Northwest Airlines Debacle & Cluetrain Manifesto

The story to follow has to do with Northwest Airlines. Please note that I refer to this paper as a story. According to author Weinberger of The Cluetrain Manifesto, “Stories are how we make sense of things. Anything else is just information” (Weinberger, 2001, p. 151). I agree with the author about stories vs. information. Stories are a more dynamic, interesting way of communicating.
In August of 2006, Northwest Airlines cut wages and fired workers as a means to get out of bankruptcy. At this time, Northwest provided 50 of its now unemployed workers with a booklet that contained 101 money-saving tips. Management provided this “so-called” helpful tool in an attempt to appear sensitive to the realities of its workers newfound wage reduction or unemployment. Someone, plain and simple, “dropped the ball” with this one. Not only were several of the 101 tips considered by many to be insensitive to the newly unemployed, but the most talked-about tip was one to “dumpster dive”. According to Mike Hall at AFL-CIO Weblog, the exact wording was as follows: “Don’t be shy about pulling something you like out of the trash”. The booklet, and more particularly the dumpster diving tip, created a frenzy of Web communication, much of which was boldly negative toward Northwest. How could management be so insensitive to its workers plight?
Please allow me to share some examples of numerous negative comments about Northwest. The following are comments taken from www.bloggingstocks.com. “The workers had already dumpster-dove when they went to work for Northwest.” Another is more direct. “If the Northwest CEO will dumpster dive first, I’ll help push his head in the dumpster farther down.” Comments went to the extent of name calling. “Northwest, or Northworst, has always had a very big problem with labor relations. This didn’t surprise me at all. My friends and I laughed and said “they are at it again.”
Northwest errored a second time. Management attempted to pass the buck in its response to its actions by saying the booklet had been prepared by an outside company, which it had. However, the preparer was representing the company. Therefore, Northwest management should have taken responsibility as well. Its failure to do so only resulted in management and the Northwest Airlines company being viewed even more negatively.
I decided to see what the preparer of the booklet had to say about the publicity surrounding this debacle. From MY.DEL.ICIO.US, I found the media response from NEAS, Inc. President and CEO Philip Chard. A portion of the response is as follows: “While we did not author the flier, we were remiss in not properly reviewing it prior to distribution. As an EAP provider . . . we sincerely apologize that some of the information in the materials was not appropriate and was felt to be offensive.” Hooray for NEAS! If they took responsibility, why couldn’t Northwest? Again, Northwest employed NEAS; therefore, they should have taken, or at least shared responsibility in a futile attempt to demonstrate some sort of human caring for its employees by simply apologizing.
I wondered if the extensive negativity that was communicated everywhere via the Web adversely impacted the financial performance of Northwest. At the company website, I discovered a much improved financial performance for the full year 2006 as compared to 2005. My conclusion here is that the expense reduction as the result of the wage cuts and layoffs were more impacting than negative PR surrounding the debacle. I wondered, however. If the financial position of the company were similar to performing peers, would the negative PR surrounding the booklet impact the company to the extent that financial performance would be significantly affected, resultingly making it less competitive? I believe that it would because the extent of the negativity generated via the Web would result in decreased revenue.
This story is of a company that was going through significant change. When attempting to minimize the negative effects of wage reductions and layoffs by providing helpful tips, Northwest management simply did not comprehend the magnitude an oversight can have in the marketplace, or they would have hopefully been much more careful and responsible with material that finds its way into the public arena.
As the authors of Cluetrain point out, the web allows everyone to communicate openly and freely. I have learned people are not afraid to say exactly what is on their mind when communicating on the Web. The extent of response to Northwest management’s error and lack of responsibility demonstrates this.
I believe the authors of The Cluetrain Manifesto are saying that management needs to understand that the marketplace continues to change as the result of the Web. Companies must be aware of the depth and breadth of communication the Web provides and understand that this expansive communication dramatically changes the way in which we communicate, obtain information, and do business. Management must address these change and decide if they have confidence in the status quo, or if they should embrace and utilize change to their advantage. I further believe the authors challenge status quo management philosophies, and are promoting more open collaboration.
Lastly, the Cluetrain authors talk about the Web as a way to foster learning. “Imagine a world where everyone was constantly learning, a world where what you wondered was more interesting than what you knew, and curiosity counted for more than certain knowledge. Imagine a world where what you gave away was more valueable than what you held back, where joy was not a dirty work, where plan was not forbidden . . .”I cannot say with certainty that the Web will overcome business as it is today, but I can say with conviction that it has dramatically impacted the world and the business segment and will continue to do so in the future.