The FDA, Congress, the US Consumer Products Safety Commission, US Immigrations and Customs Enforcement, the Department of Justice. These and countless other regulatory bodies are more proactively evaluating the potential risk and liability to our country’s goods and products; and as we’ve seen, the sharing of information among these regulatory bodies is leading to more cohesive enforcement activities with the continuous goal of protecting the consumer.
For the consumer, this is great news: increased regulatory enforcement in the name of consumer protection. For the manufacturers, however, the perception has long been that facing broader, stronger enforcement represents increased operational costs, complicated administrative processes, and for many, a major headache.
On the flip side, sitting passively in hopes their number doesn’t come up (surprise inspections, bad press, recalls, even bankruptcy) is likely to induce more than a migraine, but full-scale disaster. More and more manufacturers are sensing that they’d better keep a close eye on their operational risk factors. And this includes not only in-house operations but their full-scale supply chain. To the consumer, the top of chain ultimately liable for what happens along the way up.
So are the regulatory agencies just pulling our chain in the name of consumer protection, or should we, as a nation of manufacturers, really be sharpening our focus on supply chain issues?
For those that choose to ignore the risks and maintain a myopic view of their operations, all they have to do is take even a blurred look at what’s been going on out there in just the past few months to know how critical it is to shore up their entire team:
- Johnson & Johnson has been hit with five lawsuits seeking class-action designation in the wake of its recall of OTC children’s medications. The voluntary recall by J&J subsidiary McNeil Consumer Healthcare was the company’s third recall in an 8-month period due to quality problems, prompting the FDA to look into hundreds of adverse events, including 37 deaths linked to recalled products. One complaint stated: the company’s action clearly shows “an utter disregard for the safety and welfare of the children who use their products.”
- Wegmans Food Markets replaced its supplier of store-brand dry pet foods because of “a disappointing relationship with the previous supplier, including recalled products due to a strain of salmonella found in (the supplier’s) facility.
- A multitude of major product recalls by Toyota (and its luxury Lexus brand), in particular, the largest resulting from the stuck accelerator situation, have tarnished the company’s previous stellar reputation as a producer of reliable vehicles. CTS Corporation of Elkhart Indiana, the supplier that produces the accelerator assemblies for Toyota stated in a press release issued on its web site that an accelerator friction problem accounts for just a few cases of stuck accelerators. CTS noted that its products are not implicated by the November 2009 Toyota recall, but further states “that CTS has been actively working with Toyota for awhile to develop a new pedal to meet tougher specifications from Toyota.”
So who’s to blame in these and countless other reported scenarios of potential and realized consumer harm – spinach, peanut butter, ground beef, defibrillators, baby formula, Heparin? There are so many potential parties as fault, particularly among complex, multi-tiered, global supply chains. Yet, no matter how far down the chain, it’s the manufacturer whose name is on the label that takes the blame.
So, no, those regulators aren’t just pulling your chain. They mean business. And those manufacturers who don’t want to see their profits or their operations get washed down the drain, will have to respond to the growing pressures from these bodies to develop, implement, and maintain a supplier management program that integrates compliance, oversight, and strong supplier relationships into business practices and quality systems.