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Organization: Johnson & Johnson
I am a part of an organizational behavior intervention by
the Vice President of Administration for Johnson & Johnson
and we will be analyzing the structure, human resource policies
and procedures and the organization's culture to improve productivity
and enhance communication through this paper. Johnson &
Johnson employs approximately 110,300 people worldwide and
is engaged in the manufacture and sale of a broad range of
products in the health care field in many countries of the
world. Johnson & Johnson's primary interest, both historically
and currently, has been in products related to health and
well-being (www.jnj.com).
Johnson & Johnson (J&J) is a fairly decentralized
company having its worldwide headquarters in New Brunswick,
New Jersey. An organizational structure defines how job tasks
are formally divided, grouped and done (Text, Page 178). J&J
has 37 affiliations with other companies and that accounts
for the 200 autonomous operating units worldwide. These affiliations
are divided into three broad business segments, which are:
Consumer Business Segment, Pharmaceutical Business Segment
and Medical Devices and Diagnostic Business Segment (www.jnj.com).
This is a broad division of what J&J's structure looks
like. J&J boosts of being so decentralized that a J&J
employee gets the advantage of working in a large and a small
company at the same time. The website says "Our decentralized
structure provides the means for us to offer you the small-company
environment and culture that's so inviting to work in, along
with big-company opportunities for career development, advancement
and impact (www.jnj.com)." This small company environment
and big company impact, according to J&J helps them adapt
to change quickly as the decisions can be taken locally and
freely. 
Since there exists this degree of decentralization within
J&J, its affiliations and the operating units, each can
have their own identity. For example we know the brand Neutrogena
or RoC for itself and not as a part of the J&J family
of products. That is the reason why J&J has carved out
its Credo, as they call it, which are "deeply rooted
values behind everything we do" (www.jnj.com). These
values bond the worldwide reach of J&J; they also set
the global standards for the company to operate under. Because
J&J is so decentralized, we can try and analyze the structure
of its worldwide headquarters in New Brunswick, NJ. The headquarters
deal with the functions that are common for all of the affiliates
and the operating units of J&J. The functions are grouped
under human resources, finance, environment, engineering,
real estate, science and technology and other corporate J&J
groups (www.jnj.com). We thus see that these functions are
centralized in the worldwide headquarters so that J&J
avoids any kind of duplication and repetition in its otherwise
decentralized segments. Hence we can apply all the concepts
of chain of command, span of control, etc. only if J&J
had a formal structure for the entire company.
I do feel that the structures of the individual segments
of business that J&J have, help them to run their operations
well. All the brands under the J&J umbrella are well known
and trusted. They obviously comply with the values and the
Credo, J&J put forth for themselves. For changes in the
current structure I would
like to think that having worldwide headquarters in the USA
is not enough. Due to the global and cultural differences, I feel that the headquarters for operations
like HR, finance, advertising, etc. should be located in the
areas of geographical separation like the USA, Europe, the
Caribbean, Asia-Pacific, Mid-east, Africa, Canada and Latin
America. Of course the operations in New Brunswick can be
cut down to benefit only the USA and the rest of the countries
should have their headquarters in their respective continent.
This will facilitate the worldwide reach J&J has, and
will better manage the crisis or issues that may take place.
The headquarters in different continents also save costs and
increase productivity as the market place can better judged
in proximity to that area and the demand for the products
could be better assessed. Thus distribution can become more
efficient and also the marketing and advertising efforts needed
to promote the product can be according to local preferences.
This also avoids bureaucracy that makes tasks routine and
formalized for the entire organization. Less bureaucracy would
mean cost reduction as some practices may be valid for some
countries but not for others. Hence regional headquarters,
in my opinion will help cost reduction and management of the
enormous demand for J&J products.
Another suggestion I have for J&J that is a little far
fetched is to make J&J a boundaryless organization. This
can happen when J&J eliminates vertical and horizontal
boundaries and external barriers (Text, Page 190). With the
size and the reach J&J has at the moment this seems like
a good idea. Of course with the decentralization in place
a lot of barriers of communication are already eliminated
in case of J&J.
The worldwide headquarters in New Brunswick, NJ handles the
role of human resources for J&J. I would say that they
are proactive in nature and they are involved with the potential
and existing employees in a variety of different ways. Since
J&J emphasizes that its employees can get the feel of
working in a small company and the benefits of belonging to
a global firm, the HR department makes sure that it happens
this way. They are responsible for the training and the development
of their staff and to ensure that the staff feels comfortable
in the decentralized atmosphere but adheres to the values
and principals of the organization, in order to maintain J&J
standards.
Because J&J emphasizes on a working atmosphere of a small
company, we know that the employees are given a lot of freedom
in decision-making. However if the employees are to keep up
the standards set forth by J&J, they must be properly
trained and educated on J&J procedures. There are a variety
of programs that J&J has to enhance their workforce. Firstly
they have their Credo values and then they have their standards
of leadership, which outlines the characteristics, J&J
requires from a leader.
