News Article

BUS 600
Dr. Baldonado
November 28, 2013

Abstract
The success or failure of a company depends on a series of decisions made by the company’s leadership. Although there are companies that have had short term success by making unethical decisions history has demonstrated that a company tends to have more long term success when the leadership makes ethical decisions. A prime example is when Johnson & Johnson’s CEO in the 1980s made a series of ethical decisions that contributed to the success of the company. During the Tylenol crisis James E. Burke made decisions that cost the company a substantial amount of money in the short term to protect the public’s safety. In the long term Johnson & Johnson’s productivity increased and it is still a profitable company today.

A CEO’s decision making skills often have a direct impact on the success or failure of a company. Although there are many examples of unscrupulous business practices across industries this paper will examine a case where a CEO acted ethically. Specifically, it will discuss the impact of former CEO James E. Burke’s leadership decisions on his company Johnson & Johnson in the 1980s. Both the financial impact and the ethical impact of his decisions will be analyzed. James E. Burke’s heroic decision is a classic example of ethical leadership in action. In late September 1982 a twelve year old girl died after taking Tylenol painkillers (Fletcher , 2009) Later that day a postal worker died after taking the same drug (Fletcher, 2009). In less than a week seven people died and the only thing that linked them is that each of them had taken extra strength Tylenol(Fletcher, 2009). Investigators found that the Tylenol had been laced with very high levels of potassium cyanide (Fletcher, 2009). Although Tylenol generated seventeen percent of Johnson & Johnson’s net income in