When 16-month-old Anna Grace Gimmestad died from drinking contaminated Odwalla apple juice in 1996, CEO Stephen Williamson could imagine no greater tragedy, no larger crisis for a company founded on the principles of nourishment and integrity. But with the odds stacked against him and with lawsuits mounting, Williamson led his besieged company through a slow and painful recovery.
Here, Williamson discusses the tactics that guided him through Odwalla's E. coli crisis and ultimately made him a more resilient leader.
Weave a Web
Spiders affix their webs to a certain number of points and work inward to a central core. During times of crisis, I try to do the same with internal and external communication. I make a few key points, and I stick to them. People will try to shift your focus, divert your attention, and speculate when things get crazy. But you can't let them detach your web.
Shortly after the E. coli contamination was discovered, a television reporter introduced me as "the culprit." She was trying to get me riled by introducing me as dirty slime. I knew that I would lose ground by getting worked up and trying to defend myself. Instead, I said what I'd been saying from the outset of the emergency: "Our hearts go out to those people who were affected by this crisis. All we've ever wanted to do was produce great juice. We will cover all the medical costs of people who were injured by the contamination." Those words showed that I was not a villain; I was a human being with a heart and genuine feelings.
Tell It Like It Is
Procrastination spurs speculation, which can bring down a good leader in no time. When things go bad, people worry, wonder, and question. Leaders need to step in and address those questions with swift, straightforward communication before employees begin mistaking fiction for fact.
When we announced plans to shut down the Fresh Samantha plant in Saco, Maine, I brought an entire crew from California to meet with the employees. I stood up and said, "I'm not going to sugarcoat this: I've got bad news for you. We're going to close the facility and move it to Florida. And here's why."
Over the following 12 hours, we met with each employee to go over individual packages and personal options. Our people understood that we're in a competitive business and that the company can save millions of dollars, and improve the quality of its products, by moving closer to the fruit. We respected their knowledge and skills in this field. And we tried to take the obviously difficult news, communicate it quickly and respectfully, and make our people feel like a part of the decision.
Don't Mourn Lost Thrill Seekers
When things are going well, your company will attract people looking for thrills and excitement. When it comes time to hunker down, you will lose a hefty portion of your staff. Every leader should expect that and should concentrate on retaining only the most essential players.
Before the E. coli crisis, Odwalla was growing 35% a year. We had the wind in our sails, and we were roaring toward market domination. Then, just like that, sales dropped 90%; we were facing a grand jury investigation and 32 lawsuits; and all our revenue was gone. We lost our adrenaline-rush crowd very quickly. But the people who stayed with Odwalla truly believed in the brand. And that's whom we needed most on our side: true believers.
Let Them See You Sweat
During disastrous times, leaders get poked, pushed, and pulled. Their robes fall off, and the naked truth is exposed. To survive, leaders must accept reality and appreciate truth.
When Odwalla was facing the grand-jury investigation, I had only my own integrity to keep me sane. I didn't knowingly do anything wrong, but a little girl died because of a mistake that my company made. I was devastated by her death, and I took responsibility for it. Did we knowingly contaminate our juices? Of course not. I believe strongly in our products and in our company, but the truth required us to take responsibility for our actions.