Implementing Effective Crisis Management Techniques

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Introduction In the past decade, the sky rocketing frequency of product recalls has become a cause for concern. Even with the numbers rising, many businesses are still ill equipped to deal with the problem of recalls when they arise. The main problem surrounding faulty products is that they jeopardize the consumer’s safety. Once recalled, a company’s defective product can spark major financial losses, break consumer trust, and can stigmatize a brand’s reputation. Utilizing effective crisis management techniques can minimize the negative impacts from product recalls. A History of Product Recall and Legislation Recalling the Past for the Future As product recalls continue to skyrocket, it is important to view the statistics and to…show more content…
This will hopefully instigate increased effort from pharmaceutical companies to improve the process of making and testing their drugs and devices. These adjustments could potentially lead to an initial slew of recalls, but, more importantly, it will increase consumer safety over time. As the total number of recalls grows over time, a company’s ability to take advantage of crisis management techniques will prove to be a vital part of saving face – and finances. Studying a Current Example Jumping Off the (Volks)wagen Volkswagen’s (VW) 2015 scandal – involving their diesel engines tricking tests and findings of potentially massive carbon dioxide emissions – led to a recall of 11 million cars worldwide. Initial concerns about the emission levels were raised by U.S. regulators in 2014, but were largely brushed off by VW as smaller issues. Investigations were opened and, by 2015, discoveries revealed VW’s discrepancies between their statements and the truth of their practices. The fiscal cost of the scandal will amount to over twenty billion dollars total, but VW’s biggest future setback is the hit to the brand’s reputation. The now former-chief executive of VW stepped down after the scandal broke, having “broken the trust of [their] customers and the public.” In a survey taken by AutoPacific, 64% of respondents do not trust VW in light of the scandal. There
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