Analyzing Ethical Leadership: Johnson & Johnson Case Study Report

This report examines the ethical leadership of Johnson & Johnson, focusing on a case study related to the Tylenol crisis. The report explores the nature of ethical issues in business and the role of businesses in society, specifically analyzing how Johnson & Johnson's ethical choices impacted stakeho...Read More

OPERATION MANAGEMENT

INTRODUCTION...........................................................................................................................3
PART 1............................................................................................................................................3
Chosen case study...................................................................................................................3
Nature of ethical issues and role of business in society.........................................................3
Identification of key stakeholders and impact on them and examples how ethical choices have
benefited other business.........................................................................................................4
Recommendation for company emerging from analysis........................................................6
Application of two ethical theory on case study....................................................................7
CONCLUSION................................................................................................................................7
PART B............................................................................................................................................8
REFERENCES..............................................................................................................................11

INTRODUCTION
Operation management termed out as administration of business practices that creates
high level of efficiency possible within the enterprise (Freeman and Greenwood, 2020). Thus,
ethics and practices plays the crucial role in operating the business function in streamlined
manner. Business ethics plays the effective role within hiring and conducting business
management practices. It is based on morale rules that defines that how businesses operate, how
decision relate with business can be made and how people within enterprise can be treated
(Vidgen, Hindle and Randolph, 2020).
The present report is based on case study such as Johnson & Johnson, taking the pain
away. It is one of the most trusted brand. Furthermore, study will be based on outlining the
ethical dimension and issue from the case. Also, role of business in society will be defined and
discussion will be undertaken that how ethical choices impact the other companies. Lastly,
discussion will be made on what makes an ethical leader that offers business high ethical
standards.
PART 1
Chosen case study.
The present chosen case study is based Johnson & Johnson- Taking the pain away. Thus,
it is based on the Tylenol that is effective and over the counter pain reliever. Henceforth, Tylenol
was one of the crucial product to its manufacturer, Johnson & Johnson. Thus, the crisis happened
when someone has replaced Tylenol extra strength capsules with cyanide laced capsules resealed
the packages and placed them back on the shelves of at least six pharmacies and grocery stores in
the Chicago area. Thus, seven people died after consuming the besmirched capsules. This
incident has affected the brand image of the enterprise at the first phase. Thus, Johnson &
Johnson takes the effective strategy to alert the consumers and to save the product. They
immediately rush to media relations to alert the consumer so that they do not consumer Tylenol.
Therefore, they changed the product packaging. Also, they provided victims families counselling
and financial assistance.

Nature of ethical issues and role of business in society.
Business ethics deals with moral principles and social values. This is one of effective way
that aids to classifying what is good and what is bad. Business ethics defined as to conduct
business with human touch to provide effective welfare to the society. In addition to this,
business man must be ensuring to provide the regular supply of good quality services and
commodities at reasonable prices to their consumers (Costea and Amiridis, 2020). To regularly
complied with business ethics means to avoid indulging in the unfair trade practices such as
promoting misleading advertisement, black marketing and cheating in weights etc. Company
must pay fair wages to their worker so that they adhere with fair practices. Johnson & Johnson is
taking varied initiatives to be ethically and responsibly conduct the business practices in right
manner so that enterprise can able to gain competitive advancement in market (Soltwisch,
Brannon and Iyer, 2020). Thus, fir is conducting their business with highly ethical standard and
to do the business activities in more streamlined manner. In addition to this, Johnson & Johnson
provides enhanced guidance on to addressing the evolving business environment. Thus, the role
of business is to produce and to distribute the good and service that assist to satisfy the public
need or demand. Corporate social responsibility is one of the core source that conduct the
business practices in streamlined mode.
CSR as a business practice involves putting certain funds toward enterprise or people
who are in need of help. Business ethics is code of conduct. Thus, business ethics is based on
moral and social values and this contains the practices that helps to conduct the business
practices in effective and efficient mode (Syed, 2020). Thus, business ethics plays the crucial
role in hiring and business management practices. Business ethics are termed out as guidelines
that uses by company while interacting with entities and outside the company.
Therefore, this is conscious efforts that assist to provide the way that allows to treat
people effectively and also assist to conduct the business practices in streamlined mode (Surdam,
2020). Thus, this can be stated that ethical business practices provide the enterprise positive
professional brand image. Henceforth, effective business ethics can assist the people to create
effective and strong business relationship that results into lower product cost. With help of
maintaining the good ethics can be helpful to sustain these strong business relationships that
benefits the firm in effective manner (Del Baldo, 2020). In addition to this, ethical treatment of

