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Johnson & Johnson’s Recall Headaches: Facing Familiar Challenges in a New Era

Fonseca, M., Kelly, M., Sweet, B., and O’Rourke J. S. (Editor)
February 15, 2018
SKU:
BUS-004124
Region: 
North America
Topic: 
Strategy & General Management
Length: 
15 pages
Keywords: 
product recalls, recall, public trust, ABC, crime
Student Price: 
$4.00 (€3.4)
Average rating: 
0

On September 16, 2010, amidst a congressional inquiry into numerous product recalls over the past 15 months, Johnson & Johnson’s Chairman of the Consumer Group, Colleen Goggins, announced her retirement. With the bulk of the recall focused on their flagship product, Tylenol, the tendency was to compare these with the famous recall in 1982, which cemented the public’s trust in the company. Unfortunately, that trust has eroded because of their reaction to the numerous current product issues. When it was revealed that subcontractors had secretly bought back Motrin off the shelves without notifying the public that something was wrong with it, J&J found itself with a much larger issue than just public dismay. This phantom recall had compelled FDA regulators to call upon its crime unit to investigate whether or not these actions by Johnson & Johnson constitute criminal behavior. 

Learning Outcomes: 
  1. To highlight the complexity involved in solving business problems within a large, decentralized corporation across multiple brands, product categories, acquired companies, and geographic regions;
  2. To provide an example of government intervention in business issues, including congressional committee hearings and potential FDA criminal charges
  3. To encourage discussion regarding the differences between the famed 1982 Tylenol recall and the recalls of 2009-2010 and the differences in how the public and J&J respond in each era;
  4. To demonstrate how a corporation’s actions impact its brand reputation, and how media attention can amplify the public’s perception of a product or brand;
  5. To stimulate discussion regarding the ethical responsibilities of pharmaceutical companies and their duty to openly communicate any sort of breach of quality to the public and stakeholders