Gaffes, #scandals and #ineptitude: the# Business Agenda #awards for #failure 2017

Full marks to British business, which, after years of churning out a world-class collection of gaffes, corporate scandals and outright ineptitude, again spent 2017 producing a stockpile of gems that look like they might have been concocted by a combination of Oliver Stone and David Nobbs.

Still, that is precisely the type of unrecognised corporate achievement that the Observer’s Business Agenda Awards are designed to celebrate. At this year’s lunch the committee again cogitated over some tricky decisions – and over whether to risk sampling the Tesco turkey main course.

The judging panel was made up of a number of familiar faces former Co-op Bank chairman Rev Paul Flowers (who also said grace), rogue trader Nick Leeson and former banking knight Fred Goodwin. A special mention goes to Sir Philip Green, for his sterling work as the luncheon’s sommelier.

The Michael Fish crystal ball for rubbish forecasting

This has always been a keenly contested category, with economists, City analysts, newspaper columnists and bookies all possessing outstanding capabilities for supplying predictions that last about as long as a tin of Quality Street at Christmas.

Still, while experts from all of those trades called the 2017 election result totally incorrectly, the betting industry compounded this by also managing to completely misread much more.

A day before polling day, Betfair gave a Tory Westminster majority an 81% chance of occurring and opined “it looks unlikely we will have another upset on our hands”. Meanwhile, throughout 2017 the bookmaking industry’s own forecasters appeared oblivious to which way the wind was blowing with regard to problem gamblers and fixed-odds betting terminals. Therefore, this year’s gong goes to the gambling industry (as it has probably failed to foresee).

The Oliver Hardy chipped vase for another fine mess

Awarded to the executive who has displayed the most impressive all-round grasp of calamity, the 2017 chipped vase was an easy decision for the awards committee.

Iain Conn, the boss of British Gas owner Centrica, began 2017 with a £9.5m fine for IT failures at British Gas, but he soon got into his stride and ran off with this category by being in the vicinity for a quite sensational sequence of corporate accidents.

This year also saw a high court finding that Rolls-Royce had been aware of corruption allegations within the company in 2010, but decided not to notify the Serious Fraud Office (Conn was the senior independent director in 2010 and a director from 2005 to 2014).

Then there was the bombshell of an accounting scandal at the Italian arm of BT Group (Conn sits on the audit committee), plus the catastrophe at Centrica in November, when the group’s shares had their biggest daily fall after British Gas said it had lost almost 6% of its customers in three months. Following Conn’s stellar run, the committee will consider retiring this award, and handing him the vase in perpetuity.

The Gerald Ratner cut-glass sherry decanter
Handed to the company with the best line in turning punters against its own products. This year: Tesco.

Its Willow Farms brand of chicken is badged as “exclusively for Tesco”, but it emerged in September that it is actually the same meat sold more cheaply in other supermarkets, such as Lidl. So was the claim on the Tesco packaging withdrawn? Not a bit of it.

Dave Lewis, the supermarket’s boss, justified the tag thus: “We don’t see [the exclusive tag] at all as dishonest. The Willow Farms brand is only available inside Tesco.” Or, as the lawyer to its supplier put it: “The Willow Farms brand is exclusive to Tesco, but the raw material is not”.

The Derek Edward Trotter vial of snake oil

There has long been a suspicion in the City that the PR industry might, occasionally, try to get clients to buy services it may not be expert in – such as crisis communications. But 2017 provided the perfect case study for one major firm to demonstrate the value of a supposed expertise in this domain.

The PR firm Bell Pottinger was plunged into a crisis of its own in South Africa, after it was alleged to have used racially charged phrases such as “white monopoly capital” and “economic apartheid” to draw attention away from its wealthy client the Gupta family, which had been accused of benefiting financially from its links to President Jacob Zuma.

Having been unable to communicate its way out of that crisis – the agency disintegrated – its founder Lord Bell then tried to showcase his own skills by agreeing to be interviewed on Newsnight. It was, to use the technical PR term, a complete car crash.

The Travis Bickle replica silver revolver

A new award that in its first year fittingly goes to another Travis – Kalanick – who, as founder of ride-hailing service Uber, just about qualifies as a taxi driver seemingly intent on self-destruction.

He was forced out as chief of Uber in 2017, after a string of disasters, including being filmed berating a driver who was complaining about the difficulty of making a living on Uber’s falling rates. Still, that was nothing compared to the former employee who published a blogpost describing a workplace rife with gender discrimination and sexual harassment.

Uber’s year did not improve much from there, either. In September Transport for London (TfL) stripped the company of its licence to operate in the UK capital. Developing.

The Alfred Hitchcock violin case
The Hitchcock award is doled out to the business executive whom the committee believes has excelled themselves with the year’s most pointless cameo. In what was a stellar field, the judges wanted to congratulate the quality of a string of 2017 nominations.

Particular mention was given to the former Goldman Sachs financier Anthony Scaramucci, whose 10-day tenure as Donald Trump’s communications director elevated the global debate, particularly by producing one of the more memorable soundbites to emerge from that great office: “I’m not Steve Bannon,” he said. “I’m not trying to suck my own cock.”

Still, however highbrow Scaramucci’s work was, he was eventually eclipsed in this category by a cameo so fleeting, it is arguable whether it occurred at all. Kevin Cummings, the chief executive designate of GKN, wins the award after being ousted as the boss of the FTSE 100 aerospace and engineering firm weeks before he was due to take up the top position.

The Microsoft patch for system crashes

The judges were impressed by one particular IT shutdown, which led to chaos at British Airways and was caused by an “uncontrolled return of power”, following an outage, that physically damaged some servers at its data centre.

Flights were cancelled, tens of thousands of passengers were affected – while the airline busied itself by implausibly arguing that the incident “was not an IT failure” but “an electrical power supply which was interrupted” (which then, er, caused the IT to fail).

BA was accused of greed by the GMB union, which said the issue could have been prevented if the airline had not cut the jobs of “hundreds of dedicated and loyal” IT staff and contracted the work to India last year.

British Airways’ chief executive, Alex Cruz, insisted the outsourcing of jobs was not to blame for the “catastrophic” power failure. Still, it would be churlish to deny him his gong.

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