Watch the full episode How Airbnb is Pursuing Purpose, Compassion, and Belonging in a Time of Crisis with Kate Shaw.
During times of crisis, leaders must strike a delicate balance. On one hand, they need to provide clear, resolute direction and make tough decisions. In such moments, to survive and, in the long term, thrive, often require them to preserve resources and make difficult trade-offs. On the other hand, they also need to offer understanding, reassurance, and a sense of connection and empathy to their people.
In 2020, as the pandemic reverberated through the global economy, industries like travel and hospitality were severely impacted. Airbnb was compelled to lay off 25% of its workforce, an excruciating decision. However, the organization’s financial viability and potential for survival hinged on this necessary trade-off. So, here’s what they did: They chose transparency and honesty.
Communicating with Honesty
As global travel came to an abrupt halt, Airbnb found itself at the forefront of this challenge. Kate Shaw, Director of Learning at the company, acknowledges that navigating crises has become a hallmark of Airbnb’s journey. The company’s founders had encountered numerous hurdles while establishing the organization, but the new challenge posed by the pandemic was unprecedented. They needed to devise strategies for survival and navigate through this formidable storm. Kate comments, “If we imagine this is going to go on for quite some time, then we are really going to have to control our expenses and figure out how we pivot our business model to adapt. It is anyone’s guess though, how long this is really going to last.”
Through her years at Airbnb, Kate has come to admire the remarkable compassion of the company’s CEO, Brian Chesky. This compassion was abundantly evident throughout the entire crisis. Leading up to the layoffs, there was a consistent stream of communication. Brian conducted a weekly CEO Q&A where he candidly discussed the organization’s situation, the harsh realities of the industry, and shared data illustrating the severity of the crisis. Simultaneously, he offered reassurance that he was committed to ensuring the company’s survival and navigating through the storm, expressing confidence in its resilience.
Brian’s transparency from the outset was vital for everyone to grasp the gravity of the situation. During the layoffs, it was imperative for him and all involved to execute them with as much compassion as possible. Kate reflects, “I think the overriding sentiment was, with layoffs of that scale you are watching incredibly talented people walk out the door. These were really difficult decisions.”
Kate Shaw focus on management and leadership skills, knowing that people leaders have an outsized impact on their teammates, with a particular emphasis around belonging.
Preparing for Conversations
To ensure a respectful departure for those affected, Airbnb took several steps. They extended the most generous packages possible given the circumstances. Additionally, they made certain that every individual had a one-on-one conversation with their leader to communicate the unfortunate news. “We did absolutely no group notifications”, Kate emphasizes.
Airbnb prepared these leaders by conducting sessions where they modeled what a compassionate conversation in such circumstances might look like. They asked these leaders to approach these conversations with utmost empathy. Kate observes,
“One of the risks is that there are certain things that legally one has to say in those conversations. But if you lead with that, the way you impact someone gets truly lost. And the impression we really wanted people to walk away with was that they will not remember what they said, they will remember how we made them feel in that moment. The most important thing was to show up with as much heart and compassion as possible — and to use our own language to be a charitable host to someone in really difficult circumstances.”
Where Leaders and Community Step In
The Airbnb community responded to this challenge in ways that exceeded the company’s expectations. On the day Brian announced the impending layoffs, the company found itself in a group call where some engineers had developed a platform allowing attendees not only to watch Brian’s webcasts but also to see people virtually taking seats in the room and respond with emojis and messages that appeared on the screen. When Brian announced the layoffs, the screen filled with hearts and tears, reflecting the deep emotions within the Airbnb community. On that day, Brian regretfully informed them that layoffs would occur, beginning that afternoon, and that affected individuals would have one-on-one conversations with their team leads to discuss the impact on their roles.
Airbnb initiated the notifications on a Tuesday and requested that affected employees stay until the following Monday. This approach differed from the typical layoff process where privileges are immediately revoked, and employees are escorted out of the premises with their belongings. Kate remarks, “We knew we were going to be laying people off in extraordinary circumstances in the middle of a pandemic. These are good people who had done incredible work, who deserved a generous farewell.”
This extended timeframe also allowed the team to redirect recruiters to support departing employees. Airbnb created a dedicated page at airbnb.com/talent and encouraged employees to upload their resumes for others to discover. Recruiters were assigned to these individuals to assist them in finding new opportunities elsewhere.
Understanding that Stems From Trust
The outpouring of care, love, and generosity within Airbnb during this transitional period was truly extraordinary. Top leadership, including CEO Brian Chesky, made themselves readily available to guide employees through this challenging process. Brian held another CEO Q&A session before their departure. During these sessions, he bid farewell, expressed his gratitude, and conveyed how much each employee meant to him. Kate emphasized, “When you see your CEO on a screen in tears, you know it’s real.” Brian didn’t attempt to conceal his emotions, making it one of the most difficult things he had ever done.
The story of how Airbnb handled employee layoffs and transitions amid a pandemic demonstrates the power of compassion, even in the face of a crisis, and the positive outcomes that result from doing it well. This compassion didn’t suddenly emerge from the leaders; it was built on a foundation of trust and a history of experiences that employees could recall, recognizing that their leader genuinely cared. Despite facing adverse consequences from the tough decisions that had to be taken, employees trusted their leader because of the authenticity they had witnessed over the years. It all revolved around Airbnb’s commitment to infusing humanity into every aspect of their operations, including their relationships within the company. This transition required humanizing a process that is typically devoid of such qualities, as Kate recounted.
Airbnb had already fostered a culture that valued open communication, offered assistance when needed, and, most importantly, was grounded in trust built on authenticity. This culture not only shaped its brand but also influenced the impact the company had on its teams and individuals.
In Mentora’s training programs with clients on building trust, we show that a leader’s gaining of trust leads to increased opportunities, respect, understanding, and support from others, creating a virtuous cycle. To cultivate trust, it’s crucial to exemplify through your behavior the qualities and qualifications you wish others to associate with you, rather than simply asserting your credentials to them. And once you’ve done this, you’ll find even the most difficult conversations and circumstances become more manageable for you. Like they did for Brian Chesky and team, at that crisis hour at Airbnb.