GMO Internet Group held a press conference on November 2 after a large-scale unauthorized access incident. It ran more than three hours, an unusual length, with group founder and top executive Masatoshi Kumagai fronting the explanation and the apology himself.
What drew attention was not the account of the breach or the measures for victims. It was Kumagai's phrasing, mocked as "poem," his emotional delivery, and the odd sight of the head of a large corporate group running the session and fielding questions himself.
GMO was itself a victim of a cyberattack. After the conference, criticism and distrust turned on the group. Governance concerns also appeared in its share price.
An apology that became a one-man show
An apology conference works when the company gives victims the facts, the cause, its countermeasures and compensation — a clear view of what comes next — and eases their anxiety enough to move the situation forward. Customers who have lost large sums, or fear losing their assets, need concrete steps and a posture that meets their fear.
That requires explanation from the victim's standpoint alongside the words of apology. At this conference, Kumagai's own broadcast of his views drew more attention than the apology or the practical account.
Kumagai spoke through tears about his management philosophy, including "customers' smiles" and not using the word "profit." Behind him, group executives appeared to do nothing but listen to the representative.
For an IT company, time given to technical explanation of the unauthorized access was limited within the session. What dominated the impression was the representative's feelings. Victims and reporters wanted the full picture of the incident, compensation and concrete steps to prevent a recurrence. Instead, the executive's personal philosophy and emotions took the front.
Words of apology and a conference that functions as an apology are different things. The session was judged a failed apology because its purpose and its content diverged sharply.
Public scolding and a question of maturity
Kumagai also scolded an employee in public during the session, telling the person to button up properly. The moment raised doubts about how mature the organization is.
The conference also revived a darker image of the company, through references to an "hourglass of life" and to smiles.
The organization needs a lever on its top
A charismatic company led by a powerful top executive has a weak point, and this case exposed it. An organization also needs the power to control its top.