Apple is the darling of many entrepreneurs and businesspeople for its record profits and its story of overcoming adversity to become one of the world's most successful tech companies. And although there are a lot of things to learn from what it does right, there are also lessons from what it does wrong.
In July, Apple proved itself vulnerable when videos began to show up on the Web demonstrating how the iPhone 4's reception dramatically dropped when users' fingers covered the bottom corner of the device. The resulting scandal, now known as Antennagate, struck the company hard.
Apple weathered the PR storm and did make amends with many of its customers; it also made a lot of missteps along the way. As an entrepreneur, you can learn from what Apple did during its crisis and apply some fo the lessons to your own company.
1. Address the Real Problem
Part of what got Apple into trouble was its initial approach to Antennagate. After Steve Jobs blew off some of the concerns, Apple admitted there was a problem, but blamed it on a software issue and sidestepped the very real hardware problem.
By not addressing the real problem (the hardware) and instead focusing its efforts on the software, Apple opened itself up to Consumer Reports lab tests that led to the respected publication not recommending the device to consumers.
Don't try to sidestep your problems; tackle them head-on.
2. Take Control of the Situation
When you're in crisis mode, the last thing you need is to have the situation spiral completely out of your control. Establish control of the situation as quickly as you can.
Apple successfully did this by calling for a press conference on its home turf. There the company presented its side of the story (that all phones have antenna/receptions issues), provided evidence to back up its conclusions (via showing videos of other smartphones with the same problem), and finally answered the media's questions in an hour-long Q&A.
While you don't have to call a press conference if your small business is under fire, you do need to find a way to retake the narrative and tell your side of the story.
3. Make Reparations, and Don't Be Cheap
If you find yourself in a crisis and you are at fault, don't be afraid to make it up to your customers, no matter the cost. While it may be very painful in the short-term, it could very well be what saves your company in the long run.
Apple's solution to the iPhone 4 reception issue was to offer a free case to every iPhone 4 owner. It both addressed the problem with the iPhone 4's antenna and it gave consumers something for free, an effect you shouldn't underestimate.
While Apple could lose $175 million in revenue, it could have been a lot worse if the company hadn't offered anything at all.
4. Better Late Than Never
While Apple made many mistakes during the entire Antennagate saga, in the end it admitted that there was a problem and took enough steps to keep consumers happy.
While Apple may lose money due to the cases it is giving away, its long-term prospects are still bright and sunny. The technology giant should have been more upfront about the problem sooner, but it was able to bury the issue and focus once again on the positive qualities of its product.
It's never too late to address a crisis, as long as you and your startup are up-front about the issues at hand.