The 2010 Toyota Crisis Communication Strategy

Definitions of the Key Issues

In 2009, Toyota faced a recall crisis that was associated with several issues that demonstrated the weaknesses of the company’s crisis communication strategy. Therefore, my task is to provide the definitions of the key observed issues to present effective recommendations to address these issues in the most specific manner. The following list represents the key issues discussed in the context of the recall crisis and directly connected with the failure of the company’s crisis communication strategy:

1. The issue of car acceleration as a cause of car accidents in 2009.
2. The issue of the delay in responding to car accidents and explaining the possible causes of the automobile crashes.
3. The focus on the denial crisis communication strategy to respond to the public and customers’ complaints.
4. The focus on concealing the relevant information regarding the faults in the Toyota cars from the stakeholders for several years (since 2000).
   1. The car acceleration issue discovered in 2009 is associated with the fault in the Toyota technological, production, and quality control processes. The problem was in the gas pedal mechanism that did not allow the pedal to function appropriately. The problem was also on the floor mat that prevented the gas pedal from returning to its initial position while causing the unintended acceleration (Gorman, 2010). This issue is directly related to the discussion of the quality of produced cars. The unintended acceleration of Toyota cars observed in 2009 and caused by the problems with the gas pedal functioning resulted in several car accidents, and that fact drew the public attention to the problem (Vartabedian & Bensinger, 2009). The Saylor family died because of the unexpected acceleration in August of 2009. The necessity of the investigation caused Toyota to recall more than 3.75 million cars. In December of 2010, there was a new accident demonstrating the presence of a significant problem with the gas pedal in the Toyota cars (Gorman, 2010; Vartabedian & Bensinger, 2009).
   2. The second issue is the delay in responding to the crisis. Toyota chose not to respond to the public discussions of the car faults immediately when the first customers’ complaints became public with the help of the media. Akio Toyoda responded to the public’s concerns and complaints only in 2010 (Gorman, 2010). I should state that this reaction could be discussed as an example of the absence of an effective crisis communication strategy in the company, as well as the example of the inattention to the particular features of the North American customers and their culture. As a result, the owners’ satisfaction with the Toyota cars decreased significantly along with the customers’ interest in these automobiles. The issue can be defined as the problem related to the company’s open communication with stakeholders that needs to be resolved to improve Toyota’s communication strategy adopted not only in Japan but also worldwide. Also, Toyota ignored the opportunity to explain possible causes of car accidents in the situation when the focus on floor mats became irrelevant because there was evidence to speak about the problems with technologies.
   3. The third issue is the choice of the denial communication strategy to address the problem. In 2009, the company’s leaders denied accepting the fact that the problem was associated with the technological process and that there were faults in the cars’ electronics. Toyota referred to the preliminary results of the investigations in order to state that there were no faults in the cars. However, the case of December of 2010 demonstrated that the problem existed (Gorman, 2010; Vartabedian & Bensinger, 2009). In the situation of Toyota, the denial communication strategy can be defined with references to the attempts to reject the connection between the accidents and possible faults in Toyota cars (Kim, 2015, p. 65). However, the strategy was ineffective to address the case of December of 2010 because the accident was not connected with the problem in floor mats, as the company claimed previously. I should state that this communication strategy led to decreasing the levels of the customers’ trust in Toyota’s products and the overall reliability because the company demonstrated the unwillingness to take the responsibility for the crisis and weaknesses about the automobiles quality and drawbacks in the safety policy. This issue is important to be defined and discussed in detail because the public considered Toyota leaders as ‘arrogant’ as they focused on rejecting even the possibility of discovering faults in the cars despite the initiated recalls in 2009 and 2010.
   4. One more issue is the situation of hiding the information about the previous customers’ complaints made since 2000 and recalls and investigations made in 2004, and then in 2007, to check and repair the cars (Gorman, 2010; Vartabedian & Bensinger, 2009). The issue is important to be discussed because it is also connected with the company’s weaknesses in building the strong cooperation with the governments and investigation organizations worldwide. In their communication strategy followed during a decade, the company’s leaders focused on accentuating their positive features and reputation while hiding the information that could damage their image. The situation of concealing the information important to the public violates the norms of corporate social responsibility and ethics, and it prevents the company from effective collaboration with stakeholders (Piotrowski & Guyette, 2010, p. 89). Therefore, this issue is also the key one that is damaging the company’s reputation and illustrating the problems in the used crisis communication approaches.

