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Written by Norman Clark
Published: 11 August 2016
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icebergs: This image is in the public domain because it contains materials that originally came from the U.S. National Oceanic and Atmospheric Administration, taken or made as part of an employee's official duties.

The massive systems failure at Delta Airlines on 8 August 2016 disrupted operations for more than 48 hours and left tens of thousands of Delta passengers stranded.  Delta Airlines is one of the largest airline companies in the world, with perhaps the world's largest and  most sophisticated operations systems; but Delta's experiences over the past several days provide sobering warnings to even the smallest law firms that take don't take disaster planning and client relations recovery seriously.

The precise cause of the systems shutdown is still under investigation as of the date of this article. Obviously, though, Delta Airlines should have had in place a continuous real-time backup system, which would have taken over with little or no delay when the main system failed. This was not unforeseeable. Most of your client clients, like most of Delta's customers, are not going to be persuaded by explanations that begin "Nobody could have foreseen...".

The bigger problem, however, was that Delta Airlines acted as if they were totally unprepared to handle the consequences, both in terms of restoring operations and recovering customer good will and confidence.  I use the phrase "acted as if," because it is actions, not good intentions, that Delta customers and your clients use to measure performance. Delta's planners do not appear to have thought far enough into how such a massive system failure could have persisted for as long as two days. They obviously did not see the "whole system."

Good intentions and past successes in these situations do not help very much. The Delta employees are among the best in the business at responding to delayed or canceled flights. This happens every day. What they obviously could not handle was the sheer volume of the chaos: the cancellation or long delays of more than a thousand flights over three days and their inability to provide reliable flight information -- or any information at all -- to the tens of thousands of their stranded customers, most of whom probably were inexperienced air travelers who didn't know what their options were.

Before all of the dust settles, it will have cost Delta many millions of dollars in refunds, vouchers, and operational costs. More seriously, the way in which Delta's customer relations response was simply overwhelmed has already cost Delta the good will and loyalty of thousands of its best business customers, who now have serious doubts about whether they can rely on Delta to manage the risks and consequences of similar failures in the future.

But before we all get into too much of a high dudgeon about Delta Airlines and other air carriers that have experienced similar systems problems, let's look at your law firm. There are some good lessons to be learned from Delta's misfortunes this week.

The same risks and consequences that have cost Delta Airlines so much, also apply to law firms. Although law firms operate on a smaller scale, the consequences to a law firm's profitability, reputation, and future success can actually be relatively greater.

So, as you think about the Delta Airlines fiasco this week, ask yourself:

Do you understand what your most important risks are? It does not take a massive collapse of your firm's operations to lose your best clients.

Do you have detailed and documented plans to respond to unexpected failures in your operatiions and client services processes? In my experience and observation only a few firms have what I would consider to be minimally adequate plans.

More importantly, have you actually tested your plans? Even fewer law firms have ever done so.

Finally, have you seriously considered how you will recover the trust, confidence, and good will of the clients who might be affected, and protect the reputation of your firm? Like Delta's best customers, who are not all that impressed by a voucher worth a couple of hundred dollars and an e-mail with sincere apologies, your best clients will want to know what you are going to do to mitigate the risks and their consequences in the future.

This last point could be the most important one of all. It is relatively easy to reconstruct files, recover documents from backup systems, and get the law firm back into operation. It is much more difficult to recover the confidence of your clients, including those who are most important to your firm's continued success.

Walker Clark can help your firm to resolve these questions. Our risk management services will help you to identify and define your risks and vulnerabilities in clear, actionable terms. To be sure, these are plans that we hope that you would never have to use; but a little investment in them now can help your firm to avoid much greater losses, both financially and in terms of your firm's reputation.  

And if a crisis does arise, our crisis management team can respond immediately and help your firm navigate the dangerous waters after you hit the iceberg.

We hope that you will never have to get into the lifeboat, but we want you to know where to find it and how to use it.

Norman Clark

 

Full disclosure: I am a top-tier frequent flyer with Delta Airlines and, since 2005, have flown almost exclusively on Delta or one of its Sky Team partners.  I was not traveling on Delta earlier this week, but have the benefit of reliable reports from those who were, including our firm's student intern, who was flying home on Delta to resume his university studies, and got to test the comfort of the floor at the Atlanta airport on Tuesday night.