Tag Archives: toyota reputation

Toyota–reputation disaster or just a blip?

It’s the end of the year and all kinds of PR pundits have been making their list of the worst PR blunders. On the ones I’ve seen Toyota is near the top of the list–BP usually tops them. Which raises the question to me if reputation disasters are what they used to be.

Daily Dog, as I’ve commented before, tends to hype the PR crisis of those covered in its stories. The headline today about Toyota: “As Toyota’s Dark Year Winds Up, Analysts Say Recall Fallout is Likely to Linger: Crisis-Weakened Automaker’s Troubles are “Far From Over” — Even Though New Survey Says Consumers Still Rank Toyota Highest.

To the headline writer’s credit, the positive element of the story is mentioned which is a little unusual. But, the conflict between the oft-repeated story of the the disaster that befell the company this year with the confidence the consumers continue to show in this company raises the question about the nature of today’s reputation disasters. The Dog story says: Despite all that PR trauma, a new survey from Kelley Blue Book ranks Toyota as the most-considered brand among new-car shoppers. A total of 25 percent of those surveyed say the automaker is their top pick when shopping. Coming in a very close second with 24 percent is Ford, followed just behind at 23 percent by Honda.

There is no question that Toyota was significantly impacted by all the negative press, the series of recalls, the Congressional hearings, the suggestions by the Transportation Secretary that no one should buy Toyotas, etc. But, as bad as it looked from the press story and from the analysis of the PR pundits, the question was how could the company even survive. Toyota has not only survived but it has regained its top spot with consumers. That is remarkable.

I will admit to being skeptical of the reality behind Toyota’s problems all along. I felt it was another example of the media overhyping problems, and then, with heightened scrutiny other issues that normally would not come to this level of attention were suddenly big deals. And I was very concerned about the conflict of interest of the administration owning one of  Toyota’s biggest competitors and being both competitor and watchdog. Here’s what I wrote on Feb 22:

Well, I don’t believe the reality is there. I think this is what happens often when things go bad. Additional scrutiny causes additional problems and things pile up. Now the media-shy chairman is preparing to face a highly skeptical and go-for-the-throat Congress. Secretly I wish that Mr. Toyoda would ask the members of Congress this question: How can you be credible as watchdog of the public interest when you have a dog in the hunt? How can the American public take you seriously when your president has more to gain from your problems than anyone else on earth?

I’m not the only crisis consultant who felt there was a substantial amount of media overreaching on this issue. Here is James Donnelly’s post on the topic.

I spoke at the PRSA International Conference on reputation resilience, applying some of the basic ideas about how people and organizations survive disasters to the issues of reputation crises. The goal of resilience is to return to “normal.” Normal is in quotation marks because after a major disaster the new normal is often very different. While there may be a bit of a new normal for Toyota, it looks quite a bit from the outside like the old normal. I suspect inside it is a different story.

But, Toyota in my mind is demonstrating reputation resilience and that I think is the more significant story than how damaging the recall disaster was for them. If there is a case study written on Toyota, it ought to be focused on how a reputation built over many years plus a company culture that has the solid qualities needed to survive enabled a major brand to limit the damage from today’s media and political onslaught.

The truth is our media environment and overheated political discourse makes for a difficult environment for reputation protection. But the other side of it may be that the public instinctively understands it and doesn’t take all the accusations and heightened scrutiny as seriously as we tend to think.

Others are waking up to the US gov conflict of interest re Toyota

The US has big stake in GM. Toyota is GM’s big rival. Toyota has a product problem. The US government is the safety regulator and watchdog. The US government piles on Toyota–makes big news, sales crash and GM profits. Everyone’s happy. Not me. I complained about this stinky mess–an unintended consequence of Obama’s decision to bailout the company–in my last post. I have been stunned, absolutely stunned that there is no media coverage of this very clear and potential credibility busting conflict. But, now it appears that is starting to come.

Here’s one example. Note that this article starts putting the Toyota problems in context–something the headline crazed media refuse to do and can’t be expected to do. But the more the US government piles on Toyota, against this context, the more unfair it will be and appear and the more backlash there will be on the US ownership of GM. My advice to President Obama: decide what is a better and more appropriate role for the US government–watchdog and protector of the citizens or owner of a company in a highly competitive market. You can’t be both!

Toyota faces government scrutiny–from its competitor!

I try to avoid politics as much as possible, but I have to admit to being very squeamish about the government taking a controlling interest in GM, now known in some circles as Government Motors. So many reasons for concern–like choosing factories to close on political grounds rather than business rationale, but now here is a big one. The government is now going to “investigate” Toyota for its safety problems. And there is talk about civil penalties and maybe all kinds of other punishments. Maybe the government should eliminate Toyota from the US marketplace–they have the right to do that. Already the concern about Toyota (overhyped or not, I’m not sure, but I lean toward the over-hyped view) has resulted in a double-digit dip in their sales. Who has to gain from this? Why the government, of course! Or, maybe I should say taxpayers. So US taxpayers have to gain from Toyota’s problems. What impact does this have on media coverage? Aren’t reporters taxpayers too? Conversely, what would the reporters interest be if the same safety issue faced Government Motors (maybe should be changed to Taxpayer’s Motors)? Would reporters and editors be as tough?

