...Children: Mattel’s Toy Recalls and Supply Chain Management” | Rob Breakiron Wenyao Ma Alek Shnayder Jiajie Wang | Contents Introduction 2 Why do companies outsource? 2 What were the primary causes of Mattel’s recall problems? Where these the result of outsourcing? 4 What actions were taken by the principals in the case to address the recall problems? Were these the right actions? Why, or why not? 5 What should Mattel do now? What should governments do? 7 How can accountability be better managed in long, global supply chains? 12 Introduction Mattel, Inc. (NASDAQ: MAT), the world’s largest toy company with over $12.5 billion in revenue, has grown from the little toy company it once was and has certainly come a long way since it was founded in 1945. The exponential world-wide growth has not always come without a hitch. In the late 2000’s Mattel was at a crossroads due to a significant toy recall problem, reaching far beyond the bottom line. During this case write up we discuss what went wrong, whose fault it was, and what can and should be done to not only fix the problem, but eliminate the chance of similar problems for Mattel and other firms in the future. Our case study will tackle the following five questions through in depth discussion: 1) Why do companies outsource? 2) What were the primary causes of Mattel’s recall problems? Where these the result of outsourcing? 3) What actions were taken by the principals in the case to address the recall problems...
Words: 4472 - Pages: 18
...[pic] NORTHCENTRAL UNIVERSITY ASSIGNMENT COVER SHEET Student: James R Williams THIS FORM MUST BE COMPLETELY FILLED IN Follow these procedures: If requested by your instructor, please include an assignment cover sheet. This will become the first page of your assignment. In addition, your assignment header should include your last name, first initial, course code, dash, and assignment number. This should be left justified, with the page number right justified. For example: |WilliamsJMBA5140-8 | Save a copy of your assignments: You may need to re-submit an assignment at your instructor’s request. Make sure you save your files in accessible location. Academic integrity: All work submitted in each course must be your own original work. This includes all assignments, exams, term papers, and other projects required by your instructor. Knowingly submitting another person’s work as your own, without properly citing the source of the work, is considered plagiarism. This will result in an unsatisfactory grade for the work submitted or for the entire course. It may also result in academic dismissal from the University. | | | |32744 |Dr. Patrick Karbon ...
Words: 1533 - Pages: 7
...DSC 2006 Operations Management Outsourcing [pic] I. Introduction Outsourcing is used extensively by both the manufacturing and service industries, and there are plenty of reasons to utilize outsourcing. Organizations make use of outsourcing usually in the interest of lowering cost and to make better use of time and energy costs, hence redirecting their energy to something more important or just to conserve energy. Outsourcing is essentially a division of labour. One simple example involves companies outsourcing their financial statements to accountancy firms to consolidate their expenditures, hence eliminating the need to hire an accountant. Another relevant example would be to hire the services of another company to manage all or parts of the services that otherwise would be otherwise rendered by an IT unit of the organization. Some reasons for outsourcing include organizations being able to focus purely on their core business, for example an automobile factory. The raw materials required to manufacture an automobile are outsourced to other companies and hence the company itself can focus on just creating quality automobiles. By outsourcing the raw materials to companies who specialize in providing them, they can also ensure that the raw materials are of reasonably better quality and this can be done by contracting with a new service level agreement. Another reason being companies are able to access the wide pool of talent available through hiring agencies. In layman terms...
Words: 4008 - Pages: 17
...Content: 1. Introduction 2. Main part 3.1 Outsourcing definition and types 3.2 Outsourcing and its effect on business 3.3 Outsourcing pros and cons 3. Conclusion 4. Bibliography Introduction The term outsourcing comes with many preconceived connotations, both positive and negative, thus the study of the mechanisms for effective use of outsourcing as a business development tool is also clouded with these perception issues. Much of the academic study of outsourcing revolves around trying to determine if it is a good thing or a bad thing, whether it is harmful to the local workforce or beneficial to globalization, and whether the average company has an obligation, moral or otherwise, to consumers in its home town, state or country to use labor within that region. None of those topics are pertinent to the discussion here and are therefore being immediately excluded. That is not to say that these are not pertinent and valid area of research in their own right, only that they are tangential to this discussion herein. This review will focus on outsourcing as it relates to control mechanisms within company development. Specifically, this paper will attempt to identify the link between control mechanism and outsourcing within the framework of managerial accounting. Outsourcing, literally, is the use of an external source to perform a business function instead of having an employee do it using company equipment. In its simplest...
