guestXM – by Black Box Intelligence

How Yum! Brands is Winning the Conversation

This week, Yum! Brands announced a significant change to its family and medical leave policies for home office employees.

Changing the Game

How Yum! Brands Is Redefining Workplace Policies and Market Competition

For some time, I have argued about the definition of “winning” whenever I’m asked what success looks like for the labor and activist community. For those of you who have interacted with me at the Global Best Practices Conference and other forums, you have heard me say that for critics of our industry’s business model, winning is not just measured in successful advances in legislation, regulation, or litigation. Long-term success can be found in winning the conversation as well.

Regardless of how elected officials handle an issue, the narrative that citizens advance – whether they are customers, employees, or shareholders – can change markets. Here’s a case in point: this week, Yum! Brands announced a significant change to its family and medical leave policies for home office employees. They are increasing their maternity leave benefit from six weeks to eighteen weeks of paid leave and adding a paternity leave benefit of six weeks, including for adoptive and foster children. For any company, regardless of the industry or business model, this is staking out new ground.

The question is, why? Why would a company in one of the most cost-sensitive and lowest profit-per-employee industries in the economy take such a big step in this direction? Was it to get ahead of potential legislation or regulation in states and localities throughout the country? Was it to become more aligned with cultural and regulatory norms in countries throughout the world as it looks to expand its international footprint? Was it to curry favor with particular segments of the current political conversation in this country? Maybe. Maybe all of those considerations went into the decision as they rightfully should within a major corporation. But, maybe it wasn’t about their brand perception or staying one step ahead of the regulators. Perhaps it was really about being an employer of choice and positioning itself to compete for the best talent available.

At the end of the day, Yum! must be convinced this is the best way to stay competitive in the labor marketplace – the same marketplace that, in addition to economics, is shaped by social, political, demographic, and cultural parameters. The continual narrative pushed by the activist community over the last decade has started to take root. From a legislative perspective, there are only a handful of states and localities that have implemented leave policies and Congress has been almost silent in this space. But, the leave issue is front and center in the labor and employment workspace. The constant drumbeat around paid sick leave, paid time off, family and now parental leave has created an environment among workers – especially young workers – that these types of benefits should be part of the deal, regardless of what the law says.

A well-funded, well-orchestrated campaign over the last ten years has changed the narrative, which has changed the marketplace. The law didn’t force Yum!’s actions; in fact, lawmakers are lagging far behind the curve. The business reality is that more expansive leave policies reside not only in the labor marketplace but also front and center in the expectations of desirable workers forced their hand. Again, the labor and activist community hasn’t won very many legislative, political, or regulatory battles lately. It has, however, won the hearts and minds of a significant part of the entry-level workforce. While the business community continues to win the shorter-term policy and political battles, it continues to lose the longer-term war around the narrative. YUM! has significantly moved the marketplace concerning this issue. Others like Walmart and Disney have moved the hourly wage marketplace. Starbucks has moved the healthcare marketplace.

Companies need to understand how the public narrative moves marketplaces and impacts business models, at least as much or more than lawmakers. The Red team may own the levers of government right now, but the Blue team is still winning the conversation.

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