Case Study Communication

7/23/2019 Case Study Communication

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CASE STUDY: ODWALLA FOODS

Odwalla Foods is a company that promotes a healthy lifestyle,

and sells a plethora of juices and granola bars. In their website, they

are quoted saying, “But a company is way more than just its name. It's

een more than its products. !hat's why we ta"e e#tra steps to be

good to our enironment and our community,$ %&Odwalla corporate

website,& ()*. +oweer, ) years ago Odwalla went through a crisis

that could hae easily destroyed them.

!I-/I0 OF !+ O123//3 . 4O/I 45I6I6

“



October 7(th,)88

!he . colioutbrea" is

9rst lin"ed toOdwalla

Foods.Odwalla

immediatelyissues a recall.

October 7)st,)88

Odwalla hires:5 9rm.

F13 /aunches); monthinestigation

0oember )st,)88

Odwallae#pands recallto include carrot juice, and

o<ers to paymedical billsOdwallalauncheswebsite

0oember'nd, )885ecall is

completed

0oember;th, )88

F13 lin"s .4oli andOdwalla

0oember

=th, )88Odwalla

announcespotentialnew heat

pasteuri>ation process

,$

(Ward, 2011).

!he crisis began in October )88. “On October 7(, )88 health

o?cials in the state of 2ashington informed the company that they

had discoered a lin" between seeral cases of . coli and Odwalla



fresh apple juice. !he lin" was con9rmed on 0oember =. 3s the crisis

played itself out, one child died and more than ( people in the

2estern @nited 6tates and 4anada became sic" after drin"ing the

juice,$ %Ba"er, ())*.

2hile an outbrea" of . coli is serious for any company lin"ed

with the Food and 1rug 3dministration, the fact that a child lost their

life due to circumstances ma"e this crisis much larger. “3 crisis where

there is not only a recall, but loss of life is li"ely di<erent than other

types of accidents li"e natural disasters. Aictims and potential ictims

of these types of crises might be more heaily inested in searching for

current information and further research into how organi>ations can

maintain and proide continual updates is worthy of study,$ %4oombs

+olladay, ()(*. +ow a company handles the situation after a death is

crucial. /uc"ily, Odwalla too" the right steps to restore their reputation.

“Odwalla acted immediately. 3lthough at the point where they

were 9rst noti9ed the lin" was uncertain, OdwallaCs 4O 6tephen

2illiamson ordered a complete recall of all products containing apple

or carrot juice. !his recall coered around ;,(( retail outlets in D

states. Internal tas" teams were formed and mobili>ed, and the recall E

costing around .= million E was completed within ;G hours,$ %Ba"er,

())*. !he company did the right thing by ta"ing action immediately

after being noti9ed of the lin" between their product and cases of .

coli. If they hadnCt done this they could hae been held responsible not



only for spreading the bacteria but for not caring enough to spea" up

and put a stop to it. -uch li"e Hohnson Hohnson in the !ylenol crisis,

OdwallaCs main concern was about their consumerCs health and too"

responsibility by costing their company to recall the infected products

immediately.

“-ost public relations problems faced by indiiduals and

organi>ations result from organi>ational misbehaior. !o defend their

actions, organi>ations use 9e typical responses denial, counterattac",

di<erentiation, apology, and legal$, %/erbinger, ()*. !he approach

Odwalla Foods too" was apology. !hey apologi>ed to the public as well

as the families e<ected the by the death and the illnesses. “Odwalla

publicly promised to pay for all medical e#penses of injured consumers

and to reealuate its manufacturing process immediately,$ %&-cgrawJ

hill,& ())*. -any :5 professionals would argue that if Odwalla wanted

to "eep any shred of their reputation intact, o<ering to pay for medical

e#penses and ta"ing immediate action wasnCt een an option, it was

something that had to happen. 3ccording to the readings, “1i<erent

types of message strategies used by organi>ations in crisis are

repentance, remediation, and recti9cation,$ %4oombs +olladay,

()(*. Odwalla used all of these message strategies in this situation.

!hey apologi>ed, o<ered to handle costs, and later deeloped a

technology that assured bacteriaCs would not be present in their

products.



Odwalla receied so much praise for the way they handled the

crisis, and many people felt that they were actually ictims in the

situation. “ !he public largely belieed OdwallaCs e#planations because

its reputation for social responsibility was ironJclad in its consumersC

minds. en the parents of the child whose E. coliJrelated death had

ignited the crisis were quoted as saying that they didnCt blame the

company for her death and that Odwalla had done eerything they

could hae under the circumstances,$ %&-cgrawJhill,& ())*. +oweer,

upon closer obseration it came to the attention of some that Odwalla

was aware of the possible crisis yet did nothing to preent it. “3 report

surfaced that indicated that the @.6. 3rmy had rejected OdwallaCs

proposal to sell their juice in @.6. 3rmy commissaries after an 3rmy

inspector found uncommonly high leels of bacteria in a sample and

concluded that the ris" of contamination was e#traordinarily high. !he

3rmy rejection had ta"en place four months prior to the E. coli

outbrea",$ %&-cgrawJhill,& ())*.

Odwalla should hae ta"en the preious issues seriously to

preent the death of a )JmonthJold child. “ !o ascertain uncertainty is

di?cult, but some attempts to predict the li"elihood of certain "inds of

crises can be made by estimating statistical probabilities, giing

attention to those occurring most frequently,$ %/erbinger, ()*.

3lthough it may be iewed as common "nowledge that any company

should be on the loo"out for potential crisis, this wasnCt the case for



Odwalla. 6tephen 2illiamson, 4O of Odwalla was quoted saying, “2e

had no crisisJmanagement procedure in place, so I followed our ision

statement and our core alues of honesty, integrity, and sustainability.

Our numberJone concern was for the safety and wellJbeing of people

who drin" our juices$ %Ba"er, ())*. 2hile 2illiamson made a good

choice to put the customerCs health and well being 9rst, it could hae

been preented if the company loo"ed at the warning signs in relation

to the . coli irus and created a plan in case any of their products

became contaminated and had to issue a massie recall.

In my opinion, while Odwalla didnCt ta"e the necessary measures

to aoid the crisis, and een ignored the early warning signs, they did a

good job of handling it when it did occur. 0ot only did they ta"e the

action of recalling the products within ;G hours li"e I mentioned earlier,

they also created a website immediately. “#ternal communications

were just as ital. 2ithin ; hours, the company had an e#planatory

web site %its 9rst* that receied (,((( hits in ;G hours. !he company

spo"e to the press, appeared on !A and carried out direct adertising

with the website address,$ %Ba"er, ())*. 4reating the website in )88

was brilliant, considering not all companies utili>ed the Internet at that

point in time. !oday, a website with up to date information should

always be used during this type of crisis. “In a 9eJyear study of crisis,

it was found that oer G( percent of organi>ations e#periencing a crisis

posted a news release on their websites. 3n organi>ationCs homepage



has also become an important element in communication,$ %4oombs

+olladay, ()(*. en in )88 Odwalla Foods "new this and used it to

their adantage as a way to reach out to concerned customers and

people who wanted to "now the details about what was happening at

the time of the unfortunate crises.

By utili>ing technology and thin"ing about the consumers needs

ahead of their own, Odwalla Foods gained bac" the trust and reenue

they desired. 2hile they had no plan in place before the crises, they

acted quic"ly and became an e#ample to other companies going

through a similar situation.

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