What Toyota Could Learn from Tiger
As I write, Toyota is under the hot lights of a Congressional hearing, and it's just the first round of a series of House and Senate investigations into what the company knows and when it knew it. How Toyota handles itself in the full glare of a federal inquiry will color its public image for many years to come.
Given that, I called Lauren Bloom, the author of The Art of The Apology: How To Apologize Effectively To Practically Anyone. Bloom is also a business ethics columnist for TheStreet.com and a frequent guest on NBC's Today Show. Is Toyota handling itself well? No, and Tiger Woods did it much better, she said. "The company blew it by not handling it immediately and definitively when it first became an issue," she said. "Ignoring a safety problem to save money for shareholders is a lot worse than what Tiger Woods admitted he did."
After his press conference, Tiger Woods was accused of sounding wooden and scripted, Bloom said, but he mostly accepted responsibility for his actions (except for taking a swipe at the media). Toyota President Akio Toyoda, she said, "actually should have been a bit more scripted. When he sat there [before the recall] and said the company had still not decided what was going to do, that really hurt. The company now has to persuade customers that it cares."
To repair its image, Bloom said, Toyota needs to take a number of steps. "First, they have to make it right with the outstanding safety issues--really deal with them, spending what it takes to get it right." Second, it needs to apologize in a way that people accept.
In his testimony today, Toyoda tried the sincere approach. "My name is on every car," he said. "You have my personal commitment that Toyota will work vigorously and unceasingly to restore the trust of our customers." In a thoughtful touch, he also apologized to the California family that lost four members to an out-of-control Toyota. "Especially, I would like to extend my condolences to the members of the Saylor family, for the accident in San Diego," he said. "I would like to send my prayers again, and I will do everything in my power to ensure that such a tragedy never happens again."
But Toyoda's testimony was also vague, and said nothing about the actual cause of unintended acceleration. That was probably a mistake. With laser-like precision, Henry Waxman's Committee on Energy and Commerce is focused on showing that unintended acceleration could be caused by electronic interference.
A letter Wednesday from Waxman to Jim Lentz, president and CEO of Toyota Motor Sales U.S.A., made that plain. The Waxman letter blasted the only study Toyota has done on electronic interference (through the consulting firm Exponent Inc.) as having "serious flaws." Toyota provided 75,000 pages of documents, Waxman said, and they "appear to show that Toyota consistently dismissed the possibility that electronic failures could be responsible for incidents of sudden unintended acceleration."
Lentz also testified, and he apologized, too: "In recent months we have not lived up to the high standards our customers and the public have come to expect from Toyota," he said. "Put simply, it has taken us too long to come to grips with a rare but serious set of safety issues, despite all of our good faith efforts."
The problem is that there's still significant public doubt about the company's "good faith." And Lentz is still saying that Toyota is "confident that no problems exist with the electronic throttle control system in our vehicles." The carmaker didn't help its case when investigators uncovered an internal Power Point presentation that appeared to gloat over money saved in avoided recalls.
Meanwhile, ABC-TV has been hammering away at Toyota for the same reason, and last night aired segments asserting that a university-based researcher had identified the electronic source, and that sudden acceleration could be duplicated.
Toyota has gone on a PR offensive, bringing forth internal experts to say that it is impossible for electronic interference to produce runaway cars. But it is doubtful that such assertions will satisfy either the public. For Toyota to get past its present predicament, it will first have to fully disclose everything it knows about sudden acceleration. And, despite the reams of paper handed to Congressional investigators, that hasn't happened yet.
Asked to name examples of successful apologies, Bloom cited Johnson & Johnson, which recalled tainted Tylenol promptly and at its own expense in 1982; and Jet Blue, which generously compensated passengers stuck on the tarmac for 11 hours in 2007. But J&J's tainted Tylenol was not its fault, and Jet Blue could easily move on once it satisfied a small group of passengers. The Toyota problem is much bigger, and it's not over yet.