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A strong company credo is important

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in Leaders & Managers,People Management

You can’t install a “defeat device” into hundreds of thousands of cars unconsciously. You’d have to be sneaky and deliberate, as Volkswagen was.

But it may be possible to slide unconsciously into a kind of blindness toward unethical decisions—the opposite of consciously making moral choices.

The sociologist Diane Vaughan coined a term, “the normalization of deviance,” to describe what happens when actions anyone would consider “not okay” are gradually reclassified as “okay.”

This happened before the Challenger space shuttle disaster, when damage to the O-rings had been noticed and pointed out several times, each time reclassified as an acceptable risk.

Johnson & Johnson took the opposite approach. In 1979, then-CEO James Burke forced his managers to reconsider the company’s philosophy, “Our Credo,” a high-minded set of principles in place since 1943.

After vigorous debate, the managers decided to stick with their moral obligations.

And three years later, after a deadly poisoning of Tylenol in Chicago, those managers quickly removed the pain medication from store shelves and took a $100 million hit.

It was hardly even a decision, they said. So strong was the company credo that managers automatically took action—their CEO, in fact, was on a plane—and set the gold standard for corporate crisis response.

— Adapted from “What Was Volkswagen Thinking?” Jerry Useem, The Atlantic.

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