QUALITY MANAGEMENT IN BUSINESS ASSIGNMENT

Mattel is the world largest manufacturing toy corporation in the world. The purpose of this report is to provide information about Mattel’s quality management.Báo cáo về quy trình quản lý chất lượng tại công ty sản xuất đồ chơi Mattel

QUALITY MANAGEMENT IN BUSINESS Title page Prepared for: Ms Doti Chee Mr Jubred Peñano Mattel Quality Management System Banking Academy, Hanoi BTEC HND in Business (Finance) Prepared by: Snake group Class: F05B Number of words: 3,693 Submit day: 27th, December 2013 FO5 - QM Assignment 1/1 Dec 2013 Table of content Introduction 3.1 Explain how quality management can be measured 3.1.1 Quality management of Mattel 3.1.2 The measurement about Mattel’s QM 3.2 Evaluate the benefit of user and non-user surveys in determining customer needs 3.2.1 User survey: 3.2.2 Non-user survey 3.3 List the methods of consultation employed in one quality scheme to encourage participation by under-represented groups 3.3.1 Definition of under-represented groups 3.3.2 Quality scheme 3.3.3 There are two types of under-represented groups: 3.3.4 Consultation methods for internal under-represented groups 3.3.5 Consultation methods for external under-represented groups 3.4 Identify the value of complaint procedures and analyze how they may be used to improve quality 3.4.1 Definition 3.4.2 Mattel’s complaint procedures: 3.4.3 Evaluation about Mattel’ complaint procedure 4.1 Report on the role of self-assessment in order to determine an organization’s current ‘state of health’ 4.1.1 Definition of self-assessment 4.1.2 Self-assessment have importance role 4.2 Evaluate the importance of communicate and record keeping 10 4.2.1 Communication 10 FO5 - QM Assignment 1/1 Dec 2013 4.2.2 There are several elements that depend on effective communication 11 4.2.3 Record keeping 12 4.3 Guidelines on stages of staff consultation necessary for implementation of quality scheme 12 4.3.1 Definition of staff consultation 12 4.3.2 Set of scenario 12 4.3.3 Quality scheme 13 Conclusion 15 FO5 - QM Assignment 1/1 Dec 2013 Introduction Mattel is the world largest manufacturing toy corporation in the world The purpose of this report is to provide information about Mattel’s quality management The report is divided into parts:  Explain how quality management can be measured  Evaluate the benefit of user and non-user surveys in determining customer needs  List the methods of consultation employed in one quality scheme to encourage participation by under-represented groups  Identify the value of complaint procedures and analyse how they may be used to improve quality  Report on the role of self-assessment in order to determine an organisation’s current ‘state of health  Evaluate the importance of communicate and record keeping  Follow guidelines on the stages of staff consultation necessary for effective implementation of a quality scheme  Propose new systems or modifications to existing systems that could improve service quality The information about the report is researched from various sources such as book, website, case study and the other communication Due to the limited scope, timing and available resource, the research has only been able to give the general information about consultation methods The future research will analyze more deeply consultation methods in order to improve under-represented groups 3.1.Explain how quality management can be measured 3.1.1.Quality management of Mattel "A quality management principle is a comprehensive and fundamental rule / belief, for leading and operating an organization, aimed at continually improving performance over the long term by focusing on customers while addressing the needs of all other stake holders" (Global Quality Village, n.d.) During August 2007, Mattel had a serious problem – recalling unsafety toys because of loose magnets and excess lead It can be seen clearly that Mattel actually had poor quality FO5 - QM Assignment 1/1 Dec 2013 management However, by taking many actions which involve to improve the quality of products, Mattel gets the ordinary position – number spot on the toy market in the world In 2012, Mattel also is ranked among Corporate Responsibility Magazine's "100 Best Corporate Citizens" and the "World's Most Ethical Companies." (Yahoo Finance, 2013) 3.1.2.The measurement about Mattel’s QM 3.1.2.1.Toy industry standards After recalling, some problems were recognized so Mattel applied several methods to achieve the standards in toy industry in order to improve the quality of its products Mattel brought many changes in its design with a view to dealing with the loose magnets and other issues so that the quality would be increased We design our toys to meet standards such as ISO 8124, ASTM F963 and EN 71 on toy safety (Iso, 2013) Based on following these international standards about safety