Service of You Can Run But You Can’t Hide

March 24th, 2014

Categories: Automobiles, Board of Directors, Business Decisions, Retail

man with blndersCar with blinders on

I am breaking my rule not to mention brand names when addressing negative issues because of the size of the companies involved, the flagrant lack of concern for customer safety and the fact that this approach appears to be increasingly acceptable.

General Motors, Toyota and Target have been in the news not for their product launches and retailing innovations but because they sat on negative information of utmost importance to their customers resulting, in the case of the auto manufacturers, in death.

GM waited years before admitting to problems with ignition switches in potentially 1.6 million Chevy Cobalts. Some 12 people died as a result. I don’t know how many were injured.

Toyota hid information about sticking pedals causing cars to zoom ahead uncontrollably. They also kept mum about floor mats that interfered with acceleration. Both malfunctions caused injuries and deaths.

credit card at retailOn November 27th, two days before Black Friday and almost a month before Christmas, Target learned about the breach of its in-store credit card terminals affecting some 40 million and waited for weeks, until mid December, to own up to the disaster. I wouldn’t again charge a toothpick in this store–which I like–and I don’t carry much cash. A few years ago I was sent a new credit card immediately when TJ Maxx discovered credit card violations. These things happen and will increasingly. The prompt and seamless handling gave me more confidence in that brand.

I can hear the chorus from readers: “GREED made them do it.” But who is advising these businesses? Damage is so much worse when you don’t admit to wrong doing, causing more harm and dragging out the story so increasing numbers of people are adversely affected and more hear about it.

Why do executives, time and again, think that they will be the ones to make these problems go away before anyone notices? If they fear assault on their reputations once a disaster occurs, don’t they realize that by trying to hide they are only growing the circumference of their black eyes? Are immediate profits more important than reputations and conducting business responsibly because people count on the public’s microscopic memory?

dog with black eye

 

6 Responses to “Service of You Can Run But You Can’t Hide”

  1. DManzaluni Said:

    Gee, I like the refreshing way you put things: I hadnt realized that there were only 12 deaths with GM in 1.2 million cars over a 10-12 year period: If you count the number of ignition activations (at, say, a modest 2 a day?) for that many million cars over that long a period, I suppose you can see why no one at GM thought it worthwhile changing the ignition switch!! What are the chances of loss? One in a few hundred million or billion?

    That sounds to me like a reasonably clear case for leaving well enough alone? Especially when the greater danger is that some drivers wouldnt notice that their own carpets were pushing against their own gas pedals!!

  2. Jeanne Byington Said:

    DManzaluni,

    I get it and I can hear the boardroom chatter just as you describe it. But what if the injured person was a loved one of the vice chairman? In calculating financial cost of hiding, we don’t know how many people were too severely injured to work at their trade or ever again; families traumatized by injuries to breadwinners; lives ruined. Law suits for these events might begin to add up.

    In addition, as the shelf life of brand loyalty is about half that of a gnat I would think that these brands would need to pay some attention to their reputations: What parent or grandparent would buy one of these cars for their child/grandchild much less put themselves or the kids into any of their vehicles?

    I don’t get the floormat issue, unless it’s something that happens all of a sudden and when it does, I can envision the panic and repercussions.

  3. lucrezia Said:

    A possible reason behind major cover ups is that many of these corporate types have reached the top by getting away with such activity on the way up. Success often breeds carelessness and failure to watch ones back. Exaggerated views of ones importance and invulnerability follow, then (thank goodness) someone catches on.

    The run of the mill corporate minion simply doesn’t care what happens to others unless he must suffer the consequences he attempts to avoid.

    GM, Toyota and Target are not the only miscreants, as most of us know all too well. It’s merely a matter of many, if not all existing giants waiting to get caught. So I continue enjoying my Toyota, and use my Target card in the optimistic knowledge that these fellows will be walking the straight and narrow for a long time. It’s those still out there that are causes for concern.

  4. Jeanne Byington Said:

    Lucrezia,

    Good point: My mother used to say the safest time to fly was right after a crash. Trouble is, how many faults are hidden in the devices we rely upon, potentially dangerous glitches that we don’t yet know about?

    Interesting how people misplace their sense of values and empathy until they are caught and then, what a hollow sound their apologies make. The anger of those caught by their deceit and list of excuses must be rightly atrocious.

  5. CKG Said:

    I’m illiterate when it comes to mechanical know how, but I do know something about odds. D. Manzaluni makes a very good point. The odds are really long of anyone getting hurt because of problems with ignition switches in Chevy Cobalts.

    I’ll bet that they are far shorter for a hundred other features of the car like rearview mirrors with blind spots. Who is going to pay the bill to fix the Cobalts. The company? No, we, the taxpayers, are in the end. Go figure. GM earns less; the workers are paid less so they both pay less taxes. Everybody else has to make up the difference.

    Speaking of shorter odds, as a pedestrian, who has been hit by a speeding maniac in spandex on a bicycle, I’ll bet that anyone walking the streets of New York is ten times more likely to be hurt by a bicycle than anyone riding in a Cobalt. And now they are talking about having the taxpayers subsidize Citi Bikes, when we’ve already paid for bike lanes and bike parking and more traffic jams and more pollution, not to speak of more bicycle victims?

  6. Jeanne Byington Said:

    CKG,

    Silly me. I’m stuck in a naive time, one in which [I thought] you could trust major brands to have my best interests in mind. Now, when I buy a piece of equipment that could kill me, our friends and family members, I have to hope that I didn’t get the model with the dangerous issues.

    As for a faulty rear view mirror, that’s what the test drive is for: If you can’t see out the back window, select another model.

    Granted bicycle drivers aren’t careful in the city and with milder weather, they will be back in full force. Some drivers are nuts as well, oblivious to what’s going on around them. My advice to pedestrians everywhere: Pay attention. A green light means nothing.

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