Tylenol Crisis-1982

3rd Slot, Group-4

Aliza Rashid
Amena Rizvi
Saba Ali
Nehan Akram
Hafsa Salman
 Contribution Sheet

Name ID No Contribution in Project report % of Contribution

Write the parts of report the team Write the % of contribution of
member has worked upon this specific member. (e.g., For
equal contribution in a group of 5
members write 20% )
Aliza Rashid 16842  Did detailed research
 Wrote the Executive
Summary, Introduction and
Johnson & Johnson’s
Response.
 Managed and compiled all the 30
work.
 Compiled the PowerPoint
presentation.
 Attended 3/3 meetings.
 Submitted all work on time
Amena Rizvi 16893  Did research
 Wrote the detailed version of
The incident & its
investigations followed by
The public’s response. 25
 Made her slides.
 Attended 3/3 meetings and
printed the report.
 Submitted all work on time
Saba Ali 14096  Did research
 Wrote The challenges faced
and the company
information.
 Edited the Conclusion,
25
Introduction and Executive
Summary.
 Made her slides and attended
3/3 meetings.
 Submitted all work on time
Hafsa Salman 17437  Wrote the Link with Course
concepts.
 Read the book and researched 10
to support the facts stated.
 Made her part slides.
 Attended 1/3 meetings.
Nehan Akram 17299  Did the research
 Wrote the Conclusion 10
 Attended 2/3 meetings.

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 Table of Contents

Contribution Sheet .......................................................................................................................... 2

Executive Summary......................................................................................................................... 4
Introduction .................................................................................................................................... 5
Company Information ..................................................................................................................... 6
The Tylenol Poisonings.................................................................................................................... 7
The Victims .................................................................................................................................. 7
The Investigations ....................................................................................................................... 9
Challenges Faced ....................................................................................................................... 10
Johnson & Johnson’s Reaction .................................................................................................. 11
Warnings and Halt Production .............................................................................................. 12
Nationwide Recall .................................................................................................................. 12
1-800 Helpline........................................................................................................................ 12
Others .................................................................................................................................... 12
New Packaging ....................................................................................................................... 13
New Pricing ............................................................................................................................ 13
Building Trust ......................................................................................................................... 14
Public Response......................................................................................................................... 14
Link with Course Concepts ............................................................................................................ 16
Conclusion/Recommendation ...................................................................................................... 18
References .................................................................................................................................... 20

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 Executive Summary

Johnson & Johnson is an American Multinational company that produces medical,

pharmaceutical and consumer packaged goods. In 1982, one of its leading products, Tylenol,
was contaminated and tampered with by a third-party at a few drugstores in Chicago which
resulted in several deaths in the region. Within just a week, seven individuals that had
consumed Tylenol lost their lives.
Before the crisis, Tylenol was one of the most successful over-the-counter pain-killers in the
United states and contributed 17% to the company’s annual profits. However, post this crisis its
market share in the industry fell from 35% to just 8%.
Not only was the company’s reputation at stake, so was consumer safety. Johnson & Johnson,
having a strong strategy since the beginning, managed to handle the problem effectively with
little to no repercussions. Even though they had no direct relation with the cause of this crisis,
they took full responsibility and were willing to go to any lengths to protect their customers.
John Burke, CEO of Johnson & Johnson took hold and formed a seven-member committee to
handle the crisis. They decided to first deal with the problem, “How to protect the people?” and
then “How to save the product?”. Initially, they warned the general public through the use of
media. Once they realized the extent of the problem, they immediately halted the production
of the drug and called for a nationwide recall of all 31 million bottles of Tylenol.
Later, they reintroduced Tylenol in a new triple seal packaging in which any tampering could be
easily detected by the customer. They also introduced a new pricing strategy and made several
other efforts to save the consumers as well as the reputation of the company. Within 90 days of
the relaunch, the company’s market share rose to 48% (which was 33% before the crisis)
highlighting that they managed the problem well and were successful in protecting public
health as well as the company’s reputation.

