Kim Gwang-ho took a big risk revealing safety issues at Hyundai, his employer for the past 26 years. The engineer reported failures in proper engine checks that could prevent accidents. Whistleblowing is extremely rare, as Kim describes, "I will be the first and last whistleblower in South Korea's auto industry. There are just too many things to lose." He also said, "I had a normal life and was better off, but now I'm fighting against a big conglomerate."
Hyundai denied allegations in a statement, as reported by Reuters: "The company promotes openness and transparency in all safety-related operations, and its decisions on recalls comply with both global regulators and stringent internal processes."
The company also defended its practices, arguing that they were investigating issues before Kim raised them: "Hyundai has taken appropriate steps to ensure safety, quality and compliance with applicable regulations in our markets, including all recalls Hyundai has conducted to date."
Meanwhile, investigators raided Kim's house and confiscated some documents. Kim said, "At first my wife asked me not to do it. She was worried about living costs if I'm fired. But I'm stubborn, and persuaded her that the problems will be buried forever without my confession."
But the company eventually rehired him and reimbursed him for lost work time.
Kim's complaints did inspire the South Korean government to mandate a recall-the first in the country's history. In addition to the 1.5 million cars voluntarily recalled by the Hyundai and Kia, the government requirement adds another 240,000 to the list.
Discussion:
United tried a fun Twitter campaign, but it failed. It's simply too soon after Dr. Dao was dragged off the plane to put themselves out there.
A 16-year-old from Nevada asked Wendy's how many retweets he would need to get free Chicken Nuggets for a year. The answer was 18 million.
Somewhere along the way, United jumped in and offered a free flight to the boy to any Wendy's in the country. It was a bold move, but people had fun at United's expense.
Discussion:
For a recent IPO, Snap Inc. is taking a big hit. The stock dropped more than 20% when the company missed its first-quarter results, and few people seemed interested in picking up the shares. Analysts worry that Facebook is a fierce competitor that will usurp what's unique about Snap. Snapchat has recently introduced features for video and images to be maintained forever, which is not the original intent of Snapchat.
CEO Even Spiegel isn't helping. Jim Cramer joked, although he's against hazing, Spiegel is arrogant and needs to be hazed. Cramer suggested, on future earnings calls, Spiegel say he wants to do better and then turn it over to his CFO. Cramer said, "Humility is a fabulous thing."
Discussion:
Spirit cancelled flights, and their customers went a bit wild in the Fort Lauderdale airport. One woman says Spirit cancelled three flights in four days, and she's having trouble getting home. Customers were fighting, and some were arrested.
Spirit blames pilots, who won't take certain assignments. They have sued the Airline Pilots Association for what they're calling a work slowdown, which has caused 300 flight cancellations and affected about 20,000 customers.
In a statement, Spirit spokesperson said the company was "shocked and saddened" to see the airport chaos and said, "These pilots have put their quest for a new contract ahead of getting customers to their destinations and the safety of their fellow Spirit Team Members."
Pilots say they are working without a contract and are seeking pay increases. They deny causing a slowdown and said, "Rather, ALPA and the Spirit pilots are continuing to do everything possible to help restore the company's operations, which have experienced significant problems over the past several days."
Discussion:
Two weeks ago, Upward Bound applications to help kids get into college were rejected for formatting errors such as line spacing. To protest, 32 members of the House of Representatives signed a letter asking the Department of Education to reconsider the grants that affected approximately 2,700 students; an excerpt is below.
In response, Betsy DeVos, Secretary of Education, established a "new policy" that prevents program officers from using page limits and formatting as "mandatory requirements":
"Program offices may suggest page limits and formatting standards (such as font size, line spacing, and the like) but may not use ignoring these suggestions as a basis to reject grant applications."
In her letter, however, DeVos does not address the recently rejected applications.
Discussion:
Facebook is taking more action in response to criticism about fake news, offensive posts, and violent videos. The company will hire 3,000 more people to monitor videos, hoping to avoid another situation like the one when a man recorded himself murdering another man.
