Sunday, February 28, 2010

VERITAS: TOUCHDOWN - AKIO TOYODA TESTIFIES BEFORE CONGRESS


Here is this week's perspective for Joe Chidley:

Sometimes, winning isn't the point. Tiger Woods, for instance, must have known that he wouldn't be getting any popularity awards after his televised statement apologizing for his misdeeds. But he had to do it anyway. In the court of public opinion, redemption begins with confession. And that goes as much for the brands one represents as it does for broken marriages. In that sense, Toyota president and CEO Akio Toyoda's Feb. 24 apology before a U.S. congressional hearing into the recall scandal was both necessary and effective. In fact, as early messaging in a crisis in which there is no question over who's to blame, Toyoda's 10-minute speech was a master class. First, he began by stating core corporate principles (commitment to safety, quality and sales last). Second, he explained how the company had strayed from that philosophy, putting sales volume over safety and quality. The result: defects in manufacturing. Here, Toyoda apologized, and offered his condolences to those who had been injured or died as a result of the defects. Third, he laid out plainly what he was going to do "to ensure that such a tragedy never happens again" – a few clear steps (whose effectiveness would be measurable only over the long term, but no matter) that would return the company to its core philosophy. And finally, he took personal responsibility. He reminded the committee members that his name is on every car (Toyoda is the grandson of the company's founder). "For me, when the cars are damaged, it is as though I am as well," he said. Of course, after he finished, the congressmen laid into him with invective, but that had to be expected. Did Toyoda restore his company's tarnished image? Of course not. But it was a solid start to what will be a long and difficult process.

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