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Tylenol Crisis of 1982

In: Business and Management

Submitted By hhyde2017
Words 1084
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Tylenol crisis of 1982
John Doe
Business Society
September 30, 2015
Tylenol crisis of 1982
John Doe
Business Society
September 30, 2015

Abstract
In this paper I talked about the Johnson and Johnson Tylenol case of 1832. I explained the case and defended Johnson and Johnson’s ethical decision. I learned that this case paved the way for companies to start recalling their products if there is something wrong with them.

Tylenol crisis of 1982
Johnson and Johnson’s Tylenol product had become one of the most successful over the counter product in the United States. Then mysterious deaths all around the US were being linked to Tylenol. Johnson and Johnson was faced with the ethical decision whether or not they should have a recall on their product or not. Many companies have been put in the ethical decision of right and wrong before. Johnson and Johnson decided that the best decision they could make was to recall their product from the market. Even though this decision may have set Johnson and Johnson back in the short term, eventually they were able to come back even stronger in the long term.
Johnson and Johnson’s Tylenol was cashing in 19 percent of its profits. Tylenol was becoming one of the most successful products ever. The fall of 1982 comes around and there are reports of deaths that doctors are relating to Tylenol. Many Tylenol bottles were reported tampered with. Somebody had replaced the pills in a Tylenol bottle with cyanide-laced capsules. These pills were killing people. These deaths put the pressure on Johnson and Johnson to fix what had happened. It might not have been the companies fault directly, but it was their responsibility to try and change something.
James Burke, chairmen of Johnson and Johnson, got a team together to try and solve what was going on. Burkes guidance for his team was to first ask, “How do we protect the people.” Then he asked “How do we save this protect.” (Berge 1998) Johnson and Johnson immediately got the message out to the public not to take any of their pills because of the risk. Then came the question whether to recall their product or leave it out there. There was a small chance that there were any more bottles had been tampered with. Over thirty-one million bottles were recalled from people and stores. Burke thought that if they were going to save the people and the product they had to do this. Johnson and Johnson responded by also setting up a 1-800 hot line for people to call about recalls. People saw this as a dramatic action taken by Johnson and Johnson. Before this recall nobody ever recalled anything. In the end this would go on to help the comeback of Johnson and Johnson.
The recall of Tylenol was a huge action taken by Johnson and Johnson. It didn’t just set them back a little, but cost them around one hundred million dollars. (Paine 30) People saw what Johnson and Johnson did and respected them for it. They didn’t have to recall all of those bottles because the chances were that there weren’t anymore poisoned pills out there. Johnson and Johnson played the strategy that if they looked good by trying to fix this problem people would look past the fact that people died taking those tampered pills. This worked for them. Johnson and Johnson then introduced their new product safety. This included a new triple safety seal packaging- a glued box, a plastic sear over the neck of the bottle, and a foil seal over the mouth of the bottle, with a press conference at the manufacturer's headquarters. (Berge 1990) This was just six months after the recall. This showed people that Johnson and Johnson really cared about the safety of the people. People were starting to have faith in the company again.
From a business stand point people might look at the recall of all those bottles as a mistake. The numbers do not lie. This caused them to lose millions of dollars. This decision made them lose in the financial outcome. Most companies at that time would say that Johnson and Johnson should never have done what they did. No one had ever recalled all of their product like that before. A hit like that could have put most companies out of business. Johnsons and Johnson was thinking about their long term success when they chose to do what they did.
In the long run the decision to recall all of their products ends up being the best decision that Johnson and Johnson could have made. Not only did people Johnson and Johnson gain a lot of respect from people they also gained a lot of media coverage from this. People now saw Johnson and Johnson as a reliable company that takes responsibility when something goes wrong with their product. They were able to get on TV and broadcast their message in response to the Tylenol crisis. This helped them because Johnson and Johnson was able to put the message they wanted out there before a lot of negative media came out. Johnson and Johnson was able to flip the situation around and actually make themselves look better in the long run.
Johnson and Johnson earns a lot of respect from what they did as a company in the Tylenol crisis. They made the right ethical decision. People now look back at this event and use it as a guidance. There are now more recalls now then there was before this crisis. Johnson and Johnson has set the pace for many companies to ethically do the right thing. Even if it sets the company back for the short term, this case proves that in the long run it pays off.
The Tylenol crisis is a great example to other companies. They were faced with a problem that was not entirely their faults. They diffused the problem and attacked it with a “take responsibility for your problems” approach. They said it was all their faults and warned everyone to stop using their product. Recalling their product might have set them back in the short run, but in the long run Johnson and Johnson was able to turn it all around. They made a huge comeback and came back even bigger than before because they did what they thought was ethically right as a business.

References

Berge, T. (1990). The First 24-Hours. Cambridge, MA: Basil Blackwell, Inc.

Value Shift, book…...

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