Daimler in distress?

April 8, 2010

Should we be surprised that Daimler are already courting another corporate partner? After all, it’s hard to see how the previous relationship with Chrylser could have ended in a worse fashion.

But the simple fact is that the economies of scale in development & production, as well as the increasingly key group CO2 emissions, are just too big to ignore.

However, shouldn’t Nissan-Renault exercise some caution here? In a fairly astonishing case brought in America, Daimler have agreed to pay $185m in fines in order to settle a corruption case that covers at least the last 11 years.

It seems they were systematically handing over cash in exchange for contracts across 22 different countries – including in one particularly impressive case the gift of two armoured vehicles to one individual official in Turkmenistan. How did he manage to hide them? Surely the least subtle instance of company car park one-upmanship – “Nice 3-Series, Murik.. I parked on top of it.”

Everyone involved is terribly impressed with Daimler’s complicity in the investigation and generally seems at pains to point out how lovely they are. [From the Independent article covering the story]: ‘Prosecutor John Darden added that Daimler had “showed excellent co-operation. The company has undertaken an effort to clean its own house. That reflects a serious change of mind on part of Daimler. This deserves credit.’

In as much as they had any real choice, I suppose this does deserve credit.

But according to Deutsche Welle, Daimler gave out about 41m Euros in bribes between ’98 and ’08 – and in that same period “the deals earned the company 1.4bn Euros in revenue and at least 69bn Euros in allegedly illegal profits.”

So a pretty good deal then, albeit a distinctly shady one if it could be described as a policy decision.

On the other side of the fence, Carlos Ghosn – world-acclaimed saviour of Nissan & Renault and general all-round business good egg – once said: “I think that the best training a top manager can be engaged in is management by example. I want to make sure there is no discrepancy between what we say and what we do. […] Don’t believe what I say. Believe what I do.” (Thanks to Leadershipjot.com for the quote)

Hmmm. Do I detect an impending clash of management philosophy? That’s certainly what happened last time – Peter Schneider says that “The Germans [Daimler] found out Chrysler only planned ahead for four months on many issues, whereas the Germans planned ahead for almost 10 years on virtually everything”.

All in all, I can see the proposed partnership between Nissan-Renault & Daimler failing just as spectacularly as the Chrysler relationship did. It might take a while to do so, and actually I really hope it doesn’t – because I admire Carlos Ghosn and what he has achieved. But it’s hard to see how two such apparently distinct company ethoses (ethi?) can be reconciled, just because both parties need to make seatbelts & steering wheels.

We cannot recall

March 15, 2010

There are two interesting things about Toyota’s epic recall-a-thon:

1: They are not alone in recalling cars on a large scale. So far from alone, in fact, that they should get some badges and a special jacket made, and elect a club secretary.

2: They have handled it really, really badly.

To look at the first point, an instructive 15mins spent reformatting the list of all car recalls ever issued in the US from the NHTSA here shows you very quickly that pretty much every car manufacturer you can think of does this all the time. In 2010 alone, so far 22 different proper car marques have issued recalls in the US – more if you include Ford, Chrysler & GM!

Only joking – actually no I’m not. Anyone would think that the US media canon wasn’t very happy about Toyota taking over GM’s world number one spot… I must have missed the torrent of panic & opinion about the Chrysler 300 saloon’s wheel nuts being recalled, or the instrument display of the Jeep Grand Cherokee [both listed as 2010 recalls above].

Anyway, the point is everyone does this, all the time. Are they as serious as Toyota’s issues potentially are? Not always, but definitely sometimes.

So why is this such big news now?

Along with no doubt a number of other important factors, one reason is my second point; how was this issue fumbled so badly by such a massive company? The presumption here is that massive companies are more prepared & well fortified from a communications perspective. That may sometimes be the case, but often the reality is that it becomes another process, just like ordering new wheel nuts or instrument clusters.

