U.S. CONSUMER PRODUCT SAFETY COMMISSION
WASHINGTON. DC 20207
CPSC Document #6001
Report and Proceedings: Safety Sells Conference
Washington, D.C.
Tuesday, March 28, 1995
Sponsored by the
U.S. Consumer Product Safety Commission
Foreword
On March 28, 1995, the U.S. Consumer Product Safety
Commission (CPSC) sponsored a conference on the theme of
"Safety Sells." Approximately 175 people, representing a broad
spectrum of consumer product businesses and industries, took
part in the one-day event in Washington, D.C.
Chairman Ann Brown, in welcoming the conferees, pointed
out that the conference marked the very first time that CPSC
had brought together industry senior executives to talk about
business profitability and safety as mutual objectives.
The Safety Sells program featured presentations by top
executives of eight consumer product companies -- Hasbro,
Binney & Smith, Toys "R" Us, Procter & Gamble, Volvo, Evenflo,
Rollerblade and Whirlpool. Each was asked to present a case
study of a safe product or approach to safety in his company
and to discuss how the company had benefited and profited from
it.
The speakers' remarks, which are reprinted in this
publication, emphasized each company's commitment to safety, as
well as the competitive advantages of its safety innovations.
The presentations demonstrated an extraordinary range of new
and creative approaches taken by these companies to make and
sell safer products.
CPSC Chairman Ann Brown underscored the Commission's
interest in maintaining the creative partnership reflected by
the Safety Sells Conference. She urged industry to continue the
dialogue with government on the best ways to achieve the goal
of making products that are both safe and profitable.
Table of Contents
SPEAKER PART
Ann Brown
Chairman
U.S. Consumer Product Safety Commission........................ 1
Case Study Presentations
Alan Hassenfeld
President and Chief Executive Officer
Hasbro, Inc.................................................... 2
Richard S. Gurin
President and Chief Executive Officer
Binney & Smith, Inc............................................ 3
Michael Goldstein
Vice Chairman and Chief Executive Officer
Toys "R" Us ................................................... 4
Gordon F. Brunner
Senior Vice President
The Procter & Gamble Company .................................. 5
Albert R. Dowden
President and Chief Executive Officer
Volvo North America Corporation ............................... 6
George A. Harris
President
Evenflo Juvenile Furniture Company ............................ 7
John Hetterick
President and Chief Executive Officer
Rollerblade, Inc. ............................................. 8
J. C. Anderson
Corporate Vice President
Whirlpool Corporation ......................................... 9
PART 1
ANN BROWN
Chairman
U.S. Consumer Product Safety Commission (CPSC)
Opening Remarks
Welcome to the Consumer Product Safety Commission's Safety
Sells Conference. This is a momentous occasion. This
conference marks the very first time that CPSC has brought
together industry chief executive officers and other senior
executives to talk about business profitability and safety as
common goals.
We are here today because we recognize your legitimate
need to be profitable. And as chairman, I want you to know
that we understand and applaud that need.
The business of CPSC is saving lives and preventing
injuries. I know that you understand and applaud our efforts.
Today, in a first for the agency, we will combine our efforts
with industry so that we can both succeed.
In the past, government stood over industry and told it to
incorporate safety into its products because it was "the right
thing to do." Today, as an agency of the '90s, we want to work
with you to help you find a way to market safety in order to
increase your company's profits. It makes perfect sense that
the best incentive for you to make products safe is to make
them profitable. It's just common sense that the most
appropriate agency to promote this idea is CPSC, the one
charged with saving lives and reducing injuries.
While common sense may be a new concept for government,
it's surely not new for CPSC. CPSC has operated using common
sense since I arrived as chairman one year ago this month.
Common sense means working voluntarily with industry towards
market-driven solutions. We will continue to do so, especially
when it results in such important developments as this new
trend of safety as a profit center.
Today, we've assembled an incredible slate of innovative
companies who foresaw that marketing safety was a smart
business decision. You will hear how your industry colleagues
have put their exciting ideas into action. You will hear how
Rollerblade's safety program creates awareness about safety and
simultaneously creates a market for safety gear. You will hear
how packaging of Procter & Gamble's product Aleve helped the
company crack a very competitive painkiller market.
I know you will find these presentations enlightening and
challenging. I hope you will come away with your own creative
ideas on how to market safety and make money.
I look forward to hearing your comments and your ideas
about safety sells during the day.
Midday Remarks
I hope you enjoyed this morning's presentations as much as
I have. These companies, like all companies, are in business
to make a profit. But what is so innovative about these
companies is their bold and creative use of safety as a
marketing strategy. Today, business must be creative to
succeed in a competitive, global economy.
CPSC also must be creative to find ways to save lives in a
time of streamlined, reinvented government. In the past,
industry and government each have gotten a bum rap. People saw
business as rigid and stodgy. People saw government as
antiquated and excessively bureaucratic. Well, it's not true
of the companies here today and it's not true of this agency.
In fact, this agency is a model for reinventing
government. It is
* an agency based on common sense, dedicated to its
mission of saving kids' lives and making families safer;
* an agency that already practices risk assessment,
provides cost-benefit analysis and does peer reviews; and
* an agency that succeeds in its mission on the same
budget it had in 1979 -- that means the same dollar amount,
with no increase for inflation and about half the staff it had
in 1980.
I don't believe there is another federal agency that does
its job as well with so little. We are an agency that is truly
reinventing government, that fulfills its mission through
cooperation far more than regulation.
When I came to this agency, I knew that we had to reinvent
ourselves -- not just to survive, but to succeed. And I knew
that we had to involve not just consumers, but business as
well. Unless you take us seriously, and are willing to work
with us, we cannot do our job. So, we're here today to harness
a new energy to work together in a creative partnership.
Just as industry uses creativity to increase profits, CPSC
uses creativity to find solutions to product problems. Most of
the time, these creative solutions are faster and cheaper than
the labor-intensive, mandatory alternatives. And, as I have
stated many times before, I always prefer voluntary solutions
that solve the problems of product hazards.
CPSC is a scientific and technical agency that has
numerous tools to give and collect data on deaths and injuries.
We receive data from physicians, coroners, fire departments,
our Hotline, and from our NEISS hospital emergency room
reporting system.
Since I began as chairman, CPSC has added more hospitals
to NEISS and is linking it to additional sources of data,
making a good system even better. And we have used this system
creatively to anticipate injuries and to share this information
with industry. Last June, we used our NEISS data to project a
dramatic increase in injuries from in-line skating -- from
37,000 hospital emergency room-treated injuries in 1993 to
about 80,000 in 1994. Then we came out with a warning urging
consumers to use all of the necessary protective padding and
helmets when they skate.
Rollerblade may have even benefitted from our warning,
since they had a campaign already in place to market safety
gear. This is an example of how CPSC can strengthen creative
partnerships with industry by helping it profit from marketing
safety.
In the past, when you would receive a call from CPSC, you
immediately assumed there was trouble. Now we may call you for
many reasons. We may call to give you information. We may call
if we have an idea for you. Or, we may call to invite you to
come to CPSC to meet with our technical experts and other
interested parties to find a voluntary solution to a product
problem.
Here's how one call to industry has helped to address a
particular product hazard. Twenty-one children were killed and
hundreds injured when movable soccer goals weighing over 600
pounds tipped over and crushed them. These children were
playing in parks and fields where soccer goals were not
permanently anchored. CPSC brought together sporting-goods
manufacturers, soccer coaches, school officials, and soccer
enthusiasts to address this hazard. Together, we developed
guidelines for local jurisdictions to prevent the deaths and
injuries of other children from movable soccer goals. These
are creative solutions, not mandatory ones.
CPSC utilizes technologies that could be of use to you.
For example, we are on the Internet. We have expanded our
Hotline to get and give information directly to consumers.
These resources and our safety expertise are available to help
you build safer products so that you can then market your
products for safety.
This afternoon, you will see several more presentations by
creative companies that have made safety profitable. Our first
presenter, Volvo, changed the auto industry standard for
marketing safety. At CPSC, we believe that this is more than
an emerging trend.
We believe that marketing safety is here to stay. We are
here to help you make that happen.
Closing Remarks
This has been an incredible event that far exceeded my
expectations. I want to thank all of you for making this a
tremendous success. I also want to thank and recognize the
conference participants:
Alan Hassenfeld of Hasbro
Richard Gurin of Binney & Smith
Michael Goldstein of Toys "R" Us
Gordon Brunner of Procter & Gamble
Albert Dowden of Volvo
George Harris of Evenflo
John Hetterick of Rollerblade
J.C. Anderson of Whirlpool
Their presentations exemplify that safety is not just good
for CPSC and the American people but for business as well.
When we envisioned the idea for this Safety Sells Conference,
we established several goals. We wanted to make the point that
safety sells, and we certainly have. But we wanted that point
to be made by your industry colleagues, those who are the most
qualified to speak about what sells.
We also wanted to continue, and in some cases establish, a
face-to-face dialogue with you so we could talk about merging
our missions. For so long, it seemed that government and
industry might have been at cross purposes. But in fact, as
we've seen today, our goals are actually in sync. In the past,
you may have come to Washington only to hear some esoteric,
think-tank analyses of business. Instead, today you've heard
real-life examples of business successes. We're delighted that
you heard it here first. We hope you will implement the idea
that safety can be a profitable marketing strategy in your own
companies.
