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When it comes to a corporate crisis, Johnson & Johnson (J&J) and its subsidiary Tylenol demonstrate what a company should do in responding to stakeholder concerns. With its handling of the Tylenol tampering in the early ‘80s, J&J secured its status in the history books for effective crisis management. Since then, J&J has won numerous accolades for consumer safety and for its social responsibility initiatives. In 2010, Barron’s magazine named Johnson & Johnson #2 among the World’s Most Respected Companies. Targeted at top investors, the survey ranked winners according to their strength of management, business strategy, ethical business practices, competitive edge, shareholder orientation, and consistent revenue/profit growth. J&J also ranked eleventh place in DiversityInc magazine’s “2012 DiversityInc Top 50 Companies for Diversity” list.

As with most major companies, however, J&J has received its share of criticism in regards to Tylenol. Recent waves of Tylenol recalls and other over-the-counter medications, resulting from bacterial contamination, nauseating smells, and metallic flakes, have cost the company financially. It has also elicited criticism from the Food & Drug Administration (FDA) on Johnson & Johnson’s slow response time. The problems escalated so much that the House Committee on Oversight, Government Reform, and the Justice Department began investigating the company. Health officials are also concerned about the chemical acetaminophen found in Tylenol, which can cause injury or death if too much is consumed. This case will therefore analyze some of these crucial issues as well as how Johnson & Johnson maintains its industry-leading reputation through its day-to-day operations and commitment to its Credo of Values.

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