In July 2007, Mattel discovered that a substantial amount of their toys were contaminated with toxic lead paint after shipping out millions of toys to supply the upcoming holiday season. A crisis is defined as “the perception of an unpredictable event that threatens important expectancies of stakeholders and can seriously impact an organization’s performance and generate negative outcomes” (Coombs, 2012). Under this standard, Mattel were facing a crisis by violating their stakeholder’s expectation of product quality standards. Mattel effectively managed this lead crisis in the following ways: Mattel open a self-investigation on their supply chain and recalled 1.5 million toys to ensure children and the public safety; Mattel had a crisis management …show more content…
Mattel sought out to maintain open communication with the media and their stakeholders during their crisis response, and it started with an apology from its CEO Robert Eckert via video. On August 16, 2007, Eckert issued a video apology direct at parents in efforts to sustain the parents’ trust in their products. In the video, Eckert emphasized that he is a parent as well and understands nothing is more important than the safety and well-being of children. He addressed the recalls and outlined specifically how the company already implemented stricter safety procedures. Also, Eckert pledged to address any future recalls quickly and candidly (CNN, 2007). Mattel continue to reach out to the media and the public by immediately notifying reporters, news outlets, and sent out press releases to inform the public of the recall. Mattel also placed ads about the recall in newspapers such as New York Times and Wall Street Journal (Briguet, 2013). Additional, Mattel composed an online campaign that consisted of a crisis response website with updated recall information. Consumers were fully informed and were given a link to information direct from the company (Briguet, 2013). Mattel’s efforts in communicating often and sincerely helped retailers and parents feel the company truly understood it had violated trust and that it was determined to make it right …show more content…
Mattel’s response to the lead tainted toys crisis exemplifies the importance of having a strong, updated crisis management and communication plan that reflects the company’s culture and values. Companies, in the future, should look to Mattel’s response as a model for planning and responding to
The company has arrived at a state that is attributed to a few factors, each of which reveal that the changing stakeholder values are not necessarily in line with the values that the controversy of the Luon pants has helped bring to the forefront of this discussion. These factors include quality control, business ethics, publicity and company values.
Professor C. Scott Pryor, discusses the “liberty principle” in part II and the “jurisdiction principle” in part III of his article Consideration in the Common Law of Contracts: A Biblical-Theological Critique. Professor Pryor relates the liberty principle and the jurisdiction principle to the three perspectives that he outlined earlier in his article; the Normative (Dominion), the Situational (Office and Rights), the Existential (The Image of God). C. Scott Pryor, Consideration in the Common Law of Contracts: A Biblical-Theological Critique, 18 Regent University Law Review. 1, 12-18 (2005). The “liberty principle” can best be described as a principle foundation related to contracts as it relates to making the promise, keeping the promise,
The bursting of the housing bubble, known more colloquially as the 2008 mortgage crisis, was preceded by a series of ill-fated circumstances that culminated in what has been considered to be the worst financial downfall since the Great Depression. After experiencing a near-unprecedented increase in housing prices from January 2002 until mid-2006, a phenomenon that was steadily fed by unregulated mortgage practices, the market steadily declined and the prior housing boom subsided as well. When housing prices dropped to about 25 percent below the peak level achieved in 2006 toward the close of 2008, liquidity and capital disappeared from the market.
1. The decision facing Mattel is whether to continue to produce their products internationally where cost are low, or produce them in the United States where costs are significantly higher but quality is better. Mattel might want to even reconsider going global if there sales are decreasing more internationally than in the United States. Mattel needs to determine how many of the products produced internationally were recalled versus the amount of products produced in the United States that were recalled. Mattel also needs to decide how they are going to advertise their products in a way that will convince consumers in the external environment to buy their products, without having any
The first 48 hours after the outburst of crisis is the prime time to reduce destruction of the crisis and restore the reputation of the corporation, so when to react and how to react are crucial for crisis communication. As for the Nuance case, the company needs to take the following steps to deal with the crisis.
