Johnson & Johnson Goes to Canada
2009 is a big year for anniversaries at Johnson & Johnson. For instance, it was 70 years ago (in 1939) that Dr. Philip Levine, working in our laboratories, discovered the human Rh factor. It’s been 60 years (1949) since we opened affiliate companies in Portugal, France and Colombia. It was 50 years ago (1959) that we formed our operating company Ethicon, Inc. out of our historic suture business. It was 50 years ago that we acquired McNeil Laboratories. And it was 90 years ago this year – in 1919 – that Johnson & Johnson opened its first affiliate company, and its first plant outside of the U.S. – in Canada.
Let’s go back to 1919. Dial telephones were introduced in the United States, the 18th Amendment to the Constitution (Prohibition) was adopted, and in Europe, the Treaty of Versailles, officially ending World War I, was signed. The U.S. Congress passed legislation giving women the right to vote (however, it didn’t take effect until 1920, the following year). The Chicago Black Sox scandal of the 1919 World Series was making headlines, as was the Boston Molasses Disaster. During the war, Johnson & Johnson had dramatically increased its production capacity to meet wartime demand for its products, and in 1919 demand was still high, though the Company was starting to shift back to its regular production schedules.
Although 1919 was the year we incorporated an operating company in Canada, it wasn’t the start of our presence there: the Company had already been represented in Canada for 30 years by sales agents in Montreal called Gilmour Brothers and Company, going all the way back to 1889 – just three years after the beginning of Johnson & Johnson.
The Company shipped product from New Brunswick, New Jersey to Gilmour Brothers and Company, who then distributed the product throughout Canada. By the Nineteen-teens, the relationship was so long and close that a 1918 issue of THE RED CROSS MESSENGER, listed the Gilmour brothers’ company as the Johnson & Johnson “Canadian Office” on the “J&J Honor Roll” of Company employees who were in the armed forces during World War I. J. L. Gilmour, who’s pictured below, was one of four members of the Gilmour family from our “Canadian Office” on the Johnson & Johnson Honor Roll for the war. He served as a captain in the Canadian military. [THE RED CROSS MESSENGER, Vol. X, No. 3, 1918, p. 304]
So how did we get from sales agents to an operating company? I’ll let General Robert Wood Johnson, who witnessed the transition, describe it:
“Trade grew steadily in volume, and by 1909 Gilmour Brothers began to manufacture certain Johnson & Johnson products at their plant in eastern Montreal. Ten years later a further step was taken. It was decided to establish a Canadian plant, to be operated by our old friends and associates, the Gilmours, and organized as a separate company within the family of Johnson & Johnson. In fact, the new organization purchased the Gilmour plant for use as its factory. John Manley and I went to Montreal to help remodel the building and install additional machines. This company was incorporated in 1919; it bleached its first surgical gauze in 1927. From the first there was teamwork on both sides, with the Canadian staff making final decisions while our people from New Brunswick gave all the help they could.” [Robert Johnson Talks it Over, by Robert Wood Johnson, Johnson & Johnson, 1949, p. 121]
The fact that the Canadian management made final decisions foreshadowed the philosophy of decentralization that Robert Wood Johnson – and Johnson & Johnson – would adopt as the Company continued expanding globally. Our first affiliate company in Canada 90 years ago this year proved to the Company’s management that decentralized affiliate companies outside of the United States would work, and it set the stage for the Company’s later global expansion.