Nonprofits and apologies, part II: Apologize like Toyota

In last week’s column on apologies, we talked about how to apologize.

Today we examine for what nonprofits should be apologizing.

Rick Newman’s What GM can learn from Toyota’s humility concludes that the occasions on which a company apologizes conveys company standards quite loudly and effectively to the company’s customers…and to the general public.

Newman contrasts the reactions of GM and Toyota to the losses both have sustained in the recession.

First, Toyota. The auto giant posted an $8.4 billion loss in the fiscal year ending in March, with sales on track to decline another 18% this year. Staggering numbers to be sure, but, as Newman notes, no worse than the industry average in this recession. Further, analysts predict Toyota will continue to gain market share over the next several years, becoming the first foreign automaker ever to sniff the top sales spot in the U.S.

Yet the reaction of Toyota’s CEO Akio Toyoda is telling:

Toyota’s CEO, Akio Toyoda, said at a recent news conference that his company is “grasping for salvation” and is deep in the grip of long-term decline. “Toyota has become too big and distant from its customers,” Toyoda said grimly. Then he apologized for losing money and letting down the motoring public.

Contra GM, notes Newman:

Apologizing for missteps helps explain Toyota’s success—and Detroit’s decline. It’s hard to imagine an American CEO apologizing for much of anything, and GM, Toyota’s biggest rival, has done the opposite for years, hyping even the lamest products. GM famously predicted it would claim U.S. market share of 29 percent sometime in the early 21st century and reach earnings of $10 per share. Instead, its market share has dwindled to about 19 percent, and the company recorded historic losses before declaring bankruptcy. For 20 years, GM has maintained that eight divisions—five more than Toyota—was the right number, until it was on the verge of bankruptcy, when four divisions suddenly seemed like the right number. And, of course, former CEO Rick Wagoner insisted that bankruptcy would be ruinous, instead pleading for an open-ended lifeline from the federal government; four months after declaring bankruptcy, GM seems to be doing OK.

Despite receiving that $51 billion lifeline, notes Newman, GM has never apologized. Instead, emerging from bankruptcy, its new motto is, May the best car win.

It all begs an important question for us nonprofits:

For what do we apologize?

It’s obvious that we should apologize when we fail to remove a deceased spouse’s name off the mailing label.

But what about when we fail to make a genuine difference in the cause?

When I served as President of the Los Angeles Mission, I can recall seeing statistics showing that the number of homeless people in the city of Los Angeles had actually increased during the time the Los Angeles Mission grew from a $120,000 annual budget to a $21 million one.

At the time, I took a GM-like approach to it all, comforting myself by looking at the soaring number of shaves, showers, nights of shelter, and rehab program graduates we were providing.

Now, looking back, I wonder what would have happened if I had taken the approach of Akio Toyoda. Can you imagine the headline in the Los Angeles Times:

Homeless Shelter President Apologizes to Los Angeles Residents
“More homeless people are shaved and showered, but we haven’t made a dent in the homeless problem in the city of Los Angeles”

About Pastor Foley

The Reverend Dr. Eric Foley is CEO and Co-Founder, with his wife Dr. Hyun Sook Foley, of Voice of the Martyrs Korea, supporting the work of persecuted Christians in North Korea and around the world and spreading their discipleship practices worldwide. He is the former International Ambassador for the International Christian Association, the global fellowship of Voice of the Martyrs sister ministries. Pastor Foley is a much sought after speaker, analyst, and project consultant on the North Korean underground church, North Korean defectors, and underground church discipleship. He and Dr. Foley oversee a far-flung staff across Asia that is working to help North Koreans and Christians everywhere grow to fullness in Christ. He earned the Doctor of Management at Case Western Reserve University's Weatherhead School of Management in Cleveland, Ohio.
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2 Responses to Nonprofits and apologies, part II: Apologize like Toyota

  1. Jon says:

    In many ways as nonprofits we have failed to engage the church. I think that a healthy round of apologies between nonprofits and churches is a key part of what it will take to rebuild solid relationships of trust and partnership.

    • EFoley says:

      I agree, Jon–and there’s no time like the present. In this recession everyone’s playing the I-me-mine-don’t fish in my pond-zero sum-Darwinist survival of the fittest game. We can repent before God and churches and nonprofits can repent of their attitudes and past actions toward each other that don’t square with God’s approach.

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