Executive summary
Four main recommendations on what Johnson and Johnson Company should do to correct the continuous horrific series of activities for years. These include improving the management of the company. This may include the hiring of more officers to be in charge of various production centres or company. This is made to decentralise the management of the company. The company should also improve of the production procedure/techniques. This should be done to ensure quality of the products. Proper procedures of introducing new products should also be followed to avoid unnecessary law suites. Upholding ethics and morals in the production and selling of the products. This will check the number of the affected.
- Opportunities to create value through product awareness
- Value creation strategy
- Opportunities to create value
- Barriers to create value
- Production strategy
Products should be of high quality. The correct quantities of the ingredients should be maintained. Evidence of such a situation was by the realisation 40 Tylenol products on 30th April 2010 that they all had inappropriate amounts of both active and inactive ingredients and thus where risky for usage by the customers or patients.
Products side effects should also be communicated inn details before they are released to the users. This will reduce the many incidences of lawful suites against the company due to unexpected side effects.
The cost of the production is quite high to such extent that the company may be afraid of failing to make profits. It is due to this situation that the company may overlook some of the production procedures leading to the faulty products.
There is an inherent fear that should the users learn of the side effects before the purchase of a product, then the total sales of the product would be low reducing the high profit margins of the company
Procedures of introducing new products
Necessary procedures of introducing a new product should be followed. It includes the identification of the possible side effects of the new products which should then be released to the doctors and regulatory boards before the product is released to the end users. E.g. the ortho Evra birth-control patch was such a quick invention that was labelled as one of the best compared to the pills and it ended up causing serious problems including death.
The company’s desire to make maximum profits may be a serious limit to this. This is because the demands from the doctors and the boards in most cases delay the permits to produce a new drug.
Uphold ethics and morals
The company should consider and uphold ethics in the promotion of its products. It was wrong for the company to continue selling the highly failing products as it has done with ASR. In fact it is a gross violation of the ethics to even pay huge amounts of money to doctors who use there product regardless of its failure rates. This can be supported by the fact that law suit had been made against the company for paying kickbacks to Omnicare (OCR) for nursing patients using Risperdal for treating elderly dementia patients yet it is highly risky since it causes death.
The major challenge is in that mistakes occur quite often and they are amplified if the people undertaking the marketing activities are not well informed on matters of morals and ethics. The large numbers of people in the business line will also make it difficult to up hold strict morals.
Improving the management of the company
The overall management of the company needs to be decentralised. This is because of the fact that the big nature of the company does not allow the few executive officers to perform there duties effectively. This can be taken to mean that the leadership loop holes and carelessness that extents to lack of basic maintenance and repair of the productions centres (factories) leading to contamination of the products will be checked. Example, the FDA had released a detailed report on the conditions of the company where it had found out that unwanted material and black specks had been found in the products. The contamination was linked to an opening in the roof of the laboratory and dusty equipments.
The management team may also be questionable on matters of strictness and competence. This is clearly in that the company had to recall Tylenol twice. The first being the year 1982 found to contain cyanide and 2009 found by FDA to be possibly contaminated.
The major challenge is due to the high cost of wages to maintain the many executive officers required at various level.
It is also possible that if the number of officers in charge is increased, making decisions is likely going to be slowed down due to the numerous consultations that may be required.
Opportunity overview
The main opportunities that the company is exposed to include diversification of the products that it produces. The products should also be good quality. Good customer promotion policies can be established to create customer loyalty. The executive should develop unique administrative and management teams that will oversee the company’s activities continuously and hence provide immediate quality and long term solutions to any problems experienced.
Barrier Summary
The most significant of the barriers is the cost. This is because every new aspect in the company comes with its cost. Taking for example hiring extra support staff may be very expensive since this attracts more expenses on salary. Improving the production procedures may also lead to extra expenses cutting down the profit margins. The competition from other companies also presents a challenge since the competitors may use the current situation and the history to promote their products. The company faces a serious challenge to clear its name from the current situation. This is because of the accumulated horrific challenges that have occurred. A proper marketing strategy should be put in place to correct this.
Recommendations
1. The board should take immediate action on the matters presented to them. This includes ensuring quality of the products by ensuring proper production mechanisms and also by putting in place more quality officers to access the products before they are released to the customers. The company may also improve the customer relations.
- Benefits
- Barriers
- Decentralization of management
- Quality officers in each level of production
- Develop a good customer relationship
- High cost due to increased number of employees.
- High cost of salaries.
This require capital input hence extra expenses
2. The company should ensure that it operates within the legal frame work. It should ensure that all procedures required to introduce a new product are required. It should also uphold high level of morals in any promotion of a drug or a product.
This can not be entirely done away with due to the nature of products and customers i.e. it’s not possible to do away with all possible problems associated with a product.
There may be no any other immediate alternative to replace the already existing one.
Action steps
1. Checking the production methods and procedures
2. Improving the management by decentralization and also accountability in the management team
3. Following all procedures while introducing a new material
4. Upholding ethics and morals
5. Focusing on the quality other than the cutting down of production cost.