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 Introduction

Our Project is based on the ‘The 1982 Tylenol Crisis’. Tylenol is a product of Johnson & Johnson
(an American based multinational pharmaceutical company). It is one of the leading companies
of the industry with its products found in almost every household in not only the U.S but
around the globe.
Explained briefly, this crisis took place when, in 1982, a few of the Tylenol bottles in Chicago
drugstores were tampered with and laced with poison resulting in seven deaths in the region.
In this report, we explore how the incident took place, the consequences it brought along, the
challenges it posed for J&J and how the company was able to overcome these disastrous chain
of events.
There are numerous reasons that inclined us towards choosing this particular crisis for our
report.
Firstly, The Tylenol Crisis serves as a benchmark. It is the gold standard of how one should view
and manage an unexpected negative situation. It shows the importance of taking values into
consideration and not always prioritizing profits, a phenomenon explored later on in this
report.
The response to the 1982 Tylenol crisis is currently the most widely taught case study of
effective crisis management in business schools in the United States. It has been the bases for
many of the crisis communication strategies developed by researchers for more than 20 years.
Berg’s “Suffering Strategy” and Benoits “Rectification strategies” were both developed by
studying the way Johnson & Johnson handled the Tylenol Poisonings.
The communication and leadership examples portrayed by the higher authorities of J&J during
this crisis are worthy of study and interpretation. The numerous strategies that they adopted to
counter act the negative effects of this incident and how Johnson & Johnson didn’t only limit
itself to protect its own reputation, but considered consumer confidence and product safety as
well managed to captivate our interest. Our fascination only grew as we found out more and
more about the poisonings and their effects after which we decided to explore them in detail.
How Johnson & Johnson completely recovered its market share lost in record time along with
protecting their reputation and establishing a brand name as one of the most trusted over-the-
counter consumer products in America to this today, grabbed our interest as their handling of
this crisis serves as a pathway to better understand how the company remains successful in
trying times.
Thus, all of the afore-mentioned points led us towards choosing this particular crisis as the best
suited one for our report.

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 Company Information

Johnson & Johnson is an American multinational manufacturing company, founded in 1886 and
is headquartered in New Brunswick, New Jersey, the consumer division being located in
Skillman, New Jersey. Its brands include numerous household names of medications and first
aid supplies. Founded by Robert Wood Johnson and his two brothers James Wood and Edward
Mead Johnson, the Johnson & Johnson family has had a long history and vision of product
innovation and diversification designed for overall public health and welfare.
For close to 100 years, it has been the epitome of a well-managed, highly profitable, and tight-
lipped consumer products manufacturer. It has now become the largest and most broadly-
based health care company. Its common stock is a component of the Dow Jones Industrial
Average and the company is ranked No. 37 on the 2018 Fortune 500 list.
Currently, J&J employs more than 119,000 people in more than 250 companies located in
roughly 60 countries. It sells products in more than 175 countries and serves the consumer
(with baby care, skin care and oral care products), pharmaceutical needs (including anti
infection, contraceptives, antipsychotics and vaccines etc.) and medical devices and diagnostics
markets (including products used by professionals with medicine as their area of expertise) with
a focus on research-based, technology driver products.
Johnson & Johnson operates over 250 companies in what is termed "the Johnson & Johnson
family of companies". The company operates in three broad divisions; Consumer Healthcare,
Medical Devices and Pharmaceuticals (illustrated below):
Among its well-known consumer products are a brand line of bandages, Tylenol medications,
Johnson's baby products, Neutrogena skin and beauty products, Clean & Clear facial wash and
Acuvue contact lenses.
Exploring the company’s financial aspect, for the fiscal year 2017, Johnson & Johnson reported
earnings of US$1.3 billion, with annual revenue of US$76.5 billion, an increase of 6.3% over the
previous fiscal cycle. Johnson & Johnson's shares traded at over $126 per share, and its market
capitalization was valued at over US$367.5 billion in September 2018. Current members of the
board of directors of Johnson & Johnson are: Mary Sue Coleman, James G. Cullen, Dominic
Caruso, Michael M.E. Johns, Ann Dibble Jordan, Arnold G. Langbo, Susan L. Lindquist, Leo F.
Mullin, William Perez, Steven S. Reinemund, David Satcher, and William C. Weldon.
Tylenol is a non-aspirin, over-the-counter, non-prescription drug which was first discovered to
have analgesic (pain-killing) and antipyretic (fever-reducing) properties in 1886. Manufactured
to treat and reduce aches and pain, ironically Tylenol proved to give its birth company quite a
headache in the form of the crisis of 1982.