toys, the quality management of Mattel has become more effective Therefore, Mattel can build relationships with, and loyalty among, its customers, whatever age 3.1.2.2.Quality control Mattel maintains a quality control program to help ensure compliance with various US federal, state, and applicable foreign product safety requirements (Mattel, 2009) As a result, Mattel could define all the problems which occur in manufacturing process to ensure that there is no defective toys In addition, the actual operating performance of Mattel would be measured easily by analyzing the data from tests It means that the quality of Mattel’s toys would be raised and the quality management can be enhanced 3.1.2.3.Procedures for all operation One reason for recalling is excess lead in the paint so Mattel have improved its procedures to make sure that that this dispute would not happen again in the future To this, Mattel applied a number of procedural changes in choosing paint suppliers including: Supplier certification requirements, Testing requirements and Inspections (Mattel, 2009) Based on this process, Mattel actually want to assume responsibility for non-lead paint and all products’ quality would be improved Consequently, Mattel quality management is improved FO5 - QM Assignment 1/1 Dec 2013 In general, the quality management of Mattel have been developed so much and become more effective in controlling the problems which directly involve to the quality of Mattel’s toys In fact that the net sales of Mattel has grown by 4.7% from $5,970,090 in 2007 to $6,266,037 (in thousands) in 2011 (Mattel annual report, 2007, 2011) This shows that the quality of Mattel’s products is increased a lot and it makes the sales of Mattel go up 3.2.Evaluate the benefit of user and non-user surveys in determining customer needs 3.2.1.User survey: Definition of user survey: User survey is performed people using the product and service Furthermore, user survey helps to understanding about the customer’s needs and want, the requirement and the expectation of customer about the product and service The benefit of using user survey for Mattel:  Current satisfaction’s evaluation: Mattel can collect the information about the situation of the business based on the feeling of user about the product and service in current time It helps the company make the timely decision and solve the user’s problem in the earliest time  Tracking changes in evaluating: Mattel can compare the change in level of satisfaction of customer about product and service in previous time and in current time with same type of question It helps Mattel improve the product and service to meet the user’s expectation  Collect users’ suggestion: Mattel can receive the useful information about improving the product and service in a better way from the users Furthermore, it helps Mattel retain user and enhance the user’s satisfaction and loyalty 3.2.2.Non-user survey Definition of non-user survey: Non-user survey is performed people who are not using the particular product and service It helps to understanding why the customers not want to use the product and service  Barrier to access: Mattel can take the reason why non-users not use the product and service of the company such as the unreasonable price, the bad quality about the FO5 - QM Assignment 1/1 Dec 2013 product and service Based on these, Mattel need to improve the product and service to attract non-user and enhance Mattel’s value  Expectation of product and service: Mattel can take the information from non-user about their expectation of product and service Based on this information collected, Mattel need to improve the product with reasonable price and enhance the high service quality It helps Mattel attract the non-user group and meet non-user’s need and want  Awareness about the company: Based on the information which is collected about nonuser’s feeling for company, Mattel can understand some of the reason that non-users not satisfy about the company such as the problem about product and service Therefore, Mattel needs to improve the quality of product and service through inspection, control and assurance quality in order to enhance their perception about company 3.3.List the methods of consultation employed in one quality scheme to encourage participation by under-represented groups 3.3.1 Definition of under-represented groups: the groups that are typically underrepresented and underserved in your city and whose voices are often not included in planning or heard on issues Interestingly, these groups are often disproportionately affected by some of the issues or problems that affect a city’s overall population (Blueprintforchangeonline, 1994) 3.3.2 Quality scheme: Mattel should use ISO quality scheme model to encourage participation by internal under-represented groups (focus on involvement of