In a Facebook post, CEO Mark Zuckerberg wrote,
"Over the last few weeks, we've seen people hurting themselves and others on Facebook - either live or in video posted later. It's heartbreaking, and I've been reflecting on how we can do better for our community.
"If we're going to build a safe community, we need to respond quickly. We're working to make these videos easier to report so we can take the right action sooner - whether that's responding quickly when someone needs help or taking a post down.
"Over the next year, we'll be adding 3,000 people to our community operations team around the world -- on top of the 4,500 we have today -- to review the millions of reports we get every week, and improve the process for doing it quickly."
COO Sheryl Sandberg commented on the post: "Keeping people safe is our top priority. We won't stop until we get it right."
Some say the move reflects Facebook's disappointment in artificial intelligence (AI). The long-term goal is to develop the technology so it can adequately identify and remove inappropriate content. But that may be a way off.
Discussion:
Be careful about offering unlimited free items. Sunny Co. Clothing company learned this lesson the hard way when it posted a message on Instagram.
Naturally, nearly "everyone" reposted the image hoping for a free suit, and people complained about their feeds being over-run with red bathing suits.
The company eventually posted some rules: "Due to the viral volume of participants, we reserve the right to cap the promotion if deemed necessary." They also warned of delays because of the "overwhelming volume of orders."
One good thing did come from the situation: Sunny Co.'s followers increased from 24.1 to 458,000. Now, whether that translates into sales is another question.
Discussion:
LinkedIn has updated its terms of service, including its privacy policy and user agreement. In an email to users and posted on its website, the company promises a shorter privacy policy that's easier to understand. Highlights follow:
We see some problems with this bullet list. Besides a lack of clarify of what's new, the items aren't parallel.
In the post, LinkedIn reminds us that the site is part of Microsoft even though these terms are separate.
Discussion:
Discussion:
Dozens of colleges and organizations won't receive funding for Upward Bound programs because their grant applications failed to meet formatting requirements. The U.S. Department of Education, now led by Betsy deVos, rejected applications that would have served at least 2,400 low-income students who would have received tutoring and counseling to help prepare them for college.
Applications missed the requirements because they weren't double spaced, used the wrong font, or forgot other formatting details.
Although members of Congress have appealed to Department of Education representatives, the decision seems to stand. The acting deputy assistant secretary said, "A rule is a rule. . . . I, too, have to abide by the rules." One rule is for "no more than three lines per vertical inch." In one application, shown here, an infographic contained text spaced one-and-a-half lines apart instead of two.
Discussion:
PR Daily News reports on Mall of America's successful "newsjacking," or taking advantage of news stories to promote business. Being close to the Mineapolis-St. Paul International Airport gives the mall the chance to lure travelers to shop when their flight is delayed.
Last summer, the mall wrote a blog post, "Flight delayed? 11 things to do at MOA," offering better options than wandering aimlessly like Tom Hanks in "The Terminal." Like a lot of malls these days (what's left of them), Mall of America is part amusement park.
Through social listening, the mall is responsive, but they also promote timely events, such as the mall's 25th anniversary, and greet people who announced celebrations at the mall. We can see the potential for creepiness here, but management believes people appreciate this.
The mall has a bunch of people writing posts, and manager Timothy Pate lets them have their own voice: "Mall of America happens to have a lot of quirky stories, and we aren't afraid to share those with our readers. We find when you really let your quirks shine through, readership goes up."
Discussion:
United Airlines CEO Oscar Munoz has found some strength and a way out of the situation that angered so many around the world. The company admits that dragging a man off of a flight two weeks ago wasn't the best way to make room for four United employees.
The company has published "Changes We're Making" in an email to loyalty members, in videos, on its website, in a report, and in an interview with NBC News. The website statement begins as follows:
Earlier this month, we disappointed our customers and ourselves when a passenger was forcibly removed from one of our planes. We can never say we are sorry enough for what occurred, but we also know meaningful actions will speak louder than words.
