Read the Case Scenario that follows and answer President and CEO Alexandria Marvel’s questions in the form of a report. Address the report to President and CEO Alexandria Marvel.
You walk into your office one morning and see an article on your desk. You pick it up and realize that the President and CEO placed it there! She also has some questions on a post-it note and a request for recommendations. Alexandria Marvel was exhausted. She had just finished a long meeting with her current VP of Headquarter Operations, Michael Brown. Michael, who was himself getting ready for retirement, was giving her a rundown of a recent crisis that impacted the company. While the dust seemed to be settling, Alexandria recognized that this was one of the worst things to ever happen to the company.
Michael recalls the crisis in the following way:
On the morning of January 19th, I got a call from Joanne Edwards, my contact at our major distributor, Happy and Healthy Foodmart. She told me that three of her customers had complained that LSN’s echinacea had made them ill. I called our legal department immediately to put them on alert. By noon that day, the number of reported illnesses had risen to seven. By January 22nd, the worst possible news came in “ one of those people had actually died.
I called my team together immediately to come up with a plan for an immediate Recall. We needed to manage this crisis with our employees, our distributors, and most of all our customers. Controlling the message to the public and the media was critical. We’d had Recalls before, but never in reaction to a customer’s death. This was a whole new ball game for us.
Once the Recall had been put in place, we needed to get to the bottom of the echinacea problem. We started looking at the suppliers and ended up in the Purchasing Department. When we discovered that Henrietta Higgins, the Assistant Director of Purchasing, had cut a deal with a new supplier I became furious. I mean, it was not one of my proudest moments.
That’s understandable, replied Alexandria, go on. Tell me more.
Well, Higgins received an offer from a new supplier to buy genetically modified echinacea. She explained that she thought it was a good move because it would save the company over 20% on the wholesale price. She made the decision unilaterally, without ever going to her supervisor or to me to discuss it.
What did you do when you found this out? asked Alexandria.
I fired her, of course. We had no other choice, Alexandria. It’s because of her we have this crisis. And on top of that, we’ve decided to halt all sales of all echinacea in the foreseeable future.
Who’s we? Alexandria asked, with concern in her voice now.
My team, of course. I told my managers about my decision and they’re all behind me 100%. We all know how important it is to act quickly in this situation, You can trust me to turn this situation around.
Alexandria left the meeting sure about two things. First, she was secretly relieved that Michael was nearing retirement. The new VP of Headquarter Operations could start fresh. Second, she had just finished reading an article about a Crisis Ready Culture. She knew that it was time for LSN to start developing a crisis-ready culture.
Alexandria drops by your office with a copy of that article. She has a post-it note on the article, with the following questions and a request for recommendations:
- Identify and discuss the primary leadership style of Michael Brown in his handling of this crisis situation.
- Discuss an alternative leadership style that could have been used by Michael Brown that could have been better suited than the one he used.
- What leadership competencies did Michael Brown present in the recent echinacea crisis?
- Identify the leadership competencies beneficial for a crisis-ready culture.
- Identify the role that EQ played in the Echinacea crisis.
- Identify the role of EQ for a crisis-ready culture.
- Did either Michael Brown or Alexandria Marvel use Authentic Leadership in the Echinacea crisis?
- What role should Authentic Leadership play in a crisis-ready culture?
- Thinking about Michael Brown’s actions in handling the crisis and Henrietta Higgins’s actions leading to the crisis and the fact Alexandria Marvel was excluded from the decision-making process about how to handle the crisis, what conclusions can you draw about the role LSN’s current culture played in the echinacea crisis?
- Describe the relationship of strategy, culture, and structure for a crisis-ready culture.
- Give three specific and actionable recommendations that could be implemented to develop a crisis-ready culture for LSN. (Each recommendation should be supported by course materials).