Handling a crisis

The bad publicity a Japanese car company got regarding some supposedly wayward units of its SUV model is a classic case of how not to handle a crisis situation. Stonewalling or even a simple denial only makes things worse.

The case is also a good example why companies who value their reputation should always monitor social media. This problem was first aired in a post on Facebook.

It started with the story of an elderly driver who claimed he and his wife almost died in their relatively new SUV. Researchers started googling and found out this was not the first such case with that SUV in the Philippines.

The story was assigned to a reporter who interviewed the original complainant. As is required by the ethics rules in the ABS-CBN newsroom, the car company was asked to react. But the company declined to say anything.

Once the story was aired, it took on a life of its own. More people started complaining that they too were victims. The task of verifying each claim started. Again, the company’s side was sought, and again it declined to say anything beyond a brief statement that their SUV is safe.

Then some folks in the motoring press, notably a motoring website started claiming driver error to the point of effectively calling the victims stupid drivers. Demonizing the victims by blaming them for their unfortunate accident is hardly the way to go.

I know the ABS-CBN news editors continually sought to get the car company’s comments and were promised a news conference and a demonstration that were repeatedly cancelled. When the demonstration finally happened, the experts were in-house.

DTI finally took notice and had a hearing. It became clear we do not have independent experts to tell us what is really going on. DTI Usec. Vic Dimagiba advised potential buyers of that SUV to wait for more conclusive findings before buying.

There are so many things that could go wrong with today’s cars whose basic systems are computer driven. All of us who work with desktop, laptop, smart phones and such other devices know how computers can malfunction.

The computer is a fact of everyday life… so are computer bugs. We want to believe that car manufacturers will not knowingly sell a car with a defective computer program that could be life threatening. But sometimes a surge of electrical current could cause problems with the computer program. It’s no one’s fault. It just happens.

That is why it was wrong to simply, but categorically deny any problem. What if the car company unknowingly sold a car with a problem? And claiming driver error when there are 90 plus complaints about the same thing seems too much to take.

While DTI acted swiftly, it did not have the needed experts. That is really our problem when consumer protection cases come up. In the US, they are able to muster the services of experts from the academe or from other government agencies. Here, we are expected to take the word of manufacturers and their experts as gospel truth.

That Japanese car company should have learned from the case of Toyota which also had a very serious problem with this so called unintended acceleration of Lexus and Toyota models. A very notable case involved a former California Highway Patrol officer and his Filipina wife and family who all died in a fiery accident in San Diego, California.

The US National Highway Traffic Safety Administration (NHTSA) launched a study at the request of Congress, enlisting NASA engineers with expertise in computer controlled electronic systems, electromagnetic interference and software integrity. NASA was tasked to find out whether electronic systems or electromagnetic interference played a role in incidents of unintended acceleration.

In the end, the NHTSA was able to issue an authoritative report that “NASA found no evidence that a malfunction in electronics caused large unintended accelerations.” The transport safety agency reported “NASA engineers found no electronic flaws in Toyota vehicles capable of producing the large throttle openings required to create dangerous high-speed unintended acceleration incidents.”

Further, the safety agency also said, the two mechanical safety defects it earlier identified, “sticking” accelerator pedals and a design flaw that enabled accelerator pedals to become trapped by floor mats – remain the only known causes for these kinds of unsafe unintended acceleration incidents.

More important is that moving forward, NHTSA has come up with possible new directives to more adequately assure safety of driver and passengers. These seem relevant to us too and should probably be also required here.

For instance, they want to require brake override systems in all passenger vehicles to further ensure that braking can take precedence over the accelerator pedal in emergency situations.

The safety agency also wants to require the installation of event data recorders (EDR) in all passenger vehicles. Indeed, cars should have that black box all airliners have so we know exactly what went on before an accident. Maybe Congress can pass the necessary legislation to mandate this if the DTI can’t or won’t do it.

According to the agency, based on objective EDR readings and crash investigations conducted as part of NHTSA’s report, they can determine whether better placement and design of accelerator and brake pedals can reduce pedal misapplication which occurs in vehicles across the industry.

The safety agency also wants broad research on the reliability and security of electronic control systems. In this regard the National Academy of Sciences was tasked to examine unintended acceleration and electronic vehicle controls across the entire automotive industry.

In 2009 and 2010, the sticky pedal and pedal entrapment problem made Toyota recall nearly eight million vehicles. Toyota also paid $48.8 million in civil penalties as the result of NHTSA investigations into delayed safety recalls. Other manufacturers subsequently initiated recalls on their own.

That is exactly what we want to see happen here… show government can work with industry to protect consumers.

This is probably not going to be the last case involving a car manufacturer or any manufacturer for that matter, and a consumer. Companies must know how to respond properly. Suggesting the complainant may be working to sabotage the launch of a new model is very counterproductive.

In my many years of handling a variety of crisis situations, the first order of business is to attend to the consumer. If there are injuries, make sure proper medical attention is given quickly. Make the consumer feel that his or her safety is most important for the company. Pinching pennies will result in big losses in brand reputation.

If there is no in-house crisis communication expert, hire one immediately at the time the problem surfaces and not when the company’s reputation is neck deep in shit. Cleaning up is messy.

Don’t let the lawyers determine courses of action. I am fortunate that in the crisis situations I have handled, the CEOs concerned took my view and asked the lawyers to stand back.

The problem with lawyers in crisis situations is that they will be so defensive to the point of antagonizing the victims. The ill will from this leaves the company’s reputation in tatters.

Make sure no one in the company or its supporters seem to be ganging up on the complainants. I was ignoring this story until I felt the victims were not being treated right.

I live by what my late publisher Max Soliven once told me, that our job is to comfort the afflicted and afflict the comfortable. When the ordinary man is getting the shorter end of the stick courtesy of big business or big government, it is the duty of any real journalist to weigh in and even the odds by ferreting out the truth.

It is cases like this that separates the real journalists from the publicists pretending to be journalists. I am happy to note that the guys in the abs-cbn newsroom are doing their job as they should. The only bias they can be accused of, specially in this case, is helping otherwise helpless victims who were not being taken seriously by a big corporation.

I am proud to be identified with this bunch of young and idealistic journalists in the abs-cbn newsroom. I am also proud of a management that did not interfere and disregarded potential lost advertising revenue. A network with less commitment to truth might withhold this story to gain advertising revenue from the car company.

Japanese car companies produce great cars, but have a poor sense of responding to crisis. Maybe their problem is cultural, but that is not a valid defense. Glitches could happen that’s no one’s fault, but must be properly addressed quickly to protect corporate and brand reputation. In the end, the value of a human life trumps all other considerations. Boo Chanco’s e-mail address is bchanco@gmail.com. Follow him on Twitter @boochanco.