Words: 4675 - Pages: 19
... | | | |David Mahmoodi | |01/31/2009 | |How much of a service can be outsourced before the benefits stop outweighing the costs? For the first time in the history of the company, Boeing is| |outsourcing more than 70% of the production of its new aircraft the 787 Dreamliner. This is not just the production or assembly of the plane, but | |also the specifics of engineering the individual parts. With so many parts being designed and assembled in other countries there have been | |communication issues, lengthy delays and increased costs. This paper will explore the benefits and costs of outsourcing such a big public project. | |It will discuss how Boeing or similar companies can better mange outsourced projects or more efficient alternatives to outsourcing them all | |together. | | ...
Words: 7024 - Pages: 29
... OPERATIONS AT FIREBIRD U.S. Firebird has five distinct operations centers. The East plant manufactures light assemblies and units. Manufacturing I produces headlights and front-turn assemblies. Manufacturing II assembles taillights, lid lamps, center high mounts, and aftermarket products. The West plant provides components to assembly and external sales. Manufacturing III is a sanitization and coating process for lenses, reflectors, and extensions. Manufacturing IV is a die injection molding facility producing reflectors, lenses, and housings. A halogen bulb department provides the majority of the bulbs used in production. Assembly in the East Plant Approximately 40 lines supply different makes, models, and types of lighting for Road-Master vehicles. Dedicated lines run multiple shifts to meet OEM production for current year A-car and B-car models. OEM production for the Avenger and Odyssey Minivan runs on one-shift dedicated lines. OEM requirements may exceed...
Words: 1438 - Pages: 6
...US cigarette prices would need to lead to a 50% increase in volume (assuming unchanged costs) for Trading Profit to be unchanged. This implies a price elasticity of 5. The US Tobacco Policy Research Study Group (which is anti-tobacco) estimates the elasticity as 0 .2 to 1 .4. * Price psychology and price recall show the lowest price is remembered longest. Therefore the low prices in a price war influence a consumer's perception of what is a "reasonable" price long after the war ends. * Consumers become sensitive to price at the expense of value and benefits. * Even if a weak competitor succumbs (and the regulators/courts do not construe illegal predatory pricing) the capacity often stays. Preventing and avoiding price wars should have a high strategic priority. Price wars destroy huge chunks of company and industry profits, and rarely provide a business with sustainable advantage. They undermine the consumer base and seldom alleviate an industry's structural or capacity problems. What really causes price wars? * The main sound strategic rationale is that if a company makes an investment in new technology that slashes its costs, it can then lower prices to gain share and to block competitors from acquiring the same technology. * Other rationales tend to be as a result of a misjudgment or misunderstanding of how competitors or consumers will respond. * Some industries...
Words: 761 - Pages: 4
...In 1971 the “Swoosh” was designed for $35.00 by Carolyn Davidson and the first shoe sold doning the swoosh and the name Nike was a soccer shoe. In 1972, Blue Ribbon Sports changed its name to Nike, Inc. after the winged greek goddess of victory. Later on in the 1970’s the company’s world headquarters were opened up un Beaverton, Oregon. (http://www.theshoegame.com/Nike-History-Timeline-Info.html) Nike- 1980s The company really took off and became well known all across the world in the 1980’s. The company started prodection of their footwear in 11 countries including China, Vietnam, and Indonesia. Famous shoes such as the “Nike Air” Air Force Ones and the Air Aces were introduced. Also in the 1980’s, the famous Nike slogan “Just Do It” came about. The slogan is still a major focal point in the companies advertising and marketing to this day. The success of the Nike took a huge turn in 1985 when the company signed a deal with the world’s greatest basketball player of all time, Michael Jordan. Jordan played a major role in how successful nike is today. The newly introduce “Air Jordan” became popular to basketball players worldwide, whether was at the professional level or the youth level. (http://www.theshoegame.com/Nike-History-Timeline-Info.html) Post 1980 After the 1980’s and the deal with Michael, Nike began to sign other famous athletes to lucrative deals to promote their brand name. Sports greats such as Deion Sanders, Bo Jackson, Charles Barkley, Barry Sanders...
