Part I and II of this series of articles dealt with the evolution and functioning of the online media which many, including probably Mr. Ratan Tata, fail to grasp.  Part III, this section of the article, deals with the ‘promise of ethical business’ that ‘Brand Tata’ probably also meant, and salvaging that ‘Brand Tata’ now following the 2009-10 vehicle-recall example of  Toyota, another iconic brand that stands for safety and quality. Toyota looks to have succeeded by placing its promise before its profits.  Part IV highlights the challenges for Mr. Tata as the two compared cases differ where it hurts most, and as it seems that Tata Code of Conduct (Point 13) has been violated.

It is all about denial to acceptance to action.  

Toyota happens to be an iconic company. Similarly the Tata Group has earned an iconic image of doing business professionally and ethically in India, and now the group has expanded significantly beyond India’s borders, under Ratan Tata’s leadership. Tata Group also happens to be India’s largest group, when measured in terms of market-capitalization.

Toyota globally revolutionized Production and Operation Processes with its legendary Toyota Production System (TPS). It earned the respect of the world by creating new benchmarks and sustaining it. So did the Tata Group across India and around the world, in an implicit way, for ethics. Both have a long history of being good corporate citizens or groups, and have emerged as stronger than ever before with every new challenge they faced during their evolution.

One may legitimately raise questions in comparing Toyota recalls of 2009-10 (that involved theories from sticking floor mats, to accelerator pedals getting stuck, to anti-lock brake software problems) with an ‘apparently insignificant’ Niira Radia tape leak for the Tata Group, involving its Group Chairman, Mr. Ratan Tata.

Back in those days of Toyota recall, one would recall reading many articles in global media that reported the problems and the (in)actions taken by Toyota (or (in)actions to test reports from Government regulators). There were even reports of brake failure or heating, but the tests did not confirm the 1st version of the stories made by many of those drivers.

Many of us do not have any expertise in that area of technical recalls involving complex technologies (the author here included), nor that people who had it was of much help to them as none offered a convincing clarity. A researcher surely could have got insightful findings merely by focusing on what the readers thought about safety of Toyota vehicles, as those comments or tweets came up on a real time basis against those news articles/opinions, and whether Toyota had broken or even overlooked any of its tacit and/or implicit promise/s of safety that its products brought to millions of customers world-wide.

So the hundreds of comments those articles, covering Toyota recall of 2009-10 generated, included pure journalistic articles to opinions blaming it on Toyota (or its late response and delaying strategy because many stated that problems were ignored in its early days) to blaming it on drivers (supported by statistics to show number of Toyota vehicles facing accident was no different from others, if I remember right) to even blaming competitors for the propaganda. There were blogs that looked credible (or may still be credible) that criticized Toyota as it overtaxed many of its employees in terms of physical hours in job.

Effectively, media report of that time on Toyota proves that people to expert agencies were not sure about the root cause or causes of the problem. Most of those articles gave an impression that Toyota neither was sure about the root cause/s of the unintended acceleration problem. So many (this author included) did not know what Toyota intended to do by recalling the vehicles that would eliminate the root causes.

Essentially the similarities of the Toyota recall to the insignificant Radia-controversy lies here, in its ‘fuzziness’. In the early days, the problem looked to be irrelevant to something unidentifiable (for Toyota in identifying where the problem is, to defining ethics for Tata and its possible violation in Radia-case). Safety in automobiles is THE most important issue, whereas for any reputed group – including for the Tata Group, ethics must come before business profit or share of spectrums received.

The other similarity lies in the name. Mr. Toyoda stressed on the point:  

‘As you well know, I am the grandson of the founder, and all the Toyota vehicles bear my name. For me, when the cars are damaged, it is as though I am as well.’

This may well be true for Mr. Ratan Tata.  It may well be the last time as well when all Tata Group actions are scrutinized by that implicit understanding of ‘Tata’ ethics that its founders had, to be protected and strengthened by the subsequent CEOs  having the same family name.

We may not have the next group chairman for Tata having a Tata family name. Mr. Tata must not miss this opportunity.

Toyota had been on the denial mode of the problem (genuine or perceived or somewhere in between as partly genuine but exaggerated many times more) for a long time, if some section of media was to be believed. But once they accepted that there seems to be a problem without knowing what exactly the problem was, they moved quickly to unprecedented action mode – by even suspending sales, not considering the costs of the recall when the recall was ordered, and many more in the face of customer safety issues.

And then came the testimony to the U.S. Congress on February 24 this year (where Mr. Toyoda admitted that he didn’t personally know exactly when Toyota had found out about the problem; and he hadn’t learnt about them personally until late 2009) which also probably took the sheen of ‘denial’ mode of attack against Toyota to some extent. Many in the U.S. opined that Mr. Toyoda’s testimony probably was not rightly received by many in the U.S. (or even within the U.S. Congress) due to the deep cultural gaps between Japan and the U.S.

However all these actions and an honest testimony from Mr. Toyoda soon turned the readers’ opinions from neutral or negative to more positives, against those articles on Toyota in various news media or Web 2.0 platforms. And then Toyota delivered too. It could be a good research project to look at twitter records pertaining to Toyota recall for that period to justify what I perceived by reading a fraction of the media.

Part IV and the concluding part of the article examines actions that Tata Group should take internally, as it seems that its fabled Code of Conduct seems to be violated.

Before moving to academics, the author worked with a company, enlisted as a Tata Group Company, in its Senior Management Team.

I invite you to visit my blog, Wondering Man (or take a look at my book, Wondering Man, Money & Go(l)d that rightly predicted the housing-led economic crisis of 2008, rise of gold prices to the currency war being played now). You are also invited to join me on Twitter.

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