So please, call us, talk to us, keep the dialogue going.
Let us know how we can help you sell safety. In the meantime,
we at CPSC issue this friendly challenge: be even more
profitable by making even safer products.
Be the first in your industry to market safety and watch
the others follow. And when these products sell, we'll invite
you to be a headliner at our next Safety Sells Conference.
Thank you for coming.
##########
Ann Brown became Chairman of the U.S. Consumer Product Safety
Commission on March 10, 1994. She was nominated by President
Clinton and confirmed by the U.S. Senate as a Commissioner and
the seventh Chairman of CPSC.
Part 2
ALAN HASSENFELD
Chairman and Chief Executive Officer
Hasbro, Inc.
When Hasbro decided to become a major player in the
juvenile furniture area, it designed a high chair based on what
mothers said they wanted: a safe chair that wouldn't let
children slide out and one that could be used by infants as
well as older toddlers. In less than a year, Playskool's
1-2-3 High Chair was the best-selling one on the market.
Thank you for inviting me to come here to talk about how
safety sells. Being chairman of one of the world s largest
consumer products companies for children, you can bet that our
top priority has always been and will continue to be to sell
fun, affordable and, most importantly, safe products for
children the world over.
Hasbro s philosophy of making great products didn t start
with me. Back in 1923, when three Hassenfeld brothers started
a business, they followed a simple philosophy: sell a good,
safe product that people want, and your business will grow.
And grow it has. That simple family philosophy that my
grandfather and his brothers began was passed along first to my
dad, Merrill, then to my brother, Stephen, and to me. I now
carry that torch.
It may have been the Gallo brothers who said they will
sell no wine before it s time, but I can assure you, it is the
Hassenfeld brothers who will sell no product before it passes
our very rigorous safety standards.
We have state-of-the-art testing facilities where we
constantly evaluate all aspects of a product. The safety crew
and our talented and creative team of designers and engineers
know what they have to do before they can put the Hasbro name
on a product.
Sometimes, however, even the most tested products can
develop a problem. Let me talk about one recent example. We
began selling our Colorblaster 3-D in August of 1994. It went
through extensive testing before it was sold, but we started to
hear about a potential problem when the cap, if overpumped,
could fly off and strike a child.
We immediately alerted the CPSC and began a voluntary
recall. Fortunately, there were only a small number in
distribution. Even so, we took our efforts one step further
and produced a video news release that we transmitted by
satellite to television stations around the country. Our
results were phenomenal. In just one day, we reached almost 23
million viewers when 153 stations in 101 markets carried our
message.
This is just one way we are trying to be responsive to the
people who put their trust in us when they buy one of our
products. The most important thing if you have a problem is to
nip it in the bud, so that it stays a small problem. Don t be
indecisive -- move on it right away. By the way, when we have
done recalls in the past, the response rate to our 800 number
averaged about 300-500 calls. For the Colorblaster 3-D, our
video news release generated some 6,100 calls -- a very
impressive number.
Here s a question for all of you. How many of you have
children? I m sure each of you who does has a story or two
about how your child found a creative way to turn the safest
toy into a potentially dangerous one by the way they used it.
No, Johnny, that Tinkertoy is not something to whack your
brother with. In that regard, we as parents have to take some
responsibility for how our children play with their toys. We
need to be there at the beginning to explain what s right and
what s not.
Another way to be responsive to your consumer is through
consumer education. At Playskool, we do it two ways. One is
through our packaging. All of our products feature our
innovative ages and stages icons. It takes the guesswork out
of choosing toys by organizing them into four stages of
development: newborn, infant, toddler and pre-school.
The other way is by including a letter from Playskool s
president in many of our Playskool products bought by Mom and
Dad for their children. The letter talks about the proper uses
of the product they have just purchased. It also includes an
important safety tip unrelated to that product that we hope is
helpful to parents. For example, in our spin-around train
product, we alert parents to the dangers of window screens and
advise them to keep furniture away from windows, because the
screens are not designed to keep children from accidentally
falling out.
The issue of consumer education is a critical one. Where
possible, we should all try to go above and beyond, because it
not only helps you, by showing your consumers that you care,
but also because it is the responsible and right thing to do.
That is why we also mold our 800 number into all of our
Playskool products: to let parents know we are there if they
need us.
But enough of an overview. Chairman Ann Brown has asked
me to talk to you about one specific example of a product that
has safety as a key component, where safety really does
sell.
I can think of none better than our award-winning 1-2-3
High Chair; award-winning because of the design and the safety
elements that are built into it. We were fortunate enough last
August to receive the Chairman's commendation for significant
contributions to product safety from Ann. We designed and
built a high chair with a restraint system that helps protect
our youngest citizens from tragic consequences.
But let s step back for a second and look at the history
of high chairs. The first high chair was made in the 16th
century in Europe but didn t become common in the U.S. until
the mid-19th century. Today some 1.5 million are sold each and
every year. We roughly estimate that some 10 million high
chairs are in use every day in the U.S. alone.
To look at them, you wouldn t think that some high chairs
have the potential to be dangerous. But according to the CPSC,
since 1988, 20 children have died while being in high chairs.
Children have slid down the seat and strangled, either on the
tray or on the waist strap.
We made the decision to become a major player in the
juvenile furniture area as result of many internal meetings in
1992. At the time, we were not really involved in the
business. We did license our name out in a small number of
categories within juvenile furniture, but quite honestly, the
result had been a disappointment in terms of both sales and the
type of product that we were putting our name on.
We decided then that the best approach would be to put
together a design team that would develop exciting new features
and meet our lofty goal of designing a line of innovative, high
quality, durable and, of course, as always, safe products for
the juvenile furniture market, products we would be proud to
put the Playskool name on.
Once the team was put together, we began researching the
various juvenile product categories, because we wanted to enter
the business in a big way with just the right product. With
our success in newborn, infant and toddler feeding products, we
decided to tackle an area where we already had expertise, and
so we chose high chairs.
However, we have never been a me-too company. If we were
going to enter the market, we had to have a point of
difference. Who better to help us identify that point of
difference than mothers of infants and toddlers? We brought in
all the top- selling high chairs to a research session and
listened intently as the mothers took us through their likes
and dislikes.
Two interesting facts came to the surface. One was that
while high chairs have been equipped with the three-point
safety belt restraint, parents often admitted to not buckling
up their children. Many of them referred to their rather
active children as sliders." These were often kids who were
too difficult to buckle in, or their parents admitted to just
not having time to buckle them in. These kids would find new
and clever ways to slide down their seats, sometimes even out
of their seats, and, as we discovered from the 20 deaths,
sometimes with tragic consequences.
The second thing we picked up on was that high chairs
could only be used by parents once the child was able to sit
up, somewhere in the five- to six-month range.
We talked also to the trade. They were looking for a high
chair with an extra point of difference, but also one that
would cost less. Surprise, surprise!
After our research team recognized the opportunities
before us, we explored a variety of design solutions that would
allow younger infants to be placed in our chairs while more
securely restraining them. We looked at a variety of ways to
design a high chair with an advanced restraint system that
would not be easily circumvented by parents. We also wanted to
develop one that would cover a wider age range than those
currently on the market.
For how to broaden the age range, we looked at some of our
own products. We have become quite proficient in developing
product that grows right alongside the child. Our line of 1-2-
3 products, including our steady step walkers, the 1-2-3 bike
and our in-line skates, all follow that principle: build a
great product that has the ability to grow with the child. We
have done it again this year with a product called 1-2-3
baseball.
We took our product winning 1-2-3 philosophy and applied
it to the high chair. I first saw the fruits of our research
team s labor at a management line review early in 1993. The
team showed how they incorporated a reclining seat so that
newborns could now use the high chair. They also included a
height adjustment system with six different possibilities.
This would allow for extended use on the upper end of the age
range.
The team also showed a high chair with a rigid crotch
restraint that had to be in place in order for the tray to be
attached. We felt that even the busiest or most forgetful
parent would appreciate this feature. The team recommended,
however, that the seat belt still be used along with the rigid
restraint.
We were all blown away at the meeting, because the team
had come up with not one, but at least two innovative points of
difference. We gave them the green light and encouraged them
to go full speed ahead.
Partnerships played a big role in this product s genesis
as well. We realized that we did not have the expertise to
manufacture this product, so we teamed up with Troxel, a
company based in Tennessee that had previous experience with
high chairs.
We worked with their engineering and production people to
fine-tune the product. Each step of the way our internal
quality assurance people guided the team through to make sure
we met or exceeded all rules regarding high chairs. We also
wanted to make sure that we had JPMA (Juvenile Products
Manufacturers Association) certification.
Nineteen months from the beginning of this project, in the
second quarter of 1994, we launched Playskool s 1-2-3 High
Chair. We spent three quarters of a million dollars in tooling
alone to ensure that every part of the product would be made
with the highest standards.
I should also add that our high chair was not going to be
cheap. The cost to include all these new features was fairly
substantial. We knew it would be expensive ... but worth it.
We launched the product with a healthy print advertising
and public relations campaign. Point-of-purchase pieces were
developed and attached to each tray and footrest to convey our
message. The response was -- and continues to be --
phenomenal.
Clearly we hit a chord with parents. By the third
quarter, we had the best selling high chair in dollar volume.
By January of this year, we had the best-selling high chair in
both units sold and dollar volume. In the case of the 1-2-3
High Chair, we proved that safety does sell -- and it sells
very well.
