how Andi Owen responded to questions about bonuses at MillerKnoll? What about her apology to employees after the “pity city” portion of the town hall video went public?
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Some of Andi Owen’s comments are valid. However the points about bonuses are not and the way in which they are expressed is extremely poor and shows a complete lack of empathy and understanding. They’re a failure of leadership. That said, we all make unfortunate remarks on occasions, and she has apologized – so we can move on from this. It does not require a social media “witch-hunt”.
Neil – Well said. It reeks of I got mine and you may or may not get yours. Very poorly stated.
This is a tone-deaf CEO. By any measure, these are tumultuous times for workers. Empathy and a sense of collective effort are required–not being berated. While I do understand that sometimes tough messages are required, in this case this seems to be the completely wrong message and tone. CEOs and leaders have a responsibility to inspire and motivate their organizations, and this has never been more needed than in the current times.
The arrogance, the utter lack of empathy and leadership, is simply breathtaking. She might as well have said, “C’mon, work your butts off so I can get MY bonus. Your bonus is the privilege of working for ME.” Her earnings don’t sound out of line for a $4 billion company, but her remarks are utterly disqualifying for a leadership position.
It appears Ms. Owen responded honestly (from her perspective) and in the emotion of the moment. Unfortunately, she’s not in a position where she is afforded such luxuries and it’s easy for armchair quarterbacks to suggest that maybe she should have been better prepared to answer the question directly (and more diplomatically). I’m not sure there’s an apology she could have provided that would have atoned for her “pity city” motivational speech. However she seems to have once again answered honestly (from her perspective) and in doing so has probably dug herself into a deeper hole by once again failing to address the concern about bonuses.
The apology was due the employees but it won’t change Ms. Owen’s attitude. Ms. Owen has to change Ms. Owen’s attitude. The $4.9 million that Ms. Owen earned is many times the average income of MillerKnoll’s employees. That makes it much easier for Ms. Owen to ignore the importance of personal income to others. She doesn’t have to ever face poverty or anything like it. Very shallow.
This just underscores the incredible pressure CEOs are under to meet financial targets set by shareholders. Her outburst is also a sign of frustration that signals the company’s failure to adjust their value proposition to stay in tune with customer need, making it hard to continue to perform at pre-pandemic levels. The realities of shrinking office space, economic worries and the growing pool of strong competitors mean MillerKnoll should have already been thinking about their next evolution.
Andi Owen’s messaging started off sound: control the things you can. Once bonuses came up, Ms. Owen coolly dismissed employees’ legitimate interests amid the rising cost of living.
While reactive, her apology seems sincere and contrite. It may inspire more empathy from her to rebuild employees’ trust.
I watched the video. I think it is easy to take this out of context. I saw a frustrated CEO. In my day, I’d have had much worse and longer messages about getting out there. The truth of it is that if you focus on “what if we don’t,” you won’t get to “we did it.” Could she have said it better? Of course, but I expect she’s talking to well-compensated C-level execs, not the rank and file. There is a lack of hustle across all levels of retail right now, waiting for someone to make their day. True leaders look to exceed goals and find a way to motivate them. Let’s not throw the baby out with the bath water.
Wow. I’m glad I’m not on the MillerKnoll PR team. Ms. Owen has created quite a mess from a public perception standpoint. I doubt there’s a single executive in any business who, at some point, hasn’t been frustrated about their team, company, or role. Great leaders find ways to motivate and drive change in a way that rallies their teams, even in tough times.
I don’t know which is worse, complaining to your employees about their complaints or not realizing that today, anything you say has the potential to get outside the company and force an apology. One that I suspect may have some question its sincerity.
I love the phrase but not delivered like this. It is very true that we have to give some harsh reality checks from time to time and get people focused and motivated but this was not the right way to do that. During COVID-19 a number of employees did visit “Pity City” and we have fallen into believing that the state or company will help us out which is not always possible. However, as a motivational speech, this is way down the list of successful ones–even if some of the message was necessary.
Delivery matters, especially when you know internal meetings are being recorded now that they are conducted in a digital environment. Executives need to understand everything can be “taken out of context” and communicate assuming everything will appear on page one of The Wall Street Journal, even internal meetings. That said, one bad line should not make an executive’s career–she apologized and now needs to deliver business results.
It’s tough for employees to accept Ms Owen’s remarks about “pity city” when she earns $4 million+. And it was foolish of her to not have prepared a better response in advance to the questions about bonuses given that compensation is top-of-mind for all employees.