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 The Tylenol Poisonings

The sales of Tylenol were remarkable and were taking over 35% of the OTC painkiller market,
till 1982. And Johnson & Johnson was counting on the fact that the sales and market share
would grow in the upcoming year. However, in September of the same year Johnson & Johnson
faced an incident that they had never even thought of facing.
On 29th of September and some days following, 7 people living in Chicago had died all after
consuming Tylenol that was laced with cynide. The next morning, Johnson & Johnson had
become aware that something dreadful had happened from their Tylenol, due to which the
market shares of the product had declined from 35% to 8%.

The Victims
The first death that happened due to the poisonings was of a 12-year old girl Mary Kellerman,
who lived in the suburbs of Chicago. She woke up and had complained to her parents of a sore
throat, runny nose and a throbbing headache due to which they had given her one extra
strength Tylenol capsule, that -unknown to them - was laced with extremely poisonous
potassium cynide. Mary died the very next day.

Mary Kellerman

On the same day another death happened. This was of Adam Janus who was a 27-year old
postal worker and lived in Arlington Heights, Illinois. His death was at first said to be because of
a heart attack but it was later found out that he had also consumed a cynide laced Tylenol. His
brother, Stanley Janus, 25, and sister in law, Theresa, 19, had rushed to his home and
experienced headaches, perhaps from the death of their brother, owing to which they had also
taken one or two extra strength Tylenols from the same bottle Adam had taken one earlier that
day. Stanley died the same day and Theresa died after two days.

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 Adam janus Theresa Janus Stanley Janus

In the next few days, 3 more mysterious deaths happened: Mary Mcfarland, 35, from Elmhurst,
Illinois, Paula Prince, 25 from Chicago and Mary Reiner, 27, of Winfield, Illinois. Upon
investigation it was revealed that all three of them also had taken Tylenol before they died.
Within a week of the deaths, the news has spread over the entire nation and had already
changed the way people were consuming over the counter medicines.

Mary Reiner Mary Mcfarland Paula Prince

TIME’s Susan Tifft wrote of the tragedy’s victims on Oct. 11, 1982:
Twelve-year-old Mary Kellerman of Elk Grove Village took Extra-Strength Tylenol to ward
off a cold that had been dogging her. Mary Reiner, 27… had recently given birth to her
fourth child. Paula Prince, 35, a United Airlines stewardess, was found dead in her
Chicago apartment, an open bottle of Extra-Strength Tylenol nearby in the bathroom.
Says Dr. Kim [the chief of critical care at Northwest Community Hospital]: “The victims
never had a chance. Death was certain within minutes.”

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The Investigations

The investigation started from the 3 people that died from the Janus family. It was found out
that each of them had taken an extra strength Tylenol capsule, that too from the same bottle. It
was also then discovered that Mary Kellerman had also taken an extra strength Tylenol capsule.
The police took the bottles from the Kellerman and Janus families as evidence and upon
thorough examination by collaborating with the Cook Country chief medical examiner, Dr
Edmund Donoghue, who confirmed that the capsules in each of the bottles were containing
potassium cynide that gave off the odor of almonds.
It was found out that the pills had been manufactured in completely different parts of the
country, however their lot number showed that they belonged to the same batch. Thus, it was
concluded that it was nearly impossible that the tampering had been done on the
manufacturing level and the possibility of sabotage during production was eliminated. It did not
make sense that the pills had been played around with at opposite ends of the country and still
ended up only in or around the Chicago area. Therefore, it was adjudged by Johnson & Johnson
that the tampering occurred after the pills had been distributed and were on the store shelves.
This is the statement they gave to the public.
A nationwide panic arose when the investigations revealed and confirmed that the deaths had
taken placed due to the potassium cynide poison that was found in the Tylenol capsules that
each of the 7 people had consumed. It was found out that the Tylenol bottles and capsules had
been opened up and filled with 600mg of cynide – that is up to 10,000 times more than the
amount of cynide needed to kill a person.
The investigators believed that the perpetrator had come into different stores in Chicago and
around it, where Tylenol was sold. They had taken the bottles away to another location,
opened them, and replaced the medicines in the capsule pills with cynide and then put the
pilfered bottles back in the stores. A great downside of the Tylenol bottles was that they had no
way of showing if they had been opened or not. The criminals literally filled the whole capsule
with cynide and the victim’s reports showed that they had 100-1000 times lethal does of cynide
in their blood. Investigators and the police had found 5 bottles that caused the 7 deaths of the
victims. In addition to those, 3 more tampered bottles were discovered at different stores only
in the Chicago area.

