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?

Separating the CEO from the Brand - Better Luck Separating the Wet from the Water

Whole Foods tries to manage potential fallout from CEO John Mackey's Wall Street Journal OpEd on ObamaCare.

Last week, the often outspoken John Mackey, CEO of Whole Foods, wrote an OpEd piece in the Wall St. Journalopinion criticizing the President's public health initiative. He went as far as to declare that healthcare is not a right any more than food and shelter are rights for Americans.

This week, spokesperson Libba Letton, said the company was responding to emails about Mackey's article. "We're trying to explain that it was intended to be a personal opinion and not on behalf of the company."

Good luck!

The CEO of a company is always inextricably linked to the brand. What ties Mackey even closer (if that's even possible) are two factors: First, he is known for speaking frankly and "from the hip." Second - and specifically in this instance - Mackey sites several Whole Foods examples to prove his points on healthcare reform.

It may be too early to tell the extent of the fallout. Several groups have tried to organize consumer boycotts of the company.Those who follow the company and industry closely also expect these efforts to have some impact. Robert Passikoff, branding expert and founder of Brand Keys Consulting said: "Whole Foods has a particularly large segment of consumers who have a politically liberal tendency. That group looks at Whole Foods as a liberal brand. For them, this is now an issue of brand dissonance."

Michelle Chang, an analyst with investment research firm Morningstar boldly states: "Any concern about its image would damage sales heavily."

The general public may either strongly disagree with or align themselves tightly to Mackey's opinion. Marketing, branding and communications professionals may offer conflicting advice. And some industry analysts may predict deep loss where others say it'll barely impact the company at all. But one thing all will agree on is that what a CEO says reflects directly on his/her company.

We wonder if Mackey will ever learn - or wants to. It is nearly two years now since Mackey was "outed" for anonymously posting disparaging blog and Yahoo bulletin board entries about his competitors, namely, Wild Oats. His own communications team was forced to admit that was a blunder, banned such postings and revised policy. What will they do now?

What is your opinion? Do you believe there is any way for the CEO's opinion to be separated from the brand? What advice would you give Mr. Mackey and what precedents would you site?
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Check out: CNNMoney.com's article: Whole Foods sweats CEO's health care manifesto at: http://tinyurl.com/kpqlv8

Swine Flu & Chrysler Bankruptcy Video Blog

Leaders and Communications

Jumping into the fray, Jack and Suzy Welch opined on a President Obama Leadership Report Card in BusinessWeek. While not agreeing with all of the policies, so far the former GE CEO gives him an A for leadership.

The comments the Welch's make about Obama and communications can apply to almost any CEO. "You can't communicate too much, especially when you're galvanizing change."

In the midst of this economic turmoil and change, I believe CEO's need to keep communicating with employees, stakeholders, retirees, customers. There is a tendency to hunker down and come out only occasionally. Why keep sending out bad news, is one argument? That's not the point. Yes, there is bad news, but it's how you say it that makes a difference.

An effective CEO and his/her communications team can do a good job even with bad or "eh" news. There is bound to be some positive information to transmit; and you can figure out ways to demonstrate how the enterprise is working harder, more efficiently and maximizing opportunities.

Think about the ways you can communicate: speeches, walking the halls, town halls, media interviews, online chat rooms, old fashioned letters to the house. Who do you think is doing well?

A personal view of GM and Rick Wagoner

The news that GM CEO Rick Wagoner resigned under White House pressure is time for both sadness and a quick gut check and time to get back to work for anyone in the auto business.

CommCore has been working with GM for more than 20 years. Some of my best friends in the business have come through the Detroit doors - and many are still working in communications, design, manufacturing and quality control. Almost all have been Wagoner loyalists - they have been inspired by his leadership and his low key hands on approach.

In the last couple of months, once Toyota started losing money, it's been clear that the GM, Chrysler and Ford problems are global in nature. At some point, consumers will start buying cars again, but they aren't doing it today. Recent news that Buick had better quality scores than Lexus doesn't create a stampede at the showrooms.

So in the absence of results, something had to give. For GM'ers it's important to pick up on Wagoner's optimistic note to employees. He implored: "Ignore the doubters because I know it is a company with a great future."

If I had the answer I wouldn't be blogging - I'd be in Detroit or working for the Government's auto task force. A Buy American strategy is a nice idea, but it doesn't work. It's critical to harness all of the creative efforts to get people to consider US cars and trucks and into the showrooms.