people) and external under- represented groups (focus on customer) 3.3.3 There are two types of under-represented groups: Types Under- Barriers represented groups Internal Low salary For example, the low salary employees and the employees, cleaners the cleaners in Mattel think their working not make the big influence for Mattel operating Therefore, they not want to contribute their voice about the company FO5 - QM Assignment 1/1 Dec 2013 External Low income High price customer, Religion remoteness area Difficult to approach Mattel’s products because of lack of information 3.3.4 Consultation methods for internal under-represented groups Methods Advantages Survey Maximize (Face-to- quality face) collected of Disadvantages Time for using the Time-consumingdata especially Research more deeply data the level of satisfaction analysis of groups about the working Can take a wider Member range of answer under-represented participating survey environment, is fewer than the etc… salary, other surveys method (e.g survey telephone or questionnaire) Group Discussion can Time-consuming Refer to opinion of each discussion helps the group Pressure from the member of undercontribute more discussion because of represented group about ideas to make the the difference of the the company It helps right decisions opinion with another Mattel can understand Each member of member under-represented group more can feel group within thinking of them and make the right decision for the company confident when participating in discussion FO5 - QM Assignment 1/1 Dec 2013 3.3.5 Consultation methods for external under-represented groups Methods Advantages Disadvantages Questionnaire Easily to manage The reliability of survey Need to collect the Low of data may be low cost performing survey Time for using opinion from a lot of the The respondents can be member of underchosen in order to deal represented groups and make the Collect the data with the survey, it decision at the short from a lot of maybe create biased time respondents in opinion the short time In-depth Easy to ask for High rate of refusing to Need to collect the interview each member of participate in survey detail opinion and under- because of calling can nearly exacted from represented be disturbed groups in wide person area of each the under- represented represented groups undergroups in widely area The complicated High cost of conducting problem can be this survey solved quickly 3.4.Identify the value of complaint procedures and analyze how they may be used to improve quality 3.4.1.Definition: A written or spoken statement in which someone says that somebody has done something wrong or that something is not satisfactory (Dictionary Cambridge, n.d.) 3.4.2.Mattel’s complaint procedures: To be able to solve all customers’ complaints, Mattel has built a procedure to help customers satisfied The procedure will be shown through a diagram as follows: FO5 - QM Assignment 1/1 Dec 2013 3.4.3.Evaluation about Mattel’ complaint procedure Step Process Evaluation Customers Customers can easily make complaints about Mattel’s products or Making service by official website, phone number or postal address This shows Complaint which parts of products or service of Mattel is defective or not good FO5 - QM Assignment 1/1 Dec 2013 Collect & Mattel can know exactly its weakness through customers’ views, so Record Mattel can classify the same problems about its quality and then brings Complaints the right solution quickly Furthermore, by analyzing the data, Mattel can find out common fault of its products or service which make the quality lower As a result, the quality management will be improved Classification immediately to meet the requirement of customers Mattel will rely the complaints with weeks (10 working days) (Mattel, Solutions of 2001) This is an opportunity for Mattel’s managers evaluate their Mattel’s performance and look for different methods to improve the quality of managers products or service Moreover, Mattel can apply new quality management approaches to increase its quality Report to top managers of Mattel If customers are not satisfied with the reply of managers, the complaints will be reported to higher level managers to settle the disputes After that, the top managers can find the most effective quality management for the situation of Mattel In general, customers’ complaints brings a lot of benefits to Mattel’s performance In fact that the complaints to the company are made by only approximately 4% of dissatisfied customers Therefore, if customers are not interested in Mattel’s toy, they will not point out the faulty in the products or the problems which occurs in Mattel’s service Consequently, the mistakes would be repeated and make the quality of products and service lower Furthermore, the customers’ complaints is a challenge for Mattel about its