Toyota's Image in a Crisis

By Bill Collins, Principal

If I had asked you five years ago to name some brands that you might have considered bullet-proof, I bet Toyota would have been on your list.  Everything you would want a brand to be, Toyota seemed to have it all:  friendly, warm, innovative, reasonably priced, attractive products and dependable.  No wonder the Japanese automaker had overtaken the Detroit Big Three in becoming the biggest car company in the world.  Toyota earned the support of the car-buying public and it was all blue skies ahead.

That was then.  Now Toyota is becoming a punch line and its preeminent franchise is definitely in a world of hurt.  The company’s awkward and hesitant response to this crisis of epic proportions hasn’t helped matters and once again reinforces the dos and don’ts of such situations.  Toyota has been too much “don’t” and not enough “do” and they are paying the price.

I read an article over the weekend by an academic who wrote that Toyota’s response to the crisis has been a classic example of Japanese business practices which are in many cases polar opposite to those in the United States.  In Japan, the benefit of the doubt is always given to the company, so much so that there is no perceived need to move quickly on damage control when something goes awry.  Too, Japanese companies are so bureaucratic and rigidly organized that communication and information do not flow quickly or freely.  In other words, it takes a while for the left hand to know what the right hand is doing or should do.  Thus, the crisis-communication discipline in Japan is extremely underdeveloped when it comes to the world stage and expected business practices in the west and unfortunately, we’re seeing a good example of it. 

Here are the 7 Deadly Sins of Crisis Communications; see how many poor Toyota is guilty of:

1. Unpreparedness…it can’t happen to us.
2. Absence…top management not being on the scene and visible ASAP.
3. Ignorance…being oblivious to the needs of your constituencies.
4. Silence…lack of communication.
5. Distance…getting into the corporate bunker and staying there.
6. Fabrication…nice word for “lying.”
7. Naiveté…not understanding what standards you are being held up to.

I’m rooting for Toyota and I think the brand will come out of this firestorm and survive and be better for it in the long run.  They are not out of the woods yet but they seem to be getting a handle on the situation although it seems at times like that old carnival game, whack-a-mole.  Toyota has a large deposit in the bank of public opinion but no doubt is making some hefty withdrawals these days.  Let’s hope the account doesn’t get completely emptied.

Comments

[JasMollica]

Bill,

I was surprised at Toyota's hesitant response to this "issue." They may be prepared for the next crisis, but only after they've been drawn and quartered with this one.
I believe Toyota will recover. I saw the image commercial they produced on the TV last night and thought it came across sincere. I think enough current satisfied customers will help as well.
Best,
Jason