Listening to the playback of Volkswagen North America President and CEO Michael Horn’s testimony before the House Energy & Commerce Subcommittee on Oversight and Investigations yesterday I was struck by a singular thought: A star is born. In three hours of testimony on Capitol Hill, Horn has reset the standard for expressing contrition and coming clean before Congressional representatives.
http://tinyurl.com/qh8e4oc - Horn’s opening statement.
http://tinyurl.com/pyrn63k - Testimony
As an American citizen and product of the Watergate era I bring a lot of baggage to my listening process. Americans are accustomed to such expressions as plausible deniability, pleading the fifth and, of course, “I did not have sex with that woman.” Given his 25-year career at Volkswagen there is no doubt that Horn is himself familiar with these expressions and dodges. But he clearly did not come to the hearing with such prepared evasions.
I strongly recommend even a partial listening to Horn’s testimony. It is worth bearing in mind that he agreed to provide his testimony within about a month of the corporate parent of VW admitting it had deceived emissions inspections.
As an American I am also conditioned to hearing German-accented English in the context of a spectrum of negative connotations ranging from Sergeant “I know NUTHing!” Schultz on Hogan’s Heroes, WWII interrogations of GIs, or, of course, Nuremberg. One could argue the deck was stacked against Horn with him having the added visual disadvantage of the Congressional representatives asking their questions from the physical and moral high ground of the hearing room.
Make no mistake, moral along with legal and financial implications for consumers, dealers and the company were all laid before Herr Horn who testified under oath after providing an opening statement.
What did Horn do?
- Answered every single question. There was not a single evasion, deferment or delay - including questions as to when Horn himself learned of the deception.
- Answered honestly – ie. “I struggle as well…” to understand how such a thing could have happened without the knowledge of senior management.
- Acknowledged its responsibility to dealers, consumers and its employees. (He was not shy about identifying dealer profitability as his top priority, in part reflecting his corporate background in quality and aftersales. The Congressional leaders clearly did not know what to make of this very honest expression of his corporate obligations.)
- Detailed comprehensive details regarding how many engines were implicated, the details of required hardware and software remedies and the potential outcomes as to the ability to meet emissions while preserving performance and fuel efficiency promises – as much as possible, including timing.
- Shared details of the company’s plans to compensate dealers and customers, but acknowledged that VW does not intend to buy back its cars.
- Detailed the scope of the potential emissions impact (actually quite small in context) without minimizing it.
- Kept his cool.
Most notable in Horn’s testimony was his complete grasp of all technical details, in spite of not being an engineer and his complete breakdown and reference to specific internal communications and meetings with timing and his actions. There were no delays in his responses during the three plus hours of testimony and no hand-in-front-of-the-microphone reference to consult an attorney or refer to documents.
Finally, it was clear from his testimony that as much as everyone else touched by the crisis, Horn himself was shocked, disappointed, embarrassed and outraged. But, importantly, he did not disown his fiduciary responsibility or personal connection with the company – pointing out on multiple occasions his 25-year history at VW.
Among many telling responses I choose but one that sums it up for me:
Q: What will be done to restore faith in the overall corporate structure of Volkswagen?
A: With the compliance investigations we have to streamline our processes and we have to bloody learn and use this opportunity in order to get (our) act together. Six hundred thousand people worldwide have to be managed in a different way. This is clear.
Cheers, President Horn. Your corporate parent has handed you a royal mess. You appear to be just the executive to begin the process of restoring Volkswagen’s reputation and business.
The only question remaining is whether you, personally, can stomach the gut-wrenching process for which you will be personally held responsible regardless of your arms-length connection with Wolfsburg. But your performance before Congress is worthy of recognition for its candor and completeness. Cooperating with investigators while managing the blow-back of such a humiliating crisis is a high-wire act you could never have anticipated being asked to perform 25 years ago.
If restoring VW to past glory seemed like a big job when you were appointed, the new task before you is restoring consumer trust in both VW and the industry at the very moment in time that vehicle emissions are being blamed for everything from global warming to the decline of the nuclear family. It appears that you recognize the need to be forthright and take a highly visible stance. Welcome to your new role. So far, so good, but the journey has just begun.