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4. Impact of chosen business strategies
Tylenol capsule laced with cyanide in Chicago
After the crisis happened in 1982, Johnson & Johnson abandon capsule, develop caplets and offer coupon for new product if defected product is returned at no extra cost. The company suffers a loss of $1.24 billion due to the depreciation of the company's brand value (ICMR). Tylenol's share dropped from 37% in early 1982 to just 7% by late 1982 (ICMR). However, overall the decision of eliminating its key product in return, company gets good response and admiration from public. Furthermore, it is also considered to be a “model of corporate responsibility for its actions”. Company improves its reputation gradually.
Infant Tylenol, Tylenol overdose, liver damage and combining alcohol and Tylenol issues
About 12 after the first issue, the firm has to face another scandal which caused by lacking of effective warnings on productions’ packaging. The product is too strong and it is led to consumer’s misunderstandings, so they end up using more than needed. Then, what the company does is start correcting its mistake by modifying dosages recommendation, commercial claims and the labels language. For instance, adding bold warning: “Nothing’s safer”; “Taking more than recommended does...could cause...risks”. The initial issue affects the reputation of company, but because of its goodwill of recalling the bad product of the company in the Chicago case, it gets people’s sympathy as well. In addition, the company does not loss any market share (Jennings, 2011). Even though these issues show the decision makes its image almost at risk, the image at this moment is not that worse.
Failure in monitoring and controlling Tylenol quality
The third problem happened very recently is about safety issues at factory in May 2010. Even though Johnson &Johnson does know about the problems, it does not take public reaction for alerting. In addition, company does not recall bad quality Tylenol nor...
Tylenol capsule laced with cyanide in Chicago
After the crisis happened in 1982, Johnson & Johnson abandon capsule, develop caplets and offer coupon for new product if defected product is returned at no extra cost. The company suffers a loss of $1.24 billion due to the depreciation of the company's brand value (ICMR). Tylenol's share dropped from 37% in early 1982 to just 7% by late 1982 (ICMR). However, overall the decision of eliminating its key product in return, company gets good response and admiration from public. Furthermore, it is also considered to be a “model of corporate responsibility for its actions”. Company improves its reputation gradually.
Infant Tylenol, Tylenol overdose, liver damage and combining alcohol and Tylenol issues
About 12 after the first issue, the firm has to face another scandal which caused by lacking of effective warnings on productions’ packaging. The product is too strong and it is led to consumer’s misunderstandings, so they end up using more than needed. Then, what the company does is start correcting its mistake by modifying dosages recommendation, commercial claims and the labels language. For instance, adding bold warning: “Nothing’s safer”; “Taking more than recommended does...could cause...risks”. The initial issue affects the reputation of company, but because of its goodwill of recalling the bad product of the company in the Chicago case, it gets people’s sympathy as well. In addition, the company does not loss any market share (Jennings, 2011). Even though these issues show the decision makes its image almost at risk, the image at this moment is not that worse.
Failure in monitoring and controlling Tylenol quality
The third problem happened very recently is about safety issues at factory in May 2010. Even though Johnson &Johnson does know about the problems, it does not take public reaction for alerting. In addition, company does not recall bad quality Tylenol nor...