strategic management

7/18/2019 Strategic Management

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MATTEL’S STRATEGY AFTER ITS RECALL OF PRODUCTS MADE IN CHINA

Submitted by:

Shahiva Tazhnim S. Jadraque

Anne Therese D. Magaway

Nurhuda RJ H. Obeidat

Pia . S!tt!

Ra"ae##a Daye T. Tan

Submitted t!$

Mr. %ran&is Arr!y!

Date$

Ju#y '( )*+,



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PROBLEM STATEMENT:

-n the summer !" )**( Matte#( the #argest t!yma/er in the 0S( saw its sa#es di1

shar1#y when it re&a##ed its hinese2made t!ys severa# times. Matte# re&a##ed its hina2

made t!ys due t! high #ead &!ntent whi&h sh!wed that they are having an issue in the

qua#ity &!ntr!# !" their 1r!du&ts.

OBJECTIE:

• T! be ab#e t! strengthen qua#ity &!ntr!# !" their 1r!du&ts

• T! determine what &hanges must be made by Matte# in re#ati!n t! its in2

h!use !r !uts!ur&e manu"a&turing !" 1r!du&ts.

• T! reassess its strategy "!r !rganising 1r!du&ti!n

BRIEF DESCRIPITION OF THE CASE:

Matte#( a massive 0S t!y &!m1any res!rted t! in2h!use and !uts!ur&e

manu"a&turing !" its 1r!du&ts t! a&&!mm!date demands. Matte# had been re#!&ating its

1r!du&ti!n abr!ad and !uts!ur&ing the manu"a&ture !" its 1arts and &!m1!nents. -t

!uts!ur&ed t! Asian &!untries #i/e Taiwan( hina and Ja1an t! ta/e advantage !" #!wer

&!sts. H!wever( !n )**( the &!m1any had t! re&a## its t!ys that were made in hina(

where ',3 !" 1r!du&ti!n was d!ne( due t! sa"ety reas!ns #i/e the e4&essive#y high #ead&!ntent in the 1aint used "!r %isher2Pri&e t!ys. The re&a## was &aused by Matte#5s #!ng2

time su11#iers but &riti&s 1ut the b#ame !n Matte#( saying that the &!m1any 6had be&!me

#a4 with its &#!se manu"a&turing 1artners7. Thus( Matte# issued an a1!#!gy averring that

the re&a## was a resu#t !" a design "#aw and n!t !" hina5s manu"a&turers.

AREAS OF CONSIDERATION:

Strengths

• Matte# was the #argest t!y &!m1any in the w!r#d( and its business a&tivities

in&#uded the design( manu"a&turing and mar/eting !" t!ys.

• They have the initiative t! test their 1r!du&ts t! &he&/ i" there are any

harm"u# materia#s in their 1r!du&ts.



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• They have a sense !" res1!nsibi#ity n!t !n#y t! their buyers but a#s! t!

their w!r/ers and em1#!yees

• Massive &a1ita# &a1a&ity

• 8""e&tive strategies in management !" &!sts

•

Matte# !wned and !1erated +* manu"a&turing 1#ants w!r#dwide.• Matte# manu"a&tured a high 1r!1!rti!n !" its t!ys in2h!use t! give it m!re

&!ntr!# !ver the sa"ety !" its 1r!du&ts.

Weaknesses

• -n +99'( there was an issue ab!ut Matte# using under2age w!r/ers

• Matte# "a&ed with rising 1r!du&ti!n &!sts and 1ressure "r!m &ust!mers t!

#!wer 1ri&es( t!y manu"a&turers redu&ed &!sts by evading sa"ety

standards

• Matte# had be&!me #a4 with its &#!se manu"a&turing 1artners( #eaving the

regu#ar testing t! them and &!ndu&ting s1!t2tests !n#y every three m!nths.

• They use unhea#thy 1r!du&ts su&h as #ead &!ntent 1aints and magnets

whi&h are harm"u# t! the buyers.

• Matte#5s #a&/ !" sa"ety standard !n their 1r!du&ts

• Management !" !uts!ur&ing

• ha##enges in qua#ity &!ntr!#

•

Matte# had )** em1#!yees res1!nsib#e "!r ensuring the &!ntra&t!rs&!m1#ied with sa"ety standards( but n!ne !" them was stati!ned !n2site.

Opportunities

Matte# &an ad!1t a new sa"ety measures whi&h wi## ensure the sa"ety !" its

1r!du&ts.

• :arge manu"a&turing 1#ants a##!ws m!re 1r!du&ti!n

• They re&!mmended t! the g!vernment !" hina t! ma/e a regu#ati!n !n

1reventing "a&t!ries t! use harm"u# materia#s !n their 1r!du&ts.

Threats

• The di""i&u#ty !" &!ntr!##ing the !uts!ur&ing and manu"a&turing in hina(

des1ite 1re&auti!nary measures.



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• Matte# made severa# re&a##s !" its t!ys made in hina due t! sa"ety

reas!ns.

