Sunday, March 2, 2014

Why Do Leaders Lie?

This week it was learned that General Motors had known about a faulty ignition switch problem for at least a decade. Yet, their leaders did not sound an alarm to consumers. In a written statement issued by GM, the company acknowledges that 13 deaths and 31 crashes are linked to an ignition switch problem in certain car models in which the ignition switch inadvertently moves to the "off" position and turns off the engine. In those instances, many electrical components in the affected vehicles wouldn't work including airbags, which wouldn't deploy in crashes.

This is a serious problem that has not only resulted in the unnecessary and tragic deaths of 13 people, but it calls into question the integrity of GM’s leadership. Why did they withhold this information from consumers and dealers? If the leadership at GM did not tell us the truth, they lied. It’s that simple. There’s no shades of gray when it comes to life and death issues. Sure, they can settle lawsuits and buy the silence of grieving families. But, the fact is leaders lied. It’s that simple.

When human lives are at stake and the leadership of a company knows they have a faulty problem with their product, leaders have a sacred responsibility to come forward and warn consumers. When leaders do not come forward and issue a warning to unsuspecting consumers, it is a criminal act and they should be charged, convicted and punished harshly to send a message that society will not tolerate liars whose silence or misleading statements cause deaths.

It has become all too convenient for leaders to lie. Recently, consumers were sickened by contaminated Foster Farms chicken. Their leaders did not come forward and accept responsibility until they were pressured by consumer organizations and retailers. Why? What were Foster Farms leaders afraid of?

Toyota’s leadership denied any responsibility related to its faulty accelerator problems in 2009.  Its chairman was shamed before the United States Congress and Toyota suffered major losses because of its credibility gap and deceptive practices. Ironically, despite jury convictions holding Toyota responsible for the sticky accelerator problems, the U.S. Department of Transportation issued a report stating most of the crashes were the fault of drivers who stepped on the accelerator instead of the brake. What rubbish! Tell that to the widow of the California Highway Patrol officer and his passengers who died in a fiery crash caused by the faulty Lexus accelerator. Is anyone with a brain suggesting a CHP officer doesn’t know how to tell the difference between the accelerator and the brake?  So, this is the nonsense companies and government agencies are feeding us; and, they expect us to believe them!  No wonder consumers have lost faith and trust in government and corporations.

It seems the system is full of liars who will do anything and say anything to cover their rear. But why? What’s wrong with coming clean and telling people the truth? No one is suggesting that a company needs to admit guilt. That’s why we have courts. But, certainly, when the data suggests you have a problem with a product, you need to alert your consumers. It’s the only way you will maintain their trust and earn their respect. But, corporate leaders have been taught by their shareholders and lawyers to be silent, say nothing, don’t admit to anything that could negatively impact our quarterly earnings. This is the low level to which corporate leadership has sunk. Had it been the daughter of GM’s president who was killed because her ignition switch clicked off, I wonder how fast GM’s engineers would have identified and solved the problem?

Now, GM has serious credibility problems with consumers. Let me put it in terms the bean-counters and leaders at GM can relate to. The bottom line question that GM should be worried about it this: “What parent would ever buy their teenager a GM product knowing its leadership withheld data that contributed to the death of 13 people?” The answer is no one!


Unknown said...

Very good article. Being held responsible for safety, financial and ethical decisions is something that is gone from the American business model. It saddens me to think that I am required to complete Ethics education courses for my company every year, when I know the people making the BIG decisions are exempt from such a menial task.

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