Opportunities brought by crises

An issue ignored is a crisis ensured, Henry Kissinger rightly put it. When Toyota was faced with a crisis in 2009 which forced them to recall over 8million cars, they did many things to respond to it. Its spokespeople filled the media with messages of reassurance, its PR people blogged and tweeted non-stop to fill the information vacuum; its website was full of details about the recall and its call centre was working flat out to deal with customer enquiries.

Nevertheless, this still proved a losing game as the company still incurred more than US$ 30 billion loss, faced multiple lawsuits and a 11% drop in share prices, among others. Toyota’s hard-won reputation faced and perhaps is still facing the biggest challenge in its corporate history. Catastrophic.

And just like many companies and organisations, Toyota’s main problem lied primarily in what happened before the crisis erupted, rather than its response to it. Thus, central to Toyota's problem was its perceived delay in identifying and addressing the situation in the first place. As Jonathan Hemus of The Guardian rightly reported, corporate denial appeared to have been the order of the day, with the company following the advice of the Japanese proverb: "If it stinks, put a lid on it." What a mistake.

Toyota could have done better to avoid the recall

Most effective crisis management takes place before the problem escalates out of control during the "incubation" phase. Unfortunately, Toyota, like many companies, missed the first crucial first step: understanding that perceived risk is potentially as damaging and costly as actual risk. They ignored the problem until they were forced to take action.

Toyota should have known better that some of the biggest potential crises have been identified and addressed before they ever escalated out of control. And this is crisis management at its best.

This action, however, requires an organisational culture that is vigilant for potential crises; an organisation that puts communications on every agenda; has open lines of communication from staff to management and all stakeholders; and has a willingness to address unpleasant truths.

Toyota’s issue should certainly serve as an example to many companies, especially with the advent of New and Social Media today when the world is freer, and everyone has free opinions and information and everyone is an expert and a publisher.

Granted, managing a crisis is more complex. But companies ought to realise that today there is more knowledge, there’s zero tolerance to risk and inevitable greater demands for transparency.

Crises certainly bring with them dangers and opportunities. But by often thinking the unthinkable and preparing and rehearsing a contingency plan, crises bring PR practitioners opportunities to demonstrate their value and hence raise the profile of organisations and companies.

The following slide and video  is perhaps helpful to PR practitioners facing crisis and are still in the dark oh how best to deal with them.

Crisis Management

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