Toyota's gestures vs. actions dilemna

The dereliction surrounding Toyota's dire handling of the crisis has since stirred it from slumber and the sops being thrown our way, such as the latest advertising campaigns' claims, may calm our ire for now.

The dereliction surrounding Toyota's dire handling of the crisis has since stirred it from slumber and the sops being thrown our way, such as the latest advertising campaigns' claims, may calm our ire for now. Especially relevant if you consider studies that have shown that companies who handled a catastrophe well have recovered and even exceeded pre-catastrophe stock price.

Trait 5: Gestures V. Actions

A brand's integrity is compromised through fear. Toyota's inviolable reputation is besmirched and the gap between the two determinates of Toyota's brand equity: affinity and performance will grow. Toyota's trauma has focused car buyers' minds in a salutary way - it costs 5 times more to win a new customer than retain an existing customer.

Consequently, Toyota will spend the coming months fighting hard to rescue its market leadership and its reputation, whilst balancing contention with compromise on major issues affecting the company's future performance. Ask Jeffrey Skilling and he would tell you that Enron's corporate values were perfect also.

Toyota might still be an industry leader, as far as raising its earnings outlook for 2009 are concerned, but that was before the ($2 billion) recall and the public backlash that belabors the brand.

The disconsolate nature of Toyota's initial crisis response has shown that it is less a Gibraltar-like castle than a stool resting on three legs.

Perhaps behind Toyota's recalcitrance are three heroes who are the core of Japan's culture? Legend has it the three were presented with a bird that did not sing; Nobunga said “kill it,” Hideyoshi said “make it sing” and Leyasu said, “wait.” In deference to this legend lies the conundrum for Toyota as it attempts to purloin the crisis. Therefore, it should remember an ancient Samurai saying, “difficulty is here, I give thanks.”

Dean Crutchfield is chief engagement officer at Method.

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