Mattel Toy Recall
Executive Summary
Mattel has been criticized heavily for having to recall not once but thrice in 5 weeks 20 million toys manufactured in China with lead paint and/or loose, potentially dangerous magnets. Clearly Mattel does not have sufficiently tight quality control procedures in its supply chain to compensate for the extra risks of outsourcing to Chinese subcontractors and clearly there are design flaws in the toys with the magnets that could come loose. Although many observers give the company credit for responding to the crisis quickly with an apology from the CEO and pledges to institute more rigorous product safety checks, Mattel still faces a number of problems, including significant costs associated with the recalls and new monitoring systems, potential lawsuits and a hit to its reputation just as the holiday shopping season gets ready to launch1.
Introduction
Mattel Inc. has recalled more than 20 million toys it manufactured in China, citing problems with lead paint and concerns about loose magnets that children could swallow. Mattel blames the most recent recall on a practice that may be all-too-familiar to engineers with experience manufacturing in China – namely, a vendor’s furtive change in materials or manufacturing processes2.
Tom Debrowski, Mattel’s executive vice president for worldwide operations, explains that a subcontractor hired to decorate parts of the Sarge toy ran out of the paint Mattel specified for the car’s roof and windshield. The subcontractor, a company called Hong Li Da (HLD), then substituted a paint that contained lead. Debrowski says HLD acted without informing Mattel or its primary vendor for the car, Early Light Industrial Co. The product safety problem may seem especially pronounced in the toy industry because it relies so heavily on Chinese production. According to the Toy Industry Assoc., China makes about 80 percent of all toys sold in the U.S. Not all of Mattel’s recall woes can be blamed solely on Chinese
Mattel has been criticized heavily for having to recall not once but thrice in 5 weeks 20 million toys manufactured in China with lead paint and/or loose, potentially dangerous magnets. Clearly Mattel does not have sufficiently tight quality control procedures in its supply chain to compensate for the extra risks of outsourcing to Chinese subcontractors and clearly there are design flaws in the toys with the magnets that could come loose. Although many observers give the company credit for responding to the crisis quickly with an apology from the CEO and pledges to institute more rigorous product safety checks, Mattel still faces a number of problems, including significant costs associated with the recalls and new monitoring systems, potential lawsuits and a hit to its reputation just as the holiday shopping season gets ready to launch1.
Introduction
Mattel Inc. has recalled more than 20 million toys it manufactured in China, citing problems with lead paint and concerns about loose magnets that children could swallow. Mattel blames the most recent recall on a practice that may be all-too-familiar to engineers with experience manufacturing in China – namely, a vendor’s furtive change in materials or manufacturing processes2.
Tom Debrowski, Mattel’s executive vice president for worldwide operations, explains that a subcontractor hired to decorate parts of the Sarge toy ran out of the paint Mattel specified for the car’s roof and windshield. The subcontractor, a company called Hong Li Da (HLD), then substituted a paint that contained lead. Debrowski says HLD acted without informing Mattel or its primary vendor for the car, Early Light Industrial Co. The product safety problem may seem especially pronounced in the toy industry because it relies so heavily on Chinese production. According to the Toy Industry Assoc., China makes about 80 percent of all toys sold in the U.S. Not all of Mattel’s recall woes can be blamed solely on Chinese
References: 2) Champoux, J. Organizational Behavior: Integrating Individuals, Groups and Organizations. 3rd ed. Cincinnati, Ohio: South-Western College Publishing, 2006. 3) U21 Courseware - 601 Organizational Behaviour - Section 601-0701-6. Footnotes: 1) Trouble in Toyland: New Challenges for Mattel -- and 'Made in China ' - Published: August 22, 2007 in Knowledge@Wharton. 2) Mattel Recall Was Made in China - Joseph Ogando, Senior Editor -- Design News, August 15, 2007 3) Mattel Recall Was Made in China - Joseph Ogando, Senior Editor -- Design News, August 15, 2007 4) Trouble in Toyland: New Challenges for Mattel -- and 'Made in China ' - Published: August 22, 2007 in Knowledge@Wharton. 8) Mattel Recall Was Made in China - Joseph Ogando, Senior Editor -- Design News, August 15, 2007 9) Lessons from China 's recall episode – Govindraj Ethiraj - September 04, 2007 – Rediff - Money http://www.rediff.com/money/2007/sep/04china.htm 10) Lessons from China 's recall episode – Govindraj Ethiraj - September 04, 2007 – Rediff - Money http://www.rediff.com/money/2007/sep/04china.htm 11) These Toy Engineers Don 't Play Around - Joseph Ogando, Senior Editor -- Design News, Joseph Ogando, Senior Editor -- Design News, October 23, 2006 16) Champoux, J. Organizational Behavior: Integrating Individuals, Groups and Organizations. 3rd ed. Cincinnati, Ohio: South-Western College Publishing, 2006. Ch 11. Conflict in Organisations – Interorganisation Conflict - Pg 258 17) Champoux, J