employees is one of key element that allows to retain employees for longer period and also
reduce the negative impacts of turnover.
Identification of key stakeholders and impact on them and examples how ethical choices have
benefited other business.
Stronger ethics practices within entity allows to make the better ethical environment that
leads to better interaction with inside and outside of business organisation. Thus, stakeholder
termed out as individual that interest in firm, ranging from employees to loyal customer and
investor (Syed, 2020). Organisation management is largely get influenced with the perspective
and opinions of internal and external stakeholder. Stakeholder termed out as group, individual or
community that impacts the working of operations in huge context. Therefore, the internal and
external stakeholders are outlined such as-:
Internal stakeholder-:
They are the stakeholder in which individuals and groups impacts the operational process
of the enterprise. Thus, they are outlined such as-:
 Employees- Employees to the enterprise considered as primary internal stakeholder.
After, the crisis happened in Johnson & Johnson the employees to the enterprise become
more responsible to conduct the business activities in fair and adequate manner.
 Managers- The role of manager is to plays out the substantial role in determining the
plan of action that is suitable to maintain brand image of the enterprise. After incident of
Tylenol the manager took step to come in from of media to avoid the use of medicine and
also stopped the production process (Zhang, Cao and Li, 2020). This strategy has helped
the firm to maintain brand image.
 Owners- They are the person who holds the significant share of the firm. This incident
has also impact the owner to make the substantial decision in relation to both internal and
external stakeholders.
External stakeholder-:
They are the individuals who plays the crucial role in wide variety of interaction along
with varied external stakeholder group. Thus, these are outlined as-:
 Customers- The primary object of entity is to providing good and services to fill the
requirements. This incident of Johnson & Johnson has affected the trust of customers.
Although the incident was not taken on part of the firm. In order to cope up with it the

organisation has taken the steps to interact with customers with social media, emails and
to offer and services in more safe manner is the crucial aspect of maintaining the brand
image of enterprise.
 Suppliers- The strategic alliances to the enterprise are interdependent as success and
failure of business also impacts the another one (Vidgen, Hindle and Randolph, 2020).
Henceforth, supplier are termed out as to closely related to the organisation as they are
key to the external stakeholder. After the incident, Johnson & Johnson take steps to
stopped the production process of Tylenol. Therefore, this decision has impact the
process of supplier as this was the medicine that used to sold in bulk. Henceforth,
shipments, communication and operational process are key in terms to maintain strong
relationship with stakeholder group.
 Local community- The affect on brand image affects the brand image of the enterprise in
the negative aspect. Thus, this incident has affected the people of local community and
due to this the profitability and productivity of entity falls off (Freeman and Greenwood,
2020). In order to cope up with it, Johnson & Johnson took the strategy to packed the
medicine with triple security mode. Henceforth, entity must look at the needs of
community to ensure that negative repercussion is minimised so that engagement of
community can be enhanced.
 Government- The legal authorities play the crucial to ensure the integrity and fairness of
working enterprise. In addition to this, the government also banned the production of
Tylenol till the time Johnson & Johnson became successful to prove innocence.
Recommendation for company emerging from analysis.
On the basis of above chosen case study as Johnson & Johnson- Taking away the pain,
the following measures are outlined such as are-:
 Johnson & Johnson should set the insider trading to deal with this kind of situation as
future of course of action. They must hire the manager who keep focussing over the all
insider operations so that streamlined working activities can be conducted.
 The chosen entity should take steps to maintain better supplier relationship so that
effective raw material can be supplied and this can be effective way to enhance the brand
image of enterprise.