Words: 2419 - Pages: 10
...Operations Improvement Plan University of Maryland MBA 6022 February 17, 2012 Instructor: Dr. Ben Thompson Tracy Moore MBA 6022 2237 Gateway Blvd Baltimore, MD 21202 Abstract: Toyota is faced with an Accelerator crisis after allegedly faulty accelerator pedals in some of their vehicles caused the pedals to depress get stuck or cause them to accelerate. This lead to a massive recall and lead to penalties and fines from the US government and consumer confidence diminished. There are several processes that can be identified that will benefit Toyota and lead to improvement which is what will be discussed in this paper. Toyota Motor Corporation was founded by Kiichiro Toyoda. Its headquarters is in Japan and was established in 1933. According to by Greto, Schotter, and Teagarden (2010), “In 1934, the company produced its first Type A engine at the encouragement of the Japanese government, and two years later the company produced its first passenger car, the Toyota AA” (p. 2). After going through financial turmoil the 1950’s but helped out by the US government for the war effort in Korea, Toyota started a subsidiary in the US in 1957. In 1982 Toyota formed a joint venture with General Motors in the US at a plant in California. In 2009, a new president was named a Toyota, Akio Toyoda who was a member of the founding family. Akio Toyoda was at the helm of the company when the Toyota accelerator crisis hit and had to answer to a question and answer session before the...
Words: 2719 - Pages: 11
...Outsourcing – A Global Challenge MBA-700 International Economics Abstract The choice to outsource is a major strategic decision not made lightly by companies in today’s global marketplace. Though it brings probable results of cost reduction, loss of control in your product or the quality of service rendered makes this a decision that should not be taken lightly. Though a concept decades old, outsourcing is a topic that brings out fervor in individuals fighting for or against it. It’s a debate centered on moral, economical, and political aspects, with feelings that intensify during economic downturns because of the This paper will discuss theories of outsourcing, while comparing and contrasting the disadvantages and advantages (SWOT Analysis – see Appendix 1) of a concept that is growing in global business. The paper will conclude, most importantly, with discussions on three outsourcing alternatives and their potential to re-invent the status quo. Introduction The advent of globalization has proven that outsourcing is not a hypothetical situation; it is a major strategic business decision growing in popularity that our American workforce must now face in the decline of our U.S. economy. Some believe that outsourcing has become a serious issue not only for our workforce, but also in our major corporations, and the political arena. Issues such as the security of our nation have become debate topics, with critics arguing that outsourcing has weakened national security...
Words: 4072 - Pages: 17
...445; Questions 4-6 By using the Friedman’s rules, a Coffee Company will be able to realize a success in the market after is succeeds in defining its product because defining a product is followed by defining consumers, targeting them and retaining them, meaning a maximized income. The Coffee Company would identify the highest competence over competitors’ product, then use the level of the product’s strength in digging itself deep in winning the consumers. In addition, the company will take the advantage of being in collaborating with the PR houses that will ensure that its image is enhanced as being a large company over other bigger competitors. After elevating its image to the level of a top tier company, the company will allow their loyal consumers be partners of the company and get involved in the decisions, hence fulfilling the Friedman’s rules. Making their customers feel like they are a part of a big company and looked at as partners will help the brand grow. It’s the need that drives a consumer to buy. A need highlighted in a promotional aspect attracts more consumers that the one that doesn’t address the consumer’s need. To achieve greatly and acquire more tactics, the company will need to outsource its staff to a bigger company so that they can be well trained. The company could take some staff to an abroad company known well for coffee production. This will in turn bring a great achievement in helping the company define its product in the market because the quality...
