Monthly Archives: May 2011

Disaster Control for Two Prominent Reputations

Posted on by
Reply

This has not been a good week for a couple of very prominent names – Lance Armstrong and Disney.  I’ve written many times about Disney, and my experience working there, but never about Lance Armstrong.  This week they both went over the cliff due to their own actions, and how those actions hit the press.

The biggest news was the 60 Minutes TV interview of one of Lance’s long-term cycle team members.  This was a real showstopper with insights coming from a real insider who claimed to be privy to, and a participant with Lance in illegal training habits and foreign sources used to bolster their performance.  There have been many accustations in the past, and convictions of others for doing the same thing in both cycling, and other sports where winning was everything.  For a 7-time winner of the Tour de France race, the only person to accomplish that incredible feat, Lance was sports royalty and he parlayed that into commercial success and a huge non-profit Livestrong.  He is also a commecial success in his home town of Austin, TX where he is a ‘sports god.’

The article “Livestrong’s Challenge: Surviving Lance Armstrong” talks about his chances of beating the rap, and the impact of his fall from grace and the impact on the Livestrong foundation which has raised over $400 million in support of cancer victims.  Lance could be facing civil and criminal charges, but the impact could also hurt the foundation.  The jury is out there for now.

Disney ran afoul of many where it tried to trademark the name ‘Seal Team Six’ after the Special Ops team that handled the raid in Pakistan.  At first this looked like a good idea, and it appeared that Disney was first to apply for the trademark.  Never wanting to waste a good licensing target Disney hyped the idea and some of the things that could have carried the brand.  Almost instantly a howl came up that this was unseemly…and poof, the idea went away with Disney dropping the application.  Concurrently, it was shown that the Navy had also applied for the trademark, and may have actually beaten Disney to the door of the legal offices.

What’s the fall out from these two instances of reputation mismanagement?  Disney will recover quickly – no harm no foul.  They were lucky this didn’t go further when the real hew and cry went up for their scalps for being way to commercial.  Lance may not fare so well.  As a sports hero he may find his name being mentioned along with Barry Bonds, and Reggie Bush as a sports cheat, and some medals may have to be given back.  In Texas, Lance is a hero and will always be a hero as a hometown boy.    However, I don’t think I would go jogging with the Governor, Rick Perry, when he carries his trusty pistol with the laser scope.  Lance could find himself in the Gov’s sights if there is any hint it could hurt Rick’s reputation.

I’ll follow-up on both of these cases in a month to see what the longer-term impact of these revelations will be.  The lesson for all…in today’s world – it all comes out, eventually.

 

‘The Toyota Way’ Was Full of Cultural Blind Spots

Posted on by
1

Over the years my wife and I have been married we have owned 18 cars.  Nine were of German manufacture, 8 were of Japanese manufacture and one – just one was a Ford.  It is clear that we have preferred cars not manufactured in the U.S.  This use to be a point of pride, but I doubt it will continue forever.  Last week we had to drive to Arizona for family business in our Toytota Highlander – a true delight of comfort and power, though a little on the gas thirsty side for my liking with today’s gas prices.  This is my first Toyota and I have enjoyed it, but have been a little concerned due to the Toyota quality issues over the last couple of years.

In the Los Angeles Times an article “Toyota Safety:  Toyota’s culture has Blind Spots, Safety Panel Finds” I found some answers that I have also found with many businesses I have consulted with, work for, and called upon.  The problem is denial.  For Toyota it was assuming that their continuous improvement culture would always find these kinds of quality issues, and the safety issues as well.  When challenged they could not believe it could have been their fault – which it was.

At least that is what the independent review of Toyota Motor Corp. found.  In a 60-page report, reviewers found that Toyota has problems differentiating safety from quality and their culture and pride built over many years blinded them from seeing and acting on the issues that lead to their massive recalls and law suits.   The panel, headed by Rodney Slater, a former U.S. Transportation Secretary concluded that …”Toyota is a good company that has been a great company and has the potential to be a great company again.”