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The TIME’s reported that, the officials of the Food and Drug Administration (FDA) believed that
the culprit bought the Tylenol bottles from different stores, injected cynide in the red half of
the capsule, resealed the bottles and then placed them back on the shelves of the stores.
However, a discontented employee was also suspected by the Attorney General of Illinois. In
both the cases, the whole event was cultivated and well planned with the pathological aim of
killing people completely randomly. Initially, the sudden deaths and symptoms of each of the
people that died were confusing to the doctors until they found a connection; each of the pill
bottles smelled like almonds, that is the smell potassium cynide gives off. The culprit had left no
traces to him and no margin of error.

Challenges Faced

Despite the fact that J&J had no direct relation with the cause of this crisis, it posed a huge
challenge for the company with respect to the future of not only Tylenol but the company itself.
The immediate consequences alone were enough to create sufficient turmoil. The first and
foremost challenge was to deal with these immediate effects. Johnson & Johnson’s
management was caught by total surprise when the news first surfaced. Immediately a decision
was made to open doors to the media as before taking any other measures, the company
recognized that it had to convey all the information to the public through the media to prevent
further unrest.
Moving towards the inner proceedings and challenges to the financial state of the company,
after the initial tampering and deaths, Tylenol lost 87% of its market share. According to an
analyst, Johnson & Johnson suffered a loss of $1.24 billion due to the depreciation of the
company and fall in brand value. To make matters worse, Tylenol’s share as an over-the-
counter pain reliever in the U.S., fell from 37% to just 7% by late 1982. Predictions arose that

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Tylenol would never sell again. But, through the implementation of effective strategies
discussed in later sections of this report, they failed to have a lasting impact on the position of
the company.
A saving grace for the company was that its shareholders were hurt only briefly. In 1982, the
stock, which had been trading near a 52-week high just before the tragedy, see-sawed in panic
selling but recovered to its highs only two months later. Investors have had little to complain
about since then. If you had invested $1,000 in Johnson & Johnson shares on September 28,
1982, just before the first Tylenol episode, you would have $22,062 today, after four stock
splits. Highlighting that the challenge faced with respect to market and stock value due to this
crisis was easily reversed.
What followed, however, is one of the most frequently used examples of effective crisis
management. The way J&J was able to turn this situation around shocked many. Taking their
vision of consumer responsibility seriously, J&J implemented every method possible to avert
further damages to the company with its President James Burke pouring millions into reviving
the struggling brand. Consequently, within six months, its share was back up to 30 percent.
Putting consumer safety over profit J&J set the bar for other companies as even though the
crisis was not their doing, they still took full responsibility for it, a practice not often seen in the
corporate world.

Johnson & Johnson’s Reaction

Executives at J&J got right down to the heart of the issue which was customer satisfaction,
health and safety. They did not waste any time blaming others or being defensive. Even though,
the limited recall of Tylenol product had satisfied the Food and Drug Association (FDA) and
investigations quickly cleared Johnson & Johnson of any wrong doing, Johnson & Johnson’s
CEO, James Burke was still critical and wanted to do more to protect the public as well as the
company’s reputation.
Johnson & Johnson used the strategy of Remediation, Rectification and Sympathy to deal with
the 1982 Tylenol Crisis. Remediation is offering any form of compensation to the victims to help
them deal with the crisis, Rectification is to take action in order to prevent the recurrence of
the crisis in future and Sympathy is used to win the support of the public by portraying the
company itself as the unfortunate victim of an attack by a third party.
Burke formed a seven-member committee to deal with the situation. The team made a strategy
that first they had to deal with “How do we protect the people?” and then “How do we save
this product?”.
Within no time, the team started taking action. Their first priority was customer safety and aimed
to stop the damage from further being spread.
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Warnings and Halt Production
Before taking anything else, Johnson & Johnson started sending warnings to hospitals and
distributors to not to use the Tylenol capsules until further notice. They told the customers not
to resume using it until the extent of the tampering could be determined.
However, after they realized the extent of the damage made, immediately stopped production
and advertising of Tylenol.
Because it was the pre-internet era, suburban Chicago police drove along residential sweets
using bullhorns to warn people, “Don’t take Tylenol”. In some places, they went door to door
with bags, collecting Tylenol bottles. Announcements were made on school intercoms and on
the evening TV news.

Nationwide Recall
Even though Tylenol was a product that produced 17% of the company’s annual profits and
there was very little chance of discovering more cyanide laced tablets, Burke convinced the
company’s other executives and ordered a nationwide recall of all the 31 million bottles of
regular as well as extra strength Tylenol. The recall process was completed within a week after
the first reported death and costed more than $150 million to the company.