quality management Based on these complaints, Mattel could discover the ways to achieve higher quality in its products and service in order to make customers delighted In addition, the internal system and process of Mattel will be tested by how managers handle these complaints, so Mattel can improve its performance and take advantages to competitors In brief, complaints are not only usefulness but also the opportunity for Mattel to recover all the faults and develop the quality of its service and products 4.1.Report on the role of self-assessment in order to determine an organization’s current ‘state of health’ 4.1.1 Definition of self-assessment: the first stage of the career planning process It is the process of gathering information about you in order to make an informed career FO5 - QM Assignment 1/1 Dec 2013 decision A self-assessment should include a look at the following: values, interests, personality, and skills (McKay, n.d) 4.1.2 Self-assessment have importance role in give information to assess performance of company Nowadays, Mattel and almost company in the world use Self-assessments through method compare its current performance with its past performance to improve the situation and also take the competitive advantage with the same industry company a Compare with past performance Annual Revenues - MATTEL INC (Mattel, 2013) This chart compares Mattel’s performance in aspect of revenue and net earnings in 2012 to previous years and its expected revenue in the future Mattel, Inc had revenues for the full year 2012 of $6.4B USD This was up to 2.5% above the prior year's results 6.3B USD in 2011 In the end of 2013 and in the future revenue for 2014, Mattel expected that the revenue continue increase It means that Mattel’s state of health becomes better in operation performance b Against competitors Mattel can realize their position; recognize strength and weakness by the method compare with competitor like Hasbro Inc or LEGO Company Beside, by compare with competitors, Mattel can learn from them the good strategy to improve the quality of product and performance Mattel need to access more competitors, conduct competitive analysis, inform corporate strategy, and identify trends For full year of 2012, Mattel reported net Income of $776.5 million, or $2.22 per share, on Net Sales of $6.42 billion In the other hand, Hasbro Company reported Net Income of $336.0 million, or $2.55 per diluted share, on revenues of $4.09 billion FO5 - QM Assignment 1/1 Dec 2013 (Marketwatch, 2013) It shows that the financial health of Mattel is stronger than Hasbro c Compare with industry Mattel can create their objective to achieved higher position in segment of industry by compare with industry standard For example, “Mattel has a unique competitive advantage in the toy industry in that we own and operate manufacturing facilities that produce about 50 percent of our products” (Godelnik, 2012) It means that Mattel produced much more products than the other toy companies because Mattel owned 50% of total products of the toys industry in the world Base on this information, we can see that Mattel have strong state of health in toys Industry, it is the leader of toys industry 4.2.Evaluate the importance of communicate and record keeping 4.2.1 Communication In general, communication is a means of connecting people or places In business, it is a key function of management an organization cannot operate without communication between levels, departments and employees See also communications (Business Dictionary, n.d) There are many communication channels which is applied in corporations including Mattel Some types of communication will be shown in the table below Types of communication Communication Benefits Downward High level managers to Using this communication communication employees to give directions and instruction about jobs or goals of Mattel for employees Make employees feel of participation in the management of Mattel Motivate employees because their work is well FO5 - QM Assignment 1/1 Dec 2013 10 informed from time to time Upward communication Employees to managers Report the daily activities of Mattel or problems so Mattel can recognize the problems and solve can make quickly Employees suggestion to improve the working process and the quality of products Create strong relationship between employees and managers Horizontal communication The same level organization hierarchy of Coordinate the information between different Mattel’s departments Diagonal communication Different employees in Empower employees different departments Easy to share information the about Mattel’s activities Save time by directly reporting the information to the right department 4.2.2 There are several elements that depend on effective communication Decision making: based on the information which is provided by