What Volkswagen’s Diesel-gate Scandal Says about Trust and Crisis Communications

What Volkswagen’s Diesel-gate Scandal Says about Trust and Crisis Communications

October 27, 2015Trust Matters

Author: Mark Gregory

Last month, The Reuters news agency reported that Volkswagen, Europe’s biggest automaker admitted using illegal software to manipulate emissions tests on its diesel vehicles. The fraud involves over 11 million cars world-wide and has, according to Reuters, “sparked the biggest business crisis in its history.”

PR experts are quick to point out crisis communications maxims when things go bad; quickly take accountability, apologize, and be open and transparent with consumers and the media. Good advice to be sure. But, here are four added insights worth considering when a crisis causes a scramble to regain trust and rebuild reputation.

1. Communicate from the inside out. Internal stakeholders are the bedrock of every company’s success. All crisis communications must begin by ensuring these audiences, in Volkswagen’s case, employees, suppliers and dealers are continuously ‘in the loop’. And, that in the recovery phase, the communications are two-way.

In Diesel-gate, even Volkswagen dealers are in the dark; leaving frustrated and angry customers struggling to find answers. It is no wonder class actions are appearing as fast as dandelions in springtime.

2. Remember to build trust, feelings matter more than facts. Be authentic. Find and use a genuine ‘voice’. Empathy, and the right tone and the right words matter.

Crisis communications that sound like a clichés of remorse and resolve strain credibility and spur cynicism. When the message sounds like it was drafted by a roomful of lawyers and the PR department, it is time for a re-write. Say it straight, with understanding and compassion. This is when to use your corporate values as your compass and demonstrate them in your approach.

While well-meaning, Volkswagen’s messaging on their Canadian website sounds as if it was written by engineers with a tin heart. A button marked “Information regarding a 2.0 TDI EPA Notice” is the only hint something is gravely amiss. Similarly, the letter to customers, from the President and CEO of Volkswagen Group Canada, rings hollow and flat.

3. Share your customers’ pain and pay a proportional price. The Volkswagen brand is battling a potentially fatal cancer. In a crisis, leaders must act boldly to show employees, managers and executives that there is zero tolerance for illegal behavior that betrays both customers and company values.

Volkswagen has inflicted a world of uncertainty and probably financial loss on millions of car owners. Sure, former Volkswagen CEO Martin Winterkorn, took the fall shortly after the cheating scandal became public. But, it is inconceivable that the scheme to cheat on such a massive global scale did not involve a legion of managers and executives. Michael Horn, VW’s U.S. chief executive assertion to US law-makers recently that a handful of rogue software engineers were to blame is simply not believable.

4. Say it and show it. Good actions will build trust faster and better that words alone.
To regain trust and reputation, put aside the advice of lawyers and accountants. Reputations are not restored on the back of a balance sheet. Take action that aligns with mutual company and customer interests and lead with moral courage.

Just for a moment, imagine that next week, Volkswagen launched a buy-back program that offered owners of affected diesel cars a very fair price for their vehicle on the purchase of a new 2016 Volkswagen.

Doing good, is good for business.

-Mark Gregory