In the case of Toyota, one of the things that happened was that this issue blew up 10 days before a scheduled fortnightly PR meeting – meaning no-one did anything until the process told them to. After all, you don’t want just-in-time automated systems ordering more wheel nuts whenever they fancy. And all those fancy haircuts at the PR agency are just another supplier, aren’t they?

So there was a big gap, which inevitably got filled with the opinions of everyone who could be bothered to give one. When President & CEO Akio Toyoda (yes, relation) did make a statement, he immediately personalised it by being ‘deeply sorry’ about everything – rather than appearing in control of what had caused the situation. And then he drove off in a nice big, safe Audi

Things to learn here:

1) People don’t hang around waiting for you (as the official brand) to tell them what actually happened; they will form conclusions based on the available evidence, and if you’re not there when that happens – tough.

2) Embrace all dialogue. Imagine you’re a Prius owner that gets an email from Toyota, before there is a story at all, saying ‘It’s no big deal, but because we’re so safety-minded and curious, we’d like to check our solution to the problem everyone has – of making cars stop & go – is still the best one in the market. So come and say hello and we’ll give you a free [insert anything of value here]’. It’s the same solution, but doesn’t totally destroy your brand’s core value..

3) Buy an Audi.

Clifford Stoll wrote a an essay in 1995 explaining why the internet will fail. This has been unearthed recently by the ThreeWordChant blog, and discussed on BoingBoing – and most likely elsewhere too, especially in the form of the accompanying contemporary book ‘Silicon Snake Oil’.

Obviously, this kind of stuff is fun and common grist to the tech press mill – it being eminently satisfying to us sat in the future, looking at the internet. But actually, there something more interesting in this as well.

Stoll was an internet professional before most people knew that existed as an option; he caught hackers. In other words, he was pretty close to the technological coalface.

Bearing that in mind, let’s look at what he actually said – along with the developments that have negated his reasons for pessimism at the time:

“Lacking editors, reviewers or critics, the Internet has become a wasteland of unfiltered data. You don’t know what to ignore and what’s worth reading” [search engines – Stoll is writing at pretty much the exact launch of the consumer-facing search tool, starting with Lycos then AltaVista, Ask Jeeves and then Google in 1998]

“You can’t tote that laptop to the beach. Yet Nicholas Negroponte, director of the MIT Media Lab, predicts that we’ll soon buy books and newspapers straight over the Internet. Uh, sure” [fundamentally, the relentless downsizing of components is the key here, but also the development of Amazon from its launch at this exact point in 1995 to becoming America’s biggest online retailer]

“Computers and networks isolate us from one another. A network chat line is a limp substitute for meeting friends over coffee” [everything from Skype & IM to blogging and social networks]

“And who’d prefer cybersex to the real thing?” [about a billion people – as of October 2008, about one quarter of employees visit Internet porn sites during working hours according to Nielsen Online]

“We’re promised instant catalog shopping–just point and click for great deals. We’ll order airline tickets over the network, make restaurant reservations and negotiate sales contracts. Stores will become obsolete. So how come my local mall does more business in an afternoon than the entire Internet handles in a month? Even if there were a trustworthy way to send money over the Internet–which there isn’t–the network is missing a most essential ingredient of capitalism: salespeople. ” [this covers pretty much the whole internet, but certainly PayPal, Lastminute.com, eBay, Toptable.com.. all the obvious e-tail candidates]

Now imagine that instead of a negative article, decrying the lack of these things, instead Stoll had written a positive one – listing the necessary waypoints the internet would need to accomplish on its journey to omnipotence.
He would rightly be considered the father of internet commerce, and there would be statues of him in every town. OK, maybe not every town – but certainly Cambridge, Massachusetts. Perhaps in Second Life too.
My point is – he actually understood very well the physical specification of a successful internet. He listed precisely what would need to happen in order for it to embed completely into peoples lives.
As Jonathan MacDonald says, assumptive certainty is more dangerous than unpredictability.
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