By : RAHUL GUPTA

MBA (G) AMITY BUSINESS SCHOOL

PH: 09807885800

CRISIS MANAGEMENT

ODWALLA
INTRODUCTION
 Manufactured : Health-conscious Juice


 Founders : Greg Steltenpohl

 Gerry Percy
 Bonnie Bassett
 U.S. BASED
WHAT HAPPENED
 On October 30, 1996 :
 Health officials in Washington state
informed the company that they had
discovered a link between several cases
of E. coli 0157:H7 and Odwalla fresh
apple juice
CONSEQUENCE
 November 5 :
 Child died and more than 60 people in the
western United States and Canada became
sick after drinking the juice


 Sales fell by 90%,


 Odwalla's stock price fell 34%

 More Than 20 Personal-injury Lawsuits Filed

 Company Looked As Though It Could Well Be
Destroyed
What did the company
do?
 Internal communications were the key
Conducted regular company-wide
conference calls on a daily basis,
giving employees the chance to ask
questions and get the latest
information

This approach proved so popular that
the practice of quarterly calls survived
the crisis.

WHAT DID.. (CONT…)
 Ordered a complete recall of all
products containing apple or carrot
juice


Covered around 4,600 retail outlets in 7

states
Internal task teams were formed and
mobilised
Costing around $6.5m was completed
within 48 hours
WHAT DID.. (CONT…)
 Did not avoid responsibility
On all media interviews, Williamson
expressed sympathy and regret for all
those affected and immediately promised
that the company would pay all medical
costs


allied to the prompt and comprehensive

recall


went a long way towards satisfying

customers that the company was doing all
it could.
WHAT DID.. (CONT…)
Within 24 hours, the company had an
explanatory web site (its first) that
received 20,000 hits in 48 hours

The company spoke to the press,
appeared on TV and carried out direct
advertising with the website address


All possible attempts were made to

provide up to the minute, accurate
information.

WHAT DID.. (CONT…)
Step was to tackle the problem of
contamination
Moved Quickly To Introduce A Process
Called "Flash Pasteurisation" :
Guarantee That E-coli Had Been
Destroyed Whilst Leaving The Best
Flavoured Juice Possible.

the most comprehensive quality
control and safety system in the
fresh juice industry
On December 5, the company brought
back its apple juice.
EFFECTS
 Rapid recovery


 Good will and trust it had built up over the

years remained


 Sales picked up again quite quickly



 Company's reputation with its customers.

The father of the girl who died said. "I don't
blame the company" "they did everything
they could"
 Theyear after the crisis, Odwalla was
voted "Best Brand Name in the Bay
Area" by San Francisco Magazine.
This was the first indication
amongst many that Odwalla's
reputation had survived.