Crisis Management at Toyota
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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.
The case study is about crisis management at the Japan-based
Toyota Motors Corporation, one of the largest automakers in the world. In
January 2010, Toyota was forced to recall millions of cars after problems with
braking, floor mats and acceleration pedals in its vehicles. The recalls even
led Toyota to halt sales and production of eight of its most popular models. Due
to growing number of recalls, sales plummeted thereby affecting the company's
position in the global automotive industry. Analysts began to question Toyota's
legendary quality and felt that the recalls represented a major failure on part
of the company. After the recalls, Toyota went into crisis management mode and
announced a fix for the accelerator problem.
The case describes the various crisis management initiatives
undertaken by the company to regain the trust of customers and restore its image
as a quality automaker.
As part of its crisis management process, Toyota placed ads in print and television media, involved executives and used social media platforms to address its customers. However, some analysts felt that the crisis communication team of Toyota was weak which led to a delay in identifying and addressing the situation. The case concludes by discussing what the company planned to do in the future to contain the impact of the crisis. Crisis management experts were of the view that the image of Toyota would depend on how quickly it can fix the problems and how well it communicates with its customers.
» Understand the importance of crisis management and various issues and challenges related to it.
» Analyze whether Toyota's response to the crisis was adequate.
» Explore the PR and crisis management strategies that Toyota should adopt to contain the impact of the crisis and retain its brand reputation.
Crisis management, Public relations, Brand reputation, Brand image, Toyota recalls, Quality issues, Crisis communication, Brand equity, PR disaster, Cultural issues, Corporate governance, Risk management, Corporate Reputation, Consumer expectations, Global automotive industry, Toyota
Failure in Crisis Management?
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