Business Buzz - Making You Famous

The public relations fiasco that is United Airlines recent “re-accommodation” of an Asian doctor is costing them market value to the tune of near a $billion U.S. The PR ripple effect of this reputation management failure will keep on giving for years perhaps in ways we can only imagine. United’s 2nd largest market, China, reacted with 100 million comments in their Twitter alternative, Weibo. The resulting call for boycott may leave plenty of room for United staff to sit on their empty jets in Asia.

From a management standpoint, this represents a failure to empower employees on the ground, so to speak, to think and respond outside of ‘policy’ when seeking the make and keep happy customers. Hiding behind policy is a common challenge in bureaucratic and large companies and institutions. The pilot, on flight attendants, and the counter staff could be empowered to act when they see a situation going badly due to ‘procedure.’

Although a large company, Delta Airlines views the overbooking challenge from a more entrepreneurial view. All passengers are polled in advance for the price they would put on being bumped from a flight. Armed with this information, Delta can address overbooking using this data prior to or after boarding. This small action preserves customer relations as the consumer sets the price. It saves the airline time, prevents flight delays and all of the negative costs associated with late flights, crew overtime, and rerouting passengers missing connecting flights.

Entrepreneurs are wise to take a lesson from United. Smaller, more nimble companies can carve out significant market share against much larger competitors by providing better customer service, a little better product as tested with the customer. Measuring customer satisfaction before and after you implement allows you to constantly improve. This is the process I teach to my university Introduction to Entrepreneurship class as found in Paul Ahlstrom and Nathan Furr’s popular book, Nail It Then Scale It. Also, emerging companies can more easily empower employees to make better customer serving decisions that ensure customer loyalty—even if a little outside the box of policy.

In today’s socially connected world, reputation management demands vigilance and rapid response. A bad PR brushfire can turn into a raging wildfire faster than the time required for a legal department review of United CEO’s “re-accommodation” response that added insult to injury. If I were that CEO’s PR counsel, I would remind of the old Asian adage, “If you must bow, bow low.”