We committed to take action as a result of this incident, and today marks the first step in changing how we fly, serve and respect our customers.
In the email with the subject line, "Actions Speak Louder than Words," United summarized its most significant policy changes:
We will increase incentives for voluntary rebooking up to $10,000 and will be eliminating the red tape on permanently lost bags with a new "no-questions-asked" $1,500 reimbursement policy. We will also be rolling out a new app for our employees that will enable them to provide on-the-spot goodwill gestures in the form of miles, travel credit and other amenities when your experience with us misses the mark.
The $10,000 offer for re-booking is particularly clever: it's a generous amount, and it's unlikely the airline will have to pay that much.
Meanwhile, the airline settled with Dr. Dao for an undisclosed amount. Good idea to end the nightmare. The last thing United needs is more publicity about the case.
Discussion:
The annual Wells Fargo shareholders meeting was disrupted by angry shareholders wanting to understand how 2 million accounts were created without customers' knowledge and without the knowledge of senior leaders of the organization. One attendee shouted, "You did it that way and you allowed it to continue for years." Another yelled, "We elected you guys to protect us, to be our watchdogs, and you were not." Security removed three protestors.
Despite the protests, all 15 board members were re-elected, although some narrowly. The board's three newcomers, including the new CEO, Tim Sloan, won more support.
Sloan started the meeting with a promise to change:
"There is no doubt that the last seven months have been one of the most difficult periods in our company's 165-year history. I can assure you that we are facing these problems head-on and that Wells Fargo is emerging a much stronger company."
Board turnover will happen over time. Some directors are nearing the mandatory retirement age, and others may still be forced out. But for Brandon Rees, the deputy director of the A.F.L.-C.I.O.'s investment office, the change isn't coming quickly enough. The group holds 1.6 million shares of Wells Fargo, and Rees voted against all of the current board members:
"Fresh blood is needed to ensure that the board has sufficient independence. The narrow vote puts incredible pressure on some directors to reconsider their membership. I hope that by this time next year, we have a new slate."
In March, Gretchen Morgenson wrote a New York Times piece about the increasing number of online shareholders meetings. Partly for convenience, partly to skirt accountability and confrontations like this, more and more companies are holding web-based meetings. The director of an asset management group was quoted in her article:
"These are not management's meetings; they are the meetings of the owners of the company." Online-only events give company officials "tremendous power over controlling, censoring and really limiting the engagement of share owners with the board and management."
Discussion:
A long New York Times article chronicles Uber CEO Travis Kalanick's rise to power and what has happened since. He certainly has built a successful company, but his leadership character is not ideal.
We have seen many reports of ignored complaints and executive departures and have seen the video altercation between Kalanick and an Uber driver. The latest report is about Uber's violation of an Apple rule against "fingerprinting." Uber was tracking iPhone users even after they deleted the Uber app.
The NYT tells of a meeting between Kalanick and Apple CEO Tim Cook in 2015. In the article, "Uber's CEO Plays with Fire," we learned that Cook summoned Kalanick to his office. Surprisingly, Kalanick "was shaken by Mr. Cook's scolding, according to a person who saw him after the meeting."
He should have been: if Apple decided to remove Uber's app from iPhones, the company could have lost millions of users.
Discussion:
A study found that poorly written shareholder reports cause stocks to trade at lower values. In an upcoming article in the Journal of Financial Economics, the authors describe their process for evaluating disclosure documents and the results:
Using a copy-editing software application that counts the pervasiveness of the most important ‘writing faults' that make a document harder to read, our analysis provides evidence that issuing financial disclosure documents with low readability causes firms to trade at significant discounts relative to the value of their fundamentals. Our estimates suggest that a one-standard-deviation decrease in readability decreases firm value by a full 2.5%. Our results are particularly strong in situations in which investors are more likely to rely on annual reports.
