Premium Essay

Business Ethics Case Study - Tylenol

In: Business and Management

Submitted By tzatze
Words 1406
Pages 6
Tylenol

The background

In 1982, Johnson & Johnson (J&J) faced a major crisis that had the potential to send the company into financial ruin. Tylenol, the country’s most successful over-the-counter product, with over one hundred million users, was under attack.

The crisis

Sealed bottles were tampered with and extra-strength Tylenol capsules were replaced with cyanide-laced capsules. These bottles were then resealed and placed on shelves of pharmacies in the Chicago area. Seven people died as a result. Tylenol was called upon to explain why its product was killing people.

The solutions

The company first learned of the deaths from a local news reporter. A medical examiner had just given a press conference saying people were dying from poisoned Tylenol. Tylenol had to act fast.

What did Tylenol do right?

It is difficult to imagine how else should have Johnson and Johnson reacted at the time of the crisis except the following ways:

• Recalling all the products whether contaminated or not.
• Alerting all the customers by all available media including toll-free hotlines.
• Appearance of the chairman of the company on the television to publicize the company’s response and action taken by it to combat the emergency.
• Making public relations programmes to address the issues and concerns all the internal and external stakeholders.

• J&J put customer safety first. – Company Chairman James Burke immediately formed a seven-member strategy team with the goal of determining how best to protect people, and then, how to save the product. Their first action was to alert consumers nationwide. – They pulled all advertising and immediately stopped production of the product. – After finding two more contaminated bottles, the company ordered a national withdrawal of every capsule. (This showed that no matter the...

Similar Documents

Premium Essay

Business Ethics

...and Shades of Gray Abstract This paper discusses the business ethics in the organization through the examination of ethical practices conducted at Goldman Sachs Inc. The paper includes a list of all the actions executed by Goldman Sachs Inc which are defined in this paper as gray area practices. The paper also presents an ethical analysis of these gray area actions as well as all the parties that were affected by the Goldman Sachs practices. Business Ethics The problem to be investigated is business ethics through the examination of ethical practices conducted by Goldman Sachs Inc and ethical gray areas which are situations and problems that don’t fit neatly into any existing mode of ethical analysis within the business (Marshall, 2007). Business ethics are very important to inspire the employees and attract more wanting to work for the business. Business ethics are also important because if the business lacks good ethics, this can damage the business reputation and make it less appealing to stakeholders and that will lead to profit loss affect the whole business. Ethics of business has been discussed by Peter Drucker (Drucker, 1986, p. 254) which he said “The problem is one of moral values and moral education, of the individual, of the family, of the school. But there neither is a separate ethics of business, nor is one needed”. Drucker’s interpretation of business ethics is that personal ethics and business ethics cannot be separated and he gave an example of......

Words: 1846 - Pages: 8

Premium Essay

Business Ethic

...1. Identify the nuggets from the two-day sessions of Business Ethics class and explain how would you apply those nuggets in your work place. ANSWER: Nuggets from the lecture Ethics defined as the study of right or wrong and as broadly as the general inquiry into what is good. Ethics examines the right or wrong within the context of moral duty. Business ethics is a form of applied ethic in business activity that examines ethical principle and moral or ethical problem that may occurred on business environment. It is applies to all business activity either to the conduct of individual or entire organization. Some business may have same issue related to the business ethic such as problem of product quality, transparency of the financial statement, environmental issues, human right, workplace quality and safety issue etc. In business a company shall create a regulation and code that will regulate the daily life and how business should perform in ethical way. Those we call it Code of Business ethic and Conduct. Code of business ethic and conduct for the company is very important to set up and regulate the life of company. It’s collection of principle in term how they believe and aims to live by. It is also reflected the corporate culture and its vision and mission of the company. How the code of conduct applied in Chevron which they call it “The Chevron Way”. The Chevron code of conduct built in line with their company’s vision and mission. Integrity is one of......