 Johnson & Johnson should invest in CSR that helps to enhance and maintain the brand
image of the enterprise. This is the only way that ensure to raise working of enterprise in
effective and efficient mode.
Application of two ethical theory on case study.
In order to make the ethical decision, there are three approaches assist to conduct the
business practices in ethical manner such as utilitarian ethics, deontological and virtue ethics.
Therefore, these are outlined are as-:
Utilitarianism- This is termed out as one of best known and most influential moral theories.
Thus, the core idea of this theoretical approach is to identify that the actions are morally right
and wrong depends on their effects. Johnson & Johnson should apply this approach as this helps
to determine the rightness and wrongness of an action and that can be judged by its consequences
(Zhang, Cao and Li, 2020). However, the goal of utilitarian ethics is to promote the greatest
happiness for the greatest number. This is one of the effective approach that aids to determine the
consequences and also aids to cope up with the consequences.
Deontological Ethics- This is termed out as the normative ethical theory that assist to pit
consideration over the emphasise on relationship among the duty and morality of human actions.
This is one of the ethical approach that based on rules and rights based. However, this is one of
the theoretical approach that comprises of duties, obligations and rights. In addition to this, it can
be stated that deontological moral system are mainly characteristics by putting focus upon strict
adherence to independent moral rules and duties. In this ethical theory system, the the duties,
rules and obligation can be determined with help of agreed code of ethics. Thus, Johnson &
Johnson should apply this ethical theory so that working of the business can be conducted with
effective system, duties, rules and obligation etc.
CONCLUSION
Hereby, it can be concluded that Business ethics means to put the consideration over the
profitability and social responsibility. This is crucial to perform business practices in more
positive approach and this aids to enhance brand image of enterprise. Thus, present report has
covered the case study of Johnson & Johnson, Taking away the pain. Furthermore, study has
outlined the ethical dimension and issue from the case. Also, role of business in society has been
defined and discussion has undertaken that how ethical choices impact the other companies.

Lastly, discussion has been made on what makes an ethical leader that offers business high
ethical standards.
PART B
In an organisation a leader plays vital role in managing tasks. This is because he is having ability
to lead and direct people. Similarly, the ethical leader is also responsible for managing ethics
which is been followed in organisation. He imply and compliance those ethics within business.
I think that there is a great relationship between ethical manager and leader. It is because these
both are responsible for managing ethics. They both Work like a leader and manager. Here, the
manager defines policies and standards of how to work in ethical way. Also, plans and strategies
are developed by manager. Whereas leader ensure that employee are working in ethical way.
He monitor overall working of staff and tries to build honest relations with them. Moreover,
leader gain trust of employees and direct them to work in effective way. The leader is
responsible for implementing those ethics at workplace.
In my opinion there are several things which is required to become a ethical leader.
Basically, it is a leadership style which is based on respecting dignity and values of others.
So,ethics is first thing that makes an ethical leader. Also, he must be able to work in ethical
environment and treat his staff with respect and dignity. The leader should not allow staff to
abuse and mistreat others and if he found that then strict action needs to be taken. He must be
compassionate with them. Apart from it, leader must place his staff interest first and then his. It
will create a sense of feeling among them. Apart from it, leader has to be fair and give justice to
everyone in equal way. He should Treat staff on basis of ground like fair, just etc the leader must
not do bais on personal term with them. Leader need to remain honest with subordinate all the
time and should rely upon them. He must trust his staff in effective way and listen to their issues
and solve them by keeping their interest at priority. Also, ethical leader need to earn respect of
employees so that in any circumstances they are able to rely on them. Besides that, the situation
must be presented properly by leader with fact and he should not misinterpret it and tries to
present it. In this way leader will be able to show honesty towards staff. Henceforth, leader must
continue Build community. He should work for his as well as the staff purpose. Hence, by
working with community interest leader must try to achieve goals and objectives of team and
individual. Thus, by working in all these way it is easy to become a good ethical leader.

