7 Carlsberg, the brewing company, learned of its crisis late one Friday afternoon. Something appeared to have gone wrong with the ‘widget’ (the device which gives some canned beer its creamy characteristic)

in one of its cans of beer. One customer had found a piece of plastic in his mouth. He had complained to an environmental health official, who had contacted Carlsberg. The company’s pre-planned crisis management procedure immediately swung into action. A crisis control group of 12 members, with experts on insurance, legal affairs, quality control and public relations, took control. This group had everyone’s telephone number, so any relevant person in the company could be contacted. It also had a control room at one of the company’s sites. By the Tuesday they had issued a press release, set up a hotline and taken out national advertising to announce the recall decision.

Even though the problem had originated in only one of its six brands, the company decided to recall all of them (a total of 1 million cans) and all production using the suspect widget was halted.

(a) What seem to be the essential elements of this successful recovery from failure?

(b) How do the advantages and disadvantages of deciding whether or not to recall products in a case such as this depend on the likelihood of another potential failure being out there in the market?

(c) Relate this issue to the concept of type I and type II errors dealt with in Chapter¦17.