BrewDog: how a beautiful beer brand’s reputation has been blown by blasts from ex staff
How reputation can be put at risk during rapid expansion
Last week’s revelations about employment at BrewDog has brought the beer brand headlines that it never wanted, and no doubt left customers around the country shaking their heads in disappointment and muttering “I thought they were nice guys.”
The issues surfaced on Twitter in the form of an open letter from Punks With Purpose, a BrewDog ex-staff group, to its former employers.
An open letter, to BrewDog. pic.twitter.com/xEd3B83qot
— Punks With Purpose (@PunksWPurpose) June 9, 2021
The company has grown massively since its launch in 2007, from a small Aberdeen brewer to a global brand with annual sales in excess of £200m. It now boasts around 100 bars globally and breweries on both sides of the Atlantic as well as in Germany and Australia.
If anything is to be learned from this public spat, it is that growth must work for staff as much as it works for founders and leaders.
Three important lessons for reputation leadership
1 - No matter your size, the values you communicate externally must match those you display internally.
Environmental values are among those called into question by the ex-staff group Punks with Purpose – citing stories of regular transatlantic private jet charter trips by the founding partners, among other things. The company makes much of its team spirit too – on its BrewDog Charter page it says: “Without us, we are nothing. It all comes back to our people. Everything we do is for our team and the craft beer fans that get to enjoy the produce of our labour.” How sad that this brouhaha (say it out loud and you’ll get it) may have disappointed both.
“WE BELIEVE IN BEING A GREAT EMPLOYER
We completely believe that our long term destiny will be dependent on how well we look after our amazing people. We care about great craft beer and incredible people. Without us we are nothing. ”
2 - The most damaged part of BrewDog may not be its reputation but the value of its culture.
It was a brand that made much of its unique punk culture – not only in its marketing but in its funding strategy, attracting more than 100 ‘equity punks’ through a crowdfunding exercise. Yet this letter from ex staff suggests that a culture that was once about collaborative camaraderie may now be one of fear and ‘growth at all costs’. The fear of losing a unique culture is one that many scaleup CEOs dread – and BrewDog proves how fragile it can be. It seems BrewDog’s culture may have gradually soured like a barrel of beer in a warm room.
3 – The operational stresses that contributed to the row should have been foreseen and avoided.
One of the more serious allegations is around a lack of care for health and safety of staff. As any growing company will know, as you expand and change shape or enter new markets, operational processes can easily stretch and break. In this case, the staff say that health and safety processes were one of the casualties of the brewery’s massive expansion but go into little detail. Now, I doubt anyone would accuse the BrewDog partners of deliberately aiming to put staff at risk. However, when employee numbers begin to rise sharply, as company spaces become more densely populated, and as the demands on staff grow, any leader should surely be expected to ensure that key procedures such as training, risk assessments and so on can expand and continue to support them, simply to avoid compliance risks around their legal duty of care, if nothing else. Looking ahead, and planning how processes and procedures must evolve, is a vital growth management task.
Good guys usually win in the end
Team BrewDog hasn’t got everything right in the past. It has suffered a few unfortunate previous dings to its reputation, such as an ill-conceived ‘Pink IPA’ beer for girls – CEO James Watt even took to LinkedIn to admit this and a few other mistakes.
Until now, however, even those mistakes didn’t detract from the perception that the good guys were in charge. In March 2020, YouGov BrandIndex reported a surge in BrewDog’s UK popularity after its founders waived their salaries and switched some capacity to hand sanitiser production.
The accusations by ex-staff certainly cut right to the heart of the brand. Although, I am certain that BrewDog’s reputation will recover. It is a little bruised right now. Yet James Watt has stated on Twitter that it is now committed to doing better – and apologised, which is vital in such circumstances. The world, and his employees, will be watching to see whether change truly happens.
I wanted to share a quick update on the open letter from former BrewDog team members. pic.twitter.com/yKPtKpfUmM
— James Watt (@BrewDogJames) June 10, 2021
Lessons for leaders of growing companies
There are things to be learned here. Not just for the brewer, but for all growing companies.
Damage to employers can have real business impact. It may affect the ability to recruit and retain talent to support further growth. It can call partnerships into question. And it can impede future funding decisions.
Being caught acting in defiance of your stated brand values and commitments can do even more, sometimes causing buyers to vote with their feet and deeply damaging the bottom line.
Avoiding any reputational issues should be a priority for all businesses.
Leaders of scaling firms are well advised to take BrewDog’s lessons on board and consider very carefully the impacts of growth on people as well as production, processes and profits.
Even when they have been defused and dealt with, accusations like this stay on the record for ever.