This. I definitely would have thought she would be better prepared to talk to her staff but instead, I believe it will be harder for the staff to respect her as a leader moving forward.
I absolutely agree, Richard, that she will have an uphill climb to getting her team’s respect
My concern beyond this situation is a broader one rooted not in this exact incident but based in societal trends. Should she have apologized? Sure–the comment was a little tone deaf. Is there a large delta between CEO compensation and lower levels of the organization? Yes, of course–just look at all the references to her pay.
Did she seem sincere in her apology? Yes, to my ears anyway.
However, we are in an era where EVERYTHING can be “used” later against someone, making everyone accountable to everyone else for everything they say and do. Once the video is out you “unleash the furies” and everyone has an opinion about it, myself included. And regardless of how sincere she sounded (or was) in her apology, many of us are going away with a “who does she think she is” opinion of her. Her reputation is tarnished for as long as people remember the incident.
I hope that we are not moving to an era of everything being prosecuted in the arena of public opinion (but I fear we are already there), because the “soundbites” that become public are never the moderate ones, they are the extreme ones–the ones on the long tail of the bell curve, because THAT is what makes the news cycle.
Not a difficult question. Watching the video, she starts out fine, seemingly sincere, and devolves into sounding like a hypocritical jerk. Perhaps she is and perhaps she was just having a really bad day. Or perhaps she wasn’t smart enough to know better.
Obviously I wasn’t there, and I’m not going to take the time to find and read the whole speech, but I’m guessing this was much like the Curate’s Egg: “some parts of it were excellent.” But for a motivational speech all parts need to be excellent.
“Look, I know you are worried. It is my job to motivate you through uncertain times and get you the tools you need to make that $26 million figure. Let me make it clear: I will not be taking any bonus, and none of our executive officers will be taking a bonus, until you have succeeded in earning yours. What else can I do to help you?”
The words aren’t hard to write. It becomes a matter of character when an executive does not think to say them.
Well said, Scott.
I believe in realistic optimism. In other words, it can’t be all good. If there is bad, we can’t create false hope. We must be authentic with the words we use to describe a dire situation. More than anything, executives must be congruent with their messages. Tightening up budgets while still making seven-figure bonuses is a red flag. Remember, there are three sides to every story. Her side, their side, and the truth. It doesn’t mean anyone is deceptive. It means there is misinterpretation – and that can’t be ignored.
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Some of Andi Owen’s comments are valid. However the points about bonuses are not and the way in which they are expressed is extremely poor and shows a complete lack of empathy and understanding. They’re a failure of leadership. That said, we all make unfortunate remarks on occasions, and she has apologized – so we can move on from this. It does not require a social media “witch-hunt”.
Neil – Well said. It reeks of I got mine and you may or may not get yours. Very poorly stated.
This is a tone-deaf CEO. By any measure, these are tumultuous times for workers. Empathy and a sense of collective effort are required–not being berated. While I do understand that sometimes tough messages are required, in this case this seems to be the completely wrong message and tone. CEOs and leaders have a responsibility to inspire and motivate their organizations, and this has never been more needed than in the current times.
The arrogance, the utter lack of empathy and leadership, is simply breathtaking. She might as well have said, “C’mon, work your butts off so I can get MY bonus. Your bonus is the privilege of working for ME.” Her earnings don’t sound out of line for a $4 billion company, but her remarks are utterly disqualifying for a leadership position.
It appears Ms. Owen responded honestly (from her perspective) and in the emotion of the moment. Unfortunately, she’s not in a position where she is afforded such luxuries and it’s easy for armchair quarterbacks to suggest that maybe she should have been better prepared to answer the question directly (and more diplomatically). I’m not sure there’s an apology she could have provided that would have atoned for her “pity city” motivational speech. However she seems to have once again answered honestly (from her perspective) and in doing so has probably dug herself into a deeper hole by once again failing to address the concern about bonuses.
The apology was due the employees but it won’t change Ms. Owen’s attitude. Ms. Owen has to change Ms. Owen’s attitude. The $4.9 million that Ms. Owen earned is many times the average income of MillerKnoll’s employees. That makes it much easier for Ms. Owen to ignore the importance of personal income to others. She doesn’t have to ever face poverty or anything like it. Very shallow.
This just underscores the incredible pressure CEOs are under to meet financial targets set by shareholders. Her outburst is also a sign of frustration that signals the company’s failure to adjust their value proposition to stay in tune with customer need, making it hard to continue to perform at pre-pandemic levels. The realities of shrinking office space, economic worries and the growing pool of strong competitors mean MillerKnoll should have already been thinking about their next evolution.
