I need to write a 3 page analysis (essay) for a "crisis" strategy class. The topic selected is "Johnson & Johnson's cyanide-laced Tylenol capsules (1982)". I should answer the following questions in regards to that particular case: Focus on how Management reacted to the issue, What measures did the company already had in place in case of a crisis like this, How did it identify the problem, how did the company reacted and created solutions for the problem, and finally what valuable lessons or changes where made for the company after the crisis ended
Hello! Thanks for your question about Johnson & Johnson's cyanide-laced Tylenol capsules (1982). The short version is that this company crisis was highly costly and had a marked impact on how the company now operates. Below you will find a deep dive of my findings.
To answer this question I have searched through respected websites, to gather all the information required. Due to the subject of the question, many of the sources are somewhat older than usually preferred, but are from trusted sources and adequately answer this question as well as provide further reading for your assignment. As your question has several elements, we will work through them one by one, starting with the management's reaction.
McNeil Consumer Products, a subsidiary of Johnson & Johnson, conducted an immediate product recall from the entire country which amounted to 31 million bottles and a loss of approximately $100 million dollars. They also halted all advertisements for the product.
WHAT EXISTING MEASURES DID COMPANY HAVE IN PLACE?
To be more precise, it was a lack of measures. By and large, before the Tylenol poisonings, Tylenol capsules were packaged in bottles that were similar to what the bottles look like now. The big difference is they had caps that could be opened easily and then closed, leaving no indication that they had been tampered with. There was no additional sealing feature, except some cotton inside the bottle. Similarly, in the former packaging, the outer box could be opened and then closed again without leaving any sign that it had been interfered with.
Johnson & Johnson quickly established that the cyanide lacing occurred after cases of Tylenol left the factory. The company recalled the Tylenol and opened the recalled products to discover the cyanide in some of the recalled boxes.
REACTIONS AND SOLUTIONS
Johnson & Johnson offered to send tablet replacements to anyone who had purchased extra-strength Tylenol capsules. The company also used media facets to notify the nation not to take Tylenol capsules. The Chicago police paraded through neighborhood streets with loudspeakers to warn the public of the potential Tylenol danger.
Moving forward the company also invented triple seal packaging. Boxes are glued shut at both ends and sealed in cellophane; the cap is surrounded with a red plastic seal and a foil seal is glued over the mouth of the bottle. In addition, six-bottle packs are heat-sealed in plastic binders, and shrink-wrapped plastic is put around cartons, which hold 12 packs each. The company also introduced a new version of their pills: a tablet coated with slick, easy-to-swallow gelatin which was harder to tamper with than the older capsules which could be easily opened, laced with a contaminant, and then placed back in the older non-tamper-proof bottle.
LESSONS AND CHANGES IN THE COMPANY
Johnson & Johnson chairman, James Burke, reacted to the negative media coverage by forming a seven-member strategy team. Before the crisis Johnson & Johnson had not actively sought press coverage, but as a company in crisis they recognized the benefits of open communications in clearly disseminating warnings to the public as well as the company's stand. Johnson & Johnson communicated their 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. Johnson & Johnson did not have a proactive public affairs program before the crisis.
To wrap it up, the crisis led Johnson and Johnson to work more proactively in public relations, as well as to develop new safety features with their products. Thanks for using Wonder! Please let us know if we can help with anything else!