The Johnson & Johnson Credo The impact of the Credo of Johnson & Johnson on the organization can be seen on several levels. To begin with, the authors of this case, Professor Aguilar and Arvind Bhambri, quote a senior executive as saying, “The prime motivator in J&J is the opportunity to grow with more responsibility. It runs through the whole organization. This brief statement illuminates what is at the center of the Credo when speaking about the responsibility of J&J to its employees – provide a fertile ground for employees to work, one that is managed well with room to grow, open to change and challenge, ripe with opportunities to innovate and take risk while being treated fairly and compensated well. These ingredients encourage a like-minded move towards advancement that inevitably come with employee / employer loyalty, respect and a common goal in line with those of Robert Johnson and his son, the General.
In short, the Credo, when taken to heart, propagates a unified culture. This is supported by the fact that J&J could when needed, look outside of one of its 250[1] companies for a qualified candidate to fill a position in that organization from within one of the other 249 companies, confident that the prospective candidate would be able to move into that position with ease. The Credo also details J&J’s responsibility to the customer. This also affects the organization in that it provided the foundation for the organizational structure of J&J.
In being able to provide the highest quality of products and services to the customer in so many different niche markets, J&J’s leaders determined that the decentralized structure was the best way in order to achieve the commitments stated in the Credo to the customer. This structure is followed still today, even though the growing number of operating companies continues to grow and put strain on the executive group. The Credo also influences the organization as it is made very visible to customers and clients across the world.
This type of visibility produces a level of trust between a customer and company that was tested in the incident involving the Tylenol mishap. J&J responded just as the Credo detailed, “…and mistakes paid for. ”, rectifying the situation with a total cost upwards of 100 million dollars. Johnson & Johnson transmit this pledge to the customer by the placement of it on every operational company’s website. The Credo also influences the organization through its promise to the communities in which operating companies function.
J&J has a proven history of corporate giving that is complimented by the giving of its individual employees as well. On a corporate level J&J’s Corporate Contributions Committee oversees corporate giving across the world through hundreds of agencies[2] for such causes as educating against disease, aiding in building health care systems in developing nations, aiding mother’s and their children from conception survive birth and so on. Johnson & Johnson have always been committed to women and children – in their product offering and their support and care through giving.
J&J continues their pledge to the community through a history of disaster relief and in 2006 they introduced goals for 2010, under the title of “Healthy Planet 2010”. This initiative, part of J&J’s facility transparency, includes such goals as being 100% open about the environmental impact that each facility has on the community and environment. According to their website, 60% of the operating companies have submitted such information. Responsibility to stockholders is the last part of the Credo. It affects the organization no less then the other parts however.
An impact on the organization can be felt through J&J’s business practices. Financial planning is based on a 10 year plan that is reviewed every 5 years. Strategic planning is also vitally important to the organization and is directly linked back to the Credo. The basic principles behind J&J’s strategic planning are: ? The success of the corporation is due to the presidents and managing directors of the operating companies. ? Businesses must be organized to operate around the needs of the consumer. Constantly seek out market leadership opportunities in conjunction with maintaining high quality in products and services. ? Commit to high growth rates. ? Growth needs to be financed from earnings. ? The criteria for expansion through acquisition are as follows: compatibility with current and future businesses, good growth potential, economic practicability, and sound management capacity. The Credo that Robert Johnson created and that has continued to be shaped into the culture of all the Johnson & Johnson companies is perhaps one of the most encouraging business statements that I have encountered.
It is magnetizing to oneself as you read this document. For this it is no surprise that Credo is able to unite this decentralized organization. It speaks to the passion and desire of a person to belong to an organization that is proactive, productive and prolific. One that stands for a common good of not only the people that are employed by the company, but also the stockholders, suppliers, customers and other stakeholders. This type of fervor can easily run across company boundaries as well as those of world-wide countries.
One last intangible ingredient I believe in the Credo, is the hand-print of the founder, Robert Johnson. Incredible that after over 100 years, J&J is still committed to the long term, the community, the stockholder and the employee, just as Robert Johnson and later the General had instilled and envisioned into the company at the beginning. Works Cited 1. “Johnson & Johnson Corporate Contributions & Community Relations”. 2009. http://www. jnj. com/wps/wcm/connect/ c13fb7804ae70e59bbb4fb0f0a50cff8/our-key-partners. df? MOD=AJPERES 2. “Our Management Approach – Our Credo Values”. 2009. http://www. jnj. com/connect/about-jnj/management-approach/. ———————– [1] At the time that Professor Aguilar and Arvind Bhambri authored this report, there were 150 operating companies. 26 years later this number has climbed to just over 250; from “Our Management Approach – Our Credo Values”. [2] From Johnson & Johnson Corporate Contributions & Community Relations
