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Toyota's crisis response is a two-part story

Toyota's crisis response is a two-part story

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Published by Henry Fawell
In a February Daily Record commentary, Henry Fawell explores the two-part challenge Toyota faces in the wake of its recall crisis.
In a February Daily Record commentary, Henry Fawell explores the two-part challenge Toyota faces in the wake of its recall crisis.

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Categories:Types, Business/Law
Published by: Henry Fawell on Dec 04, 2010
Copyright:Attribution Non-commercial

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12/04/2010

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 Toyota’s crisis response is a two part story
By Henry FawellFebruary 12, 2010Like most riveting stories, the current recall crisis that has beset Toyota can be divided intomultiple parts.In Part One, which is still unfolding, the company is respondingaggressively to a crisis. In Part Two, which will unfold in thecoming months, Toyota will have to respond to the inevitablequestion from policy makers: “What did you know and when didyou know it?”Let’s look at Part One.In the last few months, Toyota has recalled a staggering 8 millionvehicles and halted production on 11 different models due to a plague of sudden accelerations inits cars. The crisis has rocked an auto company that for a half century had been synonymous withsafety and reliability.After a slow start, Toyota is responding the way any company should that is serious aboutrebuilding its reputation. Here are five key components to Toyota’s crisis communicationsstrategy.Be honest about your situation. Toyota recognized it was in a hole and stopped digging. It haltedproduction on nearly a dozen different models, pledging to fix cars currently on the road beforepushing new ones off the manufacturing line. The move is bold and not without serious financialrepercussions, but it sends an unmistakable message that the company will bear any burden tokeep its customers safe.Say “I’m Sorry.” Toyota President Akio Toyoda apologized to customers and took personalresponsibility for the recall, as did the chief of Toyota’s U.S. operations. Sound easy? Ask ACORN and Tiger Woods what happens when you respond to a public crisis with defiance orindifference.Fix the problem. Toyota quickly found a structural fix to the sticky accelerator pedals plaguingits vehicles. This may seem obvious, but too many companies believe that crisis response beginsand ends with a good public message. They ignore the underlying problem that led to the crisis,whether it’s a sticky brake pedal or, as we recently saw in the financial industry, a huge appetitefor bad debt. Toyota found a solution and dispatched thousands of employees to work 24/7 to

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