We believe that we may have changed the way high chairs
will be built in the future. At this year s juvenile products
merchandising show, two of our competitors had adapted the
crotch restraint idea into their products.
Let me assure you, we are not sitting still. We are
already looking at new innovative, fun and safe ways to drive
our competition batty and bring a new level of safety to the
global marketplace.
You, too, can do it, and with organizations like the CPSC
recognizing the work of companies like Hasbro and partnering
with us, the future of safety is very bright indeed.
We ve talked a lot about safety today. Let me show you
how serious I am. It is imperative that I safety test each
product we make. Take a look at me hard at work with the high
chair. (Video shown to audience.)
Seriously, while I couldn't really personally test each
product, I continually challenge our people to make sure that
what we do bring to market is something we would all be proud
to put our name on. So, too, can you make a difference, and as
you saw from our 1-2-3 High Chair, a profitable one at that.
Thank you.
##########
Alan Hassenfeld has been Chairman and CEO of Hasbro since 1989.
He is a third-generation member of the family that founded the
company.
Part 3
RICHARD S. GURIN
President and Chief Executive Officer
Binney & Smith, Inc.
Although Binney & Smith complied with all safety
standards, some consumers perceived that the food scents of its
new Crayola "Magic Scent" crayons would encourage children to
put the crayons in their mouths. Mr. Gurin describes how
Binney & Smith responded to those consumer concerns.
Good morning!
I'm sure some of you are wondering how many issues
regarding product safety can be challenging the makers of
Crayola crayons.
Most moms and dads and even we grandparent types remember
from our own Crayola experiences that our products are non-
toxic -- even if you eat a few Crayola crayons, there are no
harmful side effects. We don't encourage it and they don't
taste good, but they are harmless if ingested.
So why is Crayola concerned? Quite simply, our company,
Binney & Smith, has been a leader in advocating product safety
in the art materials and stationery product categories for
nearly 100 years. We were a founding member of the Crayon,
Water Color & Craft Institute in 1936.
Today, this industry organization -- known as the Art &
Creative Materials Institute, or ACMI -- is most recognized for
its certification program for children s art, fine art and
creative product materials.
If you reach for a Crayola package today, you will see a
CP or AP -- certified product or approved product -- seal,
meaning that the product is safe, has gone through
toxicological evaluation by medical experts and, according to
the ACMI Manual of Procedures, contains no materials in
sufficient quantities to be toxic or injurious to humans or
cause any acute or chronic health problems.
Each package also acknowledges compliance with hazard
labeling and performance standards mandated by federal law.
These certification seals on product packages are a vital
tool to reassure consumers about a product's safety.
Crayon safety generated national attention last spring
when the CPSC requested the recall of private-label crayons
imported from China because they contained levels of lead found
by CPSC to be hazardous. Lead is found in some pigments used as
colorants in crayons. None of the crayon packages carried the
ACMI safety seals.
CPSC did announce in press statements that Crayola
crayons were the industry standard, virtually lead-free,
following tests of Crayola crayons, which confirmed our own
test results. Lead-free may be great for gasoline, but it's
not exactly a positive coloring benefit even for Crayola
products.
At Binney & Smith, we make it easy for consumers to get
information about our products and share their thoughts on
product quality, packaging and our new product innovations. On
every box, we invite questions and comments to our consumer
affairs department via the l-800-CRAYOLA telephone line. Last
year alone, we listened to more than 100,000 Crayola consumers.
Many of the calls were positive!
Based on consumer input, we have also developed
standardized consumer information panels on all packages for
our activity kits and art sets. These panels make it easy for
parents to find pertinent product information, safety data and
washing instructions, of great importance when working with
non-washable art products.
Last year, our 800 number proved to be an invaluable
resource with the launch of a new Crayola crayon product:
Crayola Magic Scent crayons.
Faced with the challenge of building consumer excitement
into a 90-year-old product category, our crayon marketing team
worked on creative ways to enhance the play value of the crayon
-- add some glitter, make them glow in the dark, or better yet,
have them change color.
All of these product concepts tested well with consumers
and were in the works for launch. The team, however, decided
to develop a whole new crayon concept -- one in which crayons
would emit familiar scents -- a very popular idea with parents
and kids in focus group research.
The first challenge was developing the technology.
Fortunately, we had experience in color-mixing, so scented
products seemed pretty straight-forward.
Initial smells ranged from chocolate to marshmallow to
skunk, and even included marigold and dirty sneakers. As we
began our field testing with mothers and kids, food scents
consistently ranked among their favorites.
But we were unhappy with the crayons we made and those
already in the marketplace, where the crayon smelled like fruit
for example. We wanted to develop a technological breakthrough
that would give this idea a new twist.
Several months later we did. The technology involved
micro-encapsulated fragrances that we jointly developed with
our partner, 3M. These fragrances do not smell or break open
until the crayon is used to color on a surface.
In the box, the crayons don't smell any different than
regular crayons -- the scents are only released on paper
surfaces and therefore are unlikely to encourage kids to eat
them any more than any other crayon.
Since industry statistics on ingestion or aspiration from
art materials, which include crayons, paint and paper, are
relatively small compared to other children's products, we felt
confident in giving our marketing team the green light to
finalize and launch the product.
This was a long process, but we had a real breakthrough in
terms of kids' safety and more fun coloring.
Shipments of product to selected accounts began in January
of last year, while we ran controlled panel tests. We launched
a national public relations campaign in July, complete with
television advertising.
By this time, we had seven months of in-market experience
without a single recorded incident of ingestion from a Magic
Scent crayon called in to our 800 center.
Despite glowing coverage in the press and on TV, within
days the New York State Consumer Protection Board was calling
for the immediate removal of Magic Scent crayons from the
retail marketplace.
Acknowledging that the crayons were in total compliance
with all of the safety and regulatory laws, New York officials
were concerned that food-scented crayons would increase the
likelihood of a child coloring on paper and then putting the
good- smelling paper in his mouth -- raising the risk of a
choking hazard. Despite the fact that the crayons didn't
smell, some also thought the likelihood of ingestion or
aspiration was greater because of the food scents.
In short order, the company learned that others felt the
same way. Connecticut's State Consumer Protection Board and
eventually Chairman Ann Brown at CPSC expressed similar
concerns about food-scented children's products.
Newspaper headlines cast doubt and fear among some of our
consumers. In the three months after the media got into this
ingestion debate, our 800 center logged 10,000 calls with
inquiries regarding the safety of the product.
Of course, we assured them that all Crayola crayons remain
100% non-toxic. In the marketplace, the scented crayons were
selling well in all of our major national accounts like Wal-
Mart, Toys "R" Us and K-Mart. Scented crayons were fast
becoming one of our biggest sellers!
After carefully reviewing the Crayola consumer statements
called into our 800 center and weighing the opinions of child
safety advocates, I came to -- what was at the time -- a very
unpopular decision at Binney & Smith. I made the decision to
phase out the food scents and to develop a line of non-food
fragrances.
In my mind, the reputation of the Crayola brand name and
our 90-year history of providing safe, quality products was not
worth jeopardizing in the long-term, even if it was just a
perception and the product was in fact as safe as any other
Crayola crayon.
By mid-September, I advised CPSC of our company's
decision, explaining that it would take about six months of
effort by 3M and our technical people to develop a line of new
non-food scents.
At today's "Safety Sells" conference, I m pleased to share
publicly for the very first time the line-up of the new Magic
Scent crayons from Crayola.
Here they are -- first the floral scents: daffodil,
eucalyptus, tulip and lilac. Next, we have the non-floral
scents: new car, soap, leather jacket, smoke, cedar chest,
shampoo, lumber, baby powder and dirt. There are also three
non-food staples from the original package: pine, rose and
fresh air.
Even at a cost well in excess of a half-million dollars to
develop and phase the new scents into our production, we feel
it was a good idea to preserve the reputation of the Crayola
brand for safety.
Beginning April 1, the new Magic Scent crayons will be
shipped to customer warehouses and stores all over the country.
Binney & Smith will be awaiting consumer feedback to determine
just how well safety sells. Color us enthusiastic about the
prospects.
Thank you.
##########
Richard Gurin joined Binney & Smith in 1984 as President and
Chief Operating Officer and in 1987 was named President and
Chief Executive Officer. He serves on the President's
Committee on the Arts and Humanities as co-chair of the
subcommittee on Arts, Humanities and Our Youth. He also is
Vice Chair of the American Council for the Arts and a
participant in the Goals 2000 Art Education Action Planning
process.
PART 4
MICHAEL GOLDSTEIN
Vice Chairman and Chief Executive Officer
Toys "R" Us
Toys "R" Us has established several programs to protect
its customers from unsafe products. These programs include
comprehensive safety assurance testing, and educating vendors,
buyers, employees and consumers.
Four years ago, Toys "R" Us implemented a comprehensive
safety assurance testing program. Our program is unique
because, as a retail operation, our requirements are vastly
different from those of a manufacturer, although we share the
same regulatory responsibilities. Our strengths lie in
increasing vendor awareness to new and evolving regulations and
standards and in keeping potentially hazardous and
non-compliant products from our shelves and the hands of the
Toys "R" Us customer.
Toys "R" Us has consistently sought to offer for sale only
those products that meet rigorous safety standards. All
merchandise must conform with current U.S. Consumer Product
Safety Commission regulations, Food and Drug Administration
requirements, all U.S. federal, state and local laws, and
industry voluntary standards.
