Toyota Offers Lessons on Effective Recall Management

By Mike Rozembajgier

While Toyota can breathe a short sigh of relief that the National Highway Traffic Safety Administration (NHTSA) recently closed its investigation into sudden acceleration reports, the Japanese automaker certainly is not out of the woods. Since Toyota’s problems began, the company has paid more than $48 million in government fines for failures related to recall management. And the automaker is still dealing with scores of lawsuits filed by Toyota owners since the first recall was announced in September 2009.

As I told The Associated Press, brands aren’t built overnight. But brands can be ruined in an instant as a result of failed crisis management or ineffective recalls. That is why it is so important to have crisis management and recall plans in place ahead of time. Specifically, a recall plan should outline your company’s recall strategy before, during and after a recall so that you can guarantee recall compliance.

Manufacturers facing recall need to work hard to regain the trust of their customer base. But if all affected parties are on the same page and kept informed through every stage of the recall process, it can have a positive impact on the brand and overall consumer trust. As part of your recall plan, you should put in place procedures and process that facilitate transparency and open communication when working with suppliers, vendors, and consumers. If you do not plan ahead, you may fail to communicate effectively and draw more attention and mistrust from regulators, lawmakers and customers.

Toyota’s recalls offer valuable lessons. For starters, putting in place a strong, well-organized recall plan can help a company shorten the period of time during which it is most vulnerable to consumer concern. During a recall, a company faces increased regulatory scrutiny and consumer backlash, but by being well-prepared, it can reduce the length and impact of the recall. As Toyota has learned the hard way, if the recall plan is inadequate or poorly executed, the impact can extend years beyond an initial recall announcement.

Stericycle ExpertRECALL™ is the industry leader in recall logistics and regulatory compliance for consumer product, pharmaceutical, medical device, juvenile product, and food and beverage recalls. ExpertRECALL’s professionals are experts in recall management who can help you streamline the entire product recall process.