BBB Under Scrutiny

Link: http://www.bbbroundup.com

I’ve been asked again, why I’m doing this story. The reasons are complex, but essentially in this economy, what the Better Business Bureau is doing by adopting an ill-conceived Letter Grade system, and ramming it down the throats of their membership in an apparent attempt to maximize revenues comes at the expense of the small business. This is bad for the economy.

It’s been pointed out before, albeit in a satirical voice, that the newly adopted Letter Grade system is prone to mistakes, and while Disneyland can survive an unwarranted “F” grade from the Los Angeles Better Business, many a small business cannot. This is especially true in today’s economic meltdown when people are being more cautious before spending and are using the Better Business Bureau in record numbers before making purchases. The Council of Better Business Bureaus knows their Letter Grade algorithm is flawed but continues to ram it down the throats of not only the consumer, the businesses they grade, but to a large percentage of their Better Business Bureau regional offices as well. This is rapidly becoming a great divide among the Better Business Bureau. Not only do these revelations increase the appearance of impropriety, the Council of Better Business Bureau actions in stonewalling and ignoring the media queries give the appearance of making the organization look guilty.

The Better Business Bureau built up the incredible trust they have with the public for over 90 years. At the rate they are going, they will squander this trust by the end of the year.

I have stated before, and will state again that I have no wish to destroy the Better Business Bureau. I do wish to help reform it by making sure that small business is treated fairly, the Bureau operates with much more clarity and transparency, and returns to the business model of being an advocate for complaint resolution through mediation and assistance rather than adversarial, arbitrary and confrontational means.

What’s been going on in the last few days gives me hope that the “good guys” can win here. I had noticed Josh Parsons’, CEO of the Houston BBB, stand against the Letter Grade system in the Houston back in January. To date he is the only BBB official to have the strength of his ethics and go on the record against the Letter Grade system. He did it, because as he rightly pointed out, the BBB does not have the resources to do an accurate, impartial job of it, so they are better off not doing it all. Yesterday, he went on record again, reaffirming his bureau’s stance in the matter. The most important fact that wasn’t pointed out is that for the last three years, even in the wake of Katrina, the Houston Better Business Bureau was one of the fastest growing regional BBB offices (by revenues) in the nation, doing far better than the national average. Again, this brings with it an appearance of impropriety. Reasonable men, making reasonable assumptions, could conclude that the National BBB chose to ignore ethical considerations (a grading system many of the regional BBB offices think is unfair) in favor of money (the increased revenues generated by the Los Angeles BBB’s Letter Grading system.) Count me among them.