Testing is required to be performed at least once a year
on all direct import and private label products. Additional
testing is required (every shipment) for items appropriate for
children under three years old or when there is a change in
country of origin, factory, design or component materials.
In 1994, more than 7,700 product safety tests were
performed on merchandise purchased by Toys "R" Us. Most of
this testing was completed "off shore" on products made for the
U.S. but before they were accepted by our overseas
consolidators for shipment. No direct import merchandise is
accepted for shipment unless it is accompanied by a valid Toys
"R" Us certificate of compliance issued by our testing
laboratory.
Testing parameters are specified by Toys "R" Us, not the
vendor. In this way, we are sure all items are tested to the
same regulatory requirements and specifications. Of the 7,700
tests performed, 494 products failed to comply with all of the
applicable regulations and standards. Over the years, the
release of small parts during the testing procedures has been
the most frequent reason for failures. In 1994, 14 percent of
the total failures were due to small parts.
However, these findings were eclipsed by failures to
comply with various labeling requirements. Thirty-two percent
of the year's failures resulted from incorrect or missing
labeling. This extraordinarily high failure rate was a direct
result of the 1993 Connecticut small parts labeling act
requiring warning statements on toys intended for children ages
three- to seven-years-old and containing small parts. Eighteen
percent of the year's failures were attributable to
non-compliance with this one state law.
An additional 14 percent of the year's failures were due
to other labeling issues, including improper manufacturer's
identification and warnings required on electrical toys and
toys that would come in contact with food.
Heavy metals and lead content account for another 17
percent of the failure results. Although not required by law,
Toys "R" Us has been testing crayons for total lead content for
several years. With the Consumer Product Safety Commission's
increased surveillance on children's art materials, including
crayons, we have extended this testing to chalk, paints and
similar art materials. Other failures resulted from
unsubstantiated toxicity claims, string/loop length, sharp
points, polybag thickness, FDA food additives, stuffing
material contamination, sharp edges and other miscellaneous
reasons.
While our safety assurance program uncovered 494 products
with compliance problems, not all of these items were lost to
us. Manufacturers are offered the opportunity to correct
non-complying product by resubmitting new production samples to
a series of re-tests. As a result, only 41 products from 31
suppliers had to be canceled because they could not be brought
into compliance. This translates into over $3 million worth of
product at retail that did not reach our shelves. As a
comparison, in the first year of our safety assurance program,
144 products from 57 suppliers were canceled, with a retail
value in excess of $10 million.
Prior to establishing our safety assurance program, Toys
"R" Us relied on its suppliers to perform all safety testing.
We believed they, as responsible manufacturers, would perform
all applicable tests ensuring regulatory compliance and deliver
only safe product to our stores. As Toys "R" Us grew in size,
it was obvious we could no longer rely or depend solely on our
manufacturers.
Regulatory issues and pressures coupled with an increased
awareness of our corporate responsibilities as the world's
largest toy store, demanded we do more. We set out to create a
safety assurance program that addressed our immediate goals.
Our immediate goals were simple:
* Select toys that meet our high standards of quality,
safety and value.
* Minimize any adverse exposure in the market place.
* Demonstrate our ability to properly and effectively
address all regulatory concerns and matters.
Our approach was to find a qualified, approved testing
laboratory that would understand our goals and could further
offer the staffing, equipment, logistical and systemic
expertise our program was going to demand. Toys "R" Us chose
ACTS Testing Labs, Inc., as its program partner in 1989.
We also needed Toys "R" Us staff to create and administer
the program. We needed people who knew toys, understood our
import business and could grasp the technical and regulatory
subjects. Since our product development department manages our
line of private label brands, is heavily involved with imports
and familiar with Pacific Rim suppliers and has a working
knowledge of many of the safety factors, they were selected to
develop and manage the program.
Phase I of the testing program began with the examination
of all private label toys, 670 in all, to determine whether
each product complied with the requirements of the CPSC. A
significant criteria applied to the entire testing procedure
was established at that time, an ingredient that, to this day,
makes the Toys "R" Us program unique. Toys "R" Us and ACTS
Testing Labs, Inc., elected to classify all products into two
major categories: toys that pose a high risk of hazard, toys
that pose a low risk of hazard.
High-risk toys are generally defined as those intended for
children from birth through 36 months. These include rattles,
teethers, crib toys, toddler toys and brightly decorated toys.
All high-risk toys are tested prior to every shipment made to
Toys "R" Us. Low-risk toys are generally defined as those
intended for children 37 months and older. These include
construction sets, battery-operated toys, school items and
science toys. Low-risk toys are tested once every calendar
year prior to shipment.
In 1990, the program was expanded to include all direct
import toys. Implementation of Phase II began in early 1991.
During this 18-month period, customized systems and computer
programs were created allowing us to constantly monitor the
flow of product through the testing process and analyze the
results of every product and vendor test. Toys "R" Us knows on
any given day which toys have been received at the lab for
testing and has immediate access to test results on any
product. Additionally, quarterly and annual recaps are done on
each vendor's performance. Poorly performing vendors are
advised of their status and dealt with accordingly.
The Toys "R" Us safety assurance program has increased its
scope and expanded on its original goals. Today, our safety
assurance program reaches beyond the basics of just testing
products. We have a corporate safety committee that meets
quarterly to discuss safety and compliance issues. The
committee consists of eight members from various reference
points within the company.
A key event each year is the schedule of safety seminars
arranged for our buyers. ACTS Testing Lab representatives
prepare safety-related information based on each buyer's
categories. A general overview is also presented for the
newest members of the buying staff. The staff is brought up-
to-date on the latest issues in their categories. A review is
done on testing data, CPSC recalls and vendor performance.
Also, each year we sponsor a vendor seminar during our
January import buying trip held in Dallas. Our import
suppliers learn of any recent developments in the safety area,
review the provisions and requirements of our program, and
discuss any other topics relative to toy safety. This year we
were fortunate to have Mike Gidding of the CPSC at our vendor
seminar to outline the provisions of the recently enacted Child
Safety Protection Act.
A successful program needs to do more that protect Toys
"R" Us and its customers from unsafe products. A successful
program must be responsive to its customers, keep them informed
and let them know we are responsible. Toys "R" Us has
instituted several programs that convey this message.
In 1994 our safety assurance department independently
investigated skateboards, teethers, bath rings, travel cups,
strollers, window shades, costumes, toy boxes and others as a
result of direct customer inquires. An investigation includes
contacting the supplier for current safety testing information.
Where the information is incomplete or inadequate to satisfy
our inquiry, we have ACTS test samples from our store
inventory. Normally, we find the item to be in compliance with
the regulations. The consumer is then contacted directly with
the results of our findings.
Every Toys "R" Us store has a consumer safety bulletin
board located in the store lobby where our customers can learn
of recall notices and other important safety information. Toys
"R" Us, in conjunction with the Consumer Product Safety
Commission, prints a pamphlet of safety facts that is made
available at every Toys "R" Us and Kids "R" Us outlet. This
free publication contains the most current product safety
alerts issued by the CPSC. The booklet is now in its second
edition, with a distribution of approximately 1,000,000 copies.
In 1994, Toys "R" Us published another consumer-oriented
booklet called, The Toy Guide for Differently-Abled Kids. The
national parent network, the national Lekotek centers and Toys
"R" Us collaborated to produce this very special toy guide
containing everyday toys from our regular selection that were
selected through a very tough focus group exercise. The focus
group consisted of children with various types of disabilities.
Although each toy met all applicable safety standards and
regulations, not every toy met the focus group evaluation
criteria.
The surviving toys were identified for appropriateness to
meet the needs of special children with one or more specific
disabilities. In-store and targeted direct mail distribution
is made available free to our customers.
It is always a challenge to prevent recalled or hazardous
products from being sold right off our shelves. We have
created a fail-safe within our cash register system. Once a
product is identified as being hazardous, our inventory control
department changes the retail price of that product to
$9,999.00. If, by chance, our store personnel misses a single
piece of inventory, we can catch it at the register. It is
very unlikely that any customer would pay $10,000 for any toy.
Further systemic enhancement at store level allows any
customer to file a safety report right in the store. If one of
our customers has reason for any safety concern, a report can
be filed advising us of that concern. The report, completed in
front of the customer on a computer terminal, is transmitted
directly to our headquarters. An investigation, as I explained
earlier, is then initiated, if needed.
An example of how effective our customer complaint system
works resulted in Toys "R" Us halting sale of an unsafe product
two weeks before it was recalled by the Commission. The
product was the Just Toy "quick n' easy micro-bake" cake set.
Toys "R" Us had received a few complaints from customers who
had various problems while using this product in their
microwave ovens. Most complaints were limited to the product
getting too hot or somehow causing damage to the microwaves.
There were no injuries reported with any of these complaints,
and all issues were brought to the attention of the
manufacturer. However, in early December, we received another
complaint. This time, a customer suffered hand burns while
trying to take the product out of her microwave. Toys "R" Us
immediately issued a hazardous stop-sale, in accordance with
our corporate standard operating procedure. Next, we notified
the manufacturer and the Commission of our actions. On
December 20, the CPSC announced the Just Toy recall.
Incidentally, the microwave was right in the middle of a
national TV campaign at the time of the Toys "R" Us stop-sale.
