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Who is in charge?

by Alan Gleeson

Decisions are never straight forward. We all have to make decisions armed with the best information at our disposal at a particular point in time, weighing up the Pro’s and Con’s before deciding on our chosen course of action. However ‘best information’ does not of course equate to ‘complete’ or ‘accurate’ information and many decisions are made under time duress or with incomplete information. On top of these issues, commercial decisions impact a wider group than most personal decisions and these decisions are often deconstructed publically (despite the obvious information asymmetries) unlike most personal ones. There is also a growing tendency for commentators to pre-empt commercial decisions e.g. witness recent media discussions re whether the European office of Twitter will be in London or Dublin . Similarly the ‘losers’ of decisions increasingly attempt to influence the decision seeking reversals . This article seeks to explore these issues in more detail before suggesting some things to think about if you face similar situations to those described below.

Managing Change

Managing ‘resistance to change’ has been a popular academic topic for many years. In 1979, J.P. Kotter and L.A. Schlesinger wrote an article in the Harvard Business Review called ‘Choosing strategies for change’ which sought to offer practical advice to managers dealing with resistance to change. However the concept goes back a little further as the quote from the 15th century Italian philosopher Niccolò Machiavelli illustrates:

“It must be remembered that there is nothing more difficult to plan, more doubtful of success, nor more dangerous to manage than a new system. For the initiator has the enmity of all who would profit by the preservation of the old institution and merely lukewarm defenders in those who gain by the new ones. “

What has changed in recent years, however, is that external resistance can now be much more widespread and powerful than mere internal resistance and as a result managers have to make decisions in this wildly changed context. In many ways this change has been driven by the growth of social media which has enabled everyone to have a voice, and anyone with access to an Internet connection an ability to publish.

The Effects of Social Media

Where once people merely consumed products and services they now inform the feature set as active participants in the production as any software developer will confirm. Where once they solely consumed content, they now often add to the narrative with most online publications including commenting platforms enabling anyone to participate in the discussion. While these comments can really enrich the content, they can also often poison it when individuals hide behind a cloak of anonymity and post inappropriate comments or critiscms typically without full disclosure. What we say and do has never been subject to as much scrutiny as it is these days. Similarly the law of ‘unintended consequences’ also has a habit of coming into play when we least expect it. The following represent some recent examples of commercial decisions made where the backlash was very public.

1. Startup Britain


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Startup Britain was launched in a blaze of publicity in March 2011. The aims of the website were indeed worthwhile ones, as the website sought to support and advance the cause of entrepreneurship in the UK. However soon after launch, blogs and forums were full of scathing comments ranging from criticism of the features to criticism of Mr Cameron’s involvement. The ‘Create a Logo’ feature was one immediate victim of the backlash and the (foreign) 99designs.com offer was quickly replaced with a link to the (local) DBA homepage .

2. Gap

US clothing retailer, Gap ditched its new logo within one week of unveiling same following an ‘outpouring of comment’ online. Apparently more than 2000 comments were posted on their Facebook page, many of which ‘demanded’ the return of the original, a wish which was duly granted.

3. Zipcar

Following Zipcar’s $50m IPO in April, some critics argued that the institutional investors had significantly under priced the deal. “Zip Car’s IPO Underwriters Just Screwed The Company To The Tune Of $50 Million” screamed the headline in a post on Business Insider by ‘Editor-in-Chief’ Henry Blodget .

Other examples where there has been significant ‘public outcries’ include; Spotify’s recent decision to cut back their ‘Freemium model’ limiting the number of free plays the user can listen to , and the unveiling of the London Olympic Logo which some commentators described as ‘puerile’ .

How to deal with a backlash

As the above examples illustrate, decisions made by known brands (in particular) can attract the most intense reactions often from the most unexpected quarters. Here are some things to consider when faced with external resistance.

  • Make sure to get impartial independent feedback where appropriate so you can ensure a full sanity check before a launch/ or an announcement.
  • Remember you have access to more data than the critics i.e. some of this data is commercially sensitive or is not in the public domain so they do not have the ‘full picture’.
  • Some decisions will never be well received, particularly ones where services that have been free suddenly incur charges. Well rehearsed and logical responses can be prepared well in advance.
  • Be prepared to reverse your decision when either new evidence emerges after the fact. As British Economist John Maynard Keynes once said in response to accusations he was flip-flopping on some issue: “When the facts change, I change my mind. What do you do, sir?
  • You do not have to engage in a dialogue with the public – particularly when faced with criticism from anonymous commentators with undisclosed interests. However be prepared to overturn a decision when faced with over whelming resistance (as distinct from a vocal minority) from fully transparent critics with well argued cases.
  • Do not rush to judgment. A backlash does not mean a bad decision. The London Olympic logo was not withdrawn despite the barrage of criticisms it attracted when launched.

In summary, while a more connected online world brings many benefits, there are also many drawbacks. Decisions made at the business level can be subject to scrutiny far beyond the walls of the office within minutes of the decision being made public. While engagement with a diverse audience is to be welcomed, it needs to be on your terms. For the most part the wisest policy is simply to ignore the noise and concentrate on building your business.

[1] http://www.guardian.co.uk/technology/pda/2010/dec/13/twitter-office-london-dublin

[2] http://www.telegraph.co.uk/news/uknews/1553545/Olympic-chiefs-under-fire-for-puerile-logo.html

[3] http://hbr.org/product/choosing-strategies-for-change-harvard-business-re/an/R0807M-PDF-ENG

[4] http://www.guardian.co.uk/money/blog/2011/apr/05/small-businesses-startup-britain

[5] http://www.bbc.co.uk/news/business-11520930

[6] http://www.businessinsider.com/zipcar-ipo-price-2011-4

[7] http://econsultancy.com/uk/blog/7422-spotify-s-new-freemium-a-little-less-free

[8] http://www.telegraph.co.uk/news/uknews/1553545/Olympic-chiefs-under-fire-for-puerile-logo.html

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