QUALITY MANAGEMENT IN BUSINESS ASSIGNMENT

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 ..................................................................................................................................... 1
3.1. Explain how quality management can be measured ............................................................... 1
3.1.1. Quality management of Mattel ..................................................................................... 1
3.1.2. The measurement about Mattel’s QM .......................................................................... 2
3.2. Evaluate the benefit of user and non-user surveys in determining customer needs ................ 3
3.2.1. User survey: .................................................................................................................. 3
3.2.2. Non-user survey ............................................................................................................ 3
3.3. List the methods of consultation employed in one quality scheme to encourage participation
by under-represented groups ........................................................................................................... 4
3.3.1. Definition of under-represented groups ........................................................................ 4
3.3.2. Quality scheme.............................................................................................................. 4
3.3.3. There are two types of under-represented groups: ........................................................ 4

3.3.4. Consultation methods for internal under-represented groups ....................................... 5
3.3.5. Consultation methods for external under-represented groups ...................................... 6
3.4. Identify the value of complaint procedures and analyze how they may be used to improve
quality ............................................................................................................................................. 6
3.4.1. Definition. ..................................................................................................................... 6
3.4.2. Mattel’s complaint procedures:..................................................................................... 6
3.4.3. Evaluation about Mattel’ complaint procedure............................................................. 7
4.1. Report on the role of self-assessment in order to determine an organization’s current ‘state of
health’ ............................................................................................................................................. 8
4.1.1. Definition of self-assessment ........................................................................................ 8
4.1.2. Self-assessment have importance role .......................................................................... 9
4.2. Evaluate the importance of communicate and record keeping.............................................. 10
4.2.1. Communication ........................................................................................................... 10

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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

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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 8 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

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management. However, by taking many actions which involve to improve the quality of
products, Mattel gets the ordinary position – number 1 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
do 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.

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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 do not want to use
the product and service.


Barrier to access: Mattel can take the reason why non-users do not use the product and
service of the company such as the unreasonable price, the bad quality about the

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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

do 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 do not make the
big influence for Mattel operating. Therefore, they do
not want to contribute their voice about the company.

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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

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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:

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3.4.3.Evaluation about Mattel’ complaint procedure
Step

1

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.

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2

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 2 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

3

management approaches to increase its quality.
Report to top
4

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
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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

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(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

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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.
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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

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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

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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

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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.

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