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CONAGRA AND PETER PAN PEANUT BUTTER

CONAGRA AND PETER PAN PEANUT BUTTER. You name and class information. Problem. Salmonella poisoning from peanut butter in ConAgra’s Peter Pan product with 349 reported cases in 41 states Problem first discovered in August 2006 Most sick from December forward Recall in February 2007. Issues.

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CONAGRA AND PETER PAN PEANUT BUTTER

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  1. CONAGRA AND PETER PAN PEANUT BUTTER You name and class information

  2. Problem • Salmonella poisoning from peanut butter in ConAgra’s Peter Pan product with 349 reported cases in 41 states • Problem first discovered in August 2006 • Most sick from December forward • Recall in February 2007

  3. Issues • The recall will cost between $50 and $60 million. • The plant was shut down for inspection and cleaning. • FDA officials were called in. • Disposal of recalled peanut butter fell to Con Agra as well.

  4. Conagra Internal decision-making

  5. Poor Decisions • Limiting search for possible source of problem. • Delay in telling public about problem. • Further delay in recall. • Lack of consideration for consumer and business partner, Wal-Mart. • Added to previous costs noted shares were affected with the year ending (5/27/07)

  6. Good Decisions • ConAgra has attempted to address other problems more effectively including some frozen food recalls. • Changes have been made to inspection processes.

  7. Conagra’s decision-making Assessment

  8. Theories, Heuristics and Principles • Commitment Theory • Sunk-Cost Effect Theory • Information Bias Theory

  9. Theories, Heuristics and Principles • Augmenting Principle • Availability Heuristic • Prospect Theory

  10. External decision-making Recommendations

  11. Decision-Making The proper handling of this situation should have included: • Continuous testing until the appropriate product was found and destroyed. • CDC inspectors asked for help in discovering problem. • Information about possible problem made public. • Recall should have been quicker and included all possible products.

  12. Decision-Making Recommendations • The annual report must make reference to the peanut butter incident in every section • While such issues may be short term, their affects are longer lasting in the business as well as the public. • Next year’s annual report will have to consider the peanut butter incident to explain the differences in the peanut butter’s divisions.

  13. Conclusions Based on the information provided by the media and news release through ConAgra’s website, a sound and reasonable approach would reside in enhancing the protocol measures necessary to address risks. Having a reactive plan to counter immediate issues will allow for a response team to immediately address public concerns while the internal wheels are spinning. This also allows for immediate problem identification both internally and externally.

  14. References Caplan, J. (2007). Tome Magazine: Cleaning up Peter Pan’s Mess Retrieved on September 15, 2007 from http://www.time.com/time/business/article/0,8599,1593051,00.html ChangingMinds.Org (2007). Theories: Augmenting Principle. Retrieved on September 15, 2007 from http://changingminds.org/explanations/theories/augmenting_principle.htm ChangingMinds.Org (2007). Theories: Availability. Retrieved on September 15, 2007 from http://changingminds.org/explanations/theories/availability_heuristic.htm ChangingMinds.Org (2007). Theories: Commitment. Retrieved on September 15, 2007 from http://changingminds.org/explanations/theories/commitment.htm

  15. References (Contd.) ChangingMinds.Org (2007). Theories: Information Bias. Retrieved on September 15, 2007 from http://changingminds.org/explanations/theories/information_bias.htm ChangingMinds.Org (2007). Theories: Prospect Theory. Retrieved on September 15, 2007 from http://changingminds.org/explanations/theories/prospect_theory.htm ChangingMinds.Org (2007). Theories: Sunk-Cost Effect. Retrieved on September 15, 2007 from http://changingminds.org/explanations/theories/sunk-cost_effect.htm Conagrafoods.com (2007). Random sites visited for information retrieval

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