by Steve Adubato, PhD
Building a successful corporate brand can take years, even decades, to establish. Your brand is about your reputation in the marketplace. It is about how others see you, the degree to which you are respected, as well as the belief of customers and key stakeholders that your product, services and integrity are beyond reproach.
Consider the case of Toyota, an auto maker that for years has been seen as the epitome of excellence, safety, economy and customer service. Toyota had it all. But now, Toyota faces one of the most embarrassing and serious crises in business history.
Toyota’s safety problems connected with faulty accelerator pedals are bad enough. The recalls, the accidents and deaths allegedly tied to those safety problems all hurt Toyota’s brand. But how Toyota has communicated since these problems have become public has only made the situation worse. Recently, Toyota president Akio Toyoda spoke for the first time about this issue. Yet, his presentation did nothing to help things and, in fact, made things worse.
While he spoke for nearly an hour, he was not clear nor was he concise regarding Toyota’s concern about the problem and what exactly would be done to fix it. Even worse is the fact that it took this long for Mr. Toyoda, the company’s president and CEO, to speak publicly.
Further, much of the high level communication in connection with this crisis has been delegated to others. Specifically, James Lentz, a top Toyota executive in America, recently went on the TODAY Show to represent the company. Even if Mr. Lentz were to do an excellent job communicating in this pressure-filled media situation, it still wouldn’t have been enough. When a crisis of this magnitude hits, only the CEO has the authority and the position to speak. By putting Mr. Lentz out front as Toyota’s lead communicator, the corporation was sending the message that the crisis wasn’t important enough to have their top person handle it directly.
When Chrysler had a significant PR problem in the 1980s, in which it was accused of selling used cars under the guise that they were new, its CEO Lee Iacocca was the only person speaking on behalf of the auto maker. He dealt with it directly. He said Chrysler blew it big time and was going to get it right. One has to wonder why Mr. Akio Toyoda didn’t understand that Toyota’s brand was bleeding profusely (not to mention sales) in the United States, which required him to physically come here and speak on behalf of his company.
Exxon screwed up when it took 13 days for its then CEO Lawrence Rawl to show up in Valdez, Alaska to communicate on behalf of the company after one of its oil tankers hit a reef and spilled over 10 million gallons of oil into the sea. For nearly two weeks Mr. Rawl didn’t see the need for him to be the communicator-in-chief. He passed it on to PR representatives, engineers and operational types. It didn’t work for Exxon then, and it doesn’t work now for Toyota. The word is that Toyota’s CEO may now come to the United States to address this issue. However, in crisis communication, we are talking too little, too late.
There is a simple communication and leadership lesson for all of us. When things go terribly wrong, WHO communicates on behalf of the organization is sometimes more important that WHAT is communicated. I don’t know if Toyota’s brand will ever recover from this debacle, but I do know this—every time CEOs duck when things get tough or delegate sensitive communication to people below them, it only makes things worse. Toyota not only had serious problems with its acceleration pedal, but they put on the brakes when they needed to communicate in a clear and authoritative fashion at the highest level. For that, they will pay a heavy price.