Pulling People Off Planes and Your China Business






Pulling People Off Planes and Your China Business

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By now just about everyone knows about the Chinese-American doctor who was forcibly removed from a United Airlines airplane. To say this has been a PR mess for United Airlines would be an understatement. It has been a worldwide disaster. America is angry. China is outraged. The video has gone viral. Full disclosure: I started my legal career in Chicago at the law firm that back then (and I think still does) represent United Airlines and I have been a Platinum 1K (the highest tier) at United Airlines since as long as I can remember and I generally like the airline and I generally defend it.

What does this have to do with your China business? Everything.

Let me explain.

If you run any sort of business, you need to be prepared for major problems and you need to have a plan in place for dealing with those problems. Your plan must include how to prevent the problem from occurring, how to mitigate the problem if it does occur, and, sometimes most importantly, how to apologize for the problem when it does occur. If you do not have such a plan in place, your China business is at risk, and let me tell you, China poses major risks. Why is that? Because China has ~1.5 billion people and a large chunk of those people are on the internet and what happens in China or with China does not just stay in China, and vice-versa.

Let’s analyze what United did wrong and how you can do better. First off, United should have prevented the problem in the first place, and I am not talking about better algorithms that might have prevented the overbooking situation, though that certainly would not hurt. No, I am talking about how (based on what I have read) United was willing to offer only $800 to get passengers off the plane once it had become clear there was an overbooking situation. Why didn’t United just keep raising its bumping reward until it got voluntary takers? You can’t tell me that it would not have gotten more passengers off that plane had it kept raising its offer. I have to believe that it had it been willing to spend another $700 per passenger it would have had sufficient takers. United needed to get four passengers off that plane. Do you think paying another $2800 total will have killed them? What do you think this debacle is going to cost United in cancelled or never-booked flights? I’m just wildly guessing, but I’d say more like $2.8 million than $2800. Not to mention the inevitable lawsuits which will cost them another ~$2.8 million in attorneys’ fees and payouts and additional bad and lingering publicity. Does United not give enough authority/discretion to its employees to solve problems like these?

And now let’s talk about the “apology,” which I intentionally put in quotes because it really was more of an airline-speak statement.
China contingency planAccording to Psychology Today (which is what I always use when I am playing psychologist), you only get one chance to make an apology without sounding excessive. Therefore, you need to nail it with your one chance. And United Airlines most certainly did not. Let’s break down this apology.

  • It starts out saying this is an upsetting event to all of us here at United. Really? This is nearly the equivalent of saying, you having to witness your mother dying really makes me feel bad. Why is United focusing on how this has impacted United rather than on how it impacted its own passengers? Not smart.
  • I apologize for having to re-accommodate these customers. Really? I did not have sexual relations with that woman. When you apologize, you should personalize it and humanize it. This “apology” fails on all accounts. It does not constitute an apology for the way a passenger was dragged off a plane nor does not apologize for United having overbooked the flight. It is in the passive voice; rather than say I apologize for our having…., it makes it seem as though United had no choice but to do what it did. But United did have a choice as it could have paid more money to get passengers off. This is a classic non-apology. And what the heck does re-accommodate mean anyway? Is this airline-speak, because it sure as hell isn’t the way the normal people I know speak. Using industry buzzwords is a classic way to create distance and yet this is a time when United should be doing everything it can to reconnect with its customers.
  • “Our team is moving with a sense of urgency to work with the authorities and conduct our own detailed review of what happened. Your mother froze in the cargo hold, but don’t worry, we will move with a sense of urgency to work with others to review what happened. What the heck does this even mean? 1. Why say “sense of urgency” instead of just “urgency.” Another example of trying to create distance. Why talk about working with others? Why say “to review what happened” instead of to determine and report back on what happened. Most importantly, you are the CEO of United Airlines, have you not watched the video? Isn’t there enough there to say that the situation was handled poorly? Should he not at least have referred to what happened?

