A crisis can arise at any moment and sometimes it can even affect and destroy companies with a very good reputation. This is what happened last year to the biggest automobile producer, Toyota.
Toyota had a very good reputation in terms of quality and reliability of its cars. Over its seventy years of existence, Toyota had established itself as a leader in the Japanese market and in 2007 it became the world's biggest auto producer. However, in the beginning of 2010 Toyota's leading position started to be in danger.
Since September 2009 Toyota had been receiving a lot of critics as the causes of some car accidents in the US were pointing to its direction. It seemed that some Toyota models were having acceleration problems. At first the company denied it was their fault and tried to blame customers, but then changed its strategy and informed that it could be a problem with the floor mats of spefic models. They started then a recall of millions of cars. The reason of this recall were floor mats.
After more rumours and accidents, in January 2010, they were obliged to recall another 2.3 million cars due to problems in the gas pedal. From this moment on Toyota changed its communication strategy as critics began to overwhelm them. The company started informing their customers constantly. Toyota's president, the quality president and the director of Toyota in the US attended press conferences, gave interviews and even appeared before a US committee.
The consequences of this crisis were devastating for Toyota. They lost millions of dollars, had to pay a fine and its stock market value dicreased in 17% in just a couple of months. But what is worse, their reputation was extremely damaged.
Toyota did not get it right as far as its communication strategy is concerned. They were late in responding complaints, doubts and critics; when they did it they never accepted their culpability (probably because they were recommended to do so by its lawyers) and its leaders waited too long before appearing publicly. The paradox here is that in December 2009 they had appointed a new Head of Communications.
 |
| Toyota's president (left) listens to the House of Representatives' Committee |
The consequences of this crisis were devastating for Toyota. They lost millions of dollars, had to pay a fine and its stock market value dicreased in 17% in just a couple of months. But what is worse, their reputation was extremely damaged.
Toyota did not get it right as far as its communication strategy is concerned. They were late in responding complaints, doubts and critics; when they did it they never accepted their culpability (probably because they were recommended to do so by its lawyers) and its leaders waited too long before appearing publicly. The paradox here is that in December 2009 they had appointed a new Head of Communications.
It is very likely that if Toyota had decided to be more transparent from the very beginning and approached its customers faster, the consequences of this crisis would not have been that intense. They owned a good reputation and now it has been damaged because of a bad handling of a crisis. However, now they know what not to do again.
To learn more about the Toyota crisis watch the following video from a presentation I held at my Corporate Communications module.
No comments:
Post a Comment