Strauss plays by the book, but will it be enough?
Production glitches that oblige a company to recall its products, particularly food products, can easily spiral out of control if not managed correctly. Strauss – a company whose products are to be found in almost every home in the country – now faces an unprecedented crisis that, if mishandled, could shake its very foundation. The potential for catastrophe is astoundingly high.
Consumers are not unaccustomed to production problems; they realize that the price of the convenience of an industrialized world is the need to deal with defective products from time to time. Several Israeli food companies have made similar recalls in the past, including Eden Springs, Osem and Tnuva.
Of course, the public is particularly sensitive to food-product recalls, but experience shows that as long as the company is honest about its mistake, the public is willing to forgive and forget. On the other hand, when the company refuses to divulge the details of its mistake or tries to hide that a malfunction occurred in the first place, the public reacts poorly.
Take, for instance, Unilever’s cornflakes crisis; the company attempted to conceal its malfunction for several days and offered nothing but excuses.
Understandably, the public was furious and refused to buy Unilever’s products. But even in Unilever’s case, it eventually managed to restore the public’s faith, and the consumers returned to buying.
Thus far, Strauss has played things by the book as far as the media are concerned. Amid the ensuing chaos, Strauss representatives have been answering questions patiently and with full transparency; they have endeavored to both assuage the fears of worried consumers and to provide reliable information to journalists. Despite the severity of the crisis at hand, the company is deftly managing it, leaving nothing to chance.
However, the chaos and confusion will soon end, and the operational stage will begin. Its success depends entirely on how deep Strauss’s pockets are. Collecting the recalled products and offering proper compensation to consumers are both costly endeavors. And if the company attempts to cut corners, its reputation will irrevocably suffer and it will be in further financial trouble.
Then there’s the matter of the return process itself. If Strauss makes the return process too cumbersome for consumers or, worse, gives them the runaround to avoid paying out refunds, it will likely see a sordid turn in public opinion. The grace and understanding that the company is
currently enjoying from the public will be replaced with incensed complaints, targeted at perceptions of Strauss evading responsibility.
Similarly, if Strauss makes life difficult for the retail chains, it could face the possibility of its products being removed from shelves. If, however, the consumers feel that the company is trying to
streamline the return process and that they’ve been compensated nicely, the recall won’t be cause for crisis.
A beloved company
Considering Strauss’s actions in times of normalcy, it can be presumed that the company will make the necessary investments to overcome the current crisis: that it will
not, in fact, reproduce the past mistakes of other food companies.
In Strauss’s favor is that its consumers hold it in high regard. When ranked among the public’s opinions of other corporations, Strauss ranked incredibly well. It’s seen as an Israeli household name and a top contributor to the community. In fact, the company is lauded for its fairness, honesty and transparency, as well as its integration of various sections of society.
Another element in Strauss’s favor is the crisis’s lack of a face. It’s not the matter of a single brand being hit with the malfunction; the malfunction affects a broad range of products present in every home. The sheer scope of the crisis will actually play to the company’s benefit, as consumers will likely forget the specifics of what occurred after it’s passed. There will no particular brand name carrying the negative connotations of the malfunction.
A sudden twist
Even if Strauss continues to play things by the book, there are two factors that it has no control over and that could undermine its every effort to pass the crisis.
The first is the behavior of the Health Ministry, which, according to Strauss’s reports, was notified several days ago of the malfunction, as required. So far, the Health Ministry has not made any public announcements about its stance on the crisis. It remains to be seen whether the ministry will be sympathetic with Strauss or if it will look for flaws in the company’s conduct.
The second factor relates to public health. Occasional pictures of children with upset stomachs won’t affect the situation overly much. If, however, a child is hospitalized in severe condition, then the situation will inevitably worsen.
As such, it’s too early to determine whether we’re seeing a passing malfunction or a horrid crisis in the making. Assuming that Strauss does the right thing, and there are no further unpredictable factors, the situation will pass peaceably. (Globes/TNS)