The Tylenol Poisoning of September 1982 - Case Study Example

Introduction The TYLENOL poisoning of September 1982 cannot be understood well without having a look at two institutions: the McNeil Consumer Healthcare and its subsidiary known as Johnson & Johnson (J & J). McNeil Laboratories (the McNeil Consumer Healthcare) was the 1st one to be established by Robert McNeil in the year 1879 after acquiring a drugstore (Greyser, 1992). The McNeil Consumer Healthcare is the producer of TYLENOL. Seven years afterwards, the year 1886, Johnson & Johnson was established. Johnson & Johnson was founded by Robert Wood Johnson and his two siblings James Wood and Edward Mead Johnson with a view of coming up with germ-free dressings for clinics and hospitals (Greyser, 1992). With the advancement of TYLENOL Elixir for kids, the Tylenol brand was created in 1955. The sales team of the McNeil came up with the name TYLENOL by the use of letters in word ‘acetaminophen’ which is the product’s main ingredient (Hartley, 2005). The product, Tylenol, was then promoted as useful pain reliever devoid of aspirin side effects. The marketing of the product was particularly carried out to physicians and pharmacists as a safer substitute to aspirin (Hartley, 2005). It was only until the year 1959, that Johnson & Johnson commonly known as J $ J acquired McNeil Laboratories (Greyser, 1992). The first over-the counter TYLENOL bottle was sold in the year 1960 by McNeil Laboratories, under the leadership of Johnson & Johnson. It then took a short period of time for Tylenol to emerge as one of Johnson & Johnson’s well-liked non-prescribed drugs. At the moment with the aid of Tylenol in conjunction with numerous other well-liked products, Johnson & Johnson has grown to be a global leader in the manufacture of healthcare brands (Greyser, 1992). Description of the business incident An incident is defined as an occurrence that could result in loss of, or interference of, a business undertakings, operations or services (Austin, 2001). If an incident is not managed, a crisis, a disaster or an emergency can escalate into an emergency, crisis or a tragedy. Business functions and operations such IT systems, employees or customers safety can be disrupted by an incident if an effective incident management is not put in place. Incident management is thus defined as the process of preventing the possible interference resulting from such an incident in order to enjoy the normal business operations (Austin, 2001). This article will address the business incident encountered by the Johnson & Johnson in September 1982. The incident started when seven people in the Chicago region collapsed unexpectedly and passed on after using Extra-Strength Tylenol capsules that had been poisoned with cyanide (cyanide-laced Tylenol) (Institute for Crisis Management, 2005). The Extra-Strength Tylenol capsules mentioned were scrutinized and results revealed that they had about sixty five milligrams of cyanide (Foster, 1983). The details on the victims of this product tampering include two males and five females, all of them fairly young (Foster, 1983). The cyanide-laced capsules were placed on shelves in six separate stores by an individual who had an aim of taking the lives of innocent people haphazardly. One particular affected person was a twelve year old kid who was suffering from cold. Another victim was a young woman just coming back from the hospital after delivering a baby. The disaster further hit hard on a family who lost three of its members. Two other members of family died after being given Tylenol capsules from the same bottle, after being overpowered by sorrow at the unexpected mysterious death of a close family (Hartley, 2005). This was due to the fact that they were not aware that poison in the Tylenol was the cause of death (Hartley, 2005). A national panic mood was created as the news of the occurrence reached many rapidly. The Tylenol deaths, which were as result of product tampering, have never been unraveled, and the reward worth US$100,000 presented by Johnson & Johnson has not been claimed despite the fact that a number of people were probed (Foster, 1983).Nonetheless, an encouraging result of the catastrophe was that this has led to the development of tamper-proof packaging, which had been basically absent prior to the Tylenol poisoning attack (Foster, 1983). The Johnson & Johnson Tylenol poisoning case/crisis fits into the category of Terrorism. Austin (2001) explained terrorism as deliberate actions carried out by outside players intended to hurt the organization either directly for instance, cause harm to customers or employees; or the harm can be indirectly that is meant to decrease sales volumes or even cause disruption of