Another important function of the safety program is the
testing of promotional or premium items. Testing on these
items is quite important, since we do not control or
necessarily know the end-user. Much larger sample sizes are
used because of the larger quantities being ordered and the
nature of the event itself. Toy safety is an integral part of
our product development and private label endeavors. Products
considered for any of our private brands are submitted to the
testing lab prior to final buyer acceptance. Problems that are
easily correctable are brought to the manufacturer's attention.
This procedure allows us to evaluate the product for compliance
with regulations before spending too much energy or resources
on concepts and packaging.
Our biggest challenge in 1995 will be to ensure compliance
with the new Child Safety Protection Act. Basically, the act
requires a very specific warning statement on toys and certain
other articles for children three to six years of age that are,
or contain, small parts. The required warning statement
indicates that the article contains small parts that pose a
choking hazard to children under three years of age. The act
also mandates similar warning statements for marbles, small
balls and balloons and for toys that contain marbles, small
balls or balloons. It should be noted that Toys "R" Us has had
in place a policy requiring that all latex balloons contain a
warning label either on the package or on the balloon display
stand itself.
The Child Safety Protection Act has had greater publicity
than the Connecticut small parts labeling law which it now
preempts. We do, however, anticipate similar compliance
problems by our suppliers, as those we experienced when the
Connecticut law went into effect.
By mid-year, we will be testing products against the
revised industry toy standard, ASTM F963-95. Again, we
anticipate delays in shipping the product while our suppliers
come to terms with the new requirements.
Where do we go from here?
One long-term project, currently in the works, is the
initial investigation of a proposal to create a Toys "R" Us
worldwide testing standard. The standard would consist of a
basic core program supplemented by country-specific needs. A
worldwide standard would be advantageous to our U.S. division
and our international division, while offering economies to our
suppliers. There are still many hurdles to overcome before we
can even contemplate implementation of a worldwide program.
In conclusion, we believe that safety sells. By having
comprehensive safety assurance programs in place, we have
reduced our internal operating costs, particularly the high
administrative costs involved with recalls. Furthermore, we
have improved our customer service by making sure that only
"safe" toys are being sold in our stores. Last, but not least,
we improve our relationship with the CPSC and illustrate how
companies can work with the government to improve child safety.
Again, I would like to thank Ann Brown and the Commission
for inviting me here today and for encouraging industry and
government to work as partners in making products safe for
consumers.
##########
Michael Goldstein, Vice Chairman and CEO of Toys "R" Us and a
member of its Board of Directors, has been with the company
since 1983. He is also a Director of the National Retail
Federation.
PART 5
GORDON F. BRUNNER
Senior Vice President
The Procter & Gamble Company
Procter & Gamble developed and patented a new bottle
closure, "Safety SquEase," that meets government requirements
for child-resistance. It also adds value and consumer
satisfaction to a new P&G over-the-counter analgesic by making
it easy to open for most adults, including senior citizens.
My case study concerns Procter & Gamble's patented new
child-resistant closure, which we have named the "Safety
SquEase." One year ago this Thursday we were honored to
receive the CPSC Chairman's first-ever "Commendation for
Significant Contributions to Consumer Product Safety" for our
invention and marketing of this new closure.
The "Safety SquEase" closure has been used on bottles of
Aleve, our new, long-lasting, over-the-counter analgesic drug,
since its introduction last year. We have also begun using it
on our Scope mouthwash product and will introduce it on our
Vicks NyQuil and DayQuil cough relief products this coming
fall.
To really convey how we developed the "Safety SquEase," I
need to give you the context. Two long-standing corporate
policies had a major influence. The first was Procter &
Gamble's policy regarding the human and environmental safety of
its products and packages. The second was P&G's stated
corporate purpose to create and deliver products of superior
quality and value that best satisfy consumer needs.
Procter & Gamble's human and environmental safety policy
is very straightforward. It is our policy that our products
shall be safe for humans and the environment, either used as
intended or under conditions of reasonably foreseeable
accidental misuse. We want such safety during manufacturing,
distribution, warehousing, presentation for sale, consumer
storage, consumer use, and ultimately, when products and
packages find their way into the environment, either in total
or in part.
I should comment that these safety requirements are not
niceties that we incorporate simply to increase product appeal.
Rather, they are corporate mandates, a non-negotiable part of
every project. We do think that, in the long term, safety is
good business, but that is not the fundamental reason for our
safety policy. Basically, we have our safety policy because we
believe it is the right thing to do.
Please note that the term "safe," as used in our policy,
does not mean absolute safety. It means relative or practical
safety, as most consumers and safety professionals would
understand the term. This is because there really is no such
thing as absolute safety for any material in every situation.
For example, as you know, both water and table salt can be
quite lethal if consumed in excessive amounts in improper ways.
Similarly, what is considered best safety practice can change
with time. Automobile models at the forefront of safety in
1920 wouldn't be allowed on the road today.
Given that what we are after is relative or practical
safety, P&G goes to great lengths to ensure that its products
and packages fully meet this standard. Some one in eight of
our R&D staff worldwide, nearly 1,000 people in all, have the
safety of our products and packages as their only
responsibility. Many others contribute to safety also as part
of their activities. Among our 1,000 safety specialists in R&D
are over 250 Ph.D. scientists, including a number of world
leaders in various aspects of human and environmental
toxicology. Since we're at the leading edge of science in
every area we operate, we believe this expertise is critical.
The kinds of safety issues we consider and test for are
many. For example, here are the various potential human
toxicity issues that we typically address [Exhibit A].
Similarly, here are some of the many questions we ask about new
chemicals and chemical mixtures regarding their fate in and
possible effects on the environment [Exhibit B].
We also ask special questions and run special tests to
address safety issues very specific to particular products.
These include, for example, tests of products used in clothes
dryers to confirm no potential for fires and tests of small
package parts to confirm no child-choking hazards.
Our commitment to safety assurance doesn't end with market
introduction but continues as long as a product is sold. For
example, we were among the pioneers back in the 1970's in the
use of 800-lines for consumers and continue to use them
extensively today. We also undertake initiatives aimed at
supporting good safety practices in a general sense. A recent
example is our new free guide on home management and use of
medicines specifically written for parents of young children
and other caregivers. It is available free from P&G, courtesy
of our Vicks and Aleve brands.
The second pillar upon which the "Safety SquEase"
development was built is P&G's commitment to selling superior
products and packages. We are simply not content to sell "me-
too" offerings. Instead, our strategy for success is to have
product and package superiority, built on innovative science
and technology.
The development of the "Safety SquEase" cap for P&G's
Aleve brand analgesic is an excellent illustration of our drive
for product and package superiority. For those of you who
haven't heard about it, Aleve is the result of a joint venture
between Procter & Gamble and Syntax Labs. The aim was to
introduce an over-the-counter version of Anaprox, a fast-acting
sodium form of the medicine in Naprosyn. Naprosyn, sold by
Syntax, had been the leader in the Rx non-steroidal anti-
inflammatory drug market for a decade. The thinking was to do
what had been done in the early '80's when Rx ibuprofen, led by
Motrin, was converted into the Advil's and Nuprin's of today.
When used at over-the-counter (OTC) dosages, sodium
Naproxen has advantages over acetaminophen, ibuprofen and
aspirin. It's longer lasting than acetaminophen, provides a
higher level of pain relief than ibuprofen long after the
medication is taken, and is gentler to the stomach than
aspirin. Our research indicated that many consumers, such as
arthritis sufferers, would find these advantages appealing. At
the same time, we knew that our competitors in the highly
contested OTC analgesics business would not take Aleve's entry
lightly. Consequently, we wanted to increase Aleve's margin of
superiority with consumers if at all possible.
Our packaging people thought they had an answer -- develop
a truly user-friendly child-resistant package. Child-resistant
packages are required for products like Aleve to help prevent
very young children from consuming toxic amounts out of
curiosity. Personal experience, feedback from family and
friends, and consumer research, however, told us that adults
regarded existing child-resistant packages as hard to open.
Some consumers, in fact, believe they must choose between
having a drug package that they can open and one that is child-
resistant. This is a terrible dilemma if children live in the
house or grandchildren visit. Some adults, unfortunately, cut
corners. They buy child-resistant packages but leave the caps
loose or off after opening the bottle the first time.
Obviously, this defeats the purpose entirely.
The reason why most current child-resistant packages are
difficult to open is straightforward. Their child-resistance
is primarily based upon requiring a higher level of strength to
open the package than a small child can exert. What was needed
was some entirely new principle for achieving a consumer-
preferred child-resistant closure.
This was what our packaging people set out to do. It was
not an easy task. In fact, it took five years. The first two
years were spent inventing the design. Several alternatives
were conceived and evaluated during this period. We now hold
four patents relating to Aleve's Safety SquEase design alone.
The next year-and-a-half were spent fine-tuning the package
design, with heavy emphasis on testing to confirm child-
resistance, ease of adult use, and product protection. The
final one-and-a-half years were spent scaling up to full
production.
The "Safety SquEase" child-resistant closure is based upon
the principle of hand-to-hand coordination. By that I mean the
ability to do two different things with two hands at one time.
This is an ability that children do not develop until around
age five. By that time they should be mature enough to
understand and follow instructions to leave dangerous items
alone. But virtually all adults, of course, have this degree
of hand coordination.