However, as ethical leader I think that I have responsibility to manage ethics. For that
first of all I will consult with top management that what are ethical standards and policies.
Besides, that I will discuss with ethical manager that and develop a plan or procedure through
which ethics can be followed and maintained. In this I will work closely with manager in
forming a plan. Then, I will develop my own plan and on basis of that initiate my efforts. First of
all as ethical leader I will conduct a meeting and in that give brief about what ethical standards
exist and in which area it needs to be followed. Then, I would show them benefits of working in
ethical manner. Moreover, I will also describe legal actions which can be taken against them if
they breach ethics. However, I will develop my own plan of monitoring of ethics within
organisation. For that I will track feedback of employees and monitor things in proper way.
Furthermore, I will manage ethics by preparing report on each week and observing the way of
how people are doing their tasks. Besides, if I found that unethical practices are followed I will
immediately take concern of it and inform to manager about it. I will take strict action against
that particular person. So, I will share e mail to staff as well that what action was taken to create
awareness among them.
Besides that, if there occurs any situation in which I am not able to understand that
whether ethical practices are followed or not. In that I will take help of manager in it. So, on
basis of his direction next time I will ensure that ethics are followed. Also, i will provide reward
to those who have maintained high ethics in their working. I will keep changing my way of
monitoring so that i am able to implement ethics in effective way. I will show them that how
organization value and ethics are beneficial for them and to company. With this they will achieve
goals and objectives. So, in this way i will be able to ensure high standard in business.
I realise that personal ethics are values and beliefs of ones own perception. It refers to
how we are able to perform task and in what way.
However, there are several condition as well which result in unethical practices within
organisation. First is ineffective policy and procedure to perform tasks. Another is misuse of
company technology for benefit of ourself. Beside that, steal of time and material from
organisation such as pen, documents, mouse, keyboard, etc. it all results in unethical practice.
Along with it, I think that lying of performance is also included in it because it led to failure of
completion of tasks. Henceforth, breach of contract is unethical as well. The employees sign a
contract which is then shared with third party by company so, it lead to breach of privacy and

confidential info. For example, if i found that staff is working in unethical way and they are
offering me huge amount of profit. So, in this Case i will keep my personal ethics and will Not
allow them to work in that way. Here. I will remain honest and trustworthy towards the
organization. This will help me to maintain high ethical standards within business.

REFERENCES
Book & Journal
Freeman, R.E. and Greenwood, M., 2020. Deepening Methods in Business Ethics.
Vidgen, R., Hindle, G. and Randolph, I., 2020. Exploring the ethical implications of business
analytics with a business ethics canvas. European Journal of Operational Research.
281(3). pp.491-501.
Costea, B. and Amiridis, K., 2020. Business, ethics and the question of value.
Syed, J., 2020. Ethics and Governance Norms in Cross-Cultural Projects: Implications for CPEC
and Other China–Pakistan Projects. In China’s Belt and Road Initiative in a Global
Context (pp. 75-87). Palgrave Macmillan, Cham.
Soltwisch, B.W., Brannon, D.C. and Iyer, V., 2020. The Ethics of Maximizing or Satisficing.
Surdam, D.G., 2020. Ethics of the Firm and Strategic Behavior. In Business Ethics from the 19th
Century to Today (pp. 125-157). Palgrave Macmillan, Cham.
Del Baldo, M., 2020. Overview: Virtue Ethics and Managerial Control. In Intrinsic CSR and
Competition (pp. 87-104). Palgrave Macmillan, Cham.
Syed, J., 2020. Ethics and Governance Norms in Cross-Cultural Projects: Implications for CPEC
and Other China–Pakistan Projects. In China’s Belt and Road Initiative in a Global
Context (pp. 75-87). Palgrave Macmillan, Cham.
Zhang, Q., Cao, M. and Li, X., 2020. Effects of corporate social responsibility on customer
satisfaction and organizational attractiveness: A signaling perspective. Business Ethics: A
European Review. 29(1). pp.20-34.