Words: 1419 - Pages: 6

Free Essay

Public Relations Revew

...States a r t i c l e i n f o a b s t r a c t Issues management developed as a long-term process interested in the continued health and success of organizations. This essay presents a contemporary issues management case that uses inoculation and a priori solutions as issues management tactics. The case study involving Johnson & Johnson’s responsible dosing campaign demonstrates that organizations perceived to have a high standard of corporate social responsibility are not above using deceptive tactics to protect their brand. © 2008 Elsevier Inc. All rights reserved. Article history: Received 29 April 2008 Received in revised form 11 July 2008 Accepted 28 August 2008 Keywords: Issues management Corporate social responsibility Inoculation Crisis communication Public relations practitioners increasingly need to serve as ethical counselors to the dominant coalition (Health, 1994) and as the ethical conscience of the organization (Ryan & Martinson, 1983; Wright, 1996). Despite the role of issues management in guiding ethical decision making (Bowen, 2005), some communication campaigns have suspended organizational ethics to manipulate public perception. This essay examines the misuse of issues management through a contemporary issues management case study involving Johnson & Johnson’s responsible dosing campaign. Inoculation and a priori solutions literature are presented to show the deceptive nature of an advertising campaign that appears to promote social......

Words: 2818 - Pages: 12

Premium Essay

Exxon Valdez, J&J

...I. SUMMARY AND SYNTHESIS On March 24, 1989, residents near the waters of Prince William Sound awoke to the catastrophe brought by the tanker Exxon Valdez spilling more than 10 million gallons of crude oil. This incident caught the attention of the public and received many and different criticisms. Eight of eleven cargo tanks were ruptured during the incident. ARLIS or Alaska Resources Library and Information Services with the help of Exxon Valdez Oil Spill Trustee Council released a collection of materials on Exxon Valdez Oil Spill. It included the following information: * The crude oil spread approximately 1, 300 miles. 200 miles were heavily oiled. The impact was obvious while the remaining 1, 100 miles were lightly or very lightly oiled. * Aerial observations were used to determine the size of the oil spill to give immediate response and clean-up activities. It includes the estimation of the thickness and volume of oil on the water. * Exxon spent more than $2.5 billion on clean-up expenses. * Caption Joseph Hazelwood was the captain of the ship, a senior officer. He was convicted of a misdemeanour charge of negligent discharge of oil, fined $50, 00 and sentenced to 1, 000 hours of community service. * Exxon was fined $150 million, it was the largest fine imposed for an environmental crime. The court forgave $125 million in acknowledging Exxon’s cooperation in cleaning up the spill. During the clean-up, Exxon hired thousands of workers through several...

Words: 2581 - Pages: 11

Premium Essay

Education

...Journal of Academic and Business Ethics c Johnson & Johnson: An ethical analysis of broken trust t Karen L. Stewart The Richard Stockton College of New Jersey Whiton S. Paine The Richard Stockton College of New Jersey ABSTRACT For several decades, Johnson & Johnson has been the exemplar of superb ethical behavior in light of the prompt actions it undertook during the 1982 Tylenol cyanide poisoning incident. Now several decades later, J&J’s Consumer Product Division has put the company and . its reputation in jeopardy by its slow and ineffective response to a series of ongoing problems. ineffective This article provides an ethical analysis of those events and addresses the negative impact on Johnson and Johnson’s once sterling reputation. Business, ethics, recalls, Johnson & Johnson, reputation, FDA J&J: An ethical analysis, Page 1 analysis Journal of Academic and Business Ethics c INTRODUCTION: For several decades, Johnson & Johnson has been the exemplar of superb ethical behavior in light of the prompt actions it undertook during the 1982 Tylenol cyanide poisoning incident that left seven dead in the Chicago area. After the 1982 incident, Tylenol quickly even returned to category dominance. A few years later when yet another cyanide-laced Tylenol laced capsule resulted in the death of a New York woman, Johnson & Johnson and its McNeil subsidiary once again took quick action by only making a compressed and......

