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Reports from the Consumer Product Safety Commission (CPSC, 2007) indicated that three children had been hospitalized due to ingesting some particles from the toys and all these three were diagnosed with intestinal perforation, hence required surgery. Owing to this recall, the company lost over $30 million and nearly 1.5 million toys it had sold were removed from the shelves. The Wall Street Journal (2007) notes that previous to the recall, Mattel was the biggest toy manufacturer reputed for its strict safety standards.
As noted by Mitroff (1989) a positive public image could easily be destroyed in the course of a crisis. Scholar, nonetheless, have established that strategic application of corporate information, proper crisis communication and effective crisis management can assist in wining back public confidence, since communication has the ability to determine how information reaches the public as well as the media (Coombs, 2007). This paper examines Mattel crisis, the paper will specifically examine how the crisis happened, corporate communication of crisis, crisis management and give conclusion.
Mattel recalled 19 million toys from August to September in 2007 because of two separate reasons (Media Statement, 2007). This was the biggest recall in the history of the company because both recalls happened at the same time. The first reason for recall of toys was due to faulty magnets used. The toys were designed in such a way that most parts had high-energy magnets. These magnets are of great effect to infants and young children because they can ingest some parts and be affected in their digestive tract. When children shallow several magnetic particles there are high chances of that they will pull together in the stomach and rip by use of stomach tissue. The combination of magnet strength with poor design of Mattel toys made these toys dangerous to the health
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10 Conclusion 13 References 14 Abstract This report intends to provide a detailed overview on how a company can handle its organizational crisis. The report will give you a brief about the world leader in toys “Mattel”, it will give a detailed explanation about the issues it was facing in mid of 2006-2007.
The motion, however true to a certain degree, was disputed by others who viewed such event from a different perspective. In this time when the economy is at an abysmal stage, people give less regard to preferences; occupation becomes a higher priority over specifications.
Among the major turbulences that organizations have practically faced in the past include the 2008 economic crisis which according to Zhang and Liu (2012) systematically impacted major banks and subsequently leading to a global recession. In the same year, a Chinese food company, Sanlu, added melamine meant to boost protein levels in milk powder products in excessive quantities which resulted in the deaths of six children and illness among other 300,000.
Mattel’s branded toys include Barbie dolls, Fisher-Price toys, Hot Wheel Cars, etc. among which many are produced in overseas factories, especially in Asia (Lawrance & Weber, 2010, p. 401). Mattel had its own factories in China, and it contracted the production of toys to outside contractors as well without considering the risk associated with the act.
The companies already hold a large number of assets which can be liquidated. Since the organizations are chartered by the federal government, it may not lose its preferred shares and the government can choose to revive it rather than have it fail. The companies already command the local and international market and hence effects of a reduced profit margin or loss may be reverted in a short while.
This paper will look in the Mattel Toy Company case study.
Every organization goes through a phase in which it faces the situation described above. Similarly, Mattel Company also faced a situation in which
Performance Analysis of Need or Opportunity phase of the HPT model? In this phase, conduct an Organizational Assessment to determine how prepared the organization is to attend to the needs of their employees and other stakeholders during a crisis. The assessment process
Mattel was an American toy producing company established in 1945. The company has been in existence because of its ability to win customers in the marketing industry. Winning the clients into the market involve many activities. Mattel toy producing company ensures that it meets the demand of its customers at any given time.
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