Business

Globe, distributor trade blame as delivery woes persist

A Globe reporter carried a suit en route to an interview Sunday, after spending hours assisting with deliveries of the Sunday Boston Globe.

Jessica Rinaldi/Globe Staff

A Globe reporter carried a suit en route to an interview Sunday, after spending hours assisting with deliveries of the Sunday Boston Globe.

Boston Globe executives summoned managers of their new distribution partner to a meeting Sunday to discuss widespread delivery failures, but the day ended with finger pointing and no clarity about when all home subscribers could once again count on getting their newspapers.

Behind disruptions affecting up to 10 percent of daily subscribers are two basic problems, both sides said. ACI Media Group, which took over home delivery in Greater Boston last Monday, has yet to hire enough drivers to cover every route. And many of ACI’s new delivery routes lack any logical sequence, leaving drivers criss-crossing communities and making repeated trips to the same neighborhoods.

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In an unprecedented grass-roots effort Sunday, scores of Globe employees from departments throughout the company voluntarily fanned out to distribution centers after midnight, taking over many of the 150 routes that had no drivers, delivering papers until late Sunday afternoon.

Despite the effort, 3,000 to 4,000 of the roughly 205,000 Sunday Globes scheduled for home delivery did not reach their destinations, ACI executives said.

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With the problems dragging into the second week, longtime readers have responded with seething frustration and anger, overwhelming the Globe’s phone lines and venting their complaints over social media.

ACI officials say they are aggressively recruiting new drivers with incentive programs, but could not say when they will have enough to ensure every paper is delivered.

“I wish I could answer that question,” ACI’s president and chief operating officer, Jack Klunder, a former circulation executive at the Los Angeles Times, said in an interview. “I just can’t say. I think it’s going to improve each week.” He said in four to six months service will be as good as before the change, and then will continue to improve.

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Globe chief executive Mike Sheehan said the newspaper undertook the switch from Publishers Circulation Fulfillment to ACI primarily in an effort to improve service and reduce the number of delivery cancellations due to service complaints. ACI also brings a “material” cost savings, he said, which Globe owner John Henry had intended to put back into the operation.

Sheehan, in two interviews, acknowledged ACI warned of disruptions, but not of the level of vast failure Globe subscribers are experiencing.

“Ten percent of our people not getting papers?” Sheehan said. “That was never communicated to us. That goes far beyond any reasonable definition of disruption.”

Sheehan and other executives suggested in an interview they would not have gone ahead with the change had they known what a mess it would be.

Klunder, however, said he warned Globe executives that the switch would be enormously difficult. Globe officials dispute his account of those conversations.

“I said ‘I cannot describe to you how painful it is,’ ” Klunder said, recounting his warning to Globe officials. “I used the expression ‘massive disruption.’ . . . You’re going to get thousands of calls, e-mails — social media is going to be blistering you. The news media is going to be blistering you. You’re going to like where you are at the end of this cycle but you’re going to go through this.”

He said the fact that ACI’s contract with the paper carries no performance penalties for the first three months is “an acknowledgment on [Globe executives’] part of some level of pain.”

‘Ten percent of our people not getting papers? That was never communicated to us. That goes far beyond any reasonable definition of disruption.’

Mike Sheehan, Boston Globe chief executive officer 
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Klunder also faulted the Globe’s communication with readers ahead of the change.

“We were adamant that these guys communicate to the readers early and often about the disruption that would take place,” Klunder said. Maintaining good will with the public depends on “how candid you are with what [readers] are about to experience. We were pretty clear about that and I’m not sure the communication plan was as graphic as I suggested it should be.”

Klunder said his firm’s reputation has not suffered from the crisis. “I can’t say that it has or that it even will,” he said. “Because I think people who look to outsource have some level of understanding that any time you make a change of that magnitude, it’s going to be rough sledding for a while. We’ll be fine.”

Sheehan, who on Sunday delivered papers on the North Shore, said the Globe did not prepare readers for a home delivery horror show because the paper’s executives had not anticipated one. The paper had prepared readers for much milder problems, he said. The Globe is crediting the accounts of subscribers experiencing problems; that money comes out of the newspaper’s bottom line — not ACI’s, Sheehan said. He said he did not have a figure available. He said advertisers have not asked for refunds or canceled planned ad buys.

No Globe executive is planning to resign in the wake of the home delivery disaster, Sheehan said.

He apologized for late deliveries and those that never got done.

“Any time a subscriber doesn’t get the product, we’re sorry,” he said. “We’re extremely sorry the disruption has been beyond what we expected.”

Readers — so far — have not canceled subscriptions in large numbers, Globe officials say.

“All would be forgiven if the level of service could be restored [this week] to the way it was,’’ said Dan Kennedy, a journalism professor at Northeastern University who has written extensively about the newspaper business. “But if this drags on and on, and large numbers of people cancel the print edition, it does become an existential threat. The print edition is where the money comes from.”

He said the Globe has not done enough to explain the problems to subscribers.

A number of subscribers questioned why workers who had long delivered their paper without issue had been let go. One hung a sign on her mailbox demanding that her old carrier be reinstated.

“The guy who delivered to us for years wrote a letter and said, ‘I want to deliver your paper, but the new firm [ACI] won’t even talk to me,’ ” said Michael Carakatsane of Lynnfield, who has subscribed to the Globe for 23 years. “For crying out loud, that’s terrible. . . . He knew the route, he knew the subscribers, and he knew where to leave the paper.”

Carriers are paid for each paper they deliver, and generally can gross about $1,200 to $1,400 a month for about 25 hours of work each week, ACI officials said. That indicates an hourly rate of about $12 to $14.

Harry Woldt, an ACI senior vice president, would not disclose rates but said they are comparable to what carriers made under the former distributor.

A similar transition to ACI in 2014 by the Orange County Register in California was also plagued by delays, which took months to resolve. However, the Register apparently had severe financial problems at the time, according to the LA Times.

For the Globe employees, their effort to deliver the Sunday paper was a gesture of good will by staffers who have been at the receiving end of subscribers’ frustrations.

But a shared sense of determination gave way to dismay as the scale of the debacle became apparent.

Globe workers at a Newton distribution center discussed how the company’s communications to its subscribers had been slow and insufficiently contrite. They raised doubts about the assertion that ACI had hired roughly 475 of more than 530 needed drivers. Many doubted that savings from the new delivery contract would outweigh canceled subscriptions and ill will arising from the delivery delays. All agreed that the situation was untenable.

“In some ways our solidarity all-nighter was fun and bonding, and gratefully received by many subscribers,” said reporter Sacha Pfeiffer. “But I think most of us came away from the night shocked by how dire this problem seems to be, how long it will likely take to fix it, and how ill-equipped anyone at the distributor seems to be to improve the situation.”

Reader Una Hartwell, 86, of Lynnfield, welcomed delivery of her Sunday Globe just before noon.

“It’s a big part of our day,” Hartwell said, also referring to her husband. “Can we now count on it every day? Or will we just be getting it on Sunday?”

Kathy McCabe of the Globe staff and Globe correspondent Nicole Fleming contributed to this report. Mark Arsenault can be reached at mark.arsenault@globe.com. Follow him on Twitter @bostonglobemark. Dan Adams can be reached at dadams@globe.com. Follow him on Twitter @DanielAdams86.
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