Now as a lawyer I know that an apology constitutes an admission that can be used against you in a court of law, but surely Munoz could have said something more clearly and more compelling than this. Munoz just really never takes responsibility for the problem. He never takes ownership of it. And don’t think apologies don’t matter. Many years ago, I spoke at a terrific lawyer conference on the cutting edge of law. I remember one of the speakers (I apologize because I do not remember his name) gave a great talk on crisis management and he used MLB pitchers Roger Clemens and Andy Petitte as the examples. Both Clemens and Petitte had been accused of using performance enhancing steroids. Clemens vigorously denied having done so and essentially accused those who said otherwise of being liars. Petitte pretty much immediately owned up to his mistake: I used them, I should not have, I am sorry, it will not happen again. How many baseball fans know Clemens used steroids and dislike him for having done so? Way more than with Petitte. I can hear this crisis management speaker saying “Munoz should have emulated Petitte here.”

Our China lawyers often have to deal with PR imbroglios. The below are some of the following:

1. A client makes a product that many consumers would not want others to know they use and it has its Chinese manufacturer ship this product direct to the consumer who orders it and when the order goes out an email from the Chinese manufacturer goes out saying that the product has been shipped. This email appears to come from our client and usually — of course — this email goes out only to the one person who ordered the one product. But one day it inadvertently went out to every single person who had ever ordered the product and it went out to all of these people in the “to” line so that everyone else could see everyone else’s email address. We and our client immediately went into overdrive and sent out an email apologizing for the problem, owning up to it, assuring that it would never happen again, and offering a substantial discount on any future orders within the next year. This apology email went to one person at a time and it went out within 15 hours of the incident. Our client got hundreds of responses back to its own email and almost all of those responses were appreciative of how quickly and decisively it had acted. They got a few emails from people saying that they would never buy from our client again, but that was it.

2. Many years ago, a company that made ultra-high end outdoor equipment at prices about double of any of its competitors came to us because its Chinese manufacturer had sold product that our client had rejected as defective — let this be a lesson as to why your China manufacturing contract should clearly provide exactly what happens to rejected product. Anyway, the defective product had found its way to the United States and many many buyers of it had come to our client to ask for a replacement per our client’s 100% replacement guarantee. Our client said that the defective products were not theirs and they were right as the defective products were actually counterfeits. Our client wanted us to research its legal obligations to replace the defective product. My response to them was as follows: Look, we can charge you a lot of money to legally support your decision not to replace the defective equipment, but might you not be better off paying to replace it and maintaining your great reputation than paying us to fight against replacement and perhaps irreparably harming your reputation. The client said “umm” and that they would get back to me on how to proceed. They chose to replace and I have always thought that was a wise decision.

I could go on and on with real life examples but it would be a lot more productive for you to create your own worse case scenarios for your own business. 

Back in the golden age of China blogging, Will Moss (now the Director of Reputation Management at Intel) had a terrific blog called ImageThief, that focused (at least sometimes) on China public relations. He did a post once on how foreign companies need to prepare beforehand for their China PR disasters and I saved the key lines from that post and I repeat them to you below now:

Be prepared to respond fast. Silence often equals guilt in the eyes of the public. Have an issues management kit that anticipates possible crisis scenarios in place beforehand. Don’t rely on guidance from overseas headquarters.

Pay close attention to the tone of public communications. Address concerns. State positions. Don’t condescend or talk down to Chinese audiences.

Get everybody on the same page. Limit public comments to the minimum number of spokespeople and throttle unauthorized communication.

Brief employees so they know what is expected of them and how to respond to media queries, ambushes, etc.

For consumer brands, ongoing monitoring of the Internet is a good idea. Internet scandals are often flashes-in-the-pan, but they can erupt into the mainstream. It’s better not to be caught by surprise.

Great advice isn’t it? And it applies worldwide.

What are your thoughts?

(Why?)

Published at Tue, 11 Apr 2017 12:11:43 +0000

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