To open the "Safety SquEase" package, you simply squeeze
the two tabs on the sides of the package lightly while twisting
off the cap with the other hand. Closing is even simpler. You
just turn the cap until you hear a click. This click, which
can be both felt and heard, is a positive signal that the cap
is fully closed and in a locked position -- fully child-
resistant again. We call this a "safety click."
You may find it surprising that small children find it
very difficult to do two different things with their hands at
once but I can assure you it is true. A case in point is the
old game of simultaneously patting your head and rubbing your
tummy or vice-versa. Here is some footage of two real charmers
trying to do this for us. We also asked them to try to open a
bottle with the "Safety SquEase" closure, with similar results.
Of course, we didn't rely on just those two young ladies
for all our research, helpful as they were. In fact, we had
the "Safety SquEase" package tested for child-resistance by
more than 1,000 children at an independent qualified
laboratory. We also had "Safety SquEase" tested by seniors at
this same laboratory, using the senior-testing protocol that
was being considered at the time by CPSC. We further tested
the package among hundreds of people with arthritis and among
thousands of typical adult consumers of analgesics nationwide.
The new "Safety SquEase" closure -- and, I might add, our Aleve
product as well -- passed all these tests with flying colors.
Before I go any further, let me openly acknowledge that
the "Safety SquEase" closure is not the total solution to
either child-resistance or user-friendliness. No package that
is reasonably usable is completely childproof, and all
medicines should be kept out of the reach of small children.
Turning to user-friendliness, there is unfortunately a small
segment of the population whose hands are very impaired. Even
opening the "Safety SquEase" closure is too difficult for this
small group. To better meet their needs, we are considering
marketing the allowed one size of a non-child-resistant
package.
But even with these caveats, we believe the "Safety
SquEase" is a real step forward in terms of both product safety
and consumer satisfaction. Importantly, consumers seem to
think so, too. In just the few months that Aleve has been on
the market, it is now the #4 brand of analgesic. This is well
ahead of what other highly successful analgesic brands achieved
at the same stage of their existence.
Obviously, I can't tell you how much of Aleve's success is
due to the "Safety SquEase" closure and how much to its
outstanding pain-fighting properties. The two go hand-in-hand,
so to speak, to create a superior brand entry. What I can tell
you, however, is that in less than a year we have already
received more than 2,500 unsolicited testimonials from
consumers about Aleve, including more than 300 about the
"Safety SquEase" package. That is a very impressive number for
a package feature. Let me read to you from one of the more
touching letters [Exhibit C]. We are certainly pleased that
the "Safety SquEase" closure has been such a help in many
peoples' lives.
In summary, Procter & Gamble's new "Safety SquEase"
closure is providing a high level of product safety, along with
consumer satisfaction and strong business results. We think it
is a clear example that "safety sells."
##########
Gordon Brunner, Senior Vice President and Member of the Board
of Directors of Procter & Gamble, has been with the corporation
for over three decades. He also serves on the National
Advisory Committee for the University of Michigan, College of
Engineering, and is a member of the Government-Industry-
Research Roundtable.
_______________________________________________________
EXHIBIT A
POTENTIAL TOXICITIES TO BE CONSIDERED
1. Acute oral
2. Acute dermal
3. Acute inhalation
4. Acute eye irritation
5. Primary skin irritation
6. Skin sensitization
7. Phototoxicity
8. Mutagenicity/carcinogenicity
9. Subchronic toxicity
10. Developmental/reproductive toxicity (oral or dermal)
11. Neurotoxicity
12. Absorption, distribution, elimination
EXHIBIT B
ENVIRONMENTAL SAFETY QUESTIONS
1. How much chemical will be used?
2. Is it biodegradable?
3. Is it removed by sewage treatment?
4. What is its environmental fate?
5. What is its effect on sewage treatment plants? On
septic systems?
6. What concentrations are toxic to fish, algae, and
other aquatic life?
7. What levels will be present in the environment and
in what "compartments?"
8. What will happen if the chemical is spilled?
9. Are there potential long-term effects of the
chemical on the environment?
10. What levels will be present in surface waters? In
drinking water?
EXHIBIT C
CONSUMER LETTER
Dear Sirs,
I would like to thank you so very much for the wonderful
package -- I should say, packaging of Aleve. Not only is the
medication very very helpful! You can get into the bottle
easy.
I am sight-impaired and also have brain tumors along with
arthritis in my knees and various parts of my body.
When you are in pain the last thing you want or need is
the difficult caps.
You have helped so very much with this inventive cap. I
thank you so much. I really wish I could put into words how
much.
Thank you for your time in reading my letter.
Very truly yours,
PART 6
ALBERT R. DOWDEN
President and Chief Executive Officer
Volvo North America Corporation
As part of its decades-long commitment to safety, Volvo
developed a side impact protection system (SIPS) for use in its
passenger cars to reduce the severity of injuries from side-
impact collisions.
For us at Volvo, the chance to speak today is a bit like
an invitation to come in from the wilderness -- for it has
always been Volvo s demonstrated philosophy that not only is
safety a proper and necessary product element, but it makes
good business sense as well. In my business, this has
certainly not been viewed -- at least until quite recently --
as revealed truth, and even now I wonder to what extent some
of our competitors are publicly embracing safety more to
produce a dynamic commercial than a responsible product.
I want to use this opportunity to discuss Volvo's side
impact protection system (SIPS).
To put this issue into context, I first need to talk about
how Volvo thinks about safety. Here is the central idea I want
to leave you with: Safety doesn't result from devices.
Putting an airbag in a tin box doesn't make a safe car. After
all, the airbag may function perfectly, but that is scant
protection if the engine is in your lap. Safety results from
an overall approach to product conception, design and
construction.
Volvo learned its way into safety. Back in 1927 when we
began, "safety" was one of the original design criteria. That
commitment has never wavered.
Safety in the 1920s equaled reliability and durability.
This was important. Driving in the middle of a Scandinavian
winter, your car's reliability can literally be a matter of
life and death.
In the 1940s, the same thinking about safety led to unit
body construction, the precursor of today's passenger cage. As
Volvo evolved, so did the science of safety. Many of our
advances were learned by feel and experience, not by computer
modeling.
And what we learned was that everything is a safety issue:
where you put the gas tank, the angle of the windshield, the
size of the door support column, and literally thousands of
other aspects of auto design.
In 1975, when the US Department of Transportation was
conducting tests to establish its guidelines for safety, they
bought 25 Volvo cars. Then they scientifically demolished
them. They wanted the sturdiest, safest cars they could find.
Volvo was on the leading edge of safety in the 1970s, with
features such as collapsible steering columns (we did this by
intentionally misaligning the joints of the column), a cage
structure for the cab with front and rear crumple zones to
absorb the impact of the crash, and three-point safety belts
designed to be comfortable to encourage use, a safety
innovation that Volvo invented.
In the 1980s, the leading edge of safety consisted of
driver-side airbags, followed by passenger-side airbags and
anti-lock brake systems.
This is a very brief tour, omitting many additional safety
developments, but I think it is sufficient to set the stage for
the 1990s and the Volvo side impact protection system. Let me
explain to you how this system evolved.
In the late 1980s, the US Department of Transportation
announced that it would establish side-impact performance
standards by 1997. Meanwhile, however, Volvo, having made
great strides in reducing injuries from frontal and rear
collisions, had already begun to look into side-impact
collisions, especially in the development of our 800 and 900
model series. We had resolved to learn everything we could
about side-impact collisions.
This is what we learned:
* Side impacts are the second most serious of all
collisions. The impact is not six feet away from the
occupants, as in front-end collisions. It is only six
inches away. The transfer of energy occurs almost
instantaneously.
* Compensating for close proximity to the occupants
and the necessary minimal response time are the
overriding requirements in safety design.
* The front seat is the primary issue. The rear of
the car can be made stronger; the front cannot.
Considering this knowledge, we developed two goals: to
make the energy go somewhere else, not toward the driver and
passenger, and to protect the driver and passenger from the
energy that could not be diverted.
Volvo's side impact protection system has several aspects.
To deal with the first goal -- to divert the energy of the
impact away from the driver and passenger -- we stiffened the
sides of the car. This has the effect of transferring the
energy upward and downward, letting the car's frame, especially
the roof and the floor, absorb much of the energy. The public
first saw Volvos with stiffened sides in 1992.
But we didn't stop there. We still had to find a way to
meet our second goal: to protect the driver and passenger from
the energy that could not be diverted.
After seeing the mechanics of side impacts, we knew that
the most important thing was to lower the rate of acceleration
of the people inside after a crash. In a side impact, the
occupants are instantly accelerated -- at a much higher g-force
than any fighter pilot or astronaut experiences. This can
cause massive internal damage.
We discovered that a side-impact bag -- just the size of a
loaf of bread when fully inflated -- between the person and the
impact site would lower the rate of acceleration and prevent or
lessen the seriousness of injuries.
The problem is the hair-trigger response time. The bag
needs to detect the impact and inflate within 12/1,000ths of a
second. And the bag needs to be attached to the seat so that
it is close to the driver at all times. Working with AutoLiv
in Lincoln, Michigan, we did it.
In the 1995 model year, we introduced the world s first
side-impact airbag on our 850 series. We introduced the side
impact protection system with airbags in print and media
campaigns in September 1994, and it immediately catalyzed
people's thinking about safety in this area. The side impact
protection system is highly effective, reducing the seriousness
of side-impact collisions by 50 percent. I'm proud to say that
we will roll it out across all model lines now -- even though
it is not a current requirement.