The study looked at closed-end funds, which have little public information and typically are owned by individual investors. So the authors mention the caveat, "We're actually not sure to what degree our findings extend to large, visible firms, such as Apple Inc."
Morningstar summarizes the significance:
Their data suggest that "higher readability generates more trust and higher perceived managerial skill," Messrs. Hwang and Kim say. They write, "When a firm's annual report becomes difficult to read, investors become suspicious, perceive the firm and its managers to be of lower quality or subconsciously develop negative sentiments."
"The results strongly suggest that investors value clear and concise communication," says Mr. Kim. "If annual reports or corporate disclosure documents are written in a complex way, investors will trade the firm at a discount."
The authors used the program StyleWriter, which I hope is better than Grammarly. I wrote an analysis of that software last year.
Discussion:
Emotions are running high on airplanes. An altercation on an American flight-captured on video, of course-resulted in an employee's suspension.
Apparently, a flight attendant took a stroller forcefully from a woman, hitting her with it. The woman is seen crying, upset that the stroller also just missed her baby. The conflict arose because the woman wanted to keep the stroller with her in the back of the plane, and the attendant wouldn't allow it.
At some point, another passenger got involved and said to an attendant, "You do that to me and I'll knock you flat." An altercation ensues and the flight attendant can be heard saying back to the passenger, "Hit me! Come on, bring it on."
After the United incident when a man was dragged off the plane, American Airlines had to take decisive action. The airline suspended the employee, upgraded the woman and her family to first class on their next flight, and issued a statement:
"We are deeply sorry for the pain we have caused this passenger and her family and to any other customers affected by the incident."
The Association for Professional Flight Attendants (the union) spoke out against American Airlines for acting too quickly. Instead, the president blamed airline conditions, such as shrinking seats and overcrowding, for part of the issue.
Discussion:
After weeks of reports that Fox News settled sexual harassment claims with several women, Fox News anchor Bill O'Reilly is forced out of the company. After $13 million in payouts, additional women came forward, including two who hadn't received settlements and therefore could speak openly.
Pressure was on Fox News when more than 50 companies pulled advertising from the network. Parent company 21st Century Fox, owned by the Murdoch family, issued a brief statement:
"After a thorough and careful review of the allegations, the company and Bill O'Reilly have agreed that Bill O'Reilly will not be returning to the Fox News Channel."
In addition, James Murdoch answered questions a short response: "We did a thorough investigation, a thorough review, and we reached a conclusion. Everything that we said in our statement is all you need to know."
In his own statement, Bill O'Reilly defended himself and blamed his celebrity. 
Image source.
Discussion:
Adidas may need a better review process. After the Boston Marathon, the company sent a congratulatory email about "surviving" the marathon, not thinking about the terrorist attack four years ago. During that event, two bombs killed three people and left several hundred injured.
The subject line to the marathoners read, "Congrats, you survived the Boston Marathon!"
Outrage was swift. People immediately saw that Adidas hadn't posted this intentionally but had failed to consider the connection and potential reaction.
The apology also came quickly and did the job. Admitting that "no thought was given to the insensitive email subject line," the company didn't make excuses or apologize "if we offended anyone"; they said plainly that it was insensitive.
Discussion:
Private school Choate Rosemary Hall, in Wallingford, CT, has uncovered sexual abuse by 12 faculty members. According to a report commissioned by the board of trustees, abuse going back to the 1960s was mishandled:
"Sexual misconduct matters were handled internally and quietly. Even when a teacher was terminated or resigned in the middle of the school year because he or she had engaged in sexual misconduct with a student, the rest of the faculty was told little and sometimes nothing about the teacher's departure and, when told, was cautioned to say nothing about the situation if asked."
Some faculty were given recommendations to transfer to other schools.
