Cultural Differences Impacting Toyota's Handling of Its Crisis

I believe that I overestimated how well Toyota would handle its crisis. When they made the decision to withdraw cars from the market, I applauded. They took the right decision to shore up the confidence of their customers and potential customers.

However, I did not foresee an organization that seems paralyzed to say and do the right thing in a timely manner. The Japanese culture may be holding the company back from meeting the needs and interests of US customers who are the ones impacted by the sticking accelerator problems. The Japanese are not expected to admit mistakes publicly as readily as are Americans. Their companies do not practice transparency in the same way expected of US companies. The Japanese have built their success on the art of imitation; not the art of innovation. They have taken watches and made them better than the Swiss. They have taken cars and made them better than the Germans. They take inventions or innovations from others and make them better. Public criticism is difficult, if not impossible, in Japanese culture. This holds back invention and innovation--the risk of failure is too great.

I think that the complexities of the Toyota corporation has gotten in the way of effectively dealing with this crisis. They centralized this problem, but that meant taking it to the other side of the world from where the issues are the greatest. Mr. Toyota has apologized publicly--finally! However, the US CEO, Lentz, has been used more like super salesman on TV talk shows than as a CEO of a company. Lentz's background is sales and he has looked like the company salesman rather than the company leader. He has shown little contrition and has been more focused on rebuilding sales. All the while, rumors, innuendos, new stories, and plantiff attorneys cases are all building. Frustration and fear are also building. Competitors are offering incentives to Toyota customers to change cars. The clock keeps ticking and Toyota seems to treat this as a manufacturing problem. This is a crisis of confidence in the qualities that made Toyota great--quality and reliability. Take those away and it is just another car company.

I had thought that Toyota would not be inexorably hurt by this crisis since I had assumed that their withdraw of product from the market would be followed quickly by communications with its owners and the public of what it was doing, day-by-day. That hasn't happened. I have been surprised and dismayed. They may be hurting their brand and reputation inexorably.

An indication of how poorly they are communicating are the ads they have been running. An open letter from Lentz to the American consumers reads like a recall letter. The logo on-top is "Toyota: Moving Forward". Isn't "moving forward" the problem that started this crisis?? Did anyone think that maybe the logo lock-up with the tag line might be dropped while they dealt with this issue? During the Super Bowl, several commercials were run with a voice over that sounded like a government assurance that things were being done to protect the consumer. The end slide--the same logo lock-up.

Note to Toyota--get your ad agencies out of this and start dealing with this as a major crisis of confidence. When a crisis hits, do not let ad agencies take the lead. Their MO is to sell, not to communicate. They don't listen, they talk. Stop trying to sell the next car and start trying to stop your current owners from fearing death from their current car. You have a lot of owners who are counting the days until their leases are up and many others who will try to unload the car, even if they loose money, just to feel safer. When humans are fearful, they return to animalistic tendencies. Reason and rationale take a back-seat to emotions. Stop trying to tell the public what wonderful cars Toyota makes and how they will be returned to their greatness and talk to Toyota owners in the fear-instilled "caves" they are now living in.