1-800 Helpline
Moreover, Johnson & Johnson also used media and paid advertising to communicate their
strategy during the crisis. The media was used to issue a national alert to tell the public not to
use the Tylenol product as there was a risk of tampering. Also, within the first week, Johnson &
Johnson established a 1-800 hotline for consumers to call. The company responded to inquiries
on 1-800 number from customers concerning safety of Tylenol.
Johnson & Johnson also established a toll-free contact line for news and other media
organizations to call and received messages that we were pre-taped and included statements
from Johnson & Johnson officials regarding the crisis.

Others
In addition, the company also offered to exchange all Tylenol capsules that had already been
purchased by the public with solid tablets. They also partnered with the FBI, the Chicago Police,
and the FDA to track down the culprit and even offered a $100,000 reward for anyone who
would volunteer information about the killer. Perhaps most importantly, Johnson & Johnson
did not deny the link between the deaths and its products, a mistake that many companies
make immediately following a product crisis.

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The Second stage was The Comeback Stage. Johnson & Johnson needed to find a way to restore
consumers’ trust in the brand. The company took several actions to demonstrate Tylenol’s
safety and

New Packaging
Johnson & Johnson reintroduced Tylenol products in a new triple-seal, tamper resistant
packaging at a press conference conducted and the manufacturer’s headquarters. The newly
innovated triple-seal included a glued box, a plastic sear over the neck of the bottle, and a foil
over the mouth of the bottle. The new design would make any tampering obvious to the
customer.

1.Comparison between Old and New Packaging

Tylenol became the first product in the industry to use the new tamper resistant packaging just
6 months after the crisis occurred and till date, we can see the same design being used by
leading pharmaceuticals all around the world.

New Pricing
Johnson & Johnson introduced a new pricing program that provided discounts of up to 20
percent. Discount coupons could be found in newspapers or by calling on a toll free number
that offered $2.5 off on the purchase of Tylenol products. Additionally, presentations were
made in front of members of the medical community by a team of more than 2,250 salespeople
to educate them about the changes made to improve the safety of the product and satisfaction
of the customer.

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Building Trust
To gain customer support and confidence, James Burke appeared on commercials, did more
than 50 interviews. Moreover, several major press conferences were held at corporate
headquarters and within hours an internal video staff set up a live television to feed via satellite
to the New York metro area. This allowed press conferences to go national across more than
100 cities in the US.

Public Response
Although the company believed it had done nothing wrong, Johnson & Johnson acted to
assuage public concerns. Tylenol’s market share spiked from 33% before the crisis to 48% 90
days after the re-launch. Consumer trust in Tylenol increased three-fold compared to the
period prior to the crisis, restoring confidence in the brand. At the same time, Johnson &
Johnson commissioned a nationwide opinion survey to assess the consumer implications of the
Tylenol poisonings. The good news was that 87 percent of Tylenol users surveyed said they
realized that the maker of Tylenol was "not responsible" for the deaths. The bad news was that
61 percent still said they were "not likely to buy" extra-strength Tylenol capsules in the future.
In other words, even though most consumers knew the deaths weren't Tylenol's fault, they still
feared using the product.
Larry Foster, the Corporate vice President of Public Relations at Johnson & Johnson said that,
“what began as Johnson & Johnson’s darkest hour turned out to be its brightest in terms of
corporate reputation.” When asked if the response of J&J to the crisis was based on a plan, he
said that it was entirely based on their values which have been highlighted in their credo. Their
first priority is the safety and well being of their customers followed by their employees, then
the community they are operating in and lastly their own profits and stakeholders.
After the 1982 incident, it was predicted that Tylenol would lose all of its shares and never
come into the market again. However, it just took 2 months, a well tampered proof packaging
and an extensive mass media campaign the market share of Tylenol had climbed back up to 30
percent which had previously fallen from 37 percent to 7 percent. Johnson & Johnson also
became the first manufacturer to have introduced tamper-proof packaging.
However, to everyone’s surprise Johnson & Johnson faced yet another tampering case in
February, 1986. A 23-year old stenographer named Diane Elsroth died at her friend’s house In
Yonkers, NY after taking two capsules of Tylenol. Upon thoroughly investigating the bottle using
sophisticated scientific examinations, it was found that the bottle had been tampered with, and
5 out of the 24 capsules were filled with 90% poisonous potassium cynide. It was astonishing
for the F.B.I how someone breached the three safety seals of the new bottles issued after the