In a "Message to the Choate Rosemary Hall Community," posted on the website, the board chair and headmaster review the facts, thank the victims for coming forward, apologize, and promise action. The school hired Rape, Abuse & Incest National Network (RAINN) to review its policies and make recommendations. One conclusion in the letter follows:
RAINN has noted the strength of Choate's current confidentiality, amnesty, retaliation, and mandatory reporting policies; progressive training and education for students; and faculty and staff who are caring, empathetic, and supportive while preventing and responding to sexual misconduct on campus. Their recommendations call for continued codification of policies and procedures for reporting and investigating incidents, further review and refinement of adjudication processes, and additional training for faculty and staff who respond to incidents of sexual misconduct. We believe a commitment to constantly improving standards will provide more understanding and protection for our students.
Discussion:
Facebook is on the defense after a video of a murder was posted to the site. Steven Stephens filmed himself shooting a 74-year-old man for no reason except a dispute with his girlfriend, and he said it was his fourteenth killing. Stephens shot himself as police where closing in after a tip from McDonald's drive-thru employees.
Facebook is criticized for taking more than two hours to remove the video. CEO Mark Zuckerberg extended his sympathy to the victim's family: "Our hearts go out to the family and friends of Robert Godwin Sr., and we have a lot of work - and we will keep doing all we can to prevent tragedies like this from happening."
On its website, the company posted an article, "Community Standards and Reporting," about the incident and included a message from Zuckerberg. "Mark Zuckerberg, speaking at F8, Facebook's developer conference said today, 'We have a lot more to do here. We're reminded of this this week by the tragedy in Cleveland. Our hearts go out to the family and friends of Robert Godwin Sr. We have a lot of work and we will keep doing all we can to prevent tragedies like this from happening.'" The article also listed a timeline of events:
Timeline of Events
11:09AM PDT - First video, of intent to murder, uploaded. Not reported to Facebook.
11:11AM PDT - Second video, of shooting, uploaded.
11:22AM PDT - Suspect confesses to murder while using Live, is live for 5 minutes.
11:27AM PDT - Live ends, and Live video is first reported shortly after.
12:59PM PDT - Video of shooting is first reported.
1:22PM PDT - Suspect's account disabled; all videos no longer visible to public.
Here's Facebook's commitment to improving its process:
In addition to improving our reporting flows, we are constantly exploring ways that new technologies can help us make sure Facebook is a safe environment. Artificial intelligence, for example, plays an important part in this work, helping us prevent the videos from being reshared in their entirety. (People are still able to share portions of the videos in order to condemn them or for public awareness, as many news outlets are doing in reporting the story online and on television). We are also working on improving our review processes. Currently, thousands of people around the world review the millions of items that are reported to us every week in more than 40 languages. We prioritize reports with serious safety implications for our community, and are working on making that review process go even faster.
Keeping our global community safe is an important part of our mission. We are grateful to everyone who reported these videos and other offensive content to us, and to those who are helping us keep Facebook safe every day.
Discussion:
In 2015, did Snapchat founder Evan Spiegel say the app is "only for rich people" and that he didn't "want to expand into poor countries like India and Spain"? That's the claim by a former employee who is suing Snap Inc. for wrongful termination. Anthony Pompliano alleges he was fired after accusing the senior leadership team of inflating app metrics before the IPO.
Pompliano says the company falsely advertised the number of daily active users (DAU), violated a non-solicitation and non-compete agreement, and exaggerated growth and retention data. Pompliano claims that Speigel's response about poor countries came when he suggested going into international markets to expand the user base.
A representative for Snap responded:
"This is ridiculous. Obviously, Snapchat is for everyone! It's available worldwide to download for free. Those words were written by a disgruntled former employee. We are grateful for our Snapchat community in India and around the world."
Snap doesn't deny data discrepancies, but says they aren't as significant as Pompliano claims. Pompliano contends that the discrepancies indicate "a wide-spread, systemic failure in Snapchat's internal controls over its user data." A Fortune article warns that questions about user registrations and engagement could be important to investors, who bought stock in what Fortune calls a "giant IPO" that "just proved we're in a tech bubble."
Discussion:
