It was every CEO’s worst nightmare. Seven customers died in 1982 after taking the company’s most popular and profitable product. Instead of getting relief from common colds or a headache, they were given a death sentence. The extraordinary way that the CEO of Johnson & Johnson, James Burke, strategically utilized influence to respond to this major crisis made him a legend and the pharmaceutical giant one of the most respected companies in the world.
The intelligent use of influence, a process I call “Intelligent Influence,” is the foundation of success in any endeavor involving human interaction. J&J’s response to the Tylenol crisis is a textbook example of the most effective way to use the four steps of Intelligent Influence in crisis management.
Tylenol was, by far, J&J’s most successful product. Tragically, someone in the Chicago area laced several packages of Tylenol capsules with enough poison to kill several adults. Shortly after the first few deaths were discovered, investigators and J&J determined that the company was not to blame for the poisoning. Burke, therefore, could have called a press conference and, like many other CEOs, said, “We are saddened by these deaths. However, our company was not at fault. We will therefore resume our normal production and sales through our partner stores.”
Instead, he made history by calling an emergency meeting of J&J’s senior leadership team where he led them through the four critical influence steps. The first — Influence Awareness — called for a review of the culture and early influences of the company. The second — Influence Impact — suggested that they review in detail the way that the crisis was influencing the marketplace. The third — Influence Management — involved developing a plan to influence consumers to make J&J a trusted health partner again. The fourth and final step — Influence Maximization — consisted of developing a plan to flawlessly execute the influence strategy.
The first step forced the J&J leadership team to develop a crisis-response strategy built around the company’s credo and historic focus on always putting the customer first. The second step helped the executives understand the extent to which the crisis led to widespread distrust of the company and the industry. The third step helped the leadership team develop a response plan that would ultimately transform the business world. The fourth step led to a masterful implementation of the plan that succeeded beyond the team’s wildest imaginations.
This four-step process led J&J to do what few companies had done — put customers before profits by pulling Tylenol off of store shelves. They then designed the first tamper-proof packaging of its kind in the industry. When they reintroduced Tylenol, now with tamper-proof packaging, they were able to regain the trust of consumers and receive widespread positive press and praise. For more than a decade, J&J was considered one of the most respected brands in the world because of their response to this crisis. Most importantly, its crisis-management plan helped them generate record product sales.
The next time you or your company faces a crisis, follow the late James Burke’s lead and try this four-step influence process. You will be pleasantly surprised by the results.
Dale G. Caldwell is the author of “Intelligent Influence” and the CEO of Strategic Influence, which provides strategy and operations consulting services to corporations. He has taught at Columbia, New York, Rutgers and Seton Hall universities. He is a former member of the board of directors of the U.S. Tennis Association. Caldwell can be reached by e-mail at [email protected].