Words: 6273 - Pages: 26

Premium Essay

Business Ethics

...Ethics can be defined as principles or right or wrong. Business decisions should be ethical, but the evidence suggests that is not always what happens. (Hollenbeck, Gerhert, Noe, & Wright 2004) A recent study has shown that 4 out of 10 executives stated that they had been asked to behave unethically. As a result of unfavorable perceptions of U.S. business practices and an increased concern for better serving customers, U.S. companies are becoming more aware of the need for all company representatives to act responsibly (Hollenbeck, Gerhert, Noe, & Wright 2004) A recent article published in Tribune-Star discussed corporate ethics to university students in Indiana area. Over 370 were in attendance to a business conference host by Networks Professional Development Program. Students from Indiana colleges and universities as well as students from DePauw, St Mary-of-the-Woods and Rose-Holman Institute of Technology were in attendance of the conference which was hosted by fellow students. The event, organized by juniors in the Networks Professional Development Program at ISU, included speeches, panel discussions and break-out sessions on business, public policy and corporate ethics. (Foulkes, 2007) The conference would also help prepare students for the work force when they graduate. "We wanted to prepare students for when they go out into the work force" and face actual ethical decisions, said conference executive director Amber Williams, a junior in the Networks program.......

Words: 1085 - Pages: 5

Premium Essay

Business

...Baseball, Steroids and Business Ethics: How Breaches of Trust Can Change the Game: Knowledge@Wharton (http://knowledge.wharton.upenn.edu/article.cfm?articleid=1902) Baseball, Steroids and Business Ethics: How Breaches of Trust Can Change the Game Published : February 20, 2008 in Knowledge@Wharton The day after former Senator George Mitchell released his damning report on performance-enhancing drugs in Major League Baseball last December, President George Bush, a former baseball-team owner himself, seemed to speak for many disgusted fans when he pronounced, "Steroids have sullied the game." The Mitchell Report fingered 89 professional ball players, but many of these allegations were nothing new for baseball watchers. Game of Shadows, a 2006 exposé by a pair of investigative journalists, and Juiced, a 2005 tell-all memoir by player José Canseco, described a world of professional baseball rife with performance-enhancing drug abuse. The ongoing scandal, which first surfaced in the late 1990s, has bubbled on for a decade, leading commentators to label it the "steroids era." With fans aware of such egregious bad behavior, why has attendance at Major League Baseball games reached record-breaking highs during that same time period? Are baseball's "consumers" impervious to the ethical lapses of their teams? No, say Wharton professors, but the case demonstrates how bias, competition and a lack of oversight worked together to create an ethically toxic atmosphere. This is a......

Words: 2491 - Pages: 10

Premium Essay

Bosy

...213-255_Trevino_08p4.qxd 6/21/06 5:18 PM Page 213 PA R T IV ETHICS AND THE ORGANIZATION 213 213-255_Trevino_08p4.qxd 6/21/06 5:18 PM Page 214 CHAPTER 8 ETHICAL PROBLEMS OF ORGANIZATIONS INTRODUCTION In the third quarter of 2002, the Brookings Institution, a Washington, D.C., think tank, estimated that the corporate scandals that began with the Enron debacle in late 2000 would cost the U.S. economy $35 billion. That is the equivalent of a $10 increase per barrel of oil.1 It is, in a word, staggering. And we may not have seen the end of it. Long before Enron’s collapse, a number of business ethicists and business professionals watched with concern as Wall Street analysts demanded increasingly strong corporate financial performance to support rising corporate stock prices. At the same time, the gargantuan compensation packages (including stock options) of the top executives running these companies became inextricably linked to their companies’ stock prices. In 1990, average CEO pay at major corporations was 107 times the pay of the average worker. By 2004, CEO pay had risen to 431 times the pay of the average employee. (If the pay of average workers in the United States had risen as fast as CEO pay, the lowest paid workers would be earning $23.03 an hour, not $5.15 an hour.)2 It was an “accident” waiting to happen, although everyone was making so much money in the market that no one wanted to admit that something could be......

