Friday, February 19, 2010

Lessons from Tiger & Toyota: When defending corporate reputation and brand, speed is critical to success

Businesses and brands build trust with every action they take and or don’t take. This is especially true when they are beneath the microscope of public scrutiny.

Two events have come together this week that give us reason to reconsider conventional methods of public response to reputational crises – the long-awaited apology by golfer Tiger Woods and the begrudging agreement of Toyota Motor’s President Akio Toyoda to come to the U.S. to testify before Congress.

About 90 days ago, the carefully crafted public image of the world’s greatest golfer began to unravel and spiral downward when revelations of marital infidelity began to surface and were confirmed.

We saw thousands of photos of his wife, children, homes, fellow golfers, countless women claiming to have been involved with him, but we never saw or heard from Tiger himself in a timely manner. The world was clamoring to hear directly from him, a trusted and deeply admired world-class athlete. Because we didn’t hear from him immediately, the story kept getting bigger, wilder and with others jumping in to fill in (fabricate) the missing information in the continuing story. All of this resulted in huge public disappointment in their sports hero and the subsequent loss of major sponsorships. More importantly, his reputation lay in tatters.

As it relates to Toyota CEO, Akio Toyoda, until the recent disclosures of deaths caused by accelerating gas pedals and numerous recalls, Toyota was viewed as the global automotive leader whose cars were reliable, dependable and trusted. And yet, in the unfolding global news story, we have learned that months and months went by before Toyota took action. Their lack of urgency in getting the facts or grasping the severity of the situation resulted in fatalities and a reputational fall from grace. Their silence resulted in an epic public relations disaster…one for the case history books. Was the silence worth it? At last count, Toyota’s has a $3B loss on their balance sheets.

Yes, building or maintaining trust is about transparency. However, in today’s 24/7 world, speed of disclosure is as important, if not more important, as transparency. Embattled leaders and companies must not underestimate the power of moving quickly to communicate and have their voice heard. If you don’t start to tell your story, others will speculate and fill in the blanks.
So what should leaders do if an unfortunate event happens to erode your trust bank?

1. Gather the facts quickly and try to buy time by putting a stake in the ground on what you know or don’t know.
2. Tell the media and other stakeholders how long it will take to get the facts, the process and why
3. Admit guilt and give an authentic apology. People are human and we can and do forgive leaders and businesses when sincerity is expressed with a promise of action
4. Talk about impact and repercussions publicly. CBS let David Letterman offer an apology on-air for infidelity with a co-worker. His brand may be bruised, but he is still on- the- air. What does that say to your employees?
5. Reiterate your moral compass and ethical code in an internally as well as externally. Your employees want to know where you stand.

Rebuilding trust is not difficult to do when you do right by your customer, people and shareholders. It takes years to restore reputations. Don’t forget that speed in disclosure and a timely and genuine apology go a long way to help stem the negative impact to your business.

Contact Airlift today about your reputation. We help leaders craft sustainable growth through inspiring stories. or (01) 312.492.7772

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