Assessing Mr. Toyoda's Role Through the Ongoing Recall Crisis at Toyota

As the recall at Toyota turns from a crisis to a long term saga that impacts the company's reputation, the company is finally doing many of the right things and trying to avoid missteps. The full-page advertisements in 20 national newspapers, the helplines and emails, the updates and webpage buttons are all well and good and necessary. While these efforts may be too late to pacify many disgruntled customers, dealers and stakeholders, apologies are finally coming from North America heads (namely North American CEO Jim Lentz) and other company spokespeople. CEO Akio Toyoda was even quoted as recently as this past weekend saying he was "very sorry" to a local Japanese auto trade publication.

But this is a saga, not a flash-in-the-pan crisis, which means that there will be much more to deal with. There will likely be lawsuits and other legal actions, uncountable criticisms, and now there will be a congressional investigation.

Communications professionals and advisors like us are particularly interested to monitor and discuss ways in which Mr. Toyoda should and shouldn't be utilized as the company attempts to weather this storm. The similarities and differences with the Tylenol crisis have been well established. But, how is the Toyota crisis different specifically regarding the CEO's role? How should the CEO be utilized differently than Johnson & Johnson's Jim Burke?

In July of last year, when Akio took over from his father, Shoichiro Toyoda offered some sage advice to his son. The new CEO was taking the wheel at a time of a global retrenchment of the auto industry and significant sales slump, even for this well-esteemed and trustworthy 70+ year-old company. At the same time, critics discussed how there had been a shift in focus from the customer and reliability to increasing volume, market share growth and profits. Shoichiro advised his son that he should consider these great challenges -both external and internal - as opportunities to emerge as an even stronger leader.

Just a few months later, the accelerator pedal problem is now a full blown crisis that threatens to hurt sales by over $1B, and cause immeasurable reputational damage.

So, how does a communicator assess and utilize Mr. Toyoda throughout this crisis? Is it time for
Mr. Toyoda himself to speak on the national and local stages in the U.S., or is it better left to Mr. Lentz (http://tinyurl.com/yjkutsz) and others? Is Mr. Toyoda adequately skilled, articulate, and would he be embraced by a U.S. audience? Mr. Lentz has already posted at least two video updates on the Toyota YouTube channel, (http://www.youtube.com/toyotausa). Should that have been done by Mr. Toyoda or should his communication best be limited to a Q&A with a global business publication like the Wall Street Journal? Should he tour the facilities where they are implementing the fix, and visit the factories where there has been a work stoppage to talk to the workers?

If the company is really serious about refocusing on the customer, they should enlist dealers on a grass roots level to reach out to customers and employees. There is evidence that the dealers are doing that already, but how much support are they getting from HQ? Should Toyota consider developing a new "best practices" in assessing defects, faulty parts and testing that go well beyond the current NHTSA guidelines and industry norms? If so, than those efforts should be documented and turned into a communication campaign that Mr. Toyoda can begin to articulate to all audiences. Perhaps therein lies the opportunity Mr. Toyoda's father spoke of.

What are your thoughts about Mr. Toyoda's communication role here? Should it be expanded or curtailed? Should Toyota actively seek to emerge as a leader in safety or just hunker down and get through the crisis and hope that time will heal this wound?

Tylenol vs. Toyota

Tylenol vs. Toyota

Toyota's January 2010 massive recall and sales stoppage of vehicles has been quickly compared to the recall by Johnson & Johnson of Tylenol in 1982.

Most of the similarities are in the enormity of the recall and the proactive nature of the effort. However, there are more differences in the nature of the problem and the current similarity than there are similarities.

SIMILARITY:
Similar to J&J, Toyota is going beyond what it may legally be required to do in recalling vehicles. J&J went further than what was required by the FBI to pull products from the shelves. Toyota is getting a big splash from total sales and production stoppage.

DIFFERENCES:
Tylenol was a different product, a different situation and a different environment. The difference between Tylenol's facts - and perhaps including SARS and 9/11 as crises - is that there was no "contributory negligence" on the part of the brand or J&J. While no product manufacturer ever wants to have a problem or defect, the fact is that TOYOTA did something that caused the problem. In the case of Tylenol, these were well made tablets that "someone else" tampered with. No one at J&J has ever been accused of doing anything wrong.

And of course, the media world is profoundly different from 1982. While J&J didn't think so at the time, the company had a relatively easy time of controlling the story and the message. The media was print, radio, TV and advertising. Now, it's the kitchen sink, with YouTube, chat rooms, Twitter and blogs the most difficult to control. J&J was hampered by not having a web site to post its information, Toyota is using its http://www.toyota.com/ for releasing information. I'm personally a bit surprised at the relatively small size of the button on the home page.

One more item. During Tylenol, J&J Chairman Jim Burke was the face of the brand and the company. So far, no one from Toyota has emerged to give this terrible event a human dimension. In addition to the web site, I'm surprised that Toyota is not using its YouTube channel with even a brief statement. Now that the crisis has gone global, it would be appropriate to have a faces of the company and post in many languages to reach more customers.