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1982 event and cartons, without being suspected until and unless they were examined under
sophisticated analysis.
After this, as a response Johnson & Johnson stopped making Tylenol in capsule form instead
started making it in tablet form, called caplets.
Even after 37 years, the case still remains unsolved; however, Johnson & Johnson has proven to
be extremely successful in their decision-making skills and strategies. Although the tampering
may not have been their fault, J&J still put customer health and safety over anything else and
faced enormous losses in the short run but their long-term prosperity was ensured. In fact,
some evidences show that people were so happy with the measures J&J took that they shifted
from other painkillers to Tylenol; that too, within 6 months of the incident.
Today Johnson & Johnsons has recovered all of the marker share it lost in 1982 and is amongst
the top 100 best brands with the aim of creating healthier communities by selling affordable
and trustworthy goods. It has reported to have sales of US$1.3 billion and a yearly revenue of
US$76.5 billion. The decision and crisis management techniques of J&J after the 1982 incident
have proven to be remarkable and are the epitome of the true face of corporate social
responsibility.

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 Link with Course Concepts
J&J understood the set of principles and moral standards that a business should abide by and
follow under any given circumstance. Where the problem usually arises when one value of the
company dictates another i.e. company’s reputation is valued more than consumer safety,
however, J&J averted the crisis with great precision and care. They put consumer safety ahead
of the company’s reputation when they took complete responsibility for the murders and didn’t
let the situation get out of hand. Even when they found out that evidence suggested their own
public statements regarding the poisonings weren’t true, they readily accepted the mistake on
their end. This is because the company had a set of ethical codes that portrayed accountability,
responsibility, integrity and respect.
Utilitarianism is an ethical system that seeks the greatest good for the greatest number of
people. It considers how many people are benefited and by how much they are benefited.
Johnson and Johnson has efficiently handled the crisis. J&J responded to the situation
immediately by forming a committee to attend to the crisis instead of searching for other
people to toss the blame on. Nobody at the headquarters tried to steer clear of the situation or
implied anything to indicate the company did not want to take responsibility for the losses
incurred. What the company did do was clearly communicate that it was unaware of the
poisonings and how the bottles were tampered with but that they were fully invested and
committed to solving the murders and doing everything and anything that was necessary to
protect the public. These actions and intentions portray how the company put consumers, that
was the larger population at risk, ahead of everyone else. The executives at J&J could have
taken decisions and made statements to save the company’s reputation instead of taking
responsibility. Instead of posting a reward of $ 100,000 for anyone with information about the
killer. Even though Johnson and Johnson’s could have resisted the claims being made, at every
step they carefully made decisions to handle the crisis. They recalled all the bottles on the
shelves even though it was possible that the remaining bottles did not contain even a trace of
cyanide but they didn’t want to risk any more lives and this decision cost them $150 million.
Instead of using their budget to invest in strategies to recover their immense loss in the market
share, they offered the victim’s families financial assistance and counselling.
Not only did their decisions benefit the consumers, J&J itself was benefitted in the long run. All
their strategies and techniques were in line with the concept of utilitarianism because it sought
out the best for the greatest number of people, this includes both the company and the
consumers. After the consumers saw how J&J handled the crisis, J&J gained consumer
sympathy and this reflected in their market share that rose back to 30% in a period of 6
months. The fact that they took responsibility for the claims being made even though it wasn’t
their fault. So much so that the consumers switched to Tylenol from other paracetamols and
started to prefer them more.

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J&J’s actions thus exhibited the moral philosophy of universalism that are principles every
civilized society needs to function. Laws against murder, oppression, deceit, torture are
unethical under any circumstance and once such a crime is committed, the price has to be paid.
Although the bottles were tampered with after they were manufactured so the company could
not be held directly responsible, J&J prioritized the victim’s families as they offered financial
assistance and counselling because it was their product that caused the deaths.
J&J fulfilled the economic, legal, ethical and philanthropic responsibilities every corporate social
responsibility comprises. The economic responsibility of being profitable was upheld as were
the legal responsibilities to abide by the law. Thus the corporate social responsibility assumed
by the business is its primary social responsibility.
The company had an accommodative approach where they took all responsibility and did what
was necessary to assure the situation did not get out of hand. They introduced a new triple seal
packaging and a helpline to avoid such circumstances in the future. They even offered a new
reduced price for the tablets along with a reward for anyone with any information about the
killer. All these actions suggest that the company took full responsibility and it was essential to
them that they put the health and safety of consumers first.
The actions showed that public safety was of utmost importance and the company has set an
example for any organization that faces a similar situation. The company was appreciated for its
prompt and appropriate action. Johnson & Johnson’s has set an excellent example of crisis
management for other companies to follow.