Employees can take advantage of the classroom-based training
existing in the USA and Puerto Rico. J&J have what is
called the Learning Services Consortium and that has instructors
of high caliber to teach J&J staff. Technology-based training
for J&J employees takes places worldwide. There are also
tuition reimbursement plans available for the employees to
take advantage of. In the US, J&J offers a Financial Aid
to Education program for encouraging further education for
its employees. J&J has other programs to encourage education
in foreign countries. Educational and developmental programs
improve the quality of staff and hence I feel that these programs
even though may be an interference, should exist for the firm
to be competitive.
J&J also has a number of programs to develop leadership
skills among their employees. They have the I-lead process,
the succession and development planning and leadership programs
for recent graduates (www.jnj.com/careers). Besides these
they also have diversity training, which I think is very important
for the global firm J&J is. The role of HR for a firm
like J&J is of strategic importance especially because
it is centralized in the otherwise decentralized structure
of J&J. Since they have worldwide operations things like
diversity training, language courses, cultural training, ethics
training etc. should come in handy. These are the areas that
HR has to handle to remain competitive. Performance evaluations
and feedback are also extremely necessary for such a large
organization. In this proactive manner, J&J has been maintaining
and developing their staff to give them a strategic and competitive
edge. J&J is well know for taking care of their staff
as far as balancing their work and personal life in concerned.
This wins trust and loyalty from the employees, who J&J
cares about and they should continue to do so.
Johnson & Johnson was organized in the State of New Jersey
in 1887, making it more than a 100 years old now (www.jnj.com).
The company is known as a good corporate citizen, caring for
all their constituents, namely the employees, the stockholders,
the clients, the Government and the society in general. If
they have survived over a hundred years, it is because they
care about things beyond their profit margin. The company
has established their Credo, which explains their beliefs
about their constituents.
Organizational Culture is defined as the system of shared
meaning held by members of the organization that distinguishes
the organization from other organizations (Text, Page 231).
J&J has a corporate culture of having deeply rooted values
in everything they do (Definition of their Credo). Hence we
shall see that J&J tries to have those deeply rooted values
for all their constituents and those values may vary, but
the underlying characteristic is care for their constituents,
which is reflected in the way J&J conducts their business.
The employees of J&J are known to experience the benefits
of working in a small sized company and having the power of
decision making to a huge extent, at the same time they are
known to belong to a large sized company judging by the returns
they get. Hence I would say that J&J employees get best
of both the worlds. Besides this factor, J&J understands
the importance of personal life and gives their employees
that balance in their lives. J&J says "We have a
responsibility to treat them (the employees) with respect
and dignity, pay them fairly and help them develop and thrive
personally and professionally" (www.jnj.com). They also
have a variety of training and development programs, which
enhances quality of employees. J&J takes care of 110,
300 employees worldwide and they do so with care, which brings
them employee loyalty and trust.
As far as stockholders are concerned, J&J maintains, "They
have a responsibility to provide a fair return on their investment"
(www.jnj.com). The following statistics prove that J&J
does do as they preach. For the last 67 years, the sales of
J&J have increased. They have paid their stockholders
dividends for the last 57 years and 38 of those years have
bought the investors an increase in dividends (www.jnj.com).
Besides that J&J has a Triple A credit rating which signifies
the highest trust in the investment community and that is
given to only 5 other industrial corporations in the US (www.jnj.com).
This fact tells us that J&J takes good care of their stockholders.
J&J maintains, "We have a responsibility to provide
high-quality products they can trust, offered at a fair price"
(www.jnj.com). J&J places consumers before anything else.
They maintain that if they can take good care of the consumers
then the employees will get enough money and incentive to
perform better and then the community will benefit from the
products and the employment provided by J&J. Finally if
all this goes well the company will be profitable and the
stockholder will get good returns on their investment.
J&J says, "We have a responsibility to be good corporate
citizens, support good works, encourage better health and
protect the environment" (www.jnj.com). In the year 1999,
J&J donated about USD 118 million in contributions and
community responsibility programs (www.jnj.com). It is obvious
that J&J is trying to be a good corporate citizen. J&J
does not have any corporate scandal surrounding it and that
can prove that they have been honest to the Government and
the general public about their business activities. Besides
this, being a company, which deals mainly in health boosting
products they maintain a theme. Their theme of "Healthy
Planet, Healthy People" acknowledges their belief that
improving the health of the environment can improve human
health as effectively as any product or service (www.jnj.com).
In this manner we know that J&J cares for the society
and the community.
With over a 100 year history, strong corporate citizenship,
trust from customers, good treatment to employees, good performances,
etc. J&J must have a winning formula. There is not much
wrong with its culture and if I had to create a new culture,
I would stick to what they already have as it seems to work
for them. All I can think of is for J&J to try and promote
the good they do more effectively and bring about a synergy
in their worldwide operations in some manner. We hence see
that J&J is a well know, well trusted and well-established
organization, benefiting all its constituents and still is
competitive enough to survive in today's business environment.
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