Let's turn to why we did it. There are three related
reasons:
1) Safety is a core value for Volvo the company. When we
think about a car, or a truck, or another product, safety is
central to our thinking. Once we knew side impacts were a
problem and that the problem could be addressed, we had to
address it.
2) Safety is a core value for Volvo the brand. It is the
attribute people think of first when they think of Volvo. We
would never dilute the equity of the brand by ignoring a
safety issue.
3) Safety does, in fact, sell. The presence of safety
features does help to sell cars, or at least Volvos. And
consumers are increasingly attentive to the safety rankings
that are published by various public and private agencies.
What are the results of the side impact protection system?
How do we evaluate this program?
As I mentioned earlier, we know that the combination of
side reinforcement and airbags reduces serious injury from
side-impact collisions by 50 percent. People really do let us
know when one of our safety features helps them in a collision.
That s one measure -- and certainly the most important.
But there are other important measures of success. We
believe the results of our extensive testing, our engineering
solutions and our advertising campaign have helped raise the
awareness of side impacts as a safety issue for the entire
industry.
We hope that this may help to "raise the bar" on car
safety requirements. And in doing so, we have reinforced the
essential element of Volvo s philosophy: that safety is
paramount and Volvo is still the safety leader. It may be too
early to tell if this translates directly into sales -- but
it's bound to help.
Let me tell you where we go from here.
The mainstream car buyer is now more highly attuned to
safety issues. The mainstream buyer now wants safety plus
performance, safety plus style, safety plus fun. This is in
contrast to yesterday s buyer, who prioritized but seldom
demanded everything. We are working hard to respond to these
customers, and we believe that our 800 and 900 models
successfully combine these factors of safety, performance,
style and fun.
In looking ahead, we also need to expand our definition of
safety. In the past, safety has meant reliability, durability,
and survivability. In the coming years, safety is going to
continue being defined in many different ways. For example,
safety may be defined in terms of personal security, which may
result in panic buttons that automatically make 911 calls. We
may also see safety defined as intelligent car network systems
that help drivers avoid traffic blockages or warn them about
hazardous road conditions.
But perhaps most importantly in looking ahead, we also
need to recognize that today s car outperforms the driver.
Equipment is now so good on both the performance and safety
fronts that the most critical auto safety issue is driver
inadequacy. This is partly an issue of alcohol, drug and
substance abuse. But it is also an issue of driver training in
how to use properly the new safety systems and technology.
What do I mean by this? How many of you who have cars
equipped with anti-lock brake systems still pump the brakes if
your car is sliding on ice or gravel rather than apply
continual pressure, as you should?
My point? Simple. We need to "raise the bar" not only on
automotive hardware safety, but also on the software, the
driver -- not only as to basic driving skills, but also as to
how to most effectively use the developments that manufacturers
are now engineering into their products.
While I am proud of the work we have done with our side
impact protection system, it's important to recognize that
safety can only emerge from a total design orientation. The
public is increasingly attuned to safety as an essential
attribute of a desirable car. Our strength at Volvo is not
measured in the safety of individual features but in the safety
of the overall product. This philosophy will continue to drive
us into a successful, and safe, 21st century. And not only
with our cars, but with all our products: heavy duty trucks,
marine propulsion systems, earthmoving and construction
equipment, aircraft engines, and any other products which we
may, over the years, develop.
Again, my thanks for the invitation to speak with you
today and my very best wishes to all of you.
##########
Albert Dowden became President and CEO of Volvo North America
Corporation on January 1, 1991. He also serves as Senior Vice
President of the worldwide Volvo parent company, AB Volvo. He
has been with Volvo since 1974.
PART 7
GEORGE A. HARRIS
President
Evenflo Juvenile Furniture Company, Inc.
Baby walkers have come under increased criticism by
pediatricians and consumer safety groups due to the large
number of accidents each year involving walkers. Research led
Evenflo to develop an alternative -- the Evenflo Exersaucer --
that offers the desirable features of walkers but eliminates
the mobility that created much of the controversy.
Imagine developing products where the end users cannot
verbalize what they want, where the actual consumer is
obsessively concerned about quality and safety, where product
liability would scare away most investors, and where retailers
demands leave very little room for error. That s the juvenile
products industry, where Evenflo has been a major player for 75
years.
It s not enough today to merely develop products that meet
the demands of the marketplace. We also spend a tremendous
amount of time designing the expected quality and safety
features to meet federal, state and industry standards, as well
as analyzing how a consumer might misuse the product.
Remember, we are dealing with infants who don t read
instructions and often with parents who read them even less.
This ongoing process is known as hazard analysis review. It
involves not only our legal, marketing, and engineering staffs,
but also groups of consumers who help us analyze possible
hazardous features, such as pinch points, and potential misuse,
which we then try to design out of the product. As a
responsible company with a name that parents have trusted for
75 years, we realize we must earn that trust every day.
Sometimes safety issues can actually create opportunity.
For many years, walkers have been under a tremendous amount of
criticism in the U.S. from various regulatory agencies, as well
as professional and consumer groups. The reason for the
criticism is that walkers account for over 20,000 accidents a
year, according to CPSC, due mainly to the fact that they allow
the child to be mobile, often putting them in harm's way. It
should be pointed out that many of these accidents are not
necessarily the fault of the walker. No product can be
designed to relinquish the responsibility of the caregiver to
use it in a safe and responsible manner.
In spite of the number of accidents and negative
publicity, there are still over 1.5 million walkers sold every
year. Why? Because a walker allows a child to sit upright,
keep an eye on Mom or Dad, and offers play value that
entertains a child for long periods of time. The challenge was
to develop a product that provided all of the positive
attributes of the walker, particularly play value, but which
eliminated the mobility.
In December 1992, the idea of developing a non-mobile
walker with seat- spin motion surfaced at a new-product
brainstorming session. Within 45 days, one of Evenflo s
designers showed us a rough mock-up of the product idea. We
immediately recognized it as a potentially innovative
breakthrough -- a walker that doesn t walk -- and rapidly
assigned a full development team to refine the concept and get
the product to market.
But how do you give pre-toddlers the energy outlet,
stimulation and entertainment they need without true mobility?
That was one major design question addressed by the Exersaucer
development team that refined the original concept. Consisting
of marketing, quality assurance, engineering, manufacturing and
design personnel, the team had one critical thing in common:
each was the parent of an infant. As consumers and parents,
team members understood first-hand the features such a product
must have. Our basic challenge was to provide children with
activity and entertainment in a safer environment.
The polling of parents in consumer focus groups yielded
the unanimous opinion that the Exersaucer should be comfortable
physically as well as emotionally. That meant designing in not
only a cushioned, supportive seat, but also the Exersaucer s
niftiest function -- spinning -- which enables the child to
keep Mom and Dad in view at all times. In addition, live
observations of how children use walkers and doorway jumpers
led the team to include two added features: rocking and
bouncing.
After children burn off energy through spinning, rocking
and bouncing, the Exersaucer provides less intense forms of
entertainment and stimulation. Based on observations of
children at play and on feedback provided by professional child
caregivers, the team selected various visual and tactile
stimuli -- a spinner ball, plastic sliding toys, and a mirror -
- and designed them to attach to the Exersaucer s outer rim.
The team added another parent-friendly feature to the
Exersaucer: a lock to stop the spinning and rocking motions so
parents can feed their children without removing them from the
Exersaucer.
Along with the desired product features, the team worked
concurrently on an equally important requirement -- the safety
aspects of the Exersaucer. Government safety standards do not
yet exist for the Exersaucer because it is a new product type.
So, as a starting point, the Evenflo team designed to standards
established for walkers. Other standards designed and tested
to included the Consumer Product Safety Commission
specification for toys and the appropriate federal regulations
for small parts, sharp edges, etc.
The hazard analysis review process drove the team to
review all potential hazards that could be associated with the
product, paying special attention to opportunities for misuse.
Based on the intensive development effort, Evenflo began
production of the Exersaucer with first shipments in February
1994. Has the Exersaucer been successful? In 1994 it won the
following awards:
* New Products Award from the Juvenile Products
Manufacturers Association
* Bronze award from the Industrial Design Society of
America
* Product of the Year Award from the National
Independent Nursery Furniture Retailers Association
In addition, Evenflo and the Exersaucer have garnered a
tremendous amount of publicity. But the truest test of all is
whether the product sells and meets consumer satisfaction. In
the fourth quarter of 1994, the Exersaucer captured 36 percent
of the walker/exerciser category and was the top-selling single
product. In addition, we have received thousands of cards from
satisfied parents not only telling us how happy they and their
child are with the product, but also thanking us for providing
them with an alternative.
In closing, only through carefully conducted customer
research and an extremely detailed examination of all safety-
related design concerns could Evenflo have created the
Exersaucer, a revolutionary alternative to the walker. By
satisfying the youngsters who use it, the parents who buy it,
and the retailers who sell it, the Exersaucer can truly be
called a winning product alternative to walkers.
##########
George Harris has been the President of Evenflo Juvenile
Furniture Company, Inc., since 1990. He is a member of the
Board of Directors of the Juvenile Products Manufacturers
Association.
PART 8
JOHN HETTERICK
President and Chief Executive Officer
Rollerblade, Inc.
