Responding to Failure
By now, I’m sure most people have heard of the global outage experienced by RIM a few weeks ago. Shortly after the outage, RIM co-CEO Mike Lazaridis offered a public apology for the issue, and RIM itself offered free apps and a month of free technical support in response, which were received with mixed reactions.
My comment, on both Twitter and Facebook that RIM clearly just “doesn’t get it” was met with some confusion as well. One person indicating that the difference between a regular mobile plan and a smartphone plan is about $10/month. So, a refund on services equates to about 30 cents a day, so a three-day outage means a $1 refund.
All joking aside, that’s actually accurate. A recent lawsuit confirms that it equates to only about $1.25. The cost of the outage, per person, is negligible. But, at least that has a monetary value that directly corresponds to the outage. $100 worth of free apps (most of which are games, and targeted at business professionals) is just out in left field. And that’s the reason why I said that RIM doesn’t get it. As a company that appeals to businesses as a primary market, the offering of free apps and free technical support was an insulting and degrading statement.
If your product is so problematic that you need technical support, such that a month of free support is valuable, you have a problem with your product right there. Most businesses however, run on annual budgets, and paid technical support is budgeted. Adding a month of free support to the end of the plan also means that billing cycles just got shifted by a month, and the cost associated with making budget adjustments accordingly far exceed the $1 refund or the lost business associated with the outage. As many companies are relying on mail communication through enterprise-grade servers, a three day outage is a serious problem when they are paying for a service that offers a 99.99% uptime guarantee. For the record, 99.99% uptime means that service is “guaranteed” not to be down for more than 20 minutes per year.
When you’re paying for that, any outage–even accidents–is considered professionally unacceptable. Most home users won’t care. But business users are paying for service guarantees, and make decisions accordingly. Three days of downtime can translate to millions in lost revenue.
Personally, I think RIM would have been better off to offer no free apps at all, and simply stick with the public apology, fix the problem, show how they’ll prevent it in the future, and move on. The free apps was just a completely off-track, insulting statement. It sent a message that RIM wasn’t concerned with the effects of the outage, and was more interested in simply pacifying people with something that in the end really didn’t cost them anything. It sent a message that RIM doesn’t get how businesses operate any more. It sent a message that a business professional’s downtime can be pacified by giving him or her a free copy of The SIMS to pass the time.
And so I stick with my original comment, that RIM simply doesn’t get it.
But what about your business? How do you respond to your clients and customers when your own services fail to meet expectations? How do you value your customer when your mistakes cause an interruption to their work? Do you see it as a cost of doing business to pacify the customer? Or do you see it as an opportunity to really learn your customers’ needs, and provide solutions that will help them improve in the future?