Problems can happen for all businesses, but the real issue is can they see them, and will they react if they do.  Toyota failed in this area – as do many businesses, both great and small.  This is what really distinguishes the great from the also rans, but even the great have a hard time staying that way.  This is getting to be more the case in our fast evolving business environment.

Toyota had a very centralized and siloed culture.  Many of their many departments, including all of the functions in the U.S., did not talk to each other, but only to a more centralized clearing house in Japan.   This was noted as one of the more debilitating parts of their culture.  Now the report is helping them to reform their famed corporate philosophy called “the Toyota Way,’ which dictated a policy of continuous improvement.  However, safety was not a component of their focus, it was assumed that it was already built in, something they found not to be accurate.

What’s the lesson for my clients and for you?  Culture rules! A great culture with the right values, and the right focus is a great differentiating factor.  But maintaining that culture takes work, not just lip service.  Change is now inevitable and ongoing. Successful organizations will control the culture.  Listening to the customer is paramount.  The conversations will help to drive the change.  In Toyota’s case, when the customers spoke, they blamed the customer.  A great company needs to refined “the Toyota Way” to include a little listening if they want to get their greatness back.

I believe that Toyota will find their way back, but I’m still taking my Highlander in for a service next week.  Let’s just say it was time for a ‘culture check’ – and a major service while I’m there.

 

 

 

 

Disney & Apple – May the ‘Magic’ Live On

Posted on by
Reply

I was lucky enough to have had the fun of working my way through college at Disneyland.  A long time ago, but the memories are still fresh.  Fresh enough to have endured my recent IRS audit, the first in 25 years, by talking with my auditor who had been a contemporary of mine working there at the same time.  The IRS and ‘magic’ don’t often go together, but the time passed with a number of mutual stories of Disney lore and the names of many shared contacts…and a small check at the end for a mistake on my return that meant I owed a wee bit more

In my first year at DLand I had the good fortune to see Walt Disney ride around the park in his small carriage, usually with a niece or nephew riding with him.  His vision had created something special, and some of that died with him later that year.  For a number of years, both as an undergrad and grad student, DLand funded my studies, and my first business experiences.  After returning from a few years in the Army I noticed the real change.  As DLand grew, and Walt Disney World became a reality, the company was guided by “WWWD” , What Would Walt Do!  The company had leaders, but everyone still looked to Walt’s vision in making key decisions.

After some time, the WWWD stopped working, and the drift was very noticeable until Michael Eisner came in.  His impact was immediate and very noticeable.  WWWD was soon abolished and Eisner set the direction for the company for the next several years.  Disney is still a magical place and a magical company, especially to its many ‘guests’.

In 1980 I bought my first computer, an Apple.  For many years I was a total Apple guy.  I found in Apple the same kinds of ‘magic’ that I had found earlier at Disney.  In Steve Jobs, the perfectionist with a vision, guided Apple’s early years, just as Walt had done in days at Disney.  This really comes out in the new Fortune article “Inside Apple.”  In the review article “Apple Employees Tell the Secrets Behind Jobs “Magic” I found the similarities between the two men to be extraordinary.

Both men had a vision that was distinct and unique, and one that was more counter intuitive than most of their peers.  They saw things others did not, and were willing to risk it all to make those visions real.  Disney is still a top brand, but today Apple is the most admired brand in the world.  To reach those lofty pinnacles it takes some luck, and more than a little “magic.

From the Fortune article it is apparent the working for Jobs is not easy, but it is good to see that they diligently work on investing and learning for their key staff with the Apple University, a very costly undertaking, that is preparing for the next generation of top leaders.  Steve, though still young, has had his major health issues.  I hope that Apple doesn’t need to create their own version of “WWSD” to guide them if he were to exit in the near future.  The training and transition to the next group of leaders at Apple is now moving smoothly…and that should ensure that the “magic” will continue for Apple and for us in this changing digital world.