10 Dumbest Business Mistakes of 2009

Photo: kaisersosa67

With the new year dawning, it's nice to reflect on some of the worst business mistakes of the past year. Aside from adding a bit of humor, these head-scratching moves will help keep your own business mistakes in perspective as we move into 2010. No matter how big your mistakes seemed last year, these 10 prove that yes, yours could have been worse.

1. Pennies for a Stadium

The Silverdome has been host to plenty of important events. For years the 80,000-seat dome hosted the Detroit Lions, Detroit Pistons, and Super Bowl XVI. It was one of the largest domes in the NFL during its time, and many large acts like Pink Floyd and Elvis performed there. Pope John Paul II even celebrated mass in the Silverdome in 1987.

So naturally it came as quite a shock when the Silverdome was sold for $583,000, a mere 1% of the initial $55.7 million it took to build it. And that was $55.7 million in 1975 dollars. Talk about a buyer's market!

2. KFC Stops Giving Away Chicken

KFC had a successful ad campaign on their hands. Oprah Winfrey had promoted a coupon giving away free grilled chicken via a web coupon. However, KFC hadn't anticipated the huge number of coupon downloads. After giving away 4 million meals, the fast food chain had to start turning away coupon holders. Coupon holders were furious, and coupon holders staged sit-ins and and a few even sued.

After the overwhelming reaction to the coupon canceling, KFC quickly backpedaled and offered a free chicken meal plus a soft drink to those turned away from the promotion.

3. Apple Approves the Baby Shaker App

Apple has long been criticized for the strict and lengthy process that iPhone app makers have to go through to submit apps to the Apple iPhone app store. Yet for whatever reason, a $0.99 game titled "Baby Shaker" managed to make it through Apple's editorial process. The chilling game showed a picture of a baby and issued infant bawling noises. The user was able to silence the babies cries by shaking the phone until two red X's were placed over the child's eyes.

After a barrage of complaints, Apple quickly removed the app from the store and apologized in a short statement. The damage had been done, however, and the incident has since led to many criticisms of Apple's unpredictable app approval process.

4. John Thain's $1.22 Million Office Redecoration

At a time when his company was floundering, the newly-hired CEO of Merrill Lynch went on a spending spree to redecorate his posh office. Thain spent $800,000 hiring Michael Smith, the same designer slated to redecorate the White House. (The White House redecoration only cost $100,00.) Thain splurged on items like a $87,000 area rug and a $28,000 pair of chairs.

After Merril Lynch posted a huge fourth quarter loss, Thain was forced to resign. Thain said in a statement that he eventually planned on paying back Merrill Lynch for the decorations.

5. Nippon Air Asks Passengers to Relieve Themselves Before Takeoff

The Japanese airline Nippon Air ran a test to try and convince passengers on their plane to relieve themselves before boarding. On paper the idea made sense: the human bladder holds 2.2 pounds of liquid, and with 247 passengers, the plane could be 500+ pounds lighter. This would save fuel and reduce greenhouse gas emissions (as well as reduce costs). The plane company figured they could reduce carbon emissions by 4.2 tons during their test.

Nippon has yet to publish their findings.

6. Banker Does "God's Work"

Goldman Sachs CEO Lloyd Blankfein had been under considerable fire throughout 2009 by trying to defend his firm's compensation of over $16 Billion in bonuses. The bonuses wouldn't have mattered so much to the public had Goldman Sachs not received federal aid in 2008 by the government to help save their company.

To make matters worse, Blankfein tried an attempt at humor in an interview by saying he was only "doing God's work," and he knew that "people wanted to slit his wrists."

7. Tropicana Redesign

In a seemingly harmless move, Tropicana decided to do a makeover on the famous juice container in an attempt to simplify the design. What resulted was a $35 million branding effort titled "Squeeze," and customers hated it. They believed that it made the juice container look more like a generic juice line. The unexpected outpour of emails and calls that followed forced Tropicana (and parent company PepsiCo) to backtrack and bring back the original design after only a month.

8. Bernie Madoff

Was there anything that wasn't terrible about the Bernie Madoff episode? To start with, lethargic SEC staffers had been receiving warnings up to 9 years earlier on Madoff's potential ponzi scheme. (Madoff claims that the scheme started in the early 1990s, but federal investigators believe the scheme was running in the 1980s.) Madoff's sons eventually turned him in attempt to clear their name. (The sons and Madoff's daughter were later sued $198 million for negligence.)

But possibly the biggest blunder committed was by Madoff's attorney Ira Lee Sorkin. Sorkin asked for only 12 years of sentencing for Madoff's swindling of $18 billion. The judge didn't bite, and Madoff was sentenced to the maximum 150 years in prison.

9. Man Makes $470,000 Without Showing Up to Work for Five Years

In true Office Space style, Anthony Armatys managed to get paid for 5 years of work without showing up for a single day of work.

In 2002 Armatys accepted a position at Avaya, but decided later to decline their offer. Yet Armatys never informed his new employer of his decision, the company continued to deposit his six-figure salary into his bank account. Who knows how long Armatys would have continued to draw his salary had he not made an early withdrawal from his 401(k) that led to an investigation.


10. Chrysler Dealers Find Out They're Closing...From the Press

In a public relations nightmare, many Chrysler dealerships found out that they would be closing the same day that Chrysler went public with a list of the 789 dealerships that were to be terminated. The letters were put in the mail the same day that the announcement was made.

To make matters worse, Chrysler informed the dealers that they had a mere 30 days to liquidate their inventory (as opposed to the customary year), causing them to take huge losses in inventories.

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