In 1989, Exxon Corporation caused one of the worst environmental disasters. The oil tanker Exxon Valdez spilled 250,000 barrels, an amount equal to more than 10 million, into the waters of Alaska’s Prince William Sound after striking Bligh Reef at approximately 12:04 a.m. on March 24. The spill eventually covered 11,000 square miles of ocean and coated 1,300 miles of coastline. Shortly after the incident, different media piled in to begin extensive coverage often pointing out Exxon’s corporate irresponsibility. Company’s efforts to contain the spill were not good enough and slow but Exxon’s response was even slower.
In addressing the problem, it tool company officials 10 hours after the accident to deploy booms that will contain the spill. Company executives refused to comment on the accident for almost a week and refusing to acknowledge the extent of the problem. In addition, statements made to the press by high-ranking executives were often inconsistent and contained contradictory information making the press question the credibility and truthfulness of Exxon.
After the Exxon Valdez ran aground, the company conducted all its communication from the small town of Valdez, Alaska. This area proved inadequate, having only limited communication capabilities. Exxon seemed unwilling to disseminate its information using any other method or location. But the biggest criticism the company received was the fact that CEO Lawrence Rawl waited nearly six days to make a public statement. And that he did not visited the scene of the accident until three weeks after the spill. Combined, these actions left the public with the impression that the Exxon Corporation did not take the problem seriously.
The severity of the oil spill were thousands of birds, fish and animals died right away, including somewhere between 250,000 and 500,000 seabirds, thousands of sea otters, harbor seals and bald eagles, a couple of dozen killer whales and more river otters. Clean up efforts washed away visible damage of the Exxon Valdez oil spill but the environmental effects are continuously being felt. John Devers, the Mayor of Valdez, commented that the community felt betrayed by the company’s inadequate response, contrast to the promises they gave. The fishing industry and marine life collapse affecting greatly the local town of Valdez and other affected neighboring town.
As an end result, Exxon paid the price for its action in different ways. The clean up effort cost 2.5 billion US dollars alone and Exxon was forced to pay out 1.1 billion US dollars in various settlements. A federal jury also fined Exxon an additional five billion US dollars for its “recklessness”. But the damage to the company’s reputation was even more important and more difficult to manage. After the spill, Exxon’s name was permanently tarnished. Angered costumers cut up their Exxon credit cards while others boycotted their products. According to a study by Porter/Novelli, 54% of the people surveyed said that they will not buy Exxon product. Exxon lost market share and slipped from being the largest oil company in the world to the third.
Exxon Corporation failed miserably in handling management crisis. According to different experts and analysis, company failed to follow own procedure. Exxon failed to show that they have effective plans and solutions in dealing with the crisis. Time is of the essence and their ability to move quickly once the problem occurred was not evident. The company also failed to show concern giving the public an impression that they don’t care what had happened and careless to the destruction of environment. They also failed to involve the media which is in fact an important tool for they can help disseminate information to the public.
According to most observers, Exxon’s response was too little, too late. Much as they want to save and control the damage, they cannot undo the lack of action and unpreparedness they exemplified to the public’s eye. By the time media was finished, the Exxon name was synonymous and associated to environmental catastrophe.

SITUATIONAL ANALYSIS: (PET#44)
Political
In response to the oil spill accident, several changes, recommendations and reforms was proposed trying to secure that the disaster won’t happen again.
The United States Congress passed the Oil Pollution Act of 1990 (OPA). This act prohibits any vessels from operating in Prince William Sound. As of 2002, OPA had prevented 18 ships from entering Prince William Sound.
Alaska governor Steve Cowper issued an executive order requiring two tugboats to escort every loaded tanker from Valdez out through Prince William Sound. As the plans evolve, two tugboats were replaced by a 210-foot Escort Response Vehicle (ERV).
The Oil, Chemical and Atomic International Union announced its severe opposition to drilling activities in the area of Artic National Wildlife Refuge (ANWR) until congress enacted a comprehensive policy.
Economy
Commercial fishing is the main industry in Alaska. Half of households have at least one person involved in commercial fishing or processing. The fishing vessels mainly fishes at Prince William Sound and Copper Rivers Delta. There are various fisheries in the area; the most economically important is the salmon fishery and herring eggs.
According to several studies founded by the state of Alaska, the oil spill had both short and long economic effects. These included the loss of fisheries, reduced tourism and decrease of the local marine population. The economies of the cities of Alaska were adversely affected after the Exxon Valdez oil spill destroying billions of salmon and herring in the area. Years later, fisheries were still unable to recover.
Technology
In efforts to save and lessen the environmental damage the oil spill caused to the waters of Alaska, some techniques were used in attempts to clean the waters.
Hot water treatment was popular until it was determined that the treatment could be causing more damage than the oil. Small organisms were being cooked by the hot water. Another treatment is known as High-pressure cold water treatment involved dozens of people holding fire hoses and spraying the beaches. The water with floating oil would trickle down to the shore. The oil will be trapped within several layers of boom and either be scooped up, sucked up or absorbed using special oil-absorbent materials. Many beaches were fertilized to promote growth of microscopic bacteria that eat the hydrocarbons. Known as Bioremidation, this method was successful on several beaches where the oil was not to thick. A few solvents and chemical agents were used although none extensively. (Zhu, Xueqing, et al.2004)

