McDonald’s creates value out of crisis

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in Leaders & Managers,Management Training

When McDonald’s was hit with the news that its Shrek-themed drinking glasses were laced with dangerous levels of cadmium, a carcinogen, the result could have been disastrous.

In response, McDonald’s issued a swift recall. Analysts give the company high marks for its proactive response.

For every consumer who returns one of the 7.5 million Shrek glasses the company says it sold, McDonald’s is offering a $3 refund—for an item that cost $2.49 as a stand-alone purchase.

“It was pretty brilliant,” says Sophie Ann Terrisse, CEO of STC Associates, a brand-management firm. “They came clean right away, and not only did they do what customers expected, they did more.”

Lesson: Responsive leaders can turn a crisis into a value proposition.

—Adapted from "McDonald's and Shrek: How to Run a Recall," Sean Gregory, Time.

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