Words: 20980 - Pages: 84

Premium Essay

J&J Analysis

...BUS*2090*03 Team Report Winter 2011 Thursday, March 31, 2011 Johnson & Johnson – Socialization and Culture, and Organizational Structure Mathew Baptista Cassandra Dingli Sophia Jefferson Jessica Mighton Hayley Summers Daniel Vijayakumar SUMMARY Johnson & Johnson (“J&J”), one of the largest, well-known organizations in the world, produces products for consumer health care and for use by medical professionals in care and diagnostics. Some of their most recognizable brands include Tylenol, Neutrogena, Listerine, Band-Aid and Reactine. These, along with their many other brands, are produced in over 60 countries by more than 250 different operating companies that make up the J&J organization. In total, more than 114,000 employees are part of the organization, and they are managed through a system of decentralized management with a wide span of control. J&J faces the unique challenge of trying to create one corporate culture that all parts of their organization believe in and adhere to. One of the strategies used to combat these obstacles is values-based leadership and linking employees and subsidiaries under a common set of values, as outlined in "Our Credo". J&J works extremely hard to uphold their Credo, which was written by Robert Wood Johnson – one of the founders of the organization – in 1943. It is a set of values that J&J vow to work by and which lend to the present culture that is so important in the organization today. J&J also attempts to induce a......

Words: 5893 - Pages: 24

Premium Essay

Learning Activity 1

...(AT&T Breakup, January 2015). Thus creating a government regulated monopoly. The FCC was created to monitor the actions of AT&T. In 1974 The Antitrust Division of the U.S. Department of Justice sued AT&T. If the FCC had not stepped in and demanded more competition we may not have the likes of Sprint, Verizon, and T-mobile in today's marketplace, making it more expensive for the consumer. LEARNING ACTIVITY 2 Determining ethical boundaries can sometimes be a challenge, since ethics is both based on individual beliefs as well as societal standards. Would receiving a holiday gift from a client be considered bribery?  Would it be wrong for a person in a position of power, like a mayor, to ask a bank manager friend for a personal loan?  On a more practical level, is it unethical for a cashier to provide a coupon to a customer who did not have one at the register? Is it unethical for someone to complete a timesheet recording eight hours of work, when they left 45 minutes early? Select a case study of an ethical dilemma in the workplace.  You may use an example from this week’s readings, your professional experience, or a website. Please answer the following questions: 1.       What is the ethical dilemma? Describe the individuals...

Words: 1340 - Pages: 6

Premium Essay

Rwt1 Business Ethics

...Business Ethics and Efficiency RWT1 Table of Contents Executive Summary 3 Subject and Purpose 3 Introduction 5 Discussion 5 Ethics and Economic Efficiency 6 Organization Goodwill and Competitive Advantage 7 Risk Management and Credit Facility 9 Recommendation 9 Conclusion 10 References 12 Executive Summary Due to increased globalization and competition in industry, organizations are facing tough challenges in the keeping their business operations sustainable and ethical so that they continue to grow and develop in a successful manner. When we talk about driving the organization towards success it is not any different from steering a car or vehicle in the right direction towards the required destination. That is why roadmaps and directions are developed and changed constantly so that the organizations and management are able to keep their business current and follow the latest trends and requirements as demanded by the external environmental factors that are constantly changing. It is extremely important that on its way to growth and improvement, the organizational management must look out for any new developments like technological advancement, globalization, new regulations, and laws or policies with regards to their business industry in order to maintain the performance and reputation of the business. On their way towards growth many leaders and management often ignore and forget the importance of business ethics and......

Words: 3461 - Pages: 14

Premium Essay

Ethics

...Assignment on Ethics In Organization S.R.Lutra Institute Of Management Submitted to Amruta Nag Submitted by Pratibha Chaudhari 08 Payal Khetani 17 Nikita Pereira 27 Dhara Suvagiya 31 Hetal Vaghora 32 (MBA 1st shift Academic Year 2010-11) Ethics in organization Introduction to ethics Ethics is not a recent discovery. Over the centuries philosophers their struggle with human behavior have developed different approaches ethics, each leading to different conclusions. The word “ethics” which are coined from the Latin word ‘ethics’ and greek word ‘ethikos’ pertains to character. Ethics is thus said to be the science of conduct and morals. Meaning Ethics is the branch of philosophy which is the systematic study of selective choice, of the standards of right and wrong and by which it may be ultimately be......