employees through different communication channels, the current situations of Mattel will be analyzed carefully and the managers can evaluate and consider the most reasonable decisions to use FO5 - QM Assignment 1/1 Dec 2013 11 Problem solving: all problems could be reported directly to Mattel’s managers whenever and wherever the happen so the solution will be brought immediately Teamwork: all members in a production team in Mattel will have face-to-face meetings regularly to brainstorm and argue about some new ideas After that, they can bring effective plans to improve the product quality and its performance 4.2.3 Record keeping Record keeping: the maintenance of a history of one's activities, as financial dealings, by entering data in ledgers or journals, putting documents in files, etc (Dictionary, n.d.) Record keeping is very important in running business There are several reasons will be discussed as follows:  Mattel can understand the strength and weakness through the information recorded Furthermore, Mattel also can compare the past data to the current data such as sales, production, revenue…in order to evaluate its performance If there are increases in sales and production, it means that Mattel is working well and efficiency  By recording the amount of defective products, Mattel can assess how well quality management process work so that Mattel can find effective methods to improve the products’ quality  Record keeping enable Mattel forecast the future sales and productions Therefore, Mattel can plan the suitable marketing strategies to take advantages to its competitors 4.3.Guidelines on stages of staff consultation necessary for implementation of quality scheme 4.3.1.Definition of staff consultation: the exchange of views and establishment of dialogue between the employee representatives and the employer Consultation is thus a stage in the process of management of the enterprise in which those consulted can influence decision-making (Eurofound, 2013) 4.3.2.Set of scenario Mattel has to change in the production line for dolls to not make mistakes as in 2007, "Mattel recalled 19 million toys from August to September of 2007" There are two FO5 - QM Assignment 1/1 Dec 2013 12 reasons for recalling including: high-energy magnets and high levels of lead-based paint so Mattel need to fix the production line to adapt with the standard quality 4.3.3.Quality scheme Investor in People (IIP) is a recognized framework that helps Mattel to improve its performance by developing in people especially Mattel’s employees and employers 4.3.4.The important of guidelines on stages of a staff consultation: Stage 1: Provide Mattel’s employees several information including:  The current situation of Mattel, the issues that Mattel is meeting  The influence of these issues to Mattel and its performance  Some suggestions for solving these problems By providing these information, the employees will know exactly what they are facing to and how bad the situation is Consequently, the employees could have the preparations for their jobs in order to help companies solve these problems In addition, the employees could look at the negative effects of the recall to their jobs in the future because one of solutions might reduce the numbers of workers Besides, Mattel also provides some suggestions for solving these problems, so the employees would see which solution is suitable for them Stage 2: Holding a meeting with the employees in order to collect the opinions of employees about these issues and their feedback Making the meeting between Mattel’s managers and their staffs is very necessary because all problems will be discussed to find out the best solutions for the current situation of Mattel Furthermore, some new ideas about improving the product quality of the employees are collected during this meeting Additionally, by listening staffs, Mattel also find out the mistake in manufacturing process Consulting staffs about recalling can help Mattel know the mistake and provide the employees a new working condition to repair this mistake and avoid it in the future By empowering the employees and make them feel comfortable and happy, they will more attention to work Therefore quality of product is also higher, reduce the fault products Moreover, Mattel is a global organization so its culture is various Mattel can collect different ideas about improving FO5 - QM Assignment 1/1 Dec 2013 13 toys and innovative methods about managing quality management especially in testing paint and deigning toys Stage 3: Arrangements for reporting back so as to explain the decisions that involve to the employees and tell them the reasons 4.4.Propose new systems or modifications to existing systems that could improve service quality Mattel had encountered many difficulties in 2007 There are about 436,000 products were recalled