George Dearsley, of Avante, has a 20 year track record providing media training for businesses such as Shell, Kodak, KPMG, Bupa and HBoS.

So he has been fascinated, when once again, brilliant marketers and business people continue to cause incalculable damage to their organisations when a crisis hits.  George compares how BAE Systems got it right and Toyota are still getting it wrong, and it need not be that way:

BAE Systems called me about a year ago and asked me to present to its main board on how the company was perceived by the media.

I was both flattered and intrigued. Why me?  I am not a defence specialist, but looking back maybe that’s exactly why I was invited.

I talked to a dozen national media friends beforehand: the first words spoken were “bribes, corruption, brown envelopes.”   There was little or nothing about full order books, cutting edge technology or good employee relations.

In a recent BBC commissioned poll of viewers voting on “What Makes Lancashire Great?” BAE Systems had come 140^th.

Slide two told them that in the same poll black pudding was 1st and the late Fred Dibnah was….26^th.  After the wry smiles we moved inevitably to bribery.  It clearly hurt.

But I told them (as I’m sure a PR person would) that the issue would not go away until there was a significant resolution to the whole affair.

I was reminded of that meeting when I saw a wonderful television performance last week by BAE Chairman Dick Olver.  The company, he announced, had agreed to pay fines of £286m in a deal with US and UK authorities to settle criminal investigations into its actions in Saudi Arabia and Tanzania.  He said in the interview the move would allow the company to “put a really hard line separating the past from the future.”

His key messages were all in place and delivered with great gravity and credibility.  It was a majestic performance.

Compare Mr. Olver’s effort with the shambolic PR exercised by Toyota in handling what began as a minor software glitch involving the braking system in one model.

The opening shot was a Japanese executive who faced television cameras wearing a surgical mask, quite commonly worn during Japan’s cold season.  This soon became a metaphor for a company that wasn’t being totally open with its customers.  The brand loyalty, which took years and millions of yen to build, was beginning to melt away.

The safety defects were initially portrayed as an American problem.  But this was not true and the dithering led to new questions about Toyota’s famous quality control.

In Europe and the US there were crucial delays between Toyota’s confirming a planned recall millions of cars and communicating this to the public.

Journalists, keen to keep the tale hot, were delighted when customers called in with complaints about other Toyota models. The dreaded “bandwagon effect” was about to take effect.

Throughout, Akio Toyoda, the company’s president, was invisible.  After weeks of silence he finally faced the media and was thoroughly unconvincing.

He forgot the golden rules:

• Act quickly and decisively
• Apologise
• Thank customers for their patience
• Explain what’s being done to put the problems right
• Carry out the remediation as soon as possible, whatever the cost

Toyota is now one of the stories of the day – day after day.  The cars have become the butt of pub jokes and programmes such as Mock The Week are getting great mileage out of the situation.  Toyota is now the Skoda of 2010.

The initial $2 billion recall and the loss of 17% of share value is likely to prove small change when the final bill is totted up.

In Japan there is a proverb: “If it stinks, put a lid on it.”

Sadly, it is the very opposite of good crisis news management strategy.

Tags: BAE Systems, Crisis PR, Toyota

This entry was posted on Thursday, February 11th, 2010 at 11:18 pm and is filed under Crisis PR, PR, Poor practise. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.