Words: 2363 - Pages: 10

Free Essay

Close

...The field of Business Ethics relies on a relatively small core of well-known cases of corporate behavior to illustrate the themes of the subject. Near the top of this list of familiar names (e.g., the Ford Pinto, Tylenol, and Bhopal) is Nestle´ S.A., the Swiss food conglomerate. Of all the business histories examined by students of ethics, Nestle´’s saga of controversy is perhaps one of most intriguing. In the late 1960s, Nestle´ was criticized by social activists for its marketing of powdered milk formula for infants in less developed countries. The case became a cause ce´le`bre as Nestle´ became the victim of a well-organized boycott campaign. The conflict has become a popular case study in the business school curriculum because it demonstrates the need that companies have to constantly preserve and enhance their legitimacy in the public eye. The discussion of legitimacy leads quite naturally into a discussion of issue management, and the consequences of mismanaging a public issue (Post 1985 p. 127). Although Nestle´ was the subject of the boycott, the infant formula controversy may have initially been seen more as a dispute over generic bad practices within the infant formula industry rather than as a focused attack on one particular firm, a perspective that Nestle´ itself may have wanted to engineer. The original publication that stimulated the boycott refers to an industry-wide pattern of marketing of infant formula. (Muller 1974) To begin with Nestle´...

Words: 1215 - Pages: 5

Premium Essay

Ethics

...4.12 4.13 ETHICS IN MARKETING RESEARCH: MINI-CASE STUDIES – courtesy of Mr. Hicks PART 1: Read the 4 mini-cases below. For TWO of the following 4 cases,answer the following questionson a separate sheet of paper: 1. What are the relevant Facts? 2. What are the ethical Issues? 3. Offer your opinion on what actions should be taken (at least 2-3 paragraphs) Case Study 1 Incredible Shrinking Potato Chip Package Topic: Cost vs. price vs. value issues Characters: Julie, Brand Manager for potato chips at a regional salty snacks manufacturer Dave, Marketing Director for the regional salty snacks manufacturer Julie has been concerned about the profitability of the various items in her line of potato chips. According to her potato suppliers, the recent drought caused a 35 percent reduction in the potato crop compared to one year ago, resulting in a 25 percent hike in potato prices to large buyers like Julie’s company. Potatoes accounted for almost all of the content of her chips (which also consisted of vegetable oil, one of three different flavoring spices, and salt), plus there were packaging costs. To hold the line on margins, which of late had been slim at only about 5 percent due to fierce competition from several other local and regional brands, Julie would need to raise potato chip prices about 15 percent. On her most popular 7.5 oz. size, which had a price spot of $1.59 on the package, this would require a price hike of $.24, bringing the price up to...

Words: 2955 - Pages: 12

Premium Essay

Conceptual Model of Corporate Moral Development

...A Conceptual Model of Corporate Moral Development Author(s): R. Eric Reidenbach and Donald P. Robin Source: Journal of Business Ethics, Vol. 10, No. 4 (Apr., 1991), pp. 273-284 Published by: Springer Stable URL: http://www.jstor.org/stable/25058230 . Accessed: 16/09/2013 07:44 Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at . http://www.jstor.org/page/info/about/policies/terms.jsp . JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact support@jstor.org. . Springer is collaborating with JSTOR to digitize, preserve and extend access to Journal of Business Ethics. http://www.jstor.org This content downloaded from 202.125.103.33 on Mon, 16 Sep 2013 07:44:13 AM All use subject to JSTOR Terms and Conditions Conceptual Model Moral Development A of Corporate Donald R EricReidenbach P. Robin ABSTRACT: The conceptual model presented in this article argues that corporations exhibit specific behaviors that signal development. Accordingly, the authors identify five levels of moral development and discuss the that move corporations dynamics of corporate behavior another. Examples tive of of moral stages specific development from......

Words: 8320 - Pages: 34