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Editorial: Total recall

Editorial: Total recall

There's nothing like a product recall to stir up a good crisis and wipe millions of dollars off a company's revenue sheet. Such a calamity may seem remote, but product recalls are a fact of any manufacturer's life and a critical part of managing the business. Yet how many companies are actually prepared to deal with a product recall crisis when it hits?

There are 26 product recalls on the Federal Government's Recalls site (www.recalls.gov.au) for the month of October. One of them, listed as an "electrical appliance", is Epson's EPL 9000 printer. Not on the list, but communicated to resellers through ARN this week, are Brother's HL1000 printer series and Toshiba's Pocket PC e740. No big deal. Things go wrong, and customers get notified. It happens all the time. Car manufacturers do it. Food manufacturers' very existence depends on it.

In one of the most famous (and biggest) cases in the history of product recall, Coca-Cola was forced to learn the value of doing it after losing millions of dollars when the Belgian Government banned the product due to a health risk that the company vehemently denied. The case has been included in most crisis-management textbooks, detailing the importance of transparency and communication in handling product recalls. Yet, although one of the most prolific and sophisticated users of PR, IT still seems to be one of the least bright pupils and certainly one of the worst offenders when it comes to ineffective crisis management.

When resellers tried to address the recurring Fujitsu hard drive problems that had been causing grief to their customers, they encountered a classic case of stonewalling. The problem didn't exist, Fujitsu told them. Subsequent attempts by ARN to follow up the issue were met with a similar tone. There was no story to report, Fujitsu claimed. And even if there was, the story was an "old one". But for resellers frustrated with the vendor's apparent lack of willingness to deal with the problem, the story was definitely worth reporting and anything but old.

Had Fujitsu thought about the problem in terms of creating goodwill among its customers, it would have realised that this was not a case of right versus wrong, but a chance to champion its customers - Fujitsu's most important asset. These are the people who had given Fujitsu a vote of confidence by buying its product in the first place. These are the people whose own reputation rests largely with the vendor's ability to deliver a reliable product. These are the people who offer - and expect in return - some goodwill and quick service if a product fails. And, as in any relationship, these are the people who expect to be communicated with when the crisis occurs. For, while we all know that nobody wins in a crisis, communication can make it less painful, less prolonged and ultimately less costly. Epson, Brother and Toshiba certainly think so.

It's time for the rest of the bunch to bite the bullet. They certainly expect the reseller to do so!


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