Words: 867 - Pages: 4
...actually allows the supplier to manage an item or group of items for them What is Outsourcing? • Outsourcing: the act of moving a firm’s internal activities and decision responsibility to outside providers • Allows a company to create a competitive advantage while reducing cost • An entire function may be outsourced, or some elements of an activity may be outsourced, with the rest kept in-house Reasons to Outsource and the Resulting Benefits Drawbacks of Outsourcing • • • • • Layoff Hired back wages and benefits reduced Bypassing union contracts Noncore activities may become core Loss of competitive knowledge A Framework for Structuring Supplier Relationships Outlet: 10/F, World Interest Building, Kwun Tong, Kowloon, Tel: 22701263, make a phone call B4 you go Cisco Source: finance.yahoo.com Cisco In Trouble In 2001…… • Inventory cycle rose from 53.9 days to 88.3 days • Historical inventory write off in IT Biz USD 2.25 billion • Layoff 8500 staff • Steepest stock price drop Volatility Amplification in the Supply Chain: “The Bullwhip Effect” Customer Retailer Distributor Factory Tier 1 Supplier Equipment...
Words: 2091 - Pages: 9
...“Outsourcing-Offshore” Outsourcing is said to have emerged a few thousand years ago with the production and sales of food, tools, and other household appliances. As soon as small communities and societies began to form, people with specialized professions began to trade with each other for goods and services. It can be said that each worker was outsourcing some activities to others. Research shows that even in the industrial age, a few thousand years later, very few companies outsourced any of their operations. Companies in the 1800s and 1900s were vertically integrated organizations, taking care of their own production, mining, and manufacturing from raw materials to finished goods as well as then shipping the goods to company owned retail outlets. These companies often handled their own taxes, employed their own lawyers, as well as designed and built their own buildings without outside assistance. This model does not apply to all companies during that time period, but it gives a general idea of the time. The history of outsourcing portrays that as onshore outsourcing continued manufacturing outsourcing of low-tech items such as toys, shoes and apparel goods began to take place. After this manufacturing higher value items like high-tech components and consumer electronics began to appear. In fact outsourcing history demonstrates that manufacturing was the first activity that began to move to offshore destinations in a quest for lower costs. Globalization began during...
Words: 3150 - Pages: 13
...Although stakeholders realized without these changes, GC would not survive, it is found to be difficult for some long-term stakeholders. GC’s approach appeared to have personal and ethical conflicts as they failed to communicate with employees. GC has identified the problem, strategized with its stakeholders, implemented a plan and has set the process for reevaluation and changes, if necessary. GC has found other companies, in and outside its industry, to benchmark and has taken the best practices for issues similar to theirs and have used them to increase revenue, and forego any immediate outsourcing of call center jobs. However, GC has a communication problem, in that the union was never consulted or included in the decision to outsource positions. Whey they learn of the idea, the union is very upset as they worked very hard to have employees agree to a decrease in benefits previously. The union is outraged and states they will fight the newly devised plan for its members. Implementation of these changes would allow GC to lead the communications industry globally, while providing their small business and consumer customers with modern technology services, appropriately giving employees increased wages and benefits and providing future employment opportunities to local residents. Ultimately, their mission to become the leader in global services would be met. They continually search for the processes to make their company better for their employees, stakeholders, small...
Words: 3533 - Pages: 15
...Does the capitalist free enterprise system improve justice in society? In what way does it do so? In what ways does it not? Explain and defend your overall conclusion? “Capitalism can be defined ideally as an economic system in which the major portion of production and distribution is in private hands, operating under what is termed a profit or market system (Shaw, Barry, & Sansbury, 2009, p.127).” Over the many centuries, capitalism has evolved from the emergence of capitalism during fifteenth and sixteenth centuries, mercantile capitalism, financial capitalism with the increased industrialisation and the intensified competition, to today’s globalised capitalism. Although, the names used to describe capitalism have been changed over the time, the dynamic nature of laissez-faire (to let people do as they choose) (Shaw et al., pp.131) in capitalism has never been changed. We have to admit that the free enterprise system has created the greatest productive power in all of our history and become the most influential socioeconomic system in the world. It is important that we understand the characters of the capitalist free enterprise system and how does this system work for our economy and society. Therefore, we are able to judge whether the capitalist free enterprise system improves justice in our society based on the moral principles. In the following paragraphs, it lists out important features within the capitalist free enterprise system and analyzes its strengths and...
Words: 2161 - Pages: 9
