Black Friday's Lessons in Operations Risk

A friend called me on her cell phone from the Toys "R" Us parking lot in Palm Desert, Calif. the day after Thanksgiving to ask if I wanted her to pick up a popular discounted toy to donate to a toy drive. If not for that ten-minute phone call, she would have been among the shoppers detained for hours for questioning by police after two armed shoppers killed each other in the checkout line.

That event and the trampling to death of a temporary worker at a Long Island Wal-Mart store when Black Friday shoppers stormed the doors to score one of a limited supply of deeply discounted items, underscore the operational risk management challenges facing businesses as problems in the world economy play out this holiday season.

It's not the first time shoppers got carried away by special sales the day after Thanksgiving. A Wall Street Journal article reminds readers that Wal-Mart faced several lawsuits in 1998 when customers were injured in hot pursuit of a popular doll; and five years ago, a woman who cut in line at a Toys "R" Us store was assaulted by other shoppers who had been waiting. But the sheer number of people in dire financial straits today due to the worldwide economic crisis sounds a warning for companies whose employees deal directly with the public. Keeping employees and customers safe should be top of mind.

Just how culpable was Wal-Mart in the Long Island death? The company has defended itself, stating that it took appropriate precautions by setting up barricades where customers waited for the doors to open, hiring third-party security guards, and keeping extra staff on hand that day. Local police were called in the night before the sale when the crowd waiting for the doors to open swelled to more than 500 people.

But spokespeople for the United Food and Commercial Workers Union say that the death could have been prevented and that Wal-Mart failed to provide adequate security. The group called for the mega-retailer to compensate people injured as a result of the incident as well as the family of the deceased temporary worker.
Wal-Mart's long-standing reputation for unfair labor practices was clearly furthered by the Black Friday tragedy. Critics of the retailer are waiting to see if new CEO Mike Duke, who was promoted to that post from his position as vice chairman of Wal-Mart's international division only a week earlier, will improve the company's reputation as a good corporate citizen.

In the meantime, Cyber Monday, the online equivalent of Black Friday, may appear like a better option for consumers.