Canada’s largest bank stumbles through PR disaster

The Royal Bank of Canada is taking serious flak for its outsourcing.

Canada’s largest bank is struggling through a PR debacle that has Canadians up in arms and customers threatening to close their accounts.

The Royal Bank of Canada (RBC) was thrust into the media spotlight over the weekend when allegations of replacing homegrown staff with outsourced temporary foreign IT workers hit the news via a whistle-blowing website.

An investigation revealed the bank is replacing 45 employees with temporary foreign workers at the end of the month. iGATE Corp., a multinational outsourcing firm from India, employs the foreign workers.

Although outsourcing is nothing new, especially in the IT industry, the narrative by one RBC employee who complained about having to train and ultimately be replaced by a foreign worker played long and loud. And it has resonated loudly with the 1.3 million unemployed Canadians.

What happened next was nothing short of a mini-tsunami of public disgust; social media networks lit up with complaints of disgruntled customers, mainstream media jumped on the bandwagon, an anti-RBC Facebook page popped up, and even federal government opposition parties got in on the act.

In an attempt to stem the tide of criticism, RBC initially put its HR director in the media spotlight. Her corporate-speak explanation and histrionic hand gestures did little to articulate the company’s response and quell the uproar. In fact, they only exacerbated it.

A subsequent decision saw the bank’s president, Gord Nixon, carefully placed on selected news programs to try his hand at a company response. Though he appeared on one program known for its deep understanding of business, Nixon had to be goaded into another interview at the same media outlet by an irritated tweet.

The issue of outsourcing is now becoming the issue du jour of every Canadian company known to play on the global stage. The story is not going away soon, so all RBC can hope for is that the spotlight moves away from it and onto some other organization.

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