Prudent and responsible companies already have methods in place to monitor their products. They regularly investigate consumer complaints and use public relations personnel to respond to and educate the public.
They are sensitive to product recalls involving products made by competitors and review their own products in light of those recalls.
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Creating a culture of product safety from top to bottom—including product management (manufacturing and sales), design, quality, use and testing, and literature—is the best means of preventing a product recall and should be embraced, becoming the credo of management and employees alike.
But those actions alone may not be sufficiently focused or coordinated to master the demands of modern day consumerism, recent legislation or juries skeptical of corporate America and foreign suppliers. What is needed is a corporate culture of product safety.
Even the best companies face the prospect of an engineering oversight, production line failure or defective component from a supplier and wisely prepare in advance.
To wait until a recall is necessary before planning for such an event means losing valuable time and increasing the difficulty and expense of responding.
The decision-making process will be complicated by internal and external pressures to act swiftly and decisively. It’s therefore best to plan ahead before difficult decisions must be made in the midst of a fast-paced recall.
The first step in planning is to create a product recall team designed to evaluate and ferret out any possible product deficiencies before they result in injury or damage and to recommend a fix, when appropriate. The same group may also prepare a product recall action plan, which can be followed if a recall is instituted and can be adjusted and modified as the recall unfolds.
To best equip the recall team for its tasks, management should consider appointing a multidisciplinary group consisting of a management representative, product manager, chief engineer, quality control manager, public relations expert and attorney.
The objective is to combine the team’s skills and experience to implement and periodically review product safety evaluation procedures, product recall plans and product safety concerns raised internally or by user or governmental inquiries and complaints.
The inclusion of an attorney ensures timely legal advice in the decision-making process, as well as appropriate evidentiary privilege protection with respect to legal advice sought and provided.
The public relations professional can assist management in delivering a clear, concise and accurate message to the outside world and in transforming a potentially negative event into an opportunity to build brand and company credibility.
Ideally, the team will meet regularly to review public and internal information on safety issues, including items or procedures identified as toxic or hazardous by safety or industry organizations, governmental agencies or consumer groups.
The team may want to develop internal operating and quality control procedures, such as component certification, product inspection during and after the manufacturing process, and product testing, including testing by an independent testing laboratory. Doing so will help ensure compliance with the Consumer Product Safety Improvement Act (CPSIA), which is enforced by the Consumer Product Safety Commission (CPSC).
Because consumers, courts, the CPSC and state attorneys general tend to second-guess manufacturers with respect to reporting requirements, a manufacturer may wish to carefully and systematically investigate and analyze all product incidents. If an investigation indicates a product fails to comply with standards or creates a substantial risk of injury, then a formal report to the CPSC or other governmental agency may be required.
A manufacturer may also want to act promptly to correct any inaccurate public reports or misperceptions contained in the CPSC’s product database or the media.
Given the risk of heavy civil penalties and product liability exposure accompanying the failure to report an event or to correct a false claim, companies confronted by such questions may want to seek the advice of dispassionate outside counsel.
Excerpted from David G. Klaber and Jared S. Hawk, “Be Prepared: What every company should do to weather a product recall,” Quality Progress, May 2010, pages 16-21.