: Bargain shopping, which Aldi specializes in, has become more socially acceptable,
appealing to a wide range of consumers. This broad acceptance is a competitive advantage in today's market.
N. Singer and R. Abelson, "Can Johnson & Johnson Get Its Act Together,"
New York Times
, January 15,
The article discusses Johnson & Johnson's (J&J) challenges and ongoing problems related to product recalls and
manufacturing issues. The main points are as follows:
: J&J has faced a series of recalls across various product lines, including Tylenol, Motrin, Rolaids,
children's medicines, and contact lenses. These recalls have led to shortages of their products on store shelves.
Quality Control Problems
: The recalls were prompted by various quality-control issues, including moldy odors,
contamination with metal or wood particles, and potential chemical contamination. These issues have raised
concerns about the company's manufacturing procedures.
: Many consumers have lost trust in J&J products due to the frequent recalls. Some have
switched to generic alternatives, questioning whether J&J's products are worth the premium price.
: J&J has been under the intense scrutiny of regulators, with the Food and Drug
Administration (FDA) faulting its McNeil unit for failing to identify and address systemic problems in its plants.
: J&J's CEO, William C. Weldon, has allocated over $100 million to upgrade
manufacturing plants, appoint new executives, and hire third-party consultants to improve procedures. However,
these efforts have been followed by more recalls, causing confusion and frustration.
: J&J's over-the-counter product sales declined significantly due to the recalls, and competitors
have gained market share during this period. The company's reputation for quality is at risk.
Uncertainty About Recovery
: Some analysts are skeptical about the company's ability to quickly recover its
market position, as generic alternatives may have gained a foothold with consumers.
: J&J has been criticized for its lack of transparency in explaining supply disruptions and
product shortages to the public.
: The article highlights that the exact reasons for J&J's manufacturing and quality problems remain
unclear. Some critics attribute these issues to cost-cutting, decentralized oversight, or hesitation to invest in new
: J&J has been taking steps to address the factors contributing to its manufacturing
problems, including centralizing quality control operations and investing in quality improvements.
Its previous CA including:
Historical Reputation for Quality
are at risk
While Johnson & Johnson historically possessed a strong competitive advantage based on a reputation for quality,
product diversity, consumer trust, market leadership, and global presence, recent challenges have severely impacted this
advantage. The erosion of trust and market share loss have put the company in a challenging position. J&J's ability to
recover and rebuild its competitive advantage will depend on how effectively it addresses its manufacturing and
communication issues, rebuilds trust with consumers, and demonstrates a commitment to quality and safety.