How do you think Toyota is doing?

Yogi Berra Tells It Like It Is

Lessons for Business Leaders from the Massachusetts Election

The talking heads and columnists will analyze/spin the politics behind the Massachusetts upset by Scott Brown (R) over Martha Coakley (D) for Teddy Kennedy's U.S. Senate seat.

At CommCore, we think there's a lesson or two for business leaders in all this: First, know your customer. Second, celebrity CEOs don't necessarily win over buyers.

In the first case, Coakley and her team ran a weak campaign that never connected with voters:
- She lost the sound bite war. Her gaffe was calling Curt Schilling Red Sox star pitcher and blue collar hero a New York Yankee. In contrast, Brown had a slam dunk with the line, "It's not the Kennedy seat, it's the people's seat."
- She made tactical errors like going to Washington to meet with lobbyists and major donors a week before the election. The cumulative effect made it appear she was elitist, out-of-touch, didn't know who the voters were, or understand their angst about so-called Big Government and Fat Cats.
- She never introduced herself with a compelling storyline to back her law enforcement credentials as a prosecutor. How many people knew her husband was a cop? How come he wasn't out there in person and in TV spots touting her toughness and caring for everyday citizens?

Can you imagine a business successfully touting its product or service without a thorough understanding of the customer, the market, and communicating a compelling brand message that resonates? That's what Coakley failed to do. Wealthy suburban lawyer Brown, meantime, drove around in a highly-visible old pickup truck with 200,000 miles on it, and was portrayed as a hero of the people.

The second point, about celebrity CEOs, reminds us of the old line from Tip O'Neill, a Bostonian and former Speaker of the House. O'Neill's mantra: "All politics is local." So while "national CEO" President Obama is personally popular in the state, he couldn't convince Massachusetts voters to change their minds about the candidates/products in front of them despite his star quality and oratorial skill.

Lesson number two for business leaders: senior executives' popularity and celebrity are assets to be tapped carefully and selectively. They are not substitutes for an enterprise properly framing and communicating strong brand and product messages that meet a target audience's needs and wants.

Can you think of businesses and their leaders who have made the same mistakes as the Coakley campaign? Conversely, which business leaders have learned the communications and public relations lessons and managed best to connect with their target market?

Timing Isn't Everything, But It Counts For A Lot

The Rev. Pat Robertson, one of America's best-known evangelist broadcasters, created a firestorm Wednesday night even as he was busy soliciting donations for earthquake-ravaged Haiti on his Christian Broadcasting Network's flagship show, "700 Club." Robertson intimated that Haiti had been cursed by God for making a pact with the Devil to kick out the country's former French colonial masters: http://www.youtube.com/watch?v=oXiyceNZmiU

"You know ... something happened a long time ago in Haiti....They were under the heel of the French...They got together and swore a pact to the Devil. They said, 'We will serve you if you get us free from the French.' And so, the Devil said, 'OK, it's a deal.' And they kicked the French out," Robertson said. "You know, the Haitians revolted and got themselves free. But ever since, they have been cursed by one thing after another."

It didn't take long for the statement to create tremors of its own. Religious leaders such as Franklin Graham (son of evangelist Billy Graham) condemned the comment. "He must have misspoken," Graham said of Robertson. "But we need to get on the path of helping people right now. God loves the people of Haiti. He hasn't turned his back on Haiti." White House spokesman Robert Gibbs said, "At times of great crisis there are always people who say really stupid things." White House advisor Valerie Jarrett said on ABC that she was "speechless at that kind of remark. Our heart goes out to the people of Haiti....That's not the attitude that expresses the spirit of the president or the American people, so I thought it was a pretty stunning comment to make."

The Christian Broadcast Network website today contained an official statement claiming Robertson was speaking objectively about Haiti's history that has led "countless scholars and religious figures over the centuries to believe the country is cursed. Dr. Robertson never stated that the earthquake was God's wrath," the statement reads. "If you watch the entire video segment, Dr. Robertson's compassion for the people of Haiti is clear."

There are times when efforts at "clarification" ring hollow, and this is one of them. At CommCore we advise our crisis communications clients that timing is one crucial factor among many when deciding whether to apologize for a public statement that created controversy, intentional or not, or whether to try to explain it away.

With the very real possibility of tens of thousands of fatalities in Haiti at this very moment, and the prospect of a rebuilding effort that will take years to complete, now is not the time to parse phrases and try to convince an audience of what Robertson may or may not have "meant" to say.

Now would be a time to come right out and apologize immediately for making a statement that regardless of whether it was interpreted correctly, was ill-conceived and inappropriate.

What do you think? Can you come up with other misguided efforts at revisionist history after a controversial public statement created an uproar?

Crisis & NBA Players with Guns