In October of 1982, Tylenol, the leading pain killer medicine at that time faced a massive crisis. Seven people died in Chicago after consuming the medicine. A probe led to a shocking revelation. An unknown suspect put 65 milligram Cyanide in the bottles.
What did Johnsons & Johnsons do to solve the crisis? There were a number of options: Launch a media outreach to save company’s image? Recall the products? Advertise about product safety and many more.
At the time Tylenol was the market leader commanding 37% market share. A product recall would mean a loss of exactly $100 million dollars.
Luckily, the solution for Johnsons & Johnsons was already written by it’s Founder, Robert Wood Johnson in their Value Statement. And it was simple - “Customers First”.
Following their Value Statement, Johnson's & Johnson's swiftly recalled 31 million bottles of Tylenol from the market. Even though everyone knew that it wasn’t company’s fault, they took a huge loss in the interest of consumers.
The Customers First strategy not only saved Johnson's & Johnson's from the crisis but they emerged as heroes. The decision enhanced their image.
Eventually, the product returned to market. and Johnsons & Johnsons continues to thrive as a company. Temporary loss didn’t matter in the long-term.
That’s the power of Customers First. When you are on the cross-roads. When you are on the brink of taking important decisions in business, you face this irony. You will have to choose between short-term and long-term. The interest of stakeholders, investors, management, and employees might clash with customers interest. What would you choose?
You can choose topline, bottomline or some fancy strategy OR you can choose - Customers First. What I can tell you with confidence is - the later will always win.
Great Organizations follow “Customer First” strategy.
What about you?
What are your thoughts on the Customer First strategy?
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