Managing recalls in a consumer product supply chain – root cause analysis and measures to mitigate risks

Abstract

The focus of this study is to analyse the management of recalls in a consumer products supply chain, as well as the reasons, costs, and measures to prevent recalls. A Six Sigma DMAIC methodology is used to understand the root causes and management of recalls and also analyse the costs in a consumer products supply chain. There are many variables in a supply chain, so it is essential for manufacturers to have procedures in place to prevent failures that result in a product recall. It is important that companies have traceability capability or containment measures for parts, products and processes throughout a global supply chain in the event a quality or safety issue arises. Companies in the consumer products industry need to consider not only the cost to their financials in an event of a product recall, but also the loss in terms of goodwill and consumer risk. It is clear from recent Toyota recall and others, companies need to seriously examine their strategic business objectives with their priorities in mind. Which is more critical, rapid business growth and profits or quality design of their products that are less vulnerable to failures?