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?
______________________
Check out: CNNMoney.com's article: Whole Foods sweats CEO's health care manifesto at: http://tinyurl.com/kpqlv8

Rain in Pro Sports A Tale of Two Delays

Last Thursday, June 18th - First day of the US Open in Bethpage, Long Island and barely half of the players ever even teed off due to rain. But 50,000 fans certainly got teed off. What did the USGA initially tell ticketholders who ponied up over $100 per ticket, took the day off from work and slogged through the rain? Too bad, no refunds, nothing!

The New York Yankees happened to have a game at the same time, same day, but they chose a different tact: To all who paid for a ticket for the day game against the Washington Nationals - even if they didn't bother braving the weather to come to The Bronx - use your ticket (or stub) and you're welcome to come back for another game this season or next. And, if you did come to the stadium and you're sitting in the bleachers - come on down and sit in the good seats. Why not?

Why not indeed.

It seems unfathomable that any organization would not make some effort - any effort- to provide some kind of consideration for customers (fans) when forces beyond their control ruin the experience. From a communicator's perspective, this should be rule #1 in protecting reputations: give the customer something! Many will claim that this is an unfair comparison. The New York Yankees is a wealthy corporation with 80+ home games to spread out those 50,000 free tickets, while the USGA is a not-for-profit, mostly volunteer-based organization that only holds a dozen or so events each year.

We're not suggesting that the USGA should have matched what the Yankees have done. But, do something! Offer a discount to the next PGA event. Send them a souvenir. Grant them a year's free membership. The USGA has a good reputation, but in this one instance, they should actually have taken a page from the Yankee PR playbook!

Eventually, the USGA offered 50% refunds or the opportunity to attend the Monday final round to those stranded first-round ticketholders...

But the questions for communicators remain:

• Did the initial reaction by the USGA damage to its reputation?
• Did the USGA act too slowly?
• Would you have advised differently?
• What other recent examples have you witnessed or read about lately?

Twitter Accountability and Longevity: What's the Future of Twittering Versus Fact-Checked Journalism?

Twitter doesn't claim to compete with The New York Times or The Washington Post, but it can have similar influence on - can even be a maker or breaker of - an organization's or an individual's reputation. But, could "Tweets" soon be cast aside as rumor and unfounded hype? Or will tweets gain power and influence?

Tony La Russa seems to think that either way, tweets shouldn't be ignored. The St. Louis Cardinals manager filed suit in San Francisco, CA Superior Court claiming that Twitter allowed a fake account to be set up under La Russa's name with demeaning and derogatory updates about current and former players - that has caused irreparable damage to his reputation. Should Twitter and/or the person who opened the fake account be liable?

It seems that many people feel that tough-talk-twittering amounts to merely off-the-cuff, inconsequential speech as opposed to measured and leveraged assaults that can cause real damage. So, tweeters should feel free to say anything they want.

Apparently, you can even feel free to criticize the President. Sen. Chuck Grassley posted a scathing tweet about President Obama's demand for action on healthcare reform: "Pres Obama you got nerve while u sightseeing in Paris to tell us 'time to deliver' on health care. We still on skedul/even workinWKEND."

But, we're talking about just 140 characters max, so any damage would be limited, right? Wrong. As Time Magazine pointed out, Twitter is being used as a "pointing device," sharing links to articles and videos and other longer-form pieces. This all extends the interest and influence. In fact, let me point you to that interesting Time article: http://tinyurl.com/pr9qg5

Are there no consequences to tweeting? If there are none, should there be? Also, will tweeting last and even continue to expand? What is your opinion?