On September 30, 1892, Tylenol, the leading pain-killer medicine in the United States at the time, faced a tremendous crisis when seven people in Chicago were reported dead after taking extra-strength Tylenol capsules. It was reported that unknown suspects put 65 milligrams of deadly cyanide into capsules. The tampering occurred once the product reached the shelves. (Mitchell,1989)
Following their company’s credo of protecting the consumer’s safety first, Johnson & Johnson conducted an immediate product recall all over the country. This amounted to about 31 million bottles and loss in profit of more than 10 million US dollars. It temporarily ceased all production of capsules and replaced them with more tamper-resistant caplets. In addition, Johnson & Johnson immediately used media to alert the people of the potential dangers and not to consume any Tylenol products. The company also stopped any advertisements of the product. Tylenol products controlled 37 percent of the market but its share dropped to 7% after the poisoning.
Johnson & Johnson was praised for its quick decisions, efficient actions and sincere concerns for its consumers. The company’s willingness to be open with the public and communicate with the media helped the company to maintain high-level of credibility and consumers trust the tampering throughout the tampering crisis. CEO James Burke stayed visible in the public’s eye, answering every interviews and questions confidently. He also repeatedly assured the public of the company’s commitment to its consumer’s safety.
Several business analysts were quite in assuming that Tylenol would never sell again. A month after the crisis, the company put on an aggressive campaign to rebuild the brand. In November, it promised to have the product back on business in a new triple-tamper resistant package. It became the first company to comply for the national mandatory for tamper resistant packaging. They offered several incentives such as offering special coupons, free replacement of caplets and 2.50 US dollars cut off for every purchase. The company's attempts were successful and by the following spring, Johnson and Johnson had regained its previous market share. It bounced back 70% of its share. When another poisoning involving a New York woman occurred four years later, Johnson and Johnson once again had to take action. Since the company had been through it before its executives knew how to handle it. Despite the fact this case was soon identified as an isolated incident, Johnson and Johnson decided to permanently discontinue capsule products and once again demonstrating its commitment to putting safety first.
Johnson & Johnson received several acknowledgements and won praises for its quick and tough decision actions. The company achieved the status of consumer champion. Johnson saw business as having responsible to society that it went beyond usual sales and profit incentives. Therefore, it was essential to maintain the safety of its publics to keep the company alive. Johnson & Johnson’s responsibility to its public proved to be its most effective Public Relations tool. It was the key to the brand’s survival. Another important decision, that put the company’s Public Relations campaign in the right direction, was fully cooperating with the media and making them allies. Without the help of media, damage control attempts would have been completely ineffective.

SITUATIONAL ANALYSIS: (LIT#38)
Technology
A member of copycat attacks involving Tylenol and other products ensued during the following years. However, the incident inspired the pharmaceutical, food and consumer product industries to develop tamper-resistant packaging such as induction seals and improved the quality control methods.
The tamper resistance of packaging can be evaluated by consultants and experts in the subject. Also, comparisons of various packages can be made by careful field testing of the lay public.

Industry
The tragedy also prompted the pharmaceutical industry to move away from capsules which were easy to contaminate. Other foreign substance could be easily placed inside without obvious signs of tampering. Within a year, the Food and Drug Administration introduced more stringent regulations to avoid product tampering. This led to the eventual replacement of the capsule with the solid “caplet”, a drug delivery form and with the addition of tamper-evident safety-seals to bottles of many sorts.

Legal
The Federal Anti-Tampering Act of 1983 (Act) makes it a federal criminal offense to tamper with consumer products or to engage in related conduct. The Act was enacted as a result of the Tylenol poisoning deaths that occurred in Chicago in 1982.
The Act does not prevent state or local authorities from prosecuting persons for conduct that violates the Act. The federal government often refers cases to state and local authorities when there is no significant federal interest in the prosecution.
Under the Act, a person commits a federal criminal offense if he or she tampers with or attempts to tamper with any consumer product that affects interstate or foreign commerce. A consumer product includes food, drugs, devices, cosmetics, and any other household product that is consumed by individuals or that is used for personal care or for household services. Household products include waxes, detergents, air fresheners, or any other product that is intended to be used up or consumed. They do not include durable goods, such as vacuum cleaners, brooms, or brushes, which are not intended to be used up or consumed.