Big Thinking is kicking off a series about How To Communicate Bad News because we see too many partners, clients and friends often miss the mark and make bad situations worse.

There are apparently not enough distractions here so Timothy Chaney and Richard Cole jumped on their laptops
There are apparently not enough distractions here so Timothy Chaney and Richard Cole jumped on their laptops

The first guideline we’ll share is straight out of today’s headlines:  

Be Honest About The Rules.  

There is an incalculable multiplier if you break the rules, your actions cause problems and you are not immediately forthright with every possible stakeholder fast. Lightning fast.  Greased lightning fast.   So fast that you may not have a solution yet, but you’ve already assured people you are resolving the matter right now.

The problem may be as basic as a spreadsheet error that only becomes a broken rule if you cover up the mistake.  Or the problem could be as specific as flying a jet with more than 100 passengers for more than an hour past your destination.  The comments the cockpit crew made puzzled everyone.   The federal government announced today that the flight crew claimed they were using laptop computers in the cockpit, were distracted and ignored radio calls and other signals. If their story is true and they were looking at new schedules resulting from their merger, they have hopefully handed over their untampered with computers and will face whatever disciplinary action occurs when you don’t do your job and fly 160,000 pounds of plane on top of thousands of gallons of jet fuel.  

But Timothy Chaney and Richard Cole blew their chances for problems by releasing cagey statements since Thursday.  Only today, on the fifth day, have federal investigators released a statement about the events that caused Chaney and Cole to operate their plane in the way they did. Imagine two headlines. One reads, “Pilots Reprimanded, Suspended for Using PC In Flight The other reads, “Government Investigators Uncover Truth About Stray Jet.

Your responsibility is to tell the truth when things go bad and own up if you were breaking the rules.  Coverups don’t work, and the fallout is always worse.  These pilots may have thought they were protecting themselves, but they were really causing massive brand damage to Delta and Northwest who are already balancing the intricacies of their merger.  That ripple effect directly impacts tens of thousands of employees and millions of individuals who own retirement funds that have invested in the company whose stock price might suffer in the short run. Communicating Bad News is not hard, but there are standards to which you must adhere.  Be Honest About Breaking The Rules is the first standard.

Washington, D.C. headquarters of the Federal T...
FTC’s Washington, D.C. headquarters. Image via Wikipedia

News around the blogosphere is rampant with warnings about the Federal Trade Commission‘s update to the documents used to explain and enforce actions regarding testimonials and endorsements. The big issue for online marketers is that spam blogs and blogs must disclose when a material connection is present between themselves as publisher and a post — even if that post is a review.

With my big disclosure that I am not an attorney, and this is not legal advice, I don’t understand why legitimate businesses are concerned.  Isn’t disclosure a good business practice?  Certainly anyone reading this blog follows these sort of guidelines. Creating a spam blog is easy.  For that matter, we own multiple web properties that publish reviews.  If we accepted payment (the FTC says “cash or in-kind payment”) to publish a review then the review is considered an endorsement.   As an endorsement, the review then falls under advertising guidelines. But as I told group at a review site earlier this week, “You have always been responsible for what you publish online” Nothing has changed in that regard.

The FTC’s Guides are updated sporadically and these provisions don’t take effect until December.  On top of that, the FTC can make life miserable for bad businesspeople, but the FTC’s administrative actions are different from the FTC Act.  Yes, as good businesspeople you need to follow FTC guidelines and not be like the cretin I once advised about the FTC’s Mail Order Rule. “What is the penalty,” this person asked when I advised that their subscription model could be considered to be in violation of the FTC’s rules. Businesspeople who weigh penalties against knowingly violating rules and laws should be dealt with quickly.

Now the FTC has some more ammunition to go after people who create a new site on a different server through a variety of names every week.   Placing  a fake review site in the public and using good SEO tactics to rank for well-paying keywords is easy.  I can name more than a hundred people right now who have the skill sets across editorial, design, marketing and technology to put such a site in place tonight between the time they get home from work and the time they go to bed at a reasonable hour. The point is that they don’t do that kind of thing, you don’t do that kind of thing and people who follow best business practices have nothing to worry about.

If you want to read the rules for yourself, here is a PDF link to The Guides Concerning the Use of Endorsements and Testimonials in Advertising. Disclosure:  Neither Chairman Leibowitz nor President Obama nor any person affiliated with the federal government and specifically the Federal Trade Commission, made any payment regarding this review of the new Guides or an incentive to provide a link to the FTC’s site. It does get rather silly, doesn’t it?

Executive Summary: The FTC is there to catch the bad people.  Still, talk with your marketing agency or attorney about a blanket disclosure and make sure your policies regarding accepting gifts or payments for goods and services you promote are up to date.