Matthew Ferrara, Philosopher

Who Makes These Bad Decisions?

epic fail newspaperHow do good companies keep making bad decisions that seem so obvious?

Blame it on the pending Mayan Apocalypse, but it seems like December is the “month of stupid decisions” by a number of otherwise impressive companies. Now, we admit to nothing more than our impressions – and a lot of feedback from our sphere of 10,000 or so friends and subscribers online – but we can’t seem to figure out just how these obviously bad decisions made it past the drawing board – and into the marketplace.

Take, for starters, take Apple’s decision to update the iTunes software. I don’t need a software engineer or a research specialist to decide if the upgrade was successful. I simply have to look at my wife throwing her hands in the air and sighing that she can’t figure out how to do anything with her iPod any more. Apple, the company supposedly dedicated to putting people first, must have skipped the part about asking people who don’t want to “figure out” the latest updates in order to keep using their beloved products. We expect those kinds of shenanigans from Microsoft, but Apple? When you start losing the iPod users – never mind iPhone or iPad – then you’re really screwing up.

Outside of the tech world, we can point to last month’s infamous self-destruction of 15,000 jobs at the hands of the  Bakery, Confectionery, Tobacco Workers and Grain Millers Union at Hostess Brands. Even if we accept that the management team at Hostess did a lousy job of running the company for quite some time, and that innovation had stagnated for longer than the shelf-life of a Twinkie, the BCTGM’s stand “to the bitter end” certainly won the battle, but lost them the war. Rather than having 85% of something, they (plus thousands of employees they didn’t represent) now have 100% of nothing. Seems like a pretty dumb approach to job security to us.

Finally, we return to the tech world today for the “dumbest of the dumb” moves by Facebook, who now owns Instagram. In the “mother of all terms-of-use changes,” Instagram announced changes to their usage policy that reserved the right to resell users photos to third parties, without permission or compensation. In other words, your baby, cat and Las Vegas trip photos could suddenly adorn marketing pamphlets, blogs or magazine covers. It could be cool, certainly, if National Geographic picked up your safari shots, but what happens when your bad hair day makes the cover of Maxim magazine? Why a company that relies upon voluntary participation of users would possibly snub its loyal fans this way boggles the mind. There had to be a dozen better ways to roll this out, such as offering a simple “opt out” feature for die-hard users who cared enough about it. It was heavy-handed, caused needless complaints across multiple social networks, and bad reviews by media pundits. Even if Instagram only loses a small proportion of its users, it was entirely unnecessary.

Certainly there were more dumb mistakes made this week, none of which may matter after the 21st (:>) but most of which seem like even the armchair CEOs of the world could have predicted the bad outcomes. It just goes to show that no amount of revenue, history or cutting-edge technology can compensate for good judgement when it comes to making business decisions that make sense.



    Matt – how do you fight a company that has made a bad decision that personally affects you? Where do you go? How do you get someone to listen to you at that company? Customer loyalty no longer matters.

  • Hi – Thanks for your comment.

    Well, without knowing all the facts of the situation, I would say there are a variety of routes to take. The first question is: Can the problem really be “solved”? For example, I didn’t like the latest iTunes upgrade, but I can’t exactly “solve” it because they don’t offer the “last version” for me to use. So now the question is, can I live with it, or do I need to find an alternate approach/tool/vendor? Even in these cases, giving feedback is important, and I’d use a variety of tools – their websites, email, if I could talk to someone personally (like at a store) – and even social media, like Twitter and Facebook, where your feedback can be heard.

    On the other hand, sometimes decisions companies make simply mean it’s time to terminate your relationship with them. Many companies value cash-flow more than loyalty (for example, cellular wireless companies) and the sheer numbers make it possible for them to “ignore” people. In those cases, you just decide when it’s best to move on, and try another vendor. It’s not “fair” but that’s life. And I try to laugh when this happens, reminding myself that having to “chance cellular companies” is a “good problem” to have, rather than “having to find my next meal….”

    I agree that loyalty and service have suffered greatly – perhaps more than ever – and that sometimes all we can do is vent, and move on. Still, it’s nice to know that with new media, we can be heard, and sometimes even get some help (if not total satisfaction) from companies that try to take feedback seriously.

    Hope that helps a little… :>
    – MF