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I was recently reminded of the Tylenol scandal from 1982, where 7 people in the Chicago area died after taking Extra Strength Tylenol that had been laced with cyanide. An exhaustive investigation into the situation revealed that the product was tampered with after leaving the manufacturing plant. Despite investigative efforts however, to this day, no one has been charged with the killings (although someone was convicted of extortion after sending a letter to Johnson & Johnson for $1 million dollars to stop the killings). Prior to the incident, Tylenol held about 35% of the market share of the over-the-counter pain reliever market. In the immediate aftermath of the incident, Tylenol’s market share dropped to 8%.

What was fascinating and relevant to small business owners, was Johnson & Johnson’s response. Upon discovering that the tampering of the product likely happened at the retail level, they could easily have blamed retailers. But they didn’t. They could also have simply recalled products in the Chicago area since all the deaths happened there. There were some that actually pushed for this more localised recall, but instead, James Burke, the CEO at the time, pushed instead, for an immediate global recall of approximately 31 million bottles of Tylenol.

Here are some additional key efforts that Johnson & Johnson undertook to respond to the situation.

Public Warnings
The company didn’t try to cover this up. They issued national warnings advising consumers not to use Tylenol products until further notice.

Collaboration With Authorities
The company publicly communicated their cooperation with law enforcement and the FDA to investigate the tampering

Introduction of Safety Measures
Johnson & Johnson’s informed the public about the development of tamper-resistant packaging to assuage public fears about future tampering incidences.

Customer Support
The company quickly established a hotline for concerned customers and offered replacement products for those who returned potentially tainted products.

These steps weren’t initially widely accepted. In fact, there were many within the company pushing to localise the recall, stating that the cost of such an exhaustive recall would be too high. To his credit, Mr. Burke pushed stakeholders. He argued and fought for the global recall. He asserted and reminded stakeholders of the first line in Johnson & Johnson’s credo:

“We believe our first responsibility is to the patients, doctors and nurses, to mothers and fathers and all others who use our products and services.”

The Power of The Brand Promise

The power of the credo was immensely powerful. Can you imagine convincing the board to spend $100 million (over $330 million in today’s money) to invest in remedying this situation? Now, I’m approximating here, but Tylenol’s profit to the company in 1981, would have been roughly $110 million dollars (Tylenol’s revenue attributed to 19% of Johnson & Johnson’s sales in 1981. I’m just attributing the same 19% to their after-tax profit as well, so it’s just a guess), but a $100 million investment to remedy this situation would have essentially been their entire year’s profit.

By leaning into their Credo, what they stand for, and why they do what they do, they were able show, not tell. They were able to walk the walk, and not just talk the talk. And they were able to do, as Seth Godin says, “People like us, do things like this”; which in this case, meant that the Credo compelled the company to act in the interests of patients, doctors and nurses, to mothers and fathers, and to all those who use our products and services.

We talk so much about understanding our ‘why’. We talk incessantly about developing our core values. We implore constantly for companies to develop a brand promise. The Credo that Robert Wood Johnson crafted in 1932, was exactly that. And by staying true to these core values and brand promise, Tylenol bounced back to nearly 48% of the market share. Dropping to 8% and rebounding to 48% 90 days after the relaunch. Absolutely remarkable.

Communication, Transparency, and Timeliness

I’m lumping these in as one item mostly because I’m writing an article, and not a book. Johnson & Johnson acted swiftly; making sure that the public was not only informed, but clear about their intentions.

James Burke appeared in commercials, allowed for over 50 interviews, and became the face of the rebuilding of trust for the Johnson & Johnson company, and the Tylenol brand. When they relaunched with the tamper resistant packaging, he did so by holding a press event that was beamed via satellite to 100 cities.

Assuming Responsibility

To be quite honest, Tylenol, and Johnson & Johnson hadn’t done anything wrong. They could have brushed it off and blamed the perpetrator(s). They could have said that this wasn’t a Tylenol issue, but rather, a retail issue. They could easily have attempted to shift the responsibility. But they didn’t. They assumed responsibility even when they didn’t absolutely have to.

They also took the extra effort to ensure prevention by challenging themselves, not just to developing safer packaging, but revolutionising packaging. They worked with the FDA, they implemented foil seals, child-proof caps, and tamper-evident bands so that consumers would know if a product had been opened. And they did not relaunch the product until after these measures were implemented.

It resulted in the FDA implementing stricter regulations for tamper evident packaging, something that is now mandatory for over-the-counter medications.

Conclusion

Johnson & Johnson’s Corporate Vice President of Public Relations, Larry Foster, during this period reflected, “What began as Johnson & Johnson’s darkest hour turned out to be its brightest in terms of corporate reputation.”

To this day, people in crisis management talk about the Tylenol scandal of 1982. While small business owners obviously don’t have $100 million to put into rebuilding their brand, if we continue to practise living by our credo, leaning into our core values, and understanding the ‘why’ that drives us, we will perpetually and continuously building our brand image to our customers and clients. And when we do face a crisis, having a clear brand promise and fully embracing our core values will mean that we won’t have to respond to a plan, we can do what Johnson & Johnson did. According to Mr. Foster, “We responded from our values”.