Andi Owen’s messaging started off sound: control the things you can. Once bonuses came up, Ms. Owen coolly dismissed employees’ legitimate interests amid the rising cost of living.
While reactive, her apology seems sincere and contrite. It may inspire more empathy from her to rebuild employees’ trust.
I watched the video. I think it is easy to take this out of context. I saw a frustrated CEO. In my day, I’d have had much worse and longer messages about getting out there. The truth of it is that if you focus on “what if we don’t,” you won’t get to “we did it.” Could she have said it better? Of course, but I expect she’s talking to well-compensated C-level execs, not the rank and file. There is a lack of hustle across all levels of retail right now, waiting for someone to make their day. True leaders look to exceed goals and find a way to motivate them. Let’s not throw the baby out with the bath water.
Wow. I’m glad I’m not on the MillerKnoll PR team. Ms. Owen has created quite a mess from a public perception standpoint. I doubt there’s a single executive in any business who, at some point, hasn’t been frustrated about their team, company, or role. Great leaders find ways to motivate and drive change in a way that rallies their teams, even in tough times.
I don’t know which is worse, complaining to your employees about their complaints or not realizing that today, anything you say has the potential to get outside the company and force an apology. One that I suspect may have some question its sincerity.
I love the phrase but not delivered like this. It is very true that we have to give some harsh reality checks from time to time and get people focused and motivated but this was not the right way to do that. During COVID-19 a number of employees did visit “Pity City” and we have fallen into believing that the state or company will help us out which is not always possible. However, as a motivational speech, this is way down the list of successful ones–even if some of the message was necessary.
Delivery matters, especially when you know internal meetings are being recorded now that they are conducted in a digital environment. Executives need to understand everything can be “taken out of context” and communicate assuming everything will appear on page one of The Wall Street Journal, even internal meetings. That said, one bad line should not make an executive’s career–she apologized and now needs to deliver business results.
It’s tough for employees to accept Ms Owen’s remarks about “pity city” when she earns $4 million+. And it was foolish of her to not have prepared a better response in advance to the questions about bonuses given that compensation is top-of-mind for all employees.
This. I definitely would have thought she would be better prepared to talk to her staff but instead, I believe it will be harder for the staff to respect her as a leader moving forward.
I absolutely agree, Richard, that she will have an uphill climb to getting her team’s respect
My concern beyond this situation is a broader one rooted not in this exact incident but based in societal trends. Should she have apologized? Sure–the comment was a little tone deaf. Is there a large delta between CEO compensation and lower levels of the organization? Yes, of course–just look at all the references to her pay.
Did she seem sincere in her apology? Yes, to my ears anyway.
However, we are in an era where EVERYTHING can be “used” later against someone, making everyone accountable to everyone else for everything they say and do. Once the video is out you “unleash the furies” and everyone has an opinion about it, myself included. And regardless of how sincere she sounded (or was) in her apology, many of us are going away with a “who does she think she is” opinion of her. Her reputation is tarnished for as long as people remember the incident.
I hope that we are not moving to an era of everything being prosecuted in the arena of public opinion (but I fear we are already there), because the “soundbites” that become public are never the moderate ones, they are the extreme ones–the ones on the long tail of the bell curve, because THAT is what makes the news cycle.
Not a difficult question. Watching the video, she starts out fine, seemingly sincere, and devolves into sounding like a hypocritical jerk. Perhaps she is and perhaps she was just having a really bad day. Or perhaps she wasn’t smart enough to know better.
Obviously I wasn’t there, and I’m not going to take the time to find and read the whole speech, but I’m guessing this was much like the Curate’s Egg: “some parts of it were excellent.” But for a motivational speech all parts need to be excellent.
“Look, I know you are worried. It is my job to motivate you through uncertain times and get you the tools you need to make that $26 million figure. Let me make it clear: I will not be taking any bonus, and none of our executive officers will be taking a bonus, until you have succeeded in earning yours. What else can I do to help you?”
The words aren’t hard to write. It becomes a matter of character when an executive does not think to say them.
Well said, Scott.
I believe in realistic optimism. In other words, it can’t be all good. If there is bad, we can’t create false hope. We must be authentic with the words we use to describe a dire situation. More than anything, executives must be congruent with their messages. Tightening up budgets while still making seven-figure bonuses is a red flag. Remember, there are three sides to every story. Her side, their side, and the truth. It doesn’t mean anyone is deceptive. It means there is misinterpretation – and that can’t be ignored.