KEY CONCEPTS IN CASE CASE STUDY Organizational Organizational Ethics This incident is a clear case of differing organizational ethics . When the products p roducts were tampered with, the senior executives were initially told to do the moral minimum which was removing products only from the area surrounding the incident. This meant that somewhere along the chain of authority, authority, someone believed that this was the right thing to do. There was a clear case of Conflict of Interest in regards to the crisis management resolution. If the senior executives had followed the instructions, they would be adhering to one set of beliefs about what was the "right thing to do", while potentially hurting the lives of others or even the company's overall image. Johnson Johnson displayed Utilitarianism in their decision ma!ing because they disregarded the initial advice and instead removed #$$ million of Tylenol Tylenol product nationwide which was acting in the best interest of the greatest number of people rather than the amount that the executives believed to be necessary. %s a result of the product tampering, Johnson Johnson put research and development into their value chain of production, and discovered the opportunity of a safer seal on Tylenol bottles.
uestion !" %lthough Johnson Johnson too! a massive massive short&term loss as a result of its its actions, it was cushioned by the relative wealth of the company. hould hould it have acted the same way if the survival of the firm were at sta!e( #es$onse" I believe that Johnson Johnson should have acted the same way even if the survival of the firm was at sta!e. The firm responded appropriately to the Tylenol crisis and too! the proper steps in removing more than )# million bottles of the product nationwide. If the firm had done anything less than what they did I believe it would have been detrimental to the company. The survival of the firm would be even more at sta!e if they didn't remove all Tylenol Tylenol products worlwide. *ustomer loyalty would significanlty drop and consumers would still continue to be s!eptical about the safety of the produts. The #+- Tylenol *risis *risis has gone down in history as one of the must successfully handled crisis management cases. The firm firm should have acted the same way even if the survival of the firm was at sta!e. uestion %" James . /ur!e reportedly said that he felt that there was no other decision he could have made. 0o you agree( *ould he, for example have recalled Tylenol Tylenol only in the 1idwest( Was there a moral imperative to recall all Tylenol( #es$onse" I agree with James . /ur!es when he stated that there were no other decisions that could have been made. I believe that it was necessary for him to recall the product worldwide and not only in the 1idwest. I believe that there was a moral imperative to recall all of the Tylenol. Tylenol. %s a consumer, I would not feel comfortable purchasing any Tylenol product !nowing that several bottles have been tampered with. The only way I would 2ustify continuing to purchase Tylenol products would be if all products were removed and reconstructed to ensure safety. "James /ur!e, the company's chairman, was widely admired for his leadership in the decision to pull p ull Tylenol Tylenol capsules off the mar!et, and for his forthrightness in dealing with
the media." 34eha!, -$$-5 Johnson Johnson would not have been able to bounce bac! from this crisis as successfully as they did, if they only removed the Tylenol Tylenol from the 1idwest. In this case there was no othere decision that could have been made and James /ur!e made the right choice in recalling all tylenol products nation wide. wide.
uestion &"
What was the moral minimum re6uired of the company in this case( Would it favour some sta!eholders more than others( 7ow would you defend balancing the interests of some sta!eholders more than others( #es$onse"
The moral minimum is to recall the bottles from the 1idwest region alone, where the deaths occurred. 7ad they made this decision, de cision, Tylenol's Tylenol's executives would have benefited by not having to lose so much money in recalling more nationwide. The shareholders would have been hurt regardless because if the company was not socially responsible, the public would not respect their business and the mar!et share would drop anyway for not ta!ing acceptable precautions and crisis management. The general public is the most important sta!eholder to any business that depends on consumers. It is extremely important that the public is pleased and satisfied before any other sta!eholders because without consumers, there is no product demand and therefore no business.
uestion '"
Imagine that a third&world country volunteers to ta!e the recalled product. Its representatives ma!e assurances that all tablets will be visually inspected and random samples ta!en before distribution. Would that be appropriate in these circumstances( Would it have been a better solution than destroying all remaining Tylenol capsules( #es$onse"
It would not be appropriate for Tylenol Tylenol to allow a third world country to ta!e the recalled product. p roduct. Their *redo states, 8We believe our first responsibility is to the doctors, nurses and patients, to mothers and fathers, and all others who use our products and services9. If the product is not suitable to be consumed by :orth %mericans, it would be unethical to consider it good enough for those in a third&world country. country. Tylenol Tylenol would also be ta!ing a huge ris! by sending the tablets to a third&world country as they could cause more damage to their reputation if some of those tablets happened to also contain the cyanide and result in more deaths. 0estroying the remaining Tylenol capsules was the most responsible and ethical choice under these circumstances.