production. Tampering of product, taking of hostage, disruption, and various forms of violence at workplace are some cases of terrorism (Foster, 1983). With the case of Johnson & Johnson product tampering was done by an outside actor, who apparently executed the operation to harm the company’s customers and perhaps Johnson & Johnson’s employees. The executor (s) of the heinous act are thought to have stolen Tylenol packages from the shelves from supermarkets and contaminate them with cyanide at another location, and then returned the bottles. Straight away after the disaster, the Johnson and Johnson’s Tylenol had its U.S market share falling to just 7% by late 1982 from 37% of the non-prescription pain killer (Foster, 1983). Analysis of how the company addressed the incident The catastrophe that hit Johnson & Johnson was one that many consider as the most horrible nightmare. Some people felt that the company would not resurrect again. However, Johnson & Johnson undertook what many consider as one of the most often employed blueprints of successful disaster or crisis management (Hensley, 2010). Firstly, in the initial week after the Tylenol crisis of 1982, a 1-800 hotline was created by Johnson & Johnson to enable the customers call the company (Tamara, n.d). The hotline assisted the organization in responding to questions from customers pertaining to the safety of Tylenol (Austin, 2001). In addition a toll-free line was created for news stations to call and receive taped posts that carried with them important information about the crisis (Berge, 1990). J&J showed responsibility for its consumers as stated in its philosophy or principles. To kick the campaign off, the company straight away withdrew about thirty one million bottles of Tylenol (Extra-Strength) valued at over US$100 million from all sales places in the United States of America (Tamara, n.d). Additionally, the company volunteered to give solid tablets as an exchange to people who had already bought the Extra-Strength capsules (Keyton, 2001). Johnson & Johnson, furthermore, went ahead and alerted health institutions, distributors and supplies of the value close down in the production and advertising of Extra-Strength until further notification. Owing to the decline in brand value of the company, a loss of US$1.24 billion was recorded by Johnson & Johnson (Hensley, 2010). However, amidst the dip the company brand value, the company injected a lot of money to avert the situation and within a period of about six months the company’s share had risen to thirty percent (30%) (Institute for Crisis Management, 2005). The management of crisis at Johnson & Johnson was carried out in 2 steps: using PR (public relations) in order to respond to the crisis; and a return stage (Keyton, 2001). The company showed a lot of responsibility by placing the safety of the consumers over profit maximization. Besides the national-wide product recall, Johnson & Johnson liaised with the investigation body, the FBI, the Police, and the FDA to unearth the perpetrator of the heinous act. The company offered a reward worth US$100,000 to anyone who could provide information that could lead to the unmasking of the perpetrator (s) (Keyton, 2001). In addition, J&J accepted the drawn connection between its Tylenol and the deaths, which is not always the case with many companies whenever a product crisis occurs (Institute for Crisis Management, 2005). Johnson & Johnson’s comeback stage involve establishing an answer towards the restoration of consumers’ confidence in the product (Keyton, 2001). This was achieved by proving to customers about the safety of Extra-Energy Tylenol. The company’s Tylenol brands were triple sealed during packaging to provide resistance against tampering. Moreover, it gave out a $2.50 off coupon if one bought the Tylenol brands. The company’s pricing strategy was also reviewed and a new one which allows customers to enjoy price cuts of up to twenty five percent (Keyton, 2001). In counteracting this crisis, Johnson & Johnson utilized both Forgiveness and Sympathy strategies. Forgiveness approach is aimed at creating acceptance for a disaster by generating or winning forgiveness or pity from a range of publics. The specific type of forgiveness strategies or tactics embraced by Johnson & Johnson in the Tylenol crisis includes Remediation and Rectification (Daniels Fund Ethics Initiative, n.d). Remediation is where victims of the disaster are given some form of reparation to assist them. Although Johnson & Johnson were not to blame for the tampering of Tylenol, they offered counseling and financial assistance to the families of the victims (Daniels Fund Ethics Initiative, n.d). On the other hand, Rectification entails working hard to stop the crisis