The Toyota Recall: A Public-Relations Disaster?

If you Google Toyota, among the first things that pop up is an ad slugged "Toyota Recall News." That's accompanied by links to Toyota.com and a Web site about the new Prius. With just a few more clicks, you'll find hundreds of news reports that the car company's faulty accelerators have been linked to 19 deaths. There are also embarrassing, and somewhat tasteless, online gags like "How to Keep Your Toyota Floor Mat From Killing You." Managing a public-relations disaster isn't what it used to be. Back in 1982, even as people in Chicago were dying of cyanide poisoning from tampered Tylenol bottles, the drugmaker's parent company, Johnson & Johnson, didn't have to worry about Internet message boards inciting panic or fueling rumors and fear-mongering. The strategy of corporate crisis management hasn't necessarily changed, but in the Google, Twitter, and Facebook era, the execution has. To learn about the new rules of crisis management, NEWSWEEK's Matthew Philips spoke with Gene Grabowski, chair of crisis and litigation practice at Levick Strategic Communications, the same firm that represented pet-food makers and toy manufacturers during 2007 recalls. Excerpts:

Philips: How's Toyota doing?
Grabowski: Badly; so badly, in fact, that I think you'd have to say this has been the worst-handled auto recall in history in terms of the consumer anxiety that persists and the mixed messages that were being sent at the outset. They've started to catch up, especially with Jim Lentz [Toyota's president of U.S. sales] going on the Today Show. But he should've done that a week earlier.

So they've been late to respond?
Definitely. What they did this week, they should've done last. They now look flat-footed. The result has been a slow drip of bad news, which is one of the key things you always talk about avoiding in crisis management. You want to rip off that Band-Aid all at once so you don't have this Chinese water torture that creates this heightening effect.

And now that Toyota has admitted it knew about flaws in the braking system of the Prius, the water torture continues.
"There does seem to be a continual dripping. But Toyota seems to be holding the course and communicating with much more transparency with its dealers and consumers. they're finally getting consistent messages from their dealers that's being managed from headquarters. That's a good start."

What about search optimization. How can they control what pops up on the Internet?
"They need to own words and phrases like Toyota sucks and Toyota fails. There's a lot of negative and pejorative stuff out there and they seem to be doing a decent job of directing things to their website and controlling the flow of information.

Wouldn't it have been better for the Prius news to have come out a week ago?
"Of course, but I'm going to give Toyota the benefit of the doubt. They're a massive global company that has to deal with cultural and language differences, where messages and efforts have to be synchronized across lots of different platforms. They got off to a very bad start, but I think they're on the right path now. Of course, I may be a contrarian voice here."

They've obviously been combating this online with the Google ad. How much more difficult does the Internet make crisis management?
It's a crucial front, and you have got to be there. With technology evolving the way it is, it does present a challenge, but it's also a tremendous opportunity to join the conversation and engage customers and clients. It would be prudent for Jim Lentz not just to do the Today Show, which is certainly an example of old media, but to get on some of the high-authority auto blogs. This is an age of transparency, and you have to join it.

Was crisis management easier pre-Internet?
Was it easier to manage communications back in 1982 during the Tylenol recall? Yes. But this is Toyota's Tylenol moment, and actions are still what count the most.

What about social media? Should Jim Lentz be tweeting?
I don't think Twitter is the right venue for someone of his stature, but Toyota should be using social media to address this, without question. There are no doubt tons of Toyota Facebook pages and groups already out there. Toyota needs to be posting to them, joining them, and they should probably start an official recall page on Facebook, where engineers could be posting about the solutions they're coming up with. Again, they should be embracing these avenues as ways to get their message out, not running from them.

Globalization hasn't made things easier either, with suppliers based all over the world. How do you manage that when crisis strikes?
The first thing is to acknowledge that it can strike, that no matter how vigilant you are, you no longer have total control over your supply chain, and that from time to time things will go wrong. The absolute worst thing is to say they'll never happen. Consumers can accept that you aren't perfect. What they will not accept is that you're not being transparent, because that then feeds thoughts of willful deception and cover-ups.

So when it comes to a globalized supply chain, when something goes wrong, what do you do?
Well, if it's a supplier problem, then you have to be prudent and find other suppliers. Now, the thing about China is that one supplier can go out of business and another pop up in another province that ends up being the same people. It's a tough situation and requires a lot of diligence.

In 2007, there were two Chinese-based recalls that you helped manage, tainted pet food and toys made with lead paint. You represented pet-food makers and toy manufacturers. How did you advise them to manage those crises?
In the pet-food recall, we knew the two most credible sources of information for pet owners were other pet owners and veterinarians. So we got vets to go on pet blogs and post information that 98 percent of pet food was safe, which mitigated consumer anxiety. The key with the toy recall was getting to retailers and the mommy blogs and providing them with a protocol that answered people's specific questions about which toys were affected. So that undercut a lot of the gossip and rumors.