Fonterra Crisis AnalysisEmily Copeland

Background

Started in 2001

Co-operative of two big dairy corporationsNew Zealand Dairy Group and Kiwi Co-operative

Dairies

Fourth largest dairy company in the world

New Zealand is a co-operative dairy industry

Values and Beliefs

Want to be “top-of-mind” in dairy for consumers

4 Core ValuesCo-operative spirit Do what’s right Challenge boundaries Make it happen

Crisis

Precautionary recall on whey protein product

Bacteria found in product

Bacteria could potentially be bacteria that causes botulism

China, Russia, and Vietnam banned Fonterra products

Turned out to be false reading

Recall caused mass panic

Response

Verbal Response

Precautionary recall website

Sent out media releases almost every other day

2 media conferences

Visit to China

Non-Verbal Response

Two-prolonged market recovery plan

Operational Review

Media Response

Criticisms over New Zealand co-operative dairy industry

China criticizes because you shouldn’t make the same mistake twice

Wyatt Creech criticizes transparency and co-operative

Chris Claridge criticizes Fonterra for not testing the product before the recall was sent out

Lack of timeliness to the recall

Stakeholders Response

Chinese government

Consumers Not buying Tweets

“fined”Two-prolonged market recovery plan

Recommendations

Test the product before you call for a recall

Bring information to higher-ups as soon as it is found out

Different stand at the end of crisisDon’t apologizeBetter safe than sorry