Case Study on "Role of Global Corporation"

Case Study 4 pages (1085 words) Sources: 0

[EXCERPT] . . . .

Mattel and the Toy Recalls

role of global Corporation

Mattel was founded by Harold Matson and Elliot Handler in 1944. The company started by manufacturing doll house furniture, and picture frames. Their first mass produced product was the music box, and this was the product which established Mattel in the toy business. Company growth was propelled by the introduction in 1959 of Barbie. Ken was introduced two years later. Harold Matson sold his share of the company to Elliot Handler and his wife. In 1948, Ruth Handler wife to Elliot Handler incorporated the company. Mattel went public in 1960. To reduce production costs, the company had established several contracts with different principal vendors in China. These vendors manufactured toys for Mattel. The principal vendors would use other smaller companies for the partial or full production of the toys. Because of this subcontracting, the supply chain became long and complex. Mattel only had direct contact with its principal vendors.

When it came to corporate responsibility, Mattel was an industry leader. The safety of their products was a key issue and the company tried to ensure that all its products meet all quality standards, and are not hazardous. The company's image was tarnished in 2007 when it was discovered that some of its products contained high levels of lead, than the permissible levels by the U.S. federal toy policy. This lead to a massive recall of the toys manufactured in China between April 2007 and July 2007.

The problems Mattel faced

There are two main problems that the case study identifies, case study, excessive amount of lead on the toys, and loose magnets. Loose magnets were used mostly in building block toys and jewelry for kids. The availability and cheap prices of the powerful magnets had attracted the toy manufacturers to use them on the building blocks and play sets. On some of the products, the magnets would come loose, and the child might swallow the magnets. The major risks with magnets are that if a child swallowed two magnets, they could get attached and cause perforations to the intestines or block the intestine which could be fatal. Mattel had to recall 2.4 million play sets of its Polly Pocket. The recall was prompted by reports of 170 cases of children who had swallowed the magnets, and three children who required surgical care to remove the magnets swallowed. The play sets recalled were sold from May 2003 and September 2006. The recall announcement was made on November 21, 2006.

Lead in children products is a serious hazard as exposure to high levels of lead affects every organ in the human body. Exposing children to high levels of lead can cause them to have attention deficit hyperactivity disorder, IQ deficit, reaction time, and motor skills. In consideration of the damages caused by lead to humans, especially children, there is a limited amount of lead permissible by the U.S. government. All children products should not have lead amounts in excess of 600 ppm. In the developing countries, the use of lead is not restricted or banned. Many manufacturers will use paint that has a high percentage of lead as it is highly corrosion resistant, and bright which makes it appeal to consumers.

Mattel had to recall… READ MORE

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