Today, the story is about learning from your mistakes. Some companies do this very well, and some even learn from other people's mistakes. Intuit, having seen what happened to Intel when a bug was discovered in its original Pentium chip, made sure that when a bug was discovered in its Turbo Tax software, it didn't make the same mistakes. It acknowledged the problem, allowed people to download the fixes from its Web site, and ended up with a PR win.
Three years later, Intel seems to have learned from its mistakes. Its recent announcement that a bug had been discovered in the Pentium II chip was accompanied by one of the best "Mea Culpas" we've ever seen. And the fact that the announcement came from the very top was really the key. "CEO Andy Grove Admits Mistake" could have been the headline, since it was the very same CEO who was quoted in the past as saying that he knew better than the customers. This time out, it was a humble and very forthcoming Grove who met with the press.
The same cannot be said of DeCoster Egg Farm. Not only did it fail to correct mistakes, it refused to even acknowledge them. The company, the nation's largest producer of brown-shelled eggs (based in Turner, Maine), has been slapped time and time again with safety and health violations. Last month the Labor Department ruled that DeCoster will pay more than $2 million in fines to settle safety and wage violations. The start of such incidents and investigations dates back to 1979, when the business was first in the midst of child labor disputes and citations for safety violations. What is truly astounding is that after all the investigations, rulings, etc., CEO Jack DeCoster still gave the "no comment" treatment, and left everything up to a hapless PR person. Now we're the first to admit that New Englanders may be a bit different. But common sense is supposed to be one of our strong suits. Clearly Mr. DeCoster has not learned from anyone's mistakes.
| Criteria | Grade | Comments | Advice | |
| Extent of coverage | A | Since the objective of a crisis is to make the news go away as fast as possible, we look at the extent of coverage during the first six weeks of the crisis. Almost invariably, badly handled crises get worse before they get better, and Intel holds the all-time record. This time there was barely a blip, but the crisis probably contributed a few additional articles to the overall launch coverage. | This was perfection. Everyone should have as good a CEO as Intel's. | |
| Effectiveness of spokespeople | A | Andy Grove is almost always a great spokesperson but during the 1994 crisis he was dreadful. Clearly, he's learned his lesson. | Whoever did Grove's media training deserves a raise! | |
| Communication of key messages | A | The message is: we're a smart company that learns from its mistakes, and that was clearly and consistently communicated. Very rarely does a company communicate a positive message in the middle of a crisis. This is one of those rare times. | Hard to improve upon. The message was there, it was clear, and the image of the company will improve as a result. | |
| Management of negative messages | A | Very few negatives emerged, other than references to the last bug. | When you can't wish away an old problem, leverage it. Which is just what Intel did to drive home the point that it's sold a heck of a lot of chips and it learns from its mistakes. | |
| Impact on customers | A | This is the area that really shone. Instead of telling customers what they should or should not want, it clearly was listening to customers, giving them all the information they needed and letting them make their own decisions. | Was this all part of the launch strategy? If so, it probably worked. | |
| Impact on investors | A | It managed to use the crisis as a way to tell the world how many chips it sells and how much money it makes. Makes the investors pretty happy. | What's a little bug to a cash machine like Intel? | |
| Impact on employees and prospective employees | A | The honesty and forthrightness with which Andy Grove delivered the news sent a strong message to employees that those characteristics were part of the company culture. Now that's innovation! | How can you NOT want to work for a company that's honest, forthcoming, learns from its mistakes and makes a ton of money. | |
| Overall score | A ++ | So perfect, you wonder whether it wasn't part of a planned launch strategy. | During the 1994 crisis, I suggested that the case be used in communications courses as an example of how NOT to handle a crisis. Now Intel should be teaching the course on crisis management. | |
DeCoster
| Criteria | Grade | Comments | Advice | |
| Extent of coverage | F | Whenever you duck the issues, it gives reporters something to investigate. The more information you give them, the less they have to dig for. In this case, the FDA was there to provide all the information | I know it sounds counter intuitive, but the more information, however bad, you can give out, the better. | |
| Effectiveness of spokespeople | F | Whenever you see "The CEO was not available for comment" you know there's something to hide. And you know that the company is in DEEP DOO DOO. | As painful as it is, get the CEO media trained and get him out there, It's better if the messages come from the horse's mouth. | |
| Communication of key messages | F | What messages? - Oh, the one about "we don't care about health and safety issues, or cleanliness or hygiene? | There could have been a positive spin in this - i.e., small company trying its best etc. etc. - but the lack of CEO quotes and overall bad management made the company look truly despicable. | |
| Management of negative messages | F | Essentially the FDA drove the messaging, so ALL the messages were negative. | When YOU don't provide the messages the opposition will. In this case the FDA was remarkably effective in getting its side of the story out. | |
| Impact on customers | F | Who would want to buy food from a company that doesn't care about hygiene? | Admit the mistakes. And thus, it might have had an opportunity to get the message out that the eggs weren't bad, just the working conditions. | |
| Impact on employees and prospective employees | F | The message to employees was, "We don't care about your health, working conditions or the law" - not the message you want to communicate. | It'll be interesting to see if they can attract competent workers in the future. With full employment, and plenty of alternative places to work, who would want to work in those conditions? | |
| Overall score F | ||||