Tylenol Murders case study discussion

PA-2: Tylenol Murders case study discussion

Due Date: Friday September 10th @ 9 PM

Please read the case study ‘The Tylenol Murders (the scanned copy is from an old version of the book with fair quality). Then, please a) summarize what Johnson and Johnson experienced in the “Tylenol Murders” crisis, and how they managed the crisis. b) Comment on whether you think the responses from Johnson and Johnson were wise and what lesson we may learn from the practice of Johnson and Johnson. To show that you have fully reviewed this case, please summarize both rounds of the crises and what Johnson and Johnson did to handle the crises. If you only summarize one round of Johnson and Johnson’s response, your answer is not complete.

Also, don’t forget to reply to at-least two classmates response.

76 PART 2 Preparation/Process

DISCUSSION STARTERS What is the relationship between public rela-

4.1.

4.2.

4.3. 4.4. 4.5. 4.6.

tions and public opinion? . . What are attitudes, and on what characteristics are they based? How are attitudes influenced? What is Maslow’s hierarchy of needs? What is the theory of cognitive dissonance? How difficult is it to change a person’s behavior?

PICK OF THE LITERATURE

4.7.

4.8. 4.9.

4.10.

What are several key public opini ding to Cantril? on laws, ace What kinds of evidence persuade ot, What are the elements involved . people? reputation? in lllanagini In assessing the list of best and

. . f h . Worst co mes m terms o t eir reputations h lllpa. h

. . . fl , w at spe ;~ c aractenstics m uence these rank· c~ic ings?

The New York Times, nytimes.com, and The Wall Street Journal, wsj.com Public relations can be practiced only by understanding pub- lic opinion, and two of the most prominent daily forums in which to study it are The New York Times and The Wall Street Journal or, as is increasingly the case, their online vehicles, nytimes .com and wsj.com.

Despite the 21st-century problems of newspapers, these two most venerable news organizations reveal the diverse views of pundits, politicians, and plain people. The Times is arguably the primary source of printed news in the world. The Journal, likewise, is the primary printed source of the world’s business and investment news-an area of increasingly domi- nant importance.

Both papers, through their opinion pages and in-depth stories, express the attitudes of leaders in politics, business,

CASE STUDY The Tylenol Murders

Arguably, the two most important cases in the history of the prac- tice of public relations occurred within four years of each other to the same product and company.

For close to 100 years, Johnson & Johnson Company of New Brunswick, New Jersey, was the epitome of a well-managed, highly profitable, and tight-lipped consumer products manufacturer.

Round I That image changed on the morning of September 30, 1982, when Johnson & Johnson faced as devastating a public relations prob- lem as had confronted any company in history.

That morning, Johnson & Johnson’s management learned that its premier product, extra-strength Tylenol, had been used as

science, education, journalism, and the arts on topics ranging from abortion rights to genetic engineering to race relations. Occasionally, the Times and the Journal supplement their usual coverage with public opinion polls to gauge attitudes and beliefs on particularly hot issues. Sure, the news is often infuriating, but it’s also a joy to know more about what’s going on than virtually anyone else.

While some argue that the Times has become too left· leaning and the Journal too right-leaning, these two daily periodicals remain the most important reference works any public relations professional can read (even including this book!).

t followed, a murder weapon to kill three people. In the days tha 1 5 ioaded another three people died from swallowing Tylenol caps~ eChicago, with cyanide. Although all the cyanide deaths occurr~d ,nted extra· · 11ca reports from other parts of the country ~lso ,mp These 1atter strength Tylenol capsules in illnesses of various sorts. & Johnson reports were later proved to be unfounded, but Johnson products and its Tylenol-producing subsidiary, McNeil Consurn

1 ~r relations

f Pub ,c d Company, found themselves at the center O a rience · trauma the likes of which few companies had ever expel for JohO’

. · I rod uc d ct Tylenol had been an astoundingly prof1tab e P the pro u son & Johnson. At the time of the Tylenol murders, ttheyears’ held 35% of the $1 billion analgesic market. Through~u d to be,,a Joh~son & J?hnson had not been-and hadn ‘t neern:s f . eur~e, particularly high-profile company. Its chairperson , Ja

 

 

with the company for almost 30 years, had never appeared on television and had rarely participated in print interviews.

c aught by Surprise

Johnson & Johns~n’s management was caught totally by surprise when the news hit. The company recognized that it needed the media to get out as much information to the public as quickly as possi ble to prevent a panic. Therefore, almost immediately, Johnso~ & Johnson made a key decision: to open its doors to the media.

On the second day of the crisis, Johnson & Johnson discovered that an earlier statement that no cyanide was used on its prem- ises was wrong. The company didn’t hesitate. Its public relations department quickly announced that the earlier infonmation had been false. Even though the reversal embarrassed the company briefly, Johnson & Johnson’s openness was hailed and made up for any damage to its credibility.

