In 1982, Tylenol had a major crisis. Johnson & Johnson, the company responsible for Tylenol had an issue. In October, they found that somebody had put 65 mg of cyanide into Tylenol capsules, which is 10,000 times what is necessary to kill a human being. Seven people died in Chicago after taking the Extra-Strength Tylenol. This tampering happened once the product reached the shelves. They were taken off the shelves, injected with the cyanide and returned to the shelves. Technically, Johnson & Johnson didn't have anything to do with it. At that time, their market revenue was about $ 1.2 million; their market share was 37%. After the cyanide poisonings, market share was reduced to 7%.
How did Johnson & Johnson respond to this crisis? The moment they knew that one of their products was being destructive to the company and to people, they fell back on a value that they had. That value went back almost forty years to the time when Robert Wood Johnson, the son of the founder (later became to be known as General Johnson because he served as a Brigadier General in World War 2). He took over the company in 1932, and ten years later, he put together a one-page document that came to be known as the Credo. That Credo stated that the company's first responsibility was to people who used its products and services. The second responsibility was to its employees. The third was to the community and environment and the fourth, to its stockholders. It was revolutionary at that time. Johnson & Johnson believed that if the first three were taken care of, then the stockholders would be well served. In fact, at every J & J crisis meeting, if ever somebody said, "Well, hang on just a minute. I think this is a credo issue," everything came to a halt.
Dov Seidman says in his book, "It was like a trump card. That's a credo issue meant talking about the credo. What's the issue? What are the pros and cons? What's the dilemma?" Many people outside of Johnson & Johnson would say, "That's crazy! You stop every thing and begin to go back to your values. But the last sentence of that credo was the most important. It said, "When we operate according to these principles, the stockholders should realize a fair return. What that meant was that the credo was not a brake on our success; it was the engine of our success." Everything in J & J's history proved the General right.
Amazing! To have that kind of a values-driven company! Yet, as I was reading through Dov Seidman's book 'How: Why How We Do Anything Means Everything In Business and In Life' in his chapter, 'The Case For Self-Governing Cultures' he looks at different cultures that operate in companies:
1. The culture of anarchy and lawlessness, which really dealt with village markets, local artisans. They had their own self-interest at heart, little regard for group dynamics or organizational ethos; no health plans. They did not want others to take their place. If people who worked for them didn't comply, they said, "It's either my way or the highway. Do it this way or leave. There are other people to come and do the work."
2. The culture of Blind Obedience where no one questioned the boss. This was what needed to be done and they did it. They were told what were the consequences if they did it or if they didn't. They didn't have to understand why they did things. For example, if they were told to wear hard hats, they wore the hard hats. They didn't need to know the reason behind wearing a hard hat. It was sufficient that each achieve individual goals. This was the output that was expected of you; you did that and you did well. That was how blind obedience culture worked in companies.
3. During the Industrial Revolution, Informed Acquiescence became the prevalent culture. What was informed acquiescence? It was rule-based. If you wanted to participate, you learnt the rules and you lived by them. Once you lived by them, you kept them. Everything was fine. It created an efficient and very scalable culture in a company, especially in a top-down culture where things filtered down from top management. All they had to do was put the rules in place and issue directives and have them sift through the organization chart in very predictable controllable ways. It was management oriented and also established a bureaucracy meant to keep all the rules intact and to provide new rules and processes that were needed. It also helped people to be rational agents, to understand things; was more black and white because of the rules, there was not too much left for nebulous thinking, no grey areas. Everyone knew what was expected of them.
4. But Dov Seidman says that the kind of governance that is beginning to permeate companies like J & J and Coca Cola is a value-based self-governance, where everybody takes responsibility for maintaining a safe working environment. So in this type of a culture, they buy into the values of a company. They believe that value. For example, safety is a value. Because safety is a value, everyone should wear a hardhat. They believe it; they act on it and they self-govern in the name of it.
I was travelling with a friend a couple of weeks back and as we got into the car, he turned around and said, "Seatbelts, everyone!" So we were all putting on our seatbelts and one person commented on it. What we realized was that we don't wear seatbelts because it's the rule; we wear seatbelts because it is the safe thing to do. That's the difference between moving from the informed acquiescence type of culture to a value-based self-governance, where we buy into a way of doing things not because a rulebook says so, but because it is part of our own belief system. Values speak to a higher self. They have the power to inspire and not just motivate, says Dove Seidman.
I think that's the key! If we can get values to be an integral part of our company culture, then as people buy into those values, they don't need rules to tell them how they should act, because they act in accordance with those values. I remember telling you some time back, how I walked into a Mac store one day. I had a problem with my Mac; it had crashed for no reason. I was talking to this person at the counter and asked him, "Why did it crash?" He replied, "I really don't know but we'll find out." I was kidding around with him, telling him how much flak I had taken from my friends who used PCs, especially my daughter who was really giving me a hard time. He smiled, filled the form that told me how much I would pay to get this repaired. He gave me the form to sign and said, "We'll take care of it." When I looked at it, it said $ 00.00. I asked him, "What's going on?" He said, "Do you have a problem signing that form?" I shook my head and asked him why. He said, "Because here at Mac, we like our customers to leave with a smile on their faces." That was a values-based decision. It was a decision that said, "You're more important to us than any of the rules that we may have that say what we charge a customer to replace a certain part. A happy customer is an important customer to us. That's part of the value of having customers who are cheerful as they leave this place because they add value to our product. They go around and talk about what kind of service they received at a Mac store." I can tell you this: I've been a walking, talking advertisement for Mac since then.
Values-driven culture! That's the key for us as we look at some of the things that we do. What's the kind of culture that's in your company? Is it still by the rules? I remember we ordered pizza a couple of days back; we ordered at 9:30 and it hadn't come by 11:00. We called, were transferred to the call center who gave us the runaround saying that they would see what they could do. Finally we asked to talk to someone higher up because they were just going by the rulebook. They couldn't take a decision. Yet, in a value-based self-governance culture, people are empowered to take decisions that keep customers happy.
Well, what about you? What kind of culture are you in? I understand that you may or may not be able to change culture if it's not there in your organization. You have to abide by what is there. But you can change the culture of your own life. You can change it with the people who are around you, your family, your friends. You are not somebody who goes by the rulebook; you're somebody who goes by values that come from what you believe in.
That was the challenge for me today. What do I believe in that can contribute to good values, can contribute to a wonderful relationship with people around me, who know what to expect from me? Do I have a belief system? Do I have values that are close to me? I'm going to throw that out as a challenge to you. Do you have values personally that you abide by, that dictate the kind of person that you are? They stem from a belief system and then it works itself out into a worldview. That worldview is how we interact with people. How do people see us? That is a good question for us to think about. What drives us? Do we have values consistent with our life?
I'm going to leave you with that today. Just a thought to ruminate on and then come to your own decisions and make changes if you need to. I pray that the Almighty God would lead us in that process. Let's invite Him to do that.
Almighty God, come into our lives, into our thought processes. Guide us; show us what kind of values we need to have in our lives. Help us to work and live by those values. May they be values that give honor to You, Almighty God. We ask this in Jesus' name. Amen.
• The Tylenol Crisis, http://iml.jou.ufl.edu/projects/fall02/susi/tylenol.htm
• Dove Seidman, "How,"
No comments:
Post a Comment