The more I think about this morass, the more disgusted I get. But, if I was on Toyota’s side of this issue, I would see government involvement in GM as a potential huge benefit in dealing with the reputation issues involved. They need to find a way to ask the question of whether or not they can expect fair treatment from Congressional hearings when the members they are looking at are not just representing the public’s interest, but GM’s interest as well. Oh, wait, representing GM’s interest is representing the public’s interest. What a stinking mess.

The biggest loser in this may not be Toyota–it may very well be the credibility of our government. As if they have any more room for loss in public trust. But will we trust them to treat Toyota fairly when they have much at stake in making it look like they made a brilliant decision in supporting GM? They now face the same problem that corporations have in defending their reputation against government attack–the profit motive. Young people in particular have the view that if there is a profit motive, it trumps everything and anyone with any money at stake cannot be trusted to do anything other than protect their investment or ability to profit. Now our government is in that position. What a stinking mess.

What should Toyota do? Advice from the Ford-Firestone experience.

We were very fortunate to spend an hour and a half on a webinar this morning with Jon Harmon, author of the book Feeding Frenzy, and the crisis communicator in the middle of the Ford-Firestone crisis (for you young folks, this occurred in 2000). Jon’s phone was ringing away with reporters calling to ask him what he thought about Toyota’s problems with the huge recall and shut down of production–no doubt the biggest reputation challenge in the auto industry since the Ford-Firestone problems ten years ago (barring the meltdown of course). Jon will be interviewed on CNBC shortly, but you can get the scoop here.

I asked Jon during the Q&A session on this webinar what he would say to the CEO if he had a seat at the table of executives as he did at Ford. He said, “I would ask them first if they are doing enough? Are they doing all they can to protect the public? What about Lexus–they are keeping that out, but should they be looking at that too?” Then he said, “they should ask the question ‘what are people most worried about?’ and ask how we are addressing their concerns. We need to be clear about how we are addressing them.”

What struck me about Jon’s comments, clearly coming from the voice of experience, is how they well they mesh with the basic message about trust that we talk about all the time. Trust, we say, depends on two things: doing the right things, then communicating about them well. Jon is very right in advising that they first be concerned about the realities of protecting the public. No amount of posturing or spinning will compensate for decisions that don’t go to the fullest extent possible in addressing real safety concerns. But, if they are doing all those things, they need to be very aggressive and very clear about the actions they are taking. Jon talked about all the Twitter chatter and social media activity around Toyota and no doubt most of it is pretty ugly. I was interviewed by CNN Money a few days ago for my thoughts on Toyota’s reputation and I haven’t seen any of my comments showing up. They probably won’t because I did not quite see this as the blow to Toyota’s reputation that the current media hype is making it.  I related their reputation problems to a bigger issue of becoming the world’s largest and dominating auto manufacturer–an achievement that puts a huge target on them and certainly for the media as well as those who hate all things big and powerful. That is a more challenging issue long term for Toyota. However, the current spate of safety issues, recalls, accusations and negative reporting don’t help in that overall battle one bit.

I’ve asked Jon to contribute a guest post on crisisblogger and hopefully he’ll have time to do that. In the meantime, go out and get a copy of Feeding Frenzy.

Is Toyota going the way of GM?

I was intrigued by a couple of major media stories about Toyota. Today there is this story from US Today saying that Toyota’s reputation may need an overhaul following the latest hit–a major safety recall. It identifies a string of problems that the world’s largest automaker has experienced in the recent past. This follows last week’s cover story in the Economist in which the major challenges Toyota faces are examined in some detail. The story starts with the chairman and grandson of the founder revealing that he has been reading Jm Collins’ book “How The Mighty Fall.”

No doubt Chairman Toyoda has plenty to worry about. But, as I commented here a long time ago, his biggest worry from a reputation standpoint comes from his success. Strange thing about this time and culture–we like winners, but we don’t really like big, gigantic winners who keep on winning. Certainly part of that is our media pattern of following the rise of someone or some organization as they battle the giants, but as soon as they get to the top and topple the giants, the deconstruction begins. In some cases, like Tiger, the deconstruction is aided mightily by their own misdeeds. It is not just media, however. Our cultural values tend to distrust and dislike anything too big and powerful. We don’t like monop0lies or anyone that smells like one. We don’t like teams or companies or celebrities who simply dominate. I said here before that Microsoft finally emerged from under the cloud of its success when it became clear that its dominance was no longer assured with Google coming on strong. Now Google faces the very real problem of their famous corporate slogan turning on them and biting them on the backside. As they get increasingly powerful, more and more will see evil in every move they make.

Toyota has its problems, no doubt. They’ve made mistakes. But having a big safety recall over floormats that slip over accelerators and having the media conclude that this is a sign they need a reputation makeover identifies their real problem. They are the big dog. They’ve got a target on their back. They have tens of thousands of journalists, bloggers, and others beside competitors, who would love to help lower them a notch or two.

Communicators and executives at Toyota have a tough challenge. Above all they need to “walk humbly” while the company continues to innovate, put their kaizen strategies to work, and strive harder than ever to lead.