Recommendations to Fix the Issues and Improve the Crisis Communication

Having defined the issues faced by Toyota in 2009, I should recommend the approaches and tactics for improving the company’s crisis communication strategy to prevent the development of similar issues in the future and regain the customers’ trust and interest in Toyota automobiles. Therefore, the proposed recommendations are formulated to address the identified issues, and they are based on McKinsey’s Horizon framework (McKinsey and Company, 2009).

Toyota needs to fix the technological and electronic faults in automobiles to prevent the unintended acceleration of cars in the future and improve the quality and safety control processes

This recommendation is formulated to address the main car acceleration issue, and it is associated with improving the quality and safety features of the Toyota cars. I should note that this recommendation is in line with McKinsey’s Horizon One, according to which the first step to enhancing the company’s strategy is based on improving the company’s actual performance (McKinsey and Company, 2009). At this stage, Toyota needs to repair all the recalled cars to demonstrate their readiness to address the customers’ needs. The company also needs to improve the quality control procedures as part of the technological process to guarantee the safety of car owners (Kalb, 2012; Piotrowski & Guyette, 2010). The next step is the implementation of the new effective safety technologies in cars. It is important to note that the company’s weakness was in the attempt to blame the customers for using ineffective strategies while driving instead of focusing on finding and fixing the problem in automobiles immediately.

Toyota needs to choose the mortification strategy as the main crisis communication strategy in the company

The recommendation to adopt the mortification crisis communication strategy is based on the idea that stakeholders usually expect that the company will take the responsibility for producing cars with faults in the most appropriate manner. This recommendation is in line with McKinsey’s Horizon Two, according to which the company needs to focus on using opportunities for improving the current strategy (McKinsey and Company, 2009). While referring to Toyota’s current crisis communication strategy, it is important to note that the company needs to expand the corrective strategy associated with attempts in fixing the acceleration issue and to take full responsibility for the car accidents observed in 2009 and during the previous years (Piotrowski & Guyette, 2010). The next stage after following the corrective action strategy is the mortification strategy that is used when the company’s leaders take full responsibility for the actions, provide the public apologies, and compensate the consequences of the fault for stakeholders (Heller & Darling, 2012). In the case of Toyota, it is important to publish the apologies using the corporate website, newspapers, and other media and to guarantee the full compensation for the victims of the car accidents and their families and for the car owners whose automobiles need repair (Toyota, 2015). Toyota must accept the fact the company is responsible for car accidents, and the proposed recommendation is formulated to address the problem of the customers’ decreased trust.

Toyota needs to focus on corporate social responsibility tactics to improve customers’ satisfaction

The other approach to using the potential and available resources to restore the company’s image and improve crisis communication is the focus on corporate social responsibility (CSR) policies adopted in the company. The CSR tactics and approaches followed by Toyota need to be improved in terms of developing more programs for stakeholders and communities globally (Toyota, 2015). One of the approaches used by Toyota in the context of the denial communication strategy was the reference to the experience, as well as to the success of the company in producing high quality and safe cars (Gorman, 2010; Vartabedian & Bensinger, 2009). To guarantee that such messages can work to regain the customers’ trust, I recommend expanding the CSR activities oriented to responding to the persons’ needs and interests. The reference to effective CSR activities can have more effective results when it is necessary to retain the existing customers and attract new interested individuals.

I should state that by developing the CSR, Toyota could demonstrate what concrete actions the company takes when the leaders say that their primary task is the satisfaction of customers. The focus on the CSR programs is the direct action taken to respond to the customers’ needs, and these actions need to be communicated with the help of the Toyota websites in order to cover the large audience and inform stakeholders on the concrete steps taken in response to the issues or prevent any similar issues in the future (Toyota, 2015). I should also state that Toyota could refer to the weaknesses in the previous use of CSR in order to demonstrate what results the company achieved while developing the new approach to contributing to the stakeholders and communities’ interests (Heller & Darling, 2012, p. 152; Piotrowski & Guyette, 2010; Toyota, 2015). From this perspective, the CSR tactics for Toyota need to include the following ones:

1. The development of community-oriented programs.
2. The development of community-oriented programs for different regions and customers from diverse backgrounds.
3. The regular reporting on community programs.
4. The reporting on the company’s contribution to stakeholders’ needs and interests.
5. The regular reporting on the achievements in the sphere of risk management and prevention.

