James Burke, Johnson & Johnson CEO, Image courtesy of The Medium
In 1982 Johnson & Johnson had an anti-fragility crisis. Tylenol made up 19% of Johnson & Johnson’s corporate profits. When a medical examiner announced, people were dying from Tylenol laced with poison, one Wall Street firm quipped, “they’d have a better chance of survival if they turned water into wine.” Immediately Johnson & Johnson reframed the incident rather than hiding from it. They assumed responsibility. They stopped production and worked with law enforcement.
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Contrast this to Perrier, who in 1990 recalled its water from worldwide distribution after tests showed traces of naturally occurring benzene, a cancer-causing chemical, in its product in several countries. Their absence from the U.S. market created a void filled by companies such as Evian water. But, Perrier did not take the steps Johnson & Johnson had.
What distinguished Johnson & Johnson's conduct of the crisis from Perrier and others really? They put customers in the beginning by recalling thirty-one million containers of Tylenol capsules from stores and offered an alternative product in the safer tablet form free.
Before 1982, nobody ever recalled anything.
The company's chairman, James Burke widely praised for his leadership in the decision to remove Tylenol capsules from the marketplace, and for his candor in dealing with the media gave a strong impression that he was in complete control.
Johnson & Johnson went beyond resilience and robustness, growing with stress. Their maturity, however, could have made them rigid and fragile. They reread in the crisis their mission statement. Listened to employees who listened to customers, took complete responsibility, and created new policies and procedures with suppliers. This was the product of their policies about diversity and inclusion.
Jim Woods, President & Diversity Consultant, Woods Kovalova Group
ABOUT JIM WOODS
Jim is president and co-founder of Woods Kovalova Group and head of the Diversity, Equity & Inclusion (DEI) practice. In these roles, Jim advises clients on the intersections between DEI, talent, culture, corporate social responsibility, business strategy, and the future of work across all industries. A frequent speaker on the topics of DE&I and the future of work, he is the author of several publications shaping the national conversation around inclusion and race.
Outside of Woods Kovalova Group, Jim sits on numerous boards. Jim holds a B.A. and an M.S. in organizational development and human resources.