10 Lessons From the Biggest Business Mistakes of 2016

There are mistakes to avoid in business. Any mistakes you can’t avoid should be something to learn from.

But then there are the major mistakes that happen at big companies — disasters that can create ill-will, anger entire countries, become costly operational disasters, or risk the existence of the business. These are the types of mistakes you pray never happen to your undertaking. And they’re the ones you should pay close attention to as object lessons.

Here are 10 of the biggest business mistakes of the year — of varying degrees, but all mammoth whoppers. Look hard and memorize them. If you do something similar, there’s no guarantee you’ll work your way out of it.

10. Coca-Cola needs better maps

Social-media gaffes are common enough. But rarely does one propel a company into geopolitical strife. That’s exactly what Coca-Cola did at the beginning of the year. The company tried to wish a happy New Year to customers around the world. When sending a message to Russians on a national social network, Coke used a map that did not include Crimea, which Russia had annexed in 2014. That ticked off the Russians. Next, Coke reissued the map with Crimea, which ticked off citizens in Ukraine and left the company in the line of fire. Perhaps having people on hand who knew geopolitics might have been wise.

9. PwC legally threatens researchers for spilling its security beans

Any set of software engineers can make a mistake that could enable people of ill-intent to break in and do damage. Security researchers often find such problems and they often give a company advance notice before going public so they can fix the issue. The reason for eventual publicity is so everyone can learn. However, when ESNC, a security firm based in Munich, Germany, went to professional services giant PwC to inform it of a critical bug in the company’s software — which is supposed to find security risks in software its clients run — the problem was serious. A remote attacker could potentially “manipulate accounting documents and financial results, bypass change management controls, and bypass segregation of duties restrictions.” The result could be “fraud, theft, or manipulation of sensitive data including [personally identifiable information] such as customer master data and HR payroll information, unauthorized payment transactions, and transfer of money.”

Did PwC thank them? Not exactly. The company reportedly sent a cease-and-desist letter against making “any public statements or statements to users of the software,” according to ZDNet. Probably not the way to endear yourself to clients.

8. Yahoo undercuts an argument for its acquisition price from Verizon

Yahoo’s fortunes have been slowly sinking since it rejected Microsoft’s acquisition offer of $45 billion in 2008 because the company was worth more, according to the board at that time. With one turnaround effort after another having fallen far short, current CEO Marissa Mayer and the board finally realized that selling off the assets was probably the only game left in town. It eventually found a suitor, at just over a tenth of Microsoft’s offer, in Verizon. And then came news of the huge data breach that happened in 2014, with word coming out only in September of 2016. Suddenly Verizon’s lawyers started talking about having second thoughts. It’s probably time for a one-time-only special sale price, since Yahoo is pretty much out of options. The sins of the past don’t quickly go away.

7. Facebook becomes the faux news bad guy

Facebook, which denies being a media company (probably because they don’t get as much respect from Wall Street as tech companies), sure has spent a lot of effort in becoming a go-to place for people to find the media they’re looking for, including news. But doing the news for any company, tech or media, can be tough. Facebook had to defend against charges of liberal bias and changed the way it managed trending stories, by laying off the journalists producing that section and going with automation. Then came the attention on fake news sites and claims by many that such sites helped sway the election. Now Facebook has to find a way to repair that problem.

6. Samsung’s Galaxy Note 7 disaster

Companies want hot products, just not as hot as Samsung’s Galaxy Note 7, which has an annoying problem of catching fire. Twice the company had to halt production and undertake an extensive and expensive recall. How pricey? The worst-ever recall could ultimately run $17 billion, according to Reuters. Better to put off selling something that isn’t ready than to run the risk of losing more than the product might have brought in.

5. Gawker sued out of existence

Running up to the edge of legal limits has become common in tech. In media, it’s less so, in part because some of the big problems, like claims of libel in the US, leave a lot of latitude for news organizations to operate. But Gawker went a step too far in publishing without permission the sex tape of Terry Bollea, otherwise known as the wrestler Hulk Hogan. A Florida jury found for Hogan to the tune of $140 million, which caused Gawker to sell off most of its Web properties and then go out of business. The further twist was that tech billionaire Peter Thiel secretly funded the suit as part of a clandestine war against Gawker for outing him as gay in 2007. The pen may be mightier than the sword, but unless you’re ready to duel with big-time lawyers, make sure you know what you can and cannot do.

4. Mylan’s EpiPen disaster

With skyrocketing drug prices, even for medicines that have been on the market for many years, pharmaceutical companies have not been held close in the hearts of the American public. One company that rode the wave to greater financial returns, and possibly unexpected scrutiny from the public, was Mylan Pharmaceuticals, which raised the cost of an EpiPen, important to people with deadly allergies, from $57 in 2007 to more than $500 in 2016. Since the news broke, the company’s stock has gone from almost $58 a share to $38, a 34 percent drop. Sometimes increased profits may not be worth as much as they seem.

3. The fall of Theranos

Disruption and innovation are good for businesses, so long as companies can pull off what they claim. For a long time, Theranos looked as though it would become the ruling monarch of the blood testing industry. And then came the evidence that its basic claims didn’t meet serious scrutiny. And the deeper and more detailed the examination, the worse things looked. Hype is a dangerous thing.

2. Wells Fargo forced customer sign-ups

The years 2007 through 2012 seemed to be the era of the big, bad bank. There were so many problems, so much damage, no financial services CEO in his or her right mind would allow dangerous practices to flourish in the open, right? Unfortunately, no one apparently told Wells Fargo CEO and chairman John Stumpf. Since 2005, the year Stumpf became president of the bank (he became CEO two years later), some Wells Fargo employees were trying to alert management about massive fraud, as employees opened unrequested accounts for clients, which meant fees for the bank, to make bonus goals. Now the bank is being sued by customers and investigated by Congress. Stumpf resigned in October 2016. When you hear about bad practices, it’s a good idea to do something about them.

1. Presidential election

Even though it’s technically about politics, if the business of America is business, then how the Democrats and Republicans comport themselves is always a chance for entrepreneurs to learn. This year, the lessons were massive and brutal. Establishment politicians saw that after years of hearing unfulfilled promises, many voters get angry. The political media might have caught on if only they actually listened to people and not stayed within their comfort zone of Washington, D.C. sources and parties. So, make sure you talk with and listen to your customers. The final lesson is that the political establishment may have paid a heavy price and still not learned from the experience. If you really blow it, don’t try to excuse away the experience. Get smarter for next time.