The paper "The Maggi Noodle Safety Crisis in India " is a good example of a business case study. The storm all began when the Food Safety and Standards Authority of India (FSSAI), which is the food safety regulator in India, claimed to have found Monosodium Glutamate and traces of lead in the flagship product of Nestle, Maggi Noodles. This led to it being banned in Delhi, and the FSSAI considering a nationwide product recall of the successful fast food product. (Preetika, R., 2015, 19)Many factors would then escalate the situation into a nationwide fiasco that threatened the leading Nestle product in India. One major factor that the Nestle company cited was the regulator’ s lack of proper testing equipment.
Corruption in the government meant that the institution only received 40% of the budget it required, showing they were very broke and lacked the proper infrastructure to have good laboratories for food testing. In addition, the highly trained professionals who should have been heading these institutions activities prefer to seek jobs elsewhere due to the poor salaries they would be paid. This meant that the people who worked here lacked the necessary skills to use some of the equipment in labs.
These inconveniences affecting the FSSAI were observed when the various lab tests came with different results, showing their move to recall the product was a rash move with the ambiguity surrounding the test results. (Asian Age, 2015, 20) Another major influence on the troubled product was the media coverage. In a country with one of the highest populations in the world, the Indian media was a major tool in the rise and fall of the Maggi noodles.
The noodles were not a big hit with the Indian community at first, but the revamping of marketing strategies to suit the society’ s preferences and a well-planned advertising campaign led to it becoming one of the biggest products in India. Not only did it sell a lot, but it also became a national symbol for the huge middle-class society found in India who were the main target of this product. (Avakian, A. V., & Haber, B., 2005, 23) However, once the FSSAI began their hunt down on the product, the very competitive media took it upon themselves to produce as many headlines as possible.
Many of them would opinionate on the issue and claimed that the company had broken Indian’ s hearts. The situation was also amplified more due to the long period in which it escalated, with Nestle having to endure long periods of time for test results. (Times of India on the Web, 2015, 28) The media preyed on the company’ s influence on society and social media made the situation worse since society got involved in the Maggi discussion.
The intensive debate on whether the iconic fast food was safe or not on media and social media affected its financial flow. ( BBC News, 2015) Many major retailers in India recorded huge loses and the value of Nestle India plummeted. (Nestlé India, 2014 Annual Report, 32) To withdraw or not withdraw? With the media and society increasingly in unrest due to the ambiguity surrounding the Maggi noodles and the banning of the product in various states of India (Bindu S P 2015, 14), Nestle had to come up with a solution for the problem, which all boiled down to two choices; to withdraw the iconic foodstuffs from the market and recall the stock or to not withdraw and continue selling the product.
Both of these choices had serious consequences, with withdrawal having the major effect of proving the FSSAI was right and spending a lot of money and time sourcing the product at a grassroots level. Not withdrawing, on the other hand, meant that Nestle would have to do a lot of convincing to the society to prove they are a safe product while trying to control their losses.
In the end, Nestle had to withdraw for a while after a number of states in India banned them. (Nestlé India, 2015, 16) They, however, maintained their strong view that Maggi was always safe and pointed to the fact that other countries had no problem with their product since there had never been any health issues concerning Maggi.
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Preetika, R., 2015. Before the Maggi Noodles Scare: Look at What the U.S. FDA Found in Indian Snacks,” Wall Street Journal on the Web, June 11, 2015. http://blogs.wsj.com/indiarealtime/2015/06/11/before-the-maggi-noodles-scare-look-at-what-the-us-fda-found-in-indian-snacks/, accessed July 2015.
Ratna B. 2015. Maggi Ban Hits 1,500 Nestlé Employees as Company to Move some of its Staff for Manufacturing Other Items. Economic Times on the Web, June 17, 2015, http://articles.economictimes.indiatimes.com/2015-06- 17/news/63540249_1_nestle-india-maggi-instant-noodles, accessed July 2015.
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