Tom Petrocelli's take on technology. Tom is the author of the book "Data Protection and Information Lifecycle Management" and a natural technology curmudgeon. This blog represents only my own views and not those of my employer, Enterprise Strategy Group. Frankly, mine are more amusing.

Friday, July 16, 2010

A Swift Kick In The Apple

I’m not a great believer in schadenfreude. Finding joy in other people’s misery does not say something positive about me so I try not to engage in it. However, with some companies, it’s too tempting to ignore.  Apple is one of those companies. In my opinion, they sell a lot of style over substance. Pretty much anyone who has developed for Apple environments such as the iPhone or Mac will attest to them being control freaks. They are the epitome of a closed system. Apple, and Apple alone, decides if your App gets to be in the App Store. They are not exactly forthcoming with the criteria for rejection either. At times it has appeared that they were rejecting apps from competitors for all the wrong reasons. They make Microsoft seem like Open Source.

So, it was with a bit of guilty glee that I have followed the latest iPhone 4 debacle. Why, because Apple approached it with their usual arrogance. Even though it was obvious to a first year Electrical Engineering major that there was a problem with the antenna, they denied it. It wasn’t the signal that was wrong, they said, it was how the software measured it. The first thought that came to mind was “So, it’s always had a lousy signal. Silly us. Thanks for pointing that out.”

Now, they are suggesting but not really admitting that they may have an antenna problem. Still, the reaction is slow. Everyone has to wait for a press conference starring Steve God… I mean Jobs. This is classic Apple. They think they can fix this with a marketing event. The arrogance is astounding.

Here's a quick lesson in Crisis Management 101. First, you admit that you may well have a problem, that your customers are not stupid rubes who don’t know how to hold a phone. You don’t blame partners and faceless engineers. Second, you investigate quickly and offer to replace the product if there is indeed a hardware problem. You let anyone return the product whether you can prove there is a problem or not. Most people won’t but it’s the kind of gesture customers appreciate. Finally, you fix or replace all the problem devices for free. Even if you take it on the chin financially in the short term, you will have built long term value and enhanced your brand. For a company dependant on brand, like Apple, this was an opportunity to build long term loyalty.

What you don’t do is deny that there is a problem before you’ve even investigated it. You don’t act like your customers are morons. Most importantly, you don’t tell everyone to shut and up and take what you give them. This type of attitude takes an opportunity to connect with customers and turns it into a lot fewer customers.

More than anything else, you check your ego at the door. You act humble, sorry for the pain that you caused your loyal and beloved customers. This seems to be something that Apple is genetically incapable of doing. You think they would have learned from the recent Toyota debacle. Silence is deadly here. Arrogance is even worse.

At one point in my career, I was on both sides of this type situation at once. Network boards that we had been shipping were failing. Most were caught by our manufacturing QA engineers. Those that weren’t we offered to take back from customers even if they hadn’t seen problems yet. The contract manufacturer tried to deny that there were problems at all. Then they tried to deny that they had anything to do with it even when we showed them the defects. Finally, we had to threaten to pull all of our business from them. Suddenly, they were willing to admit and rework all the boards. Needless to say, we weren’t looking to send them any new business. We no longer trusted them.

This is classic Apple. Too bad. They had an interesting opportunity to make their customers trust them, to grow loyalty, and turn a bad situation into a positive one. They’ve done the opposite. In the long term, this will haunt them.

1 comment:

JL said...

Tom, I agree completely. The problem here is not the antenna, but how Apple handled the situation. Had they addressed the situation immediately, the uproar that we now see would have been minimized.