Toyota needs to expand the channels of communicating with the public and use more media

As an expert in the field of crisis communication, I recommend using multiple communication channels and media to address the stakeholders and react to their concerns. In 2009-2010, Toyota addressed the public concerns directly, with the help of conferences and public speeches of the company’s representatives and CEO Akio Toyoda (Gorman, 2010; Vartabedian & Bensinger, 2009). However, it is important to state that currently, the traditional approaches to communicating the message to the customer are not effective. By McKinsey’s Horizon Two principles, Toyota needs to use the opportunity to utilize all the available media to respond to the stakeholders’ concerns (McKinsey and Company, 2009). The improved crisis communication plan for Toyota should include communication with stakeholders with the help of the messages and reports on the corporate websites, television advertisements, messages in newspapers, and social media like Facebook, YouTube, and Twitter. The content of these messages should be different and appropriate for the medium and the targeted audience that uses this or that channel. From this point, the following media should be used for different purposes:

• Websites. The information posted on corporate websites is oriented to the shareholders, dealers, and car owners. It is expected that the company will post the information on the recent safety inspections and improvements in the quality standards. The public relations (PR) specialists should also post the information on the achievements in the sphere of CSR, for instance, programs developed to support communities and stakeholders. In response to the crisis of 2009-2010, the public relations specialists need to post the information on the company’s successes regarding the development and implementation of the new safety technologies in Toyota automobiles (Heller & Darling, 2012; Piotrowski & Guyette, 2010). The current version of the Global Toyota website includes pages on the achievements of the company in the sphere of CSR and risk management to address the public interests (Figure 1; Toyota, 2015). This information can be expanded and provided in a new attractive and user-friendly form.

• Television. The company should develop communication with the media and inform the news teams of different TV channels when there are important messages on the company’s activities to be shared or when there is a necessity to address the crisis. Additionally, it is important to communicate messages with the help of TV advertisements. As a response to the 2009-2010 crisis, Toyota should propose social TV advertisements in which the leaders apologize for the safety issues in the company and inform about the provided compensation and other taken actions.
• Newspapers. Advertisements and information messages published in the newspapers should include data about the positive changes in the company’s strategy regarding the quality and safety controls. In response to the crisis of 2009-2010, it is necessary to publish messages that provide information about the number of cars repaired after the recalls and about the specifics of the new quality control technologies implemented at Toyota’s plants. Press releases responding to the crises need to be immediate to guarantee that the risks of the customers’ dissatisfaction are prevented (Heller & Darling, 2012).
• Facebook and Twitter. The company should follow the open communication strategy and demonstrate attention to the customers’ interests. Social media are used in order to target the car owners and potential customers who are inclined to share the opinion on the Toyota automobiles and ethical crisis in the social networks. The PR managers need to organize the communities and public pages in the social networks in order to unite the car users and potential customers and share the information for the immediate release among them quickly (Piotrowski & Guyette, 2010). In addition, car owners can share their experiences in using the automobiles and the company representatives can monitor the customers’ feedbacks to identify the gaps in the communication strategy or weaknesses in the marketing strategy. The potential of social networks for sharing the information is significant, as it is demonstrated with references to the Facebook page for Toyota USA that has more than 2,500,000 ‘likes’ (Facebook, 2015; Figure 2).

• YouTube. In response to the crises, PR specialists must prepare the videos in which the company leaders demonstrate their acceptance of the crisis, take the responsibility for the inappropriate actions, and apologize for the unexpected consequences (Heller & Darling, 2012). Stakeholders need to see that the company can express the apology and take the responsibility for actions publicly. The reason is that the Toyota CEO’s apology located on the Associated Press channel was watched by thousands of viewers in 2010 and later (Associated Press, 2010; Figure 3; Toyota, 2015).