Early on in the crisis, the company was largely convinced that the poisonings had not occurred at any of its plants. Nonetheless, Johnson & Johnson recalled an entire lot of 93,000 bottles of extra- strength Tylenol associated with the reported Chicago murders. In the process, it telegrammed warnings to doctors, hospitals, and distributors and suspended all Tylenol advertising.

But what about all those millions of dollars worth of Tylenol capsules on the nation’s shelves?

The company was convinced such a massive recall wasn’t war- ranted by the facts. It was convinced that the tampering had taken place during the product’s Chicago distribution and not in the man- ufacturing process. Further, the FBI was worried that a precipitous recall would encourage copycat poisoning attempts. Nonetheless, five days later, when a copycat strychnine poisoning occurred in California, Johnson & Johnson did recall all extra-strength Tylenol capsules-31 million bottles-at a cost of more than $100 million.

Although the company believed it had done nothing wrong, Johnson & Johnson acted to assuage public concerns. It also posted a $100,000 reward for the killer or killers. Through advertise- ments promising to exchange capsules for tablets, through thou- sands of letters to the trade, and through statements to the media, the company hoped to put the incident into proper perspective.

Loyal Users but … At the same time, Johnson & Johnson commissioned a nation- wide opinion survey to assess the consumer implications of the Tylenol poisonings. The good news was that 87% of Tylenol users surveyed said they realized that the maker of Tylenol was “not responsible” for the deaths. The bad news was that 61 % still said they were “not likely to buy” extra-strength Tylenol capsules in the future. In other words, even though most con- sumers knew the deaths weren’t Tylenol’s fault, they still feared using the product.

But Chairperson Burke and Johnson & Johnson weren ‘t about to knuckle under to the deranged saboteur or saboteurs who had poisoned their product. Despite predictions of the im_minent demise of extra-strength Tylenol, Johnson & Johnson dec1d~d to relaunch the product in a new triple-safety-sealed, tamper-resistant package (Figure 4-4). Many on Wall Street and in the marketing community were stunned by Johnson & Johnson’s bold decision.

So confident was Johnson & Johnson’s management that It launched an all-out media blitz to make sure that people u~d_er- stood its commitment. Chairperson Burke appeared on telev1sIon shows and in newspaper interviews.

Chapter 4 Public Opinion 77

_. FIGURE 4-4 New packaging. The triple-safety-sealed , tamper-resistant pack- age for Tylenol capsules had (1) glued flaps on the outer box, (2) a tight plastic neck seal, and (3) a strong inner foil seal over the mouth of the bottle. A bright yellow label on the bottle was imprinted with a red warning: “Do not use if safety seals are broken .” As it turned out, all these precautions didn’t work. Photo: Courtesy of Johnson & Johnson

Welcoming 60 Minutes The company even invited the investigative news program 60 Minutes-the scourge of corporate America-to film its execu- tive strategy sessions to prepare for the new launch. When the program was aired, reporter Mike Wallace concluded that although Wall Street had been ready at first to write off the company, it was now “hedging its bets because of Johnson & Johnson’s stunning campaign of facts, money, the media, and truth.”

Finally, on November 11 , 1982, less than two months after the murders, Johnson & Johnson’s management held an elaborate video news conference in New York City, beamed to additional locations around the country, to introduce the new extra-strength Tylenol package.

In the months that followed Burke’s news conference, it became clear that Tylenol would not become a scapegoat. In fact, by the beginning of 1983, despite its critics, Tylenol had recaptured an astounding 95% of its prior market share. Morale at the company, according to its chairperson, was “higher than in years.” It had acted true to the “Credo,” which spelled out the company’s beliefs (Figure 4-5). The euphoria lasted until February 1986 when, unbe- lievably, tragedy struck again.

Round II Late in the evening of February 10, 1986, news reports began to circulate that a woman had died in Yonkers, New York, after taking poisoned capsules of extra-strength Tylenol.

Unbelievably, the nightmare for Johnson & Johnson was about to begin again.

 

 

78 PART 2 Preparation/Process

FIGURE4-5 The Johnson & Johnson credo. Johnson & Johnson, Our Credo

OUR CREDO

We believe our first responsibility is to the doctors, nurses and patients, to mothers and fathers and all others who use our products and services.

In meeting their needs everything we do must be of high quality. We mu•t constantly strive to reduce our costs

in order to maintain reasonable prices. Customers’ orders must be serviced promptly and accurately.

Our suppliers and distributors must have an opportunity to make a fair profit.

We are responsible to our employees , the men and women who work with us throughout the world.

Everyone must be considered as an individual. We must respect their dignity and recognize their merit.

They must have a sense of security in their jobs. Compensation must be fair and adequate,

and working conditions clean, orderly and safe. We mu•! be mindful of ways to help our employees fulfill

their family responsibilities. Employees must feel free to make suggestions and complaints.

There must be equal opportunity for employment, development and advancement for those qualified.

We must provide competent management, and their actions must be just and ethical.

We are responsible to the communities in which we live and work and to the world community as well.

