October 5, 2012 Times Businiss
This post is in partnership with Knowledge@Wharton, the online research and business analysis journal of the Wharton School of the University of Pennsylvania. The article below was originally published at knowledge.wharton.upenn.edu.
In a 2004 Wharton School Publishing Book titled, Lasting Leadership: What You Can Learn from the Top 25 Business People of Our Times, Burke emphasized the value of the J&J credo, dating back to the company’s founding in 1887, which stated that the company is responsible first to its customers, then to its employees, the community and the stockholders, in that order. “The credo is all about the consumer,” Burke said. When those seven deaths occurred, “the credo made it very clear at that point exactly what we were all about. It gave me the ammunition I needed to persuade shareholders and others to spend the $100 million on the recall. The credo helped sell it.”
Ironically, Johnson & Johnson has recently experienced a number of setbacks that “have caused many to question whether the firm has lost sight of that credo,” according to a Knowledge@Wharton article earlier this year. The company’s problems with plants in Fort Washington, Pa., Lancaster, Pa., and Puerto Rico — the sites associated with recalls of over-the-counter products like Benadryl and Children’s Tylenol – “dragged on for years,” the article notes. Two hip devices were recalled in 2010 for post-surgical complications, and the company agreed to pay $158 million to the state of Texas to settle claims it improperly marketed the anti-psychotic drug Risperdal to some patients. Other suits surrounding the marketing of this drug are ongoing. Recalls of surgical sutures and contact lenses have been announced as well.
The person who placed the cyanide in the Tylenol capsules was never found.
Read more: http://business.time.com/2012/10/05/tylenol-and-the-legacy-of-jjs-james-burke