Toyota needs to organize the additional quality and safety inspections in cooperation with the national governments and report on the successes regularly

According to McKinsey’s Horizon Three principles, while growing and developing successful strategies, the company needs to focus on the areas where it did not operate previously (McKinsey and Company, 2009). About the Toyota crisis, these areas include the organization of safety and quality control teams in cooperation with the governmental agencies (Toyota, 2015). For the effective restoration of the company’s image, Toyota needs to pay more attention to developing open communication with stakeholders.

This communication can be realized with the help of regular reports that inform the interested persons about the company’s achievements in the sphere of addressing the quality and safety issues. These publicly available reports based on the investigations and inspections that are conducted in cooperation with the national governments and organizations can be discussed as the important aspect of Toyota’s communication with stakeholders to ensure that the company continues focusing on high quality, innovation, and reliability (Kalb, 2012; Piotrowski & Guyette, 2010). These tactics will be effective to predict future technological risks and reduce the level of uncertainty in customers’ opinions regarding the company.

Toyota needs to organize the communication centers in countries where the company operates to respond to the customers’ concerns and uncertainty immediately and in a culturally appropriate manner

The absence of the immediate response to the problem through the North American channels affected the customers in 2009-2010 because they could not overcome the emotional aspect of the problem (Piotrowski & Guyette, 2010). From this perspective, I can advise the organization of the crisis communication centers in the regional offices of Toyota for PR specialists to be ready to address similar issues in the future. Although the company’s regional offices work to represent the company in different contexts, the leaders in these offices have limited rights regarding direct and open communication with stakeholders. As a result, following Horizon Three principles in McKinsey’s framework, it is necessary to propose the opening of communication centers in the regional offices (McKinsey and Company, 2009). PR specialists in these offices need to develop crisis communication strategies with a focus on the cultural features typical of the concrete nation. The reason is that the absence of the culturally appropriate message provided to the North American customers in 2009 contributed to worsening the crisis, as well as to decrease the persons’ trust in the company.

Toyota needs to organize the crisis communication training for public relations specialists working in the context of different cultures

My final recommendation is developed to support the previous one, and it is based on the idea that PR specialists working in different multicultural offices of Toyota need to receive special training in the area of crisis communication to work with diverse stakeholders. The main positive feature or the strength of this recommendation is that the training can combine the general and specific features to share the principles of the general crisis communication strategy developed for Toyota and support them with the tactics and approaches that are effective to work with stakeholders from different cultural backgrounds. In this context, crisis communication training allows decreasing the possibilities for the company’s ineffective reactions to different issues in the future (Heller & Darling, 2012; Piotrowski & Guyette, 2010). The training is important to guarantee that all stakeholders are addressed effectively when they demonstrate any concerns regarding the company’s operations. The discussed stages or recommendations for improving the crisis communication strategy of Toyota can be considered as appropriate to meet the company’s needs and prevent the communication crisis in the future.

References

Associated Press. (2010). Toyota CEO apologizes for recall, accidents [Video file]. Web.

Facebook. (2015). Toyota USA page. Web.

Gorman, S. (2010). Lawsuit claims Toyota ignored safety issues. Reuters. Web.

Heller, V. L., & Darling, J. R. (2012). Anatomy of crisis management: Lessons from the infamous Toyota case. European Business Review, 24(2), 151-168.

Kalb, I. (2012). How Toyota’s crisis management failures added to the billion-dollar settlement. Business Insider. Web.

Kim, Y. (2015). Toward an ethical model of effective crisis communication. Business and Society Review, 120(1), 57-81.

McKinsey and Company. (2009). Enduring ideas: The three horizons of growth. Web.

Piotrowski, C., & Guyette, R. W. (2010). Toyota recall crisis: Public attitudes on leadership and ethics. Organization Development Journal, 28(2), 89-96.

Toyota. (2015). Sustainability: Corporate social responsibility. Web.

Vartabedian, R., & Bensinger, K. (2009). Runaway Toyota cases ignored. The Los Angeles Times. Web.