from reappearing in the future. Johnson & Johnson rectified the situation by coming up with a Triple sealed packaging. Moreover, they came up with a new haphazard examination measures to be used prior to the shipment of Extra-Energy Tylenol to retailers (Berge, 1990). What took a large element of Johnson & Johnson's disaster communication strategy was a type of strategy known as Sympathy strategy (Hensley, 2010). This form of a strategy pegs its success on depicting a company as unjust victim of a raid from the external body and in so doing get public support (Daniels Fund Ethics Initiative, n.d) Johnson & Johnson's readiness to sacrifice profits, as seen when they recalled its entire Tylenol brands, helped them attract sympathy from the public (Berg & Robb, 1992). Conclusion The Extra-Energy Tylenol crisis and how it was handled by Johnson & Johnson to greater extent depict how an organization ought to communicate with a variety of customers in the event of a crisis (Broom, Center, & Cutlip, 1994). The company showed a great concern for the safety of its customers over profit maximization. This was seen immediately after the organization’s leadership established a connection between the reported deaths and the Tylenol brands (Tamara, n.d).Although the fear created in the country was high, there was a high degree of calm and compassion shown by Johnson & Johnson which serve to reassure the customers of their wellbeing. Without a doubt, the organization’s good crisis management probably improved its share in the market in the long-term as consumers developed the perception that the organization was keen about their interests (Broom, Center, & Cutlip, 1994). The management of J&J acted well during the crisis; however, there were some crucial areas where the organization needed to improve (Hensley, 2010). To begin with the organization lacked a practical public relationships program prior to the crisis (Austin, 2001). Johnson & Johnson carried out media relationships only in the areas of marketing and advertising. It was reported that during the initial times of the crisis, the organization learned from a Chicago about what had transpired (Hensley, 2010). Paradoxically, Johnson & Johnson failed to develop a good relationship with the media, which is an important stakeholder (Austin, 2001). This compelled the organization to react to the crisis in a way similar to advertising. That is the main reason as why Johnson & Johnson was criticized by the media house for running sales type of advertisement the incident which resulted from cyanide-laced poisoning (Cohn, 2000). Recommendation In order for the organization to deal with crisis effectively, it must come up with effective incident management to shun a crisis from disrupting business operations. Besides, the company should also maintain a good relationship with the media, both print and broadcast (Broom, Center, & Cutlip, 1994). This is because the media is a key stakeholder which can enhance or tarnish the reputation of the organization. An organization must develop a practical public relationships program to assist shun crisis (Austin, 2001). It is also important for organizations to consider putting in place new equipment and refurbishing its operations in order to eliminate any chance of contaminating company’s products. In addition, there must be regular employee training (Tamara, n.d). References Austin, E. W. (2001). Strategic Public Relations Management: Planning and Managing Effective Communications Programs. Mahwah, NJ: Lawrence Erlbaum. Berge, T. (1990). The First 24-Hours. Cambridge, MA: Basil Blackwell, Inc Broom, G., Center, A., & Cutlip, S. (1994). Effective Public Relations. 7th edn. Prentice-Hall Inc Cohn, R. (2000). The PR Crisis Bible. New York: St. Martin’s Press. Daniels Fund Ethics Initiative, University of New Mexico. TYLENOL® Continues Its Battle for Success. Retrieved from: https://danielsethics.mgt.unm.edu/pdf/tylenol%20case.pdf Foster, L. G. (1983) The Johnson & Johnson Credo and the Tylenol Crisis. The New Jersey Bell Journal. 6(1). Greyser, S. A. (1992). Johnson & Johnson: The Tylenol Tragedy. Harvard Business School Case 583-043, October 1982. Hartley, R. F. (2005). Business Ethics: Mistakes and Successes. Hensley, S. (2010). FDA: Johnson & Johnson concealed Motrin recall. NPR Institute for Crisis Management. (2005). Annual ICM crisis report: News coverage of business crises during 2004. 20(1) Keyton, J. (2001). Communication Research: Asking Questions, Finding Answers. Mountain View, CA: Mayfield. Tamara K. (n.d) The Tylenol Crisis: How Effective Public Relations Saved Johnson & Johnson. Retrieved from: http://www.aerobiologicalengineering.com/wxk116/TylenolMurders/crisis.html (On 11th December, 2015) Read More