uestion ("
%pparently no relatives relatives of any of the victims sued Johnson Johnson. Would Would they have had a moral case if they had( hould the company have forseen a ris! and done something about it( #es$onse"
This was not the first case of such harmful tampering. In :ew ;or! ;or! in #++, 7arry *ornish, the owner of !nic!erboc!er athletic club, was sent a pac!age that contained /romo&elt
too! the bottle home and thought nothing of it until a relative consumed some and complained of feeling ill the next day. *ornish tried some of the antacid and admitted to it tasting off as well. Turns out the contents had been poisoned. *ornish survived a minor illness following the tasting but sadly, his relative passed.This was a very long trial and li!ely very public because the appeal process was a landmar! in = law which determined previous crimes cannot be used as evidence for unrelated ones 3chwart< -$#-5.ince other medical products had been tampered b efore the time of this Tylenol incident, there should have been more awareness of the potential ris!s to insufficient pac!aging. The research and development of their value chain should have been a priority before any ma2or incident prompted it. The families would have had a moral case because there should be more preventative measures to protect the public from situations li!e this. The investigators found that many bottles were either purchased or stolen from a few different locations to be tampered with and eventually returned to the shelves. This should not have been so easy to accomplish by the individual responsible for the poisoning.
uestion )"
7ow well do you thin! a general credo wor!s in guiding action( Would you prefer a typical mission statement or a clear set of policy outlines, for example( 0o you see any way in which the Johnson Johnson *redo could be improved or modified( #es$onse"
0efining your beliefs and guiding principles is important to running a successful business. If you don't define your beliefs, others&&be it friends, associates or the mar!etplace&&will do it for you. 3ugars, -$#$5 I thin! that a general credo wor!s really well in guiding action. % credo credo covers much more than simply where the company is going and why they are there, it covers the values of the company. The credo forces the company to !eep the needs of the customer first. In my opinion, the credo wor!s better than a mission statement or a clear set of policy outlines because it covers and defines so much more> companies would have to write out millions of policies in order to prepare for future conflicts and a mission statement doesn?t even begin to cover how to deal with such a crisis. :o, I don?t thin! that Johnson Johnson needs to improve the credo because it covers all the important categories of people affected> customers, employees, the community and stoc!holders.
!*
#ecalling all T+lenol T+lenol ,ottles nation -i.e
This was the decision that James /ur!e implemented in order to handle the Tylenol Tylenol poisonings crisis. This was by far the most effective decision out of all possible choices. %lthough JJ suffered for the first year after the recall they were able to bounce bac! and regain -@ mar!et share. Johnson Johnson did an effective 2ob by immediately recalling all tylenol bottles and informing the public about the incident.
Pros & liminating the ris! of another death & 1ar!et share returned to -@ after the first year & 4eassured safety in the eyes of the consumer & *ustomer loyalty regained & 0evelopment of a new, safer bottle Cons
& The removal and destruction of )# million Tylenol bottles bottles & 1ar!et share decrease by -@ for the first year & -$$ million spent in removal and bottle development costs
%* #ecalling T+lenol onl+ in the /i.-est James /ur!e felt that there was no other decision he could have made and that eliminating the Tylenol Tylenol products only in the 1id&West 3where the fatalities too! place5 was not an option. If he did however only recall the products in the 1id&West there would be both pros cons to this decision. It would have saved Johnson and Johnson millions of dollars in the recall process and would have been less wor! for employees. 7owever, 7owever, customer loyalty would decrease and consumers not located in the 1id&West would be reluctant to purchase any Tylenol Tylenol product. Inevitably JJ would not have been able to recover from this crisis as well as they did if they only recalled the products in the 1id&West. Pros & Aess of an expense for the company & Aess wor! from employees and drug store owners & 1illions of dollars saved Cons & *ustomer willingness to buy Tylenol products & 4is! of another customer fatality & Aoss of overall brand loyalty and trust & 0ecrease of Tylenol sales in the future & 4is! of lawsuit
&* 0iving recalle. $ro.ucts to a thir. -orl. countr+ If Johnson Johnson decided to give the remainder of the Tylenol products to a third world country in need there would be a number of pros and cons to this scenario. It would benefit Johnson Johnson in not having to destroy millions of products. The products would not go to waste and JJ would have saved a large sum of money in not having to destroy many p roducts that may not have been tampered with. Pros & :ot having to waste millions of Tylenol Tylenol products & aving money by selling the products to a third world country & Biving a less fortunate f ortunate country medicine they desperately need Cons & Threat of an individual dying from tampered product & Cther countries viewing this as unethical and unsafe & *onsumers may view the Johnson Johnson brand negatively
'* No #ecall of T+lenol T+lenol $ro.ucts With crisis management a company needs to evaluate every possible scenario when dealing with a dilemma. In order to ma!e the best decision all scenarios need to be considered. Cut of all the possible
choices and decisions, this by far would have been the most ineffective. I believe that Tylenol would not exist today if JJ decided to not recall the products what so ever.
Pros &:o hassle for company to recall products Cons & 4is! of multiple more deaths to individuals & Dublic outrage & 1ultiple lawsuits against Johnson Johnson & *omplete loss of brand trust and loyalty & 1illions of dollars lost in future Tylenol Tylenol sales & *hance of JJ going ban!rupt
