Mattel - The year of recall

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Mattel - The year of recall

  1. 1. Corporate Reputation Management Mattel Crisis Management - The year of recall
  2. 2. Case Studie The Company Core Brands /Top Toys Mattel Inc (MAT), the world’s largest toy company ► designs ► manufactures and ► markets toys worldwide
  3. 3. Types Of Reputation Crisis Internal External Technical Social Recall Lead Paint Maggnetts
  4. 4. <ul><li>Retailer in Europe discovers </li></ul><ul><li>a high lead content in some Mattel toys </li></ul><ul><li>Mattel began an investigation </li></ul><ul><li>and halted operations at the factory that produce the toys </li></ul><ul><li>CEO takes personal charge of the situation </li></ul><ul><li>100 pages crises </li></ul><ul><li>Contacted Federal Agency to oversee toy problem and product safety </li></ul><ul><li>E-mail recall press release </li></ul><ul><li>Teleconference with executives </li></ul><ul><li>Schedule TV appearances </li></ul><ul><li>Phone conversation </li></ul><ul><li>Massive online crusade – recall </li></ul><ul><li>Webpage link – updated </li></ul>5 Elements of Reputation Crisis Signal Detection Preparation /Prevention Containment Recovery <ul><li>Short Term: </li></ul><ul><li>Recall of 19 million toys </li></ul><ul><li>Offered equivalent value coupons good for the exchanged toys </li></ul><ul><li>Long Term: </li></ul><ul><li>Certified suppliers </li></ul><ul><li>Increasing control </li></ul><ul><li>Pledged test toys </li></ul>Learnings <ul><li>Thigh quality control procedures in supply chain </li></ul>
  5. 5. Reputation & Threats to Reputation Relationship with China Lack of control of manufacture process Trustworthy company for children and community . In 1997 Mattel created the Global Manufacturing Principles , making them the 1st company to create a framework to ensure manufacturing would be conducted through consistent standards on a global level. At Mattel, unwavering integrity defines our corporate culture on every level, guiding how we work and how we do business. Solid standards of corporate governance are so important to earning and retaining trust, which is why we take corporate governance so seriously. We are pleased to provide the opportunity to take a closer look at our standards - those required, as well as those we impose on ourselves - in an effort to develop best practices, and earn your trust every day. Product integrity Possible Threats to Reputation
  6. 6. July August September Early July – 1 st recall from a retailer in Europe Mattel Recall Timeline/Escalation of Media 2 nd August – 1.500 million recall due to a lead-based paint problem (91 models) , most of them from Mattel-Fisher line. C ompany alerted the public <ul><li>Mattel scoped the problem: </li></ul><ul><li>Wich toy </li></ul><ul><li>Where was made </li></ul><ul><li>When </li></ul><ul><li>. What other toys were made at the same plant </li></ul><ul><li>What paint was used and when…. </li></ul>After the scope, Mattel had another 83 recall 9 th August - China cancelled the export license of 2 of the factories linked to the recalls 14 th August - 18 million recall due to a magnet problems (71 models) Mattel then voluntarily expanded the scope of its investigation. 4 th September - 848,000 recall toys – high levels of lead-based paint Mattel prepared an apology to China Mattel was critized for placing too much confidence with their relationship with China New test proceedure and tested all toys before released A post of senior vice-president of corporate responsibility was created Time Number of incidents/Press mentions Turnaround Process
  7. 7. Plan After Crisis/Lessons to learn Manufactures Control Consumers <ul><li>Tight quality control procedures in its supply chain </li></ul><ul><li>Certified suppliers </li></ul><ul><li>Product test </li></ul><ul><li>Every level of production process </li></ul><ul><li>Random inspections at all vender facilities </li></ul><ul><li>Strict safety standards </li></ul><ul><li>Constant update the recall information of all products for all countries </li></ul>
  8. 8. Mattel Action across time-period / Lessons Lessons Partnership Mattel Action across time-period  Scope the problem  Recalls  National Campaign press  Stopped production  Hired a senior vice president of corporate reputation to report to the CEO Face the problem with honesty /integrity Crisis plan Teamwork Daily meetings at set times Communication consistency Determine who sets up
  9. 9. “ Litttle one, have fun” http://www.youtube.com/watch?v=0oXwEwZtPME
  10. 10. Corporate Reputation Management Mafalda Condado Mónica Silva Patrícia Aguiar 2012

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