Leadership is influencing others to think and/or act a certain way, directed at a specific goal or outcome. It is the fuel which powers the manager, supervisor and team leader roles. Without effective leadership, these roles fall flat. The performance of employees and team members is unpredictable, with so many variables driving it that their accomplishments are sporadic at best.As I watched the hearings and read the Press Telegram, April 12, 2010 “ AP probe reveals in Toyota cases, evasion became tactic” regarding the sudden acceleration issue with several models of Toyota vehicles I would have to say it is scary to say the least.
Testimony included stories from victims of the problem – in one case, an entire family was killed. With such disastrous consequences and huge liabilities and ruining of a once great brand know for quality, it provides a platform to look at how companies, and leaders, address ethics, leadership issues and crisis. When faced with crisis, leaders need to make important decisions quickly. That involves surveying their direct teams, and in many cases several levels below to get answers. It’s not apparent if CEO Toyoda did this given the criticism they received for their slow reaction time to consumer complaints.
Once a leader is engaged in addressing a critical issue, what should they do to make sure they respond adequately? Here are a few ways leaders can cope with rapidly changing circumstances: 1. Focus on a few key elements and build a plan. Often emotional tensions are so high that seepage of minor issues explodes upward as the most important issues. A leader has to determine critical touch points that - addressed properly - cascade down to fix other issues.
It’s not the lowest hanging fruit argument, but a strategic view of the top 3-5 issues that need immediate attention. For a business this is usually shareholder and customer communication of what’s happening, operational analysis of essential work processes, and key legal considerations/regulatory interests. Toyota executives were late to the game in some of these areas. This could have reduced the level of exposure and amount of crisis to handle (e.g. notifying people of other models that had the problem, etc).2. Communicate constantly. Crisis management requires immediate updates as new information is available.
To facilitate this exchange, networks need to be created that can share pertinent details to different parts of the organization and to external interests. Sometimes creating internal e-information or discussion boards helps with this process and ensures that appropriate business units are talking to each other. In the hearings, CEO Toyoda said he was not aware of key meetings addressing the complaints.3. Roll through setbacks. Often the first ideas aren’t the best – they are solutions meant to get certain actions in place. They require modification on-the-fly as the situation unfolds. These initial actions may prove to be failures or they do not capture the full scope of the problem resulting in negative backlash.
Toyota thought the problem was solved with adjusting floor mats, then sticky brake pads, and now the problem appears to be in the software. While consumers were not pleased with these initial measures, Toyota has continued to diagnose the problem and issue offer different solutions. Leaders often make the mistake that after pouring so much effort into initial solutions, they have to adhere to them no matter what. Toyota did this with the floor mat issue for a long time - blaming driver error if this solution was not the fix. A confident leader will accept imperfection in initial approaches and make sure the team is ready to change quickly and respond with new approaches.
The leader has to stay calm and focused when this happens to avoid worsening the crisis. 4. Recognize what is working. The bright spot at the end of the tunnel can be elusive in the early going of crisis management. Everyone is in a quagmire with moving forward so it becomes difficult to notice how solutions are taking root and reducing issues. Leaders who have created the right communication channels will be able to flag good results and use those results to strengthen ongoing efforts. This facilitates morale and shows progress against the crisis mitigation plan. Toyota made the right move to halt new car production in January which saved more potential accelerator problems from going to market.
5. Maintain a good pace. Leaders need to be mindful of the pressures coming from all directions to solve problems quickly and “perfectly.” If a strong plan is in place, backed up by the right communication channels, and a focused team, resolution activities will eventually balance out. This has nothing to do with perception or reputation damage control – that can take much longer as Toyota is sure to experience. Pacing decisions around good solutions and re-working as needed provides a sense of ethics and crisis management. Reacting to everything all the time is chaotic and doesn’t endear a leader as professional and deserving of the higher position.
Leadership must maintain honesty to their team and key stakeholders at all times. They must be ready to calm nerves for weeks or months depending on the issue and never waver from a methodological and reasoned response to crisis situations. Only time will tell if Toyota is pacing their crisis management properly and what that will mean in order for them to regain global consumer confidence. In my opinion, perhaps the leadership of Toyota can implement organizational change by utilizing one of the OD theories, specifically Lewin’s basic change model of unfreezing, changing, and refreezing.
This model could be used as a theoretical foundation upon which change theory with their organization could be built soundly. The key, of course, would be to see that human change, whether at the executive, individual or group level would be a profound emotional dynamic process that involved painful unlearning without loss of ego identity and difficult relearning as the company cognitively attempts to restructure its thoughts, perceptions, feelings, and attitudes.