Until this morning, Volkswagen might have been one of the most trusted names in the auto industry for sustainability. That was then. Back before we all discovered that they’ve been rigging their emissions tests and lying to pretty much, well, everyone on the planet. Before VW stock crashed after plummeting 20% or more.
As the biggest auto-maker in the world, employing more than three-quarters of a million people, the fallout could be catastrophic.
What does this mean in everyday terms? That VW programmed some engines to turn on emissions control only during tests. The rest of the time, you know, out on the road where it really matters… those same cars would run emissions 40x higher.
Michael Horn, president of VW America has admitted they violated the company’s mission “by manipulating software to make its diesel cars appear cleaner than they are,” and that VW has “totally screwed up”. (CNN) To the tune of about 11,000,000 vehicles around the world. CNN also reports that VW has allocated $7.3 BILLION dollars to handle the costs of recalls in an “effort to win back the trust” of people who thought they were doing the planet a favor by buying “sustainable” VW cars. That doesn’t even begin to count the $18 BILLION in possible fines from the USA alone.
Really Mr. Horn? That’s the best you can manage?
“Oopsies. Our bad. We screwed up. We’ll drop a few billion bucks on positive propaganda until the world forgets this happened…”
VW is facing the very real possibility that no one will ever trust their marketing again — because, once you’ve lied about something this big, what else are you lying about too? But this colossal scandal isn’t just about them. It has the potential to cast suspicion on not only every other sustainable auto company (Mercedes and BMW stock both lost points since the scandal broke), but also on companies stating a mission of sustainability across other industries.
Which leads both consumers and corporations the world over to ask piercing and pointed questions such as:
– When can you EVER know for sure that a company’s mission isn’t just words on paper?
– How do you measure transparency from your favorite brands?
– Even more challenging, how do you offer transparency in ways that are undeniably believable by your consumers?
So, dear VW, here are three things you could have done at pretty much any point along the way, to avoid flaming out while the world looks on:
- Design better.
At some point, someone discovered the emissions issue, and someone decided that the simplest way to fix it would be to write software code to rig the engines during tests. Instead, VW should have gone to the root of the problem and designed a lower emissions engine. Fix the cause, rather than patching the symptom.
- Be honest.
Own your problem to your buyers. In case that feels like rocket science, this is what honesty looks like: “Good morning, VW world. We’ve discovered that Jettas, Beetles, and Golfs could be improved in their emissions efficiency, and we want you to know that we’re working on it. We’ll keep you posted as soon as we have a solution that is true to our brand and makes you still proud to buy from us!” That should have happened, oh… about 11 million cars ago. Like, about five minutes after first realizing there was an emissions problem.
- Blow the whistle on yourself.
Maybe the problem got away from you?
Maybe it was covered up by middle management?
Maybe you discovered it way, way too late and the short-term fix seemed like a smart idea when you were suffocating under the crushing reality of your mistake? Totally understandable. But waiting until a third party outs your dishonesty to the world? Rookie mistake, especially for the American market. American culture may extend near-unlimited grace to those who out themselves and show intention to change, but we can hold a near-permanent boycott grudge against those caught cheating. Blame it on the old Wild West.
In essence, the lesson for every business owner in the world right now is this: short-term thinking can destroy your brand, possibly permanently. If self-destruction is your endgame, go right ahead and operate on a mindset of short-term profit. If you prefer survival, you gotta live with one face, operate on one set of values, and embrace one single identity that drives everything you do.
Without that, sooner or later you’re going to end up just like Volkswagen.