John Sortino founded the Vermont Teddy Bear Company (VTBC) in 1981 by selling handsewn teddy bears out of a pushcart in the streets of Burlington, Vermont (Wheelen & Hunger, 2004). Mr. Sortino's motivation for making the teddy bears in the United States cultivated while playing with his son, Graham, and after noticing his son had many stuffed animals that were made in other countries (Wheelen & Hunger, 2004). Since its inception, the company's focus has been to design, manufacture, and direct market the best teddy bears made in America; using quality American materials and labor (Wheelen & Hunger, 2004).
Mattel, Inc has the vision of being the world’s premier toy brand, for the present and the future. It currently sells products in over 150 nations. The company was founded in 1945 by Harold Matson and Elliot Handler. It has gone to be 30,000 employees strong working in 43 countries. Mattel, Inc includes a number of toy brands such as Barbie, Fisher Price, Hot Wheels, American Girl, Tyco, and others. In 2008, the company was recognized by FORTUNE magazine as one of the “100 Best Companies to Work For”.
The purpose of this memo is to document and evaluate the business risks faced by Toy Central Corporation (TCC), as well as audit risks, accounting issues identified, and management assertions affected.
In 2007, Mattel a California based toy company shockingly recalled 19 million toys that had been manufactured in China. Mattel was founded in 1944, and has produced iconic toys such as Barbie and Hot Wheels. The company had a long established trust with their consumers that had been forged from decades of reliability. However, when the company recalled 19 million toys due to health and safety violations, consumer confusion and outrage soared. The public wanted to know how such an established company’s safety regulations could fail, how Mattel was addressing the issue, and whether consumers could trust Mattel to produce reliable toys in the future.
In a competitive market to which Johnson and Johnson operates, the smallest of errors can lead to consequences which can cut revenue. When large mistakes occur, millions of dollars are lost, and even worse, there is a loss of customer confidence. Johnson and Johnson has had numerous recalls in their consumer healthcare division recently, which rocked the organization’s once sound image, and diminished its profits. These recalls have hurt Johnson and Johnson’s stocks and cost the company about $900 million in sales last year (Rockoff, 2011).
recalls related to product quality problems. Observers felt the company would have lost even more
The problem surrounding Mattel Inc. is their mismanagement of international subcontractors and vendors and the production of certain toys (the manufacturing process), as well as their inability to adapt their marketing strategy or product to the constantly changing “demographic and socioeconomic trends.” This is supported by Mattel’s legal battle with Carter Bryant and MGA, their forced recall of certain toys that were manufactured overseas, and the increasing rate at which traditional toys are becoming less appealing to today’s young audience. Essentially, Mattel’s mismanagement and oversight lead to violations in terms of ethical and social responsibilities and safety standards.
1. no. 1-0013 Mattel, Inc: Vendor Operations in Asia Only 3% of the world’s children are here in the U.S. Our biggest opportunities are in growth outside the U.S. – Jill Barad President & CEO Mattel, Inc. The sun was just breaking over Kowloon Harbor. From his corner office, Ron Montalto gazed across the water and watched the early morning light reflect off Hong Kong’s famous downtown skyline. Only 24 hours ago Ron had been riding around the Carolina Speedway in Kyle Petty’s blue Pontiac, emblazoned with the Hot Wheels logo. The event was part of the kickoff for a new series of Hot Wheels® replicas of NASCAR racers. Now, back in Hong Kong questions still swirled around the sourcing
In 2111, Prof. Sethi and colleagues disclosed that Mattel Inc. had played a part in, what many would consider, unacceptable business practices (p. 483). Although Mattel took actions to investigate the level to which practices were truly occurring, they had also promised to remediate all noted unacceptable practices. One of the unacceptable business practices that was uncovered was the mandating of certain employee groups required to live in company dormitories and were not permitted to utilize any other options for housing. Was this practice a form of discrimination? In order to decide if the business practice and any alternatives are fair and ethical for all, resulting in the greatest amount of good for the greatest number of people, the scenario will be run through the EthicsOps.com’s Utility Test.
Managers and leaders do not welcome crises because they don't realize that problems and crisis if handled with intelligence become an opportunity for the company. The purpose of writing this paper to discuss the case of "Johnson & Johnson" that became a hero in the eyes of public (Rehak, 2002) and gained their market share back with the help of their effective public relations plan. They accomplished this by making good relations with public and by proving how much they were concerned about the safety of their consumers.