because the toys were covered with paint containing high lead levels (Louise Story and David Barboza, 2007) Based on the scenario, lead levels exceeded 180 times more than allowed It is very dangerous and can cause behavioral problems, slow muscle and bone growth, hearing loss, anemia, brain damage, seizures, coma, and in severe cases, death This is a main reason that affected the image, reputation and reduced the purchasing power of customers for Mattel Based on this problem, Mattel management should improve product quality especially testing paint To solve this problem, Mattel should apply a new checking paint system – a new procedure of testing paint supplier The process includes three steps as follow:  Step 1: Supplier certification requirements  Assures that a supplier's product is produced, packaged, and shipped under a controlled process  Assure consistent high quality as demonstrated by predictable conformance  Identify suppliers that have adequate process controls in place  Step 2: Testing requirements  Determine which suppliers meet the company’s needs  Step 3: Inspections  Test the batch of paint to make sure no lead and other toxic The benefits of this new system in improving the product quality for Mattel:  Mattel can make sure that the mistake about the lead paint would not be repeated and affect the product quality of Mattel’s toys  Enhance the quality management of Mattel in order to bring the toys with the highest quality for customers FO5 - QM Assignment 1/1 Dec 2013 14 Conclusion The research has only been able to conduct analysis about the measuring quality management, benefit of user or non-user survey, using consultation method to encourage under-represented group, using complaint procedure diagram to improve quality, self-assessment to determine an organization’s current state of health, the important of communicate and report keeping, guidelines on stages of staff consultation and propose new systems to improve quality of Mattel The future research is desirable to point out more analyze about using more consultation method to improve under-represented group in Mattel FO5 - QM Assignment 1/1 Dec 2013 15 Reference Blueprintforchangeonline 2013 Underrepresented Groups [online] Available at: http://www.blueprintforchangeonline.net/pages/stakeholders/underrepresented.php [Accessed: 21 Dec 2013] BusinessDictionary n.d What is communication? definition and meaning [online] Available at: http://www.businessdictionary.com/definition/communication.html [Accessed: 24 Dec 2013] Dictionary Cambridge 2013 complaint noun - definition in the Business English Dictionary Cambridge Dictionaries Online (US) [online] Available at: http://dictionary.cambridge.org/us/dictionary/business-english/complaint [Accessed: 21 Dec 2013] Dictionary n.d the definition of recordkeeping [online] Available at: Available at: http://dictionary.reference.com/browse/recordkeeping [Accessed: 23 Dec 2013] Eurofound 2013 Consultation in the enterprise [online] http://www.eurofound.europa.eu/areas/industrialrelations/dictionary/definitions/consultationinthe enterprise.htm [Accessed: 26 Dec 2013] Godelnik, R 2012 Is Mattel, the World's Largest Toy Company, Playing Responsibly? [online] Available at: http://www.triplepundit.com/2012/11/interview-mattel-worlds-largest-toy- company-playing-responsibly/ [Accessed: 23 Dec 2013] Iso 2013 Play matters [online] Available at:http://www.iso.org/iso/home/news_index/news_archive/news.htm?refid=Ref1769 [Accessed: 27 Nov 2013] MarketWatch 2013 Technical Analysis on Hasbro and Mattel: What's Fuelling Growth in the Industry? [online] Available at: http://www.marketwatch.com/story/technical-analysis-onhasbro-and-mattel-whats-fuelling-growth-in-the-industry-2013-02-22 [Accessed: 22 Dec 2013] Mattel 2009 Mattel Global Citizen Report [pdf] Available at: http://corporate.mattel.com/aboutus/cr-csreport.aspx [Accessed: 28 Nov 2013] Mckay, D 2013 Self Assessment - definition [online] http://careerplanning.about.com/od/selfassessment/g/def_selfassess.htm Available [Accessed: 21 at: Dec 2013] FO5 - QM Assignment 1/1 Dec 2013 16 Yahoo Finance 2013 Mattel Launches New Global Entertainment Franchise Max Steel™ [online] Available at:http://finance.yahoo.com/news/mattel-launches-global-entertainment- franchise-120000485.html [Accessed: 25 Nov 2013] FO5 - QM Assignment 1/1 Dec 2013 17 ... measured 3.1.1 Quality management of Mattel 3.1.2 The measurement about Mattel’s QM 3.2 Evaluate the benefit of user and non-user surveys in determining customer needs... importance of communicate and record keeping 10 4.2.1 Communication 10 FO5 - QM Assignment 1/1 Dec 2013 4.2.2 There are several elements that depend on effective communication... scenario 12 4.3.3 Quality scheme 13 Conclusion 15 FO5 - QM Assignment 1/1 Dec 2013 Introduction Mattel is the world largest manufacturing toy corporation