MIT Sloan Management Review

illustrating their recommendations using cases of both successful and unsuccessful recovery from brand crises. The authors draw heavily on Toyota’s recent experience in responding to the unintended acceleration of some of its vehicles. Toyota’s responses provide examples both of what to do, and what not to do, when a company is accused of wrongdoing.

The authors contend that there is no one best communications path to follow when a company is in crisis. Rather, they say, the best approach will depend on the answers to three central questions: Is the accusation prompting the crisis true? Is the crisis severe? Has the company established its brand as something that customers closely identify with? Taking these factors into account, a company might best be served by some combination of seven communications strategies. These strategies range from admitting error and apologizing on the one extreme to defiantly denying any wrongdoing and even attacking the accuser on the other.

In addition to describing these seven communications strategies, the authors lay out four lessons on corporate crisis communications that emerge from the Toyota debacle. First, in the Internet age, speed of response is imperative. Second (and a corollary to the need for speed), companies need to be ready for a crisis at all times, and have at hand a step-by-step protocol to follow when bad things happen. Third, it is essential that in a time of crisis, the CEO him- or herself — not lower level management — needs to step forward and publicly articulate the company’s responses. And fourth, companies must not delude themselves that they can skate by while ignoring a crisis. Response is essential.

Reprint 51415. To order reprints of this article, see page 10.

The Four-Point Supply Chain Checklist: How Sustainability
Creates New Opportunity

Edgar Blanco (Massachusetts Institute of Technology), interviewed by Michael S. Hopkins pp. 65-69

Because they interact with so many sections of a company, and even with a company’s external partners, supply chain managers are uniquely positioned to consider — and benefit from — sustainability initiatives. Unfortunately, they rarely do so, according to Edgar Blanco of the MIT Center for Transportation & Logistics.

But Blanco says that that’s changing. Increasingly, supply chain operators are capitalizing on four key areas of opportunity that Blanco describes in this interview: 1) packaging redesign, which can reduce both environmental impact and the costs of shipping and waste; 2) transportation system revision, which can reduce carbon footprints as well as costs; 3) collaboration with suppliers on innovations that yield multiparty benefits; and 4) alignment with changing consumer expectations about sustainability-related product and service supply.

To gain the benefits that sustainability thinking can extract from supply chains, companies will need first to dramatically improve the information they capture and the ways they measure it. Then they’ll need to understand the system effects of their activities, both within their own organizations and among stakeholders throughout their value chains. Early movers, says Blanco, have already achieved considerable competitive advantage.

Reprint 51401. To order reprints of this article, see page 10.

Is Decision-Based Evidence Making Necessarily Bad?

Peter M. Tingling (Octothorpe Software) and Michael J. Brydon (Simon Fraser University) pp. 71-76

In recent years, much has been written about evidence-based — or fact-based — decision making. The core idea is that decisions supported by hard facts and sound analysis are likely to be better than decisions made on the basis of instinct, folklore or informal anecdotal evidence. And many organizations have invested heavily in data processing infrastructure and analytical tools based on the assumption that better evidence-based decisions will follow naturally from these investments.