We must be good citizens – support good works and charities and bear our falr share of taxes.

We must encourage civic improvements and better health and education . We must maintain in good order

the property we are privileged to use, prote<:ting the environment and natural resources.

Our final responsibility is to our stockholders. Business must make a sound ·profit.

We must experiment with new ideas. Research must be carried on, innovative programs developed

and mistakes paid for. New equipment must be purchased, new facilities provided

and new products launched. Reserves must be created to provide for adverse times .

When we operate according to these principles, the stockholders should realize a fair return.

And once again, the company sprang into action. Chairperson Burke addressed reporters at a news conference a day after the incident. A phone survey found that the public didn’t blame the company. However, with the discovery of oth?’. poisoned Tylenol

ules two days later, the nightmare 1ntens1f1ed. The company capsrded 15 000 toll-free calls at its Tylenol hotline. Once again, reco ‘ halt d “I’ h ‘ k” B k production of Tylenol capsules ~as . e • m earts1c , . ur e

This time, the firm decided once and for all to cease produc- tion of its over-the-counter medications in capsule form . It ottered to ‘.eplace all unused Tylenol capsules with new Tylenol caplets, a solid f?rm of medication that was Jess tamper-prone (Figure 4-6)· The withdrawal of its capsules cost Johnson & Johnson more than $150 million after taxes.

told the press. “We didn’t believe It could happen again, and nobody else did either.”

Once again, in the face of tragedy, the company and its CEO received high marks. As President Reagan said at a White House reception two weeks after the crisis hit, “Jim Burke of

 

 

A special message from the makers of TYLENO[ products.

If you have TYLENOL capsules,

we’ll replace them with

TYLENOL caplets. And we’ll do it at our expense.

As vou knO\\\ there has been a trc1 gic event. A small number of Extra-Strength ~~~~a::~n=~~~a:J~th.

Titls was an outrageous ~ct whid1 damages all of us.

Both federal and local authorities have established that it was only capsules that were tampered with.

In order to prevent any further capsule tampering, we have removed all our alpsules &om your retailers’ shelves. This includes Regular and Extra-Strength TYLENOL capsules, CO-TYLE:sJDI: . • capsules, Maximum-Strength TI’l….Ef\ 0~ Sinus Medication capsules, Extra-Strength SINE-AID· capsules, and DIMENSYN’ Menstrual Rellef capsules.

And Johnson & Johnson’s McNeil Consumer Products Company has decided to cease the manufacture, sale, and distribution of ru.! capsule forms of over-the- counter medicines.

If you’re a regular capsule usei; you may be wondering what to use instead. That’s why we’d like you to try TYLENOL caplets.

The caplet is a solid form of ffiE’.\/0~ pain reliever, which research has proven 1s

~~:~hl~~’. r:t:~t~ ~~,,:;d coated for easy, comfortabfc swallmvmg.

And the caplet delivers a full extra-strength dose quickly and effectively.

So, if vou have any TYLENOL Capsules in vour h’ome, do one of the following:

·1 Return the bottles with the unused

~ddt;~ ~n uti~~g~~~\rn~r;;ne and replace your TYLENOL capsules …. ~th TYLENOL Caplets (or tabfets, it vou prefe,) . ~•u also refund your postage. Or . .. rei~: t~~i:~~~red\~n :e~d~ng the bottle to us along witha letter requesting the refund.

\.-Ve are taking this step becrmse, for the past 25 years, overlOO million Americans have made TYLE’.\JOL products a trusted part of their health care.

We’re continuing to do everything we can to keep your bUst. r i-::1h• 7 I TYLENOL· C.p~11l,Eu:Jv.ngt I I P.OS0\2000 ) j Maple Pl1Ji,, MIi- lliU \ I 1’1.-, .. ,,..,ll!'”‘· ,;,nirun1,,,.t1w”1~m.11 l r •f’;,.1 ,,,.~11>lo·l• k• I 1 1’1,,,,·/”1.i I I x, …. _ ___ ___ ___ _ – I I AJ,U<M — – – – – — – – I l”‘— – —– 1 LSI••·- – ~,,;;;;:;;; .. z.~~ .:.:–J ··~ .

(Courtesy of Johnson & Johnson)

Questions

Chapter 4 Public Opinion 79

FIGURE 4-6 A special message. Johnson & Johnson

Johnson & Johnson, you have our deepest app~e?_iation for liv- ing up to the highest ideals of corporate respons1b1ltty and grace under pressure.”

Today, 30 years after the first customers were murdered after ingesting Tylenol capsules, the Tylenol c,ase st~dy stands as a model in how to conduct positive publtc relat1ons-honestly, openly, transparently-even in the face of unspeakable tragedy,

4.11. What might have been the consequences if Johnson & Johnson had decided to “tough out” the first reports of Tylenol-related deaths and not recall the product?

4.12. What other public relations options did Johnson & Johnson have in responding to the first round of Tylenol murders?

Open chat