1) There has to be transparency, not only from CEOs, but throughout the organization. Toyota knew in October that there was a problem but nothing was done; the issue was covered up until 4 weeks after the fatal accident caused by an electronic glitch which accelerated a car of control. The transparency problem sounds familiar. Lack of transparency caused our financial system to crumble and our housing marking to flounder; it’s primarily a question of trust and openness. The lesson here: come clean early, and put the best brains to work on finding solutions.
2) There is strength in a competitive environment. Luckily we live in a capitalistic, democratic society, where we pride ourselves on our freedom of choice. Consumers have alternatives. Other auto companies have been quick to woo Toyota’s unhappy customers, by offering them cash incentives for trading cars. I saw an ad on TV by local GM dealer who was offering a loaner to all Toyota drivers while their cars were being recalled. Competition is healthy. Toyota will now have to work overtime to maintain its market share.
3) In today’s world no Brand is bullet proof; even the “Tiger” brand fell apart in less than a week. Toyota’s recall is so big that the logistics involved will actually provide a small boost to the economy. The lesson: stay vigilant and protect your brand by doing the right thing in every situation, with each customer, and every time a problem arises.
It will take a while for things to get back to normal for Toyota. Jack Welch, former CEO of General Electric, twittered that the outcome would define car manufacturing for the next decade. I’m inclined to agree.