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 Conclusion/Recommendation

Keeping all the above mentioned arguments in view, it can be concluded that the Tylenol
incident was a rollercoaster ride for Johnson and Johnson’s. The impact on the company was
considerably great but they bounced back in no time. When the crisis first hit, there was
sufficient loss of production, destroyed goods, damage to the brand image etc. The consumer
trust and loyalty was at stake with market share falling from 33% to 8%. However, it was
recovered within the time span of only six months along with the rectification of other dangers
the company was faced with. J&J was acknowledged for its quick and prompt action along with
its commitment to the consumers. They were even awarded the title of consumer champion
highlighting how pleased the public was with the way the crisis was handled.

“We are responsible to the communities in which we live and work and
to the world community as well. We must help people be healthier by
supporting better access and care in more places around the world.
We must be good citizens — support good works and charities, better
health and education, and bear our fair share of taxes. We must
maintain in good order the property we are privileged to use,
protecting the environment and natural resources.”
The above mentioned text has been extracted from the ‘credo’ of J&J highlighting their mission
statement and vision for the company. This credo has been carved in stone in around 800 of
J&J’s buildings worldwide and is also present in the form of a book. It has been altered over the
years but one thing has remained constant, their dedication to their customers. The promise to
be responsible towards the community and its inhabitants are not just mere words but are
practices that J&J have carried out over the years, as evident in the aftermath of this crisis.
Detailed analysis and research on this incident has provided us with an in-depth view of the
inner workings of the company. It provided us with an opportunity to carefully study and
understand crisis management along with effective decision making. Illustrated below are few
of the many thing we learnt during this project.

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 1. Values based brands outperform non-values based brands on trust, credibility and
listenability.
2. Crisis management is not about public relations driven ‘damage control’. It’s about
business continuity. About affirmative strategic, business-centric action with a strong focus
on the victims in crises.
3. Assume responsibility for the solution, even if you don’t have to, because it’s about the
publics’ trust in your brand and the test of your character.
4. Act quickly, honestly and decisively.
5. Good behavior delivers great returns. Remember the high cost of low trust.
6. Establish trust. Nothing good happens without trust. One of the most overlooked concepts
in crisis management and mitigation is forgetting about the ‘speed of trust.’

We believe that J&J acted on its motto and values and continues to do so today. The way they
handled this crisis emerging with little to no permanent damage to the company itself, proves
why J&J is considered a powerhouse of pharmaceuticals even today. They have consistently
cared for and valued their clients upholding the promises they make.
Looking back at the decisions and strategies adopted by Johnson and Johnson’s during this
incident, it can be safely concluded that they put on an exemplary display of ethics and crisis
management.
In 1990, Fortune inducted Burke into its National Business Hall of Fame, noting, “Few managers
of corporate crises have survived an episode of the perfect crime — unsolved murder — in
which their product was the murder weapon and their customers the innocent victims. Indeed,
James Burke of Johnson & Johnson may be the first CEO ever to have confronted such a horror
— twice. He managed it so well that he not only restored Tylenol, his company’s single most
important profit maker, to preeminence, but he also enhanced the company’s fine reputation
in the process. During his tenure Burke also took J&J’s earnings and stock prices to new highs.”
Thus, proving why this crisis has been a benchmark for companies ever since and is known to
be one of the most well-known cases of effective decision making.

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 References

https://en.wikipedia.org/wiki/Chicago_Tylenol_murders
https://www.ou.edu/deptcomm/dodjcc/groups/02C2/Johnson%20&%20Johnson.htm
https://www.nytimes.com/2002/03/23/your-money/IHT-tylenol-made-a-hero-of-johnson-
johnson-the-recall-that-started.html
https://www.biznews.com/thought-leaders/2013/11/15/five-key-lessons-from-tylenol-crisis
http://mallenbaker.net/article/clear-reflection/johnson-johnson-and-tylenol-crisis-
management-case-study
http://fortune.com/2012/10/07/the-fight-to-save-tylenol-fortune-1982/