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Toyota, what took you so long?
By Lauren | February 12, 2010
Toyota Motor Corporation, former superstar of the automotive industry, is struggling to recover from a major hit to its reputation. The company has been dogged in recent months with a series of quality control problems: allegedly faulty floor mats, reportedly sticky gas pedals, and allegations that the braking systems on recently-issued Prius hybrids were flawed. Faced with a plummeting stock price, a damaged image and Congressional inquiries, Toyota made the only decision it reasonably could: it apologized.
Unfortunately, Toyota took far too long to get there. Though the gas pedal recalls began on January 21st, Toyota’s president and chief operating officer for U.S. sales, Jim Lentz, didn’t apologize to U.S. consumers until almost two weeks thereafter. A few days later, Toyota President Akio Toyoda, grandson of the company’s founder, issued a separate apology of sorts, but admitted that the company “was still deciding what to do” about the Prius’ braking problems. Small wonder that the Japanese media blasted Toyoda’s comments as belated and ineffective.
Japanese companies are supposed to be especially skilled at making apologies, but Toyota seems to lack the knack. The automaker has (finally) issued three separate recalls and launched a multi-million dollar advertising campaign with a nicely-phrased apology that expresses regret without saying anything that would hurt it too much in court. It’s good that Toyota finally bit the bullet and apologized, but it would have been better if the company had acted more swiftly. We’re talking about consumer safety issues, after all. If it took Toyota this long to admit that it’s sorry to have put its customers at risk, potential automobile buyers may well decide that Toyota really doesn’t care about their well-being. That will make Detroit very happy, but it won’t do much for future Toyota sales.
Topics: Apologies, Business Ethics, business communications, customer relations, ethics |
February 12th, 2010 at 10:30 am
Lauren,
Toyota’s handling of this whole affair has been absolutely appalling.
Perhaps one reason for their tardiness in this regard is the Japanese concept of ‘losing face.’ In Japanese society, so I have read, there is not so much shame in actually doing the wrong thing in the first place, but there is a great degree of shame in getting caught, since it is only in the being caught where one actually loses face. Perhaps this may be one reason why Toyota has been so slow to acknowledge its problems (if this makes any sense at all).
Whatever the reason, there is no excuse, and the loss of reputation which the company has suffered particularly in America but also worldwide has been more than deserved.
I wonder how the reputations of the other Japanese car makers and the Korean car makers will fare in all of this. Will drivers start to suspect that all of them are hiding something like Toyota?
February 12th, 2010 at 9:26 pm
Unfortunately, many business organizations often believe that they can cut costs by avoiding some of their responsibilities - this approach is short-sighted in nature and unprofessional. They prefer to deny the existence of a problem rather than admit their fault, solve the problem and move on.
What we need in this world is “ethical leadership, assuming it’s not an oxymoron.
We need leaders who lead by example rather than those who believe that one set of rules applies to employees and others, and that another (convenient) set of rules applies to the! Some thoughts on ethics:
Ethics is concerned with “doing the right thing” but…
Moral standards differ between individuals depending upon their upbringing, traditions, religion, social and economic situations, and so on. Hence, the existence of grey areas. Therefore, state the “moral” problem in a simple manner and review feedback so that an acceptable decision can be made with minimal overall harm/loss—i.e., we are concerned with “Pareto optimality,” which is related to the net balance of bene?ts over harm for society as a whole.
Economic theory is concerned with the ef?cient utilization of resources to satisfy consumer wants and to maximize pro?t and satisfaction. Pareto optimality exists at the point where it is impossible to make any given individual better off without harming another given individual. Although most businessmen believe that pro?ts and cash ?ow are very important, there has been a move toward the recognition of social responsibility.
The blind pursuit of pro?t has resulted in bribes, environmental problems, injured workers, unsafe products, closed plants, and so on—this is unethical. Many business schools emphasize the philosophical, rather than the practical aspect of ethics. We need a practical approach to the solution of ethical problems.
Ethical leadership calls for morals, fairness, caring, sharing, no false promises or unreasonable demands on others, etc. Is “ethical leadership” an oxymoron?
I believe that “ethics” should be a part of all management courses. Yes, there are grey areas depending on different perspectives, but there are also areas of “black” and “white”. There is more to ethics than drafting and implementing codes of ethics for others to observe. Leaders should lead by example and refrain from adopting an approach which conflicts with ethical interests. Therefore, leaders should respect and care for all stakeholders, rather than only stockholders e.g. show that you care for your employees, customers, suppliers, the community, etc.
Making false promises and unreasonable demands on employees and others, preventing participative management, talking about the “green” approach as a public relations exercise, rather than adopting a “green” approach, is unacceptable. Ethics is conscience-based, knowledge-based and attitude-based, and not suited to some individuals, who, by their very nature, have consistently demonstrated selfishness and greed.
Can any ethics training program prevent Bernie Madoff, Vincent Lacroix, Conrad Black, etc. from being themselves ?
No, but a well-designed & implemented program can
(a) help good people to do the right thing consistently
(b) make it more difficult for wrong-doers to succeed &
(c) raise people’s ethical IQS*.
Business ethics is concerned with dealing with dilemmas that sometimes do not have a clear indication as to what is right or wrong e.g. potential conflicts of interest, wrongful use of resources, mismanagement of contracts, false promises and exaggerated demands on resources which include personnel.
Right and wrong are black and white - pure and simple. Our ethical system and behaviour are a function of several factors, including our cultural background, upbringing, education, ego, environment, circumstances and the related stress. Hence, the development of gray areas i.e. areas where explicit rulings or guidance is not available Looked at in another way, there are shades of black and shades of white, just like when you go to a paint shop to buy black paint or white paint or when you go to a clothing store to buy a black suit or a white suit. If you find that your ethical standards are higher than those of most people, you should follow your own standards.
It is possible to improve, from an ethical point of view.
As we mature into adulthood, we develop an ego and try to use our communication skills to justify our behaviour, while focusing on our own goals. With our ego-based approach, our innate selfishness, and the influences of friend and environment come many gray areas. One’s image will depend on one’s operation within the black, white and/or gray areas. This should always be borne in mind.
Alas, many business schools provide courses in business ethics which which are philosophical, rather than practical, in approach. This needs to be rectified in the light of experience in the real world. Research confirms that the focus on ethics deters people from straying, although it is difficult to alter the basic nature of some people e.g. Bernie Madoff and Vincent Lacroix.
Constant communication and open discussions on ethics foster a bond between individuals who are keen on being ethical and help promote teamwork built on good spirit. Emotionally intelligent people are often more ethical than others.
* confirmed by Research from the Assocn. of Certified Fraud Examiners, the Ethics Resource Center, and other firms.
I have a policy of distributing free abridged versions of my books on leadership, ethics, teamwork, motivation, women, bullying and sexual harassment, trade unions, business law, etc., to anyone who sends a request to crespin79@hotmail.com.
Maxwell Pinto, Business Author
http://www.strategicbookpublishing.com/Management-TidbitsForTheNewMillenium.html