Mattel

Mattel, Inc.
History:
Ruth and Elliot Handler and Harold Matt Matson founded Mattel in 1945 in South California. Elliot Handler soon took over the parts of his partner and put his main focus on the production of toys. Inspired by their daughters fascination with cutout dolls with changing clothes Mattel invented Barbie. Barbie soon leads Mattel to be the leading production in the toy industry. In 1960 Mattel became publicly owned and was listed in the New York and Pacific Coast Stock exchange. Only 5 years later Mattel made a sales top of 100 Million US Dollar and joint the Fortune 500. 1986 they acquire the Hong Kong based industry ARCO and create a joint Venture with Bandai, Japans largest toy company. In 1997 Mattels Global Manufacturing Principles were established. Mattel is the first global consumer products company that established a framework within which all of the companys manufacturing must be conducted and who applied such system to its facilities and core contractors all over the world.
Production:
In 2002 Mattel closed the last American factory and outsourced the production to China, which was the beginning of a chain of events that led to a scandal involving the lead contamination. About 65% of Mattels toys were made in China. Approximately half of them were manufactured in Mattels own plants. The contracts required vendors to undergo a review of
their production facilities and to agree to be audited under Mattels Global Manufacturing Principles.
Supplier:
In 1993 the two businessmen Cheung Shu-hung and Xie Yuguang with an investment of almost 4 million US dollars founded Lee Der in the booming Province Guangdong. From a first small order from Mattel, the Mattels orders increased and Lee Der dropped its other clients and focused on its future with Mattel. Since 1993 they never had quality problems, considers Xie Yuguang.
Issue:
On the 2nd of August 2007 the toy giant Mattel recalled almost 1 million toys produced by their supplier Lee Der in China. They stated that their toys were colored using lead-based paint. This, if children suck or jaw toys with high lead content, can even lead to death in some cases. The contaminated parts of the paint on the toys were 110,000 parts per million, instead of the 600 parts per million which is allowed by the U.S. Federal law. Two weeks later Mattel recalled 9 million more china-made toys from their supplier in Guangdong. A third recall took place, another two weeks later, which involved 800,000 toy products. Mattel, Inc. was not the first manufacturer who had to face a breakdown in the Chinese production chain. 70% of the worlds toys are made in China and most of them in Guangdong province, so this is not the first scandal to hit the industry. Due to that the Chinese government is improving its product regulations and even members of congress have called for amending current laws requiring more inspections of imports from China. Experts here say that many Chinese factory owners have to cut corner in making products and regularly cheap and illegal substitutes, because they are often under intense pressure to lower the production costs. Also the toy manufacturer Mattel was blamed for apparently failing to enforce safety standards in its supply chain. Even though Mattel has its own established safety checks, including independent audits of facilities and many of its own factories in China, that has not prevented them from this events.
This is a vendor plant with whom weve worked for 15 years; this isnt somebody that just started making toys for us, Robert A. Eckert, the chief executive of Mattel, said in an interview. They understand our regulations, they understand our program, and something went wrong. That hurts.
Consequences:
After Mattel, Inc. sent investigators to China - which identified Lee Der as the main supplier of the tainted products - the government suspended the companys export license. That caused a loss of 30 million US dollar as a result of the scandal. Although economists say that the cases have been damaging, they are unlikely to have a great influence to the strength of Chinas manufacturing industries. China even had an export boom and countrys sales trade has increased to more than 24 billion US dollar, the second-highest figure on record until 2007. Two weeks after the proclamation that Lee Der was suspended the companys export license, the head of the Chinese company, which was behind the recall, committed suicide. A spokeswoman for Mattel, Inc. released a statement saying, We were saddened to learn of this tragic news. The Consumer Product Safety Commission fined the big player in toy industry, Mattel, Inc. and his Fishers Price division 2.3 million US dollar for violation of Federal Regulations. Mattel agreed to the fine and no wrongdoing was admitted on the companys part.
The Logical Framework:

The US Agency of International Development invented the Logical Framework Approach in the late 60s. Since many years the European Union takes advantage of this method for development projects. The main tool is the so-called Logical Framework Matrix, also called Logframe. The Logframe is composed of five rows and (vertical logic) and four columns (horizontal logic). The five rows are used to describe 5 different types of events that take place as a project is implemented.
Vertical logic: Goal (main goal, impact - long term) Purpose (outcome - immediate) Outputs (measurable results) Activities (measures) Inputs
The vertical logic includes goal hierarchy (=project description). The four columns provide different types of information about the events in each column. Horizontal logic: Design summary (=project description) Indicators + Targets Monitoring Mechanism Risk + Assumptions
References: http://www.shyup.cn/images/Case6/1.pdf http://www.nytimes.com/2007/08/02/business/02toy.html http://www.msnbc.msn.com/id/20254745/ns/business-consumer_news/t/mattel-issuesnew-massive-china-toy-recall/ http://www.guardian.co.uk/uk/2007/aug/03/estheraddley.uknews4 http://www.guardian.co.uk/business/2007/aug/13/china http://www.telegraph.co.uk/finance/markets/2814037/Chinese-boss-of-toy-firm-involvedin-Mattel-recall-commits-suicide.html http://www.nytimes.com/2007/08/14/business/worldbusiness/14toy.html http://findarticles.com/p/articles/mi_m5072/is_1_23/ai_69259287/pg_10/ http://money.cnn.com/news/newsfeeds/articles/newstex/AFX-001318873781.htm?cnn=yes

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How was Mattel founded and what was its early success?

What caused the toy recall crisis of 2007?

Mattel, Inc.

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