• !m1etit!rs ;i.e( Hasbr!<

• 8thi&a##y re#ated issues in HR

•

St!&/ va#ue !" &!m1any may dr!1 due t! re&a##s

ALTERNATIE COURSES OF ACTION:

+. Matte# sh!u#d re#y m!re !n in2h!use 1r!du&ti!n.). Matte# sh!u#d be !uts!ur&ing t! m!re deve#!1ed &!untries.=. Matte# sh!u#d strengthen its 1re&auti!nary measures in the qua#ity !" their

1r!du&ts in hina.>. Matte# sh!u#d #!!/ "!r an a#ternative 1r!du&t that &an re1#a&e #ead 1aint and

magneti& materia#s used in their 1r!du&ts.,. Matte# sh!u#d 1ri!ritize the we##ness !" their buyers.'. Deve#!1 &!ntr!# &enters tas/ed t! s!#e#y m!nit!r the 1r!du&ti!n 1r!&ess !" a## the

manu"a&turing 1#ants. 8stab#ish a &#ear &ut and #aw"u##y binding set !" 1!#i&ies with su11#iers !r third

1arties t! ta/e "u## &!ntr!# !" the manu"a&turing 1r!&esses

RECOMMENDATION:

?e be#ieve that the best way t! im1r!ve the qua#ity &!ntr!# !" Matte#5s 1r!du&t is

t! re#y m!re !n the in2h!use 1r!du&ti!n. This wi## give them m!re &!ntr!# !ver the

design 1r!b#ems and !1erati!na# issues. -t wi## be easier "!r them t! ensure that the

&!ntra&t!rs &!m1#ied with Matte#5s sa"ety 1r!du&ts. -t wi## a#s! assure the &ust!mers that

their 1r!du&ts are m!nit!red we##. ?e a#s! be#ieve that Matte# sh!u#d deve#!1 &!ntr!#

&enters that wi## ta/e !n the stri&t m!nit!ring !" the manu"a&turing !" their 1r!du&ts. This

a&ti!n wi## a##!w them t! minimize i" n!t 1ut a &!m1#ete st!1 t! the "#aws !&&urring during

the 1r!du&ti!n !" t!ys and this wi## 1r!vide rea# time u1dates as t! the &!nditi!n !" the

!n2g!ing 1r!&ess !" said 1r!du&ti!n.

ACTION PLAN:

!HO !HAT !HEN



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Matte#

O1erati!na#

Dire&t!r

T!y Design

Manager

T!1 #eve#

management( "#!!r

managers(

&!m1any advis!rs(

#ega# &!unse#s

Human res!ur&e

de1artment(

managers

Hired em1#!yees(

management

- Pr!du&ing t!ys in2

h!use- A stri&t 1!#i&y in the

1r!du&t sa"ety must

be im1#emented

- A team must be

assigned in the

regu#ar testing !" the

1r!du&ts.

- A sa"ety standard "!r

t!y design must be

&reated

-Meeting with1ers!ns &!n&erned

t! dia#!gue ab!ut

&!ntr!# &enters

- Hiring !" 1e!1#e t!

be in &harge !"

&!ntr!# &enters

- A&tivati!n !" &!ntr!#

&enters

As soon as possible

As soon as possible

As soon as possible

As soon as possible

As soon as possible

As soon as possible

CONCLUSION:

-n2h!use 1r!du&ti!n and !uts!ur&ing b!th have its advantages and

disadvantages. As the #argest t!y &!m1any( Matte# must va#ue 1r!du&ing a g!!d qua#ity

and sa"e 1r!du&ts than #essening its 1r!du&ti!n &!sts. Outs!ur&ing may #essen the

1r!du&ti!n &!sts but it wi## be m!re ris/y and &!st#y in the #!ng2run #i/e what had

ha11ened in the hinese2made t!ys whi&h was re&a##ed. - be#ieve that it is better "!r

Matte# t! re#y !n in2h!use 1r!du&ti!n than !uts!ur&ing be&ause they &an !versee and

manage 1r!1er#y the 1r!du&ts that they 1r!du&e. -t w!u#d be di""i&u#t "!r Matte# t!

&!ntinue its !uts!ur&ing in hina be&ause maintaining the sa"ety standards w!u#d be



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di""i&u#t due t! the di""eren&e !" their 1ub#i& hea#th standards and the distan&e whi&h

w!u#d ma/e it &ha##enging "!r them t! !versee the qua#ity !" the 1r!du&ts that are being

1r!du&ed. Meanwhi#e( sh!u#d the im1#ementati!n !" the &!ntr!# &enters be su&&ess"u#(

Matte# sh!u#d e41erien&e a high 1!sitive deve#!1ment in 1r!du&ti!n &!ntr!#. This sh!u#d

1ave the way "!r a sm!!th 1r!du&ti!n 1r!&ess that is "ree "r!m "#aws that may be

br!ught u1!n by an !versight in ins1e&ti!n "urther@ this &!u#d a#s! a&t as the &!m1anys

way !" ensuring the sa"ety and best qua#ity !" their 1r!du&ts.

strategic management

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