In-line skating is one of the fastest growing sports in
America. To attract new customers and keep the old,
Rollerblade has used safety messages as an important marketing
strategy to make people aware of safety precautions they should
take. Rollerblade uses several safety-specific marketing tools
to partner its safety messages with its marketing image.
It's an honor and a pleasure to be here today to talk
about Rollerblade's safety programs and their role in the
marketing of our products. I'd like to start today by showing
a segment from our latest point-of-sale video. See if you can
pick out our safety messages. (Video shown to audience.)
That's the kind of image and excitement that has made our
products so successful. But what stands out as a "safety
message?" Every single skater is outfitted from head to toe in
protective gear, which is mandatory for all Rollerblade
promotional photography and video. I'll review more safety-
specific marketing tools later. This is one of the more subtle
examples of how our marketing image can partner successfully
with our safety messages.
Let me also give you a brief overview of our company and
our position in the in-line skating industry. To start with,
many people are unaware that there are more than 30 companies
making in-line skates today. Rollerblade started it all back
in the 1980s -- and we still maintain a 50 percent market share
-- but we have lots of competition these days.
Contrary to popular belief, "rollerblading" is not the
name of the sport. The correct term for the sport is "in-line
skating." "Rollerblade" is a trademarked brand, much like
"Kleenex" and "Xerox." And we go to great lengths to protect
our trademarked name.
Rollerblade is in a unique position because we founded an
industry and played an essential role in every aspect of its
development. Today there is the International In-line Skating
Association that is supported by the industry and helps promote
safety. But the forerunner to this organization was the
Rollerblade In-line Skating Association, which we created in
1987 to help promote safe skating.
Safety messages have been an important marketing strategy
for Rollerblade from the very beginning. In-line skating is an
action sport that requires certain gear and precautions before
starting out. Making people aware of and responsible for their
safety while in-line skating ensures a fun experience -- and
keeps people in the sport. Encouraging a safe, fun experience
also ensures that people will keep entering our sport. Our
current instructional video, "Ready, Set, Roll!," helps people
get started.
Because we enjoy the benefits of a cool, edgy and exciting
image, we have to make certain our safety messages don't
conflict or confuse people about our products and sport.
That's why Rollerblade's early safety programs had themes like
"Don't Skate Naked" and "Skate Smart." We wanted to get
people's attention and create awareness about safety -- and
still be cool.
The tremendous growth in our sport -- participation has
increased more than 500 percent over the past four years --
makes it even more important to get out the message that safety
enhances the skating experience.
There are two key reasons why Rollerblade emphasizes
safety in our marketing efforts:
1) Concerns about safety can keep people from trying our
sport -- and that, of course, translates into fewer sales
opportunities.
2) People who have had a bad experience need a very good
reason to try in-line skating again -- and this time without
fear!
Rollerblade produces a lot of traditional consumer safety
information, such as instructional videos, consumer brochures,
media materials and in-box handbooks. I'd like to highlight
just two programs that best illustrate our approach to
marketing safety.
Automated Brake Technology (ABT)
Our most significant new technology and safety tool, all
rolled into one, is the ABT brake, which we introduced last
year.
How to stop on in-line skates has been the single biggest
obstacle keeping people from entering our sport. ABT offers
consumers a whole new way to stop while keeping all eight
wheels on the ground. And it's much easier for beginners to
learn with the ABT brake.
The introduction of the ABT brake was supported by
television advertising that reinforced the consequences of
skating recklessly. And it did so in a hip, humorous way that
both entertains and educates our largely young audience.
ABT was also supported by print ad, major public relations
efforts and in-store merchandising.
The results have been phenomenal. We sold 650,000 pairs
of ABT skates last year and one of the ABT models is our
number-one seller.
ABT was named to several "Product of the Year" lists,
including Business Week and Popular Science. In addition, our
Aeroblade ABT skate was selected for an exhibit on integrating
technology and design at the Museum of Modern Art in New York
this spring.
The success of the ABT and its safety theme tell us that
consumers want to participate in the fun of in-line skating --
but they most definitely want a safe ride. So this year, we are
introducing a children's skate with the ABT brake and a
moderately priced skate with ABT. We expect the popularity of
this family of skates to continue to grow dramatically.
"Asphalt Bites" Campaign
In 1995, we also are taking our consumer safety messages
to a new level by introducing a national consumer awareness
campaign.
Our thinking was that if we could come up with something
hip and humorous to remind people about the importance of
wearing protective gear, we'd not only get attention for the
campaign itself, we'd attract more people to the sport and sell
more skates and gear.
In keeping with our image, we wanted a theme for our
safety campaign that would appeal to the average 14-year-old.
Younger kids aspire up to what this age group thinks is cool,
and we older folks often aspire down to this group as well.
Well, maybe not as far down as 14 in my case!
With that in mind, we selected this theme: "Asphalt
Bites. Wear the Gear."
We had a very funky logo designed and introduced the
campaign to national media at an event in New York attended by
more than 45 consumer publications.
"Asphalt Bites" is a multi-year campaign that includes the
following components:
* promotional items, such as T-shirts and
stickers;
* a consumer safety brochure;
* an instruction information headline;
* school programs; and
* incorporation of the "Asphalt Bites" logo into
ad, packaging and point-of-sale materials.
The cornerstone of Rollerblade's "Asphalt Bites" campaign
is a public service announcement -- or PSA -- for television.
As most of you know, a PSA is unbranded and is broadcast by
media outlets as information to consumers. Given our
objectives, see what you think of the safety message in our
PSA. (PSA shown to audience.)
Pretty wild, huh? But it got your attention, didn't it?
And by the way, no cat was hurt in this spot. We had a
professional cat wrangler and an ASPCA cop on hand making sure.
The PSA will run on MTV this summer, and we plan to offer
it to TV stations around the country. By the way, MTV will run
the PSA spot free right after we run our paid TV spot. It
won't say Rollerblade, but the connection will be clear. We
are also developing a print PSA and posters with the "Asphalt
Bites" theme for schools, hospitals and community centers.
Rollerblade's "Asphalt Bites" campaign has been very well
received so far and we hope to expand on the program in the
future.
Before I answer your questions, let me underscore why
safety and marketing go hand-in-hand for Rollerblade. Safety
is obviously an important component for an action sport like
in-line skating. The difference for us is how we look at
safety and how we present it to consumers ... and that message
is:
"Being safe just makes skating even more fun!"
Thanks. I'd be happy to answer any questions you have.
##########
John Hetterick has been President and CEO of Rollerblade, Inc.
since March 1992. He was previously with the Tonka Toy
Corporation and Pepsico.
PART 9
J. C. ANDERSON
Corporate Vice President
Whirlpool Corporation
Whirlpool is taking an increasingly proactive approach to
potential product safety concerns and views all its activities
-- from training to design evaluation to early and frequent
product testing -- as integral to what consumers expect in
their home appliances: safety and quality.
Good afternoon. I appreciate this opportunity to
represent Whirlpool Corporation at this conference. It is my
pleasure to be in the company of the other speakers, the
Commission, and all of you in the very positive pursuit of
providing ever-higher levels of product safety for our
consumers. I hope to offer you another perspective on how
safety sells.
Safety has always held an important position for us at
Whirlpool. It stands at the center of our company's culture.
Our culture is best expressed in the values all of our
employees share regarding how we seek to operate:
* business with integrity ... no right way to do a wrong
thing;
* quality as a quest ... lift the quality and the value
of our products above the expectations of those who receive
them;
* customer as focus;
* commitment to the common good;
* power of trust;
* learning to lead; and
* a spirit of winning.
It would be difficult to articulate these values, and we
do, and then to permit safety issues to occupy less than the
highest priority within our company. As a result, we look at
providing product safety, not only as good business, but as our
way of doing business.
Product safety at Whirlpool closely parallels our
relentless pursuit of quality. In fact, I'm privileged to
chair both the quality and safety committees within our North
American Appliance Group. As a result, I can tell you without
reservation that the same individuals who define safety also
define the quality of our products: consumers. Their
definition is quite simple. They expect appliances to operate
safely. Period. Therefore, we consider developing,
manufacturing and marketing safe products as the standard for
entry into our home appliance industry, rather than as a
competitive advantage.
Let me hasten to add, however, that although consumers
expect our products to be safe, they may not always treat them
or use them in ways that are safe. In fact, they sometimes do
what we least expect with them. That's particularly true as
younger and younger consumers participate in household tasks.
Whirlpool has always dealt with product safety as a key
concern, from product concept to delivery. We've reacted
quickly to potential consumer safety issues, whether they arose
from normal use or through misuse. We continue today to work
aggressively and proactively to prevent safety issues from even
arising in the first place.
Let me illustrate one of the changes that has taken place.
Many of you are old enough to remember a challenge our industry
faced in the '50s. The challenge was youngsters at play using
the refrigerator in the garage for a "jail" of sorts for
playmates. The combination of playmates' forgetfulness and a
latched door handle sometimes meant that play turned to
tragedy.
A group of Whirlpool engineers, however, working with
other industry, consumer and government groups, looked intently
for a way to provide a refrigerator closure strong enough to
assure properly chilled foods, yet one from which a youngster
could free himself if the refrigerator were put to this
unintended "jailhouse" use. And they found it: an industry
first that Whirlpool developed in 1958, and later shared with
industry -- the now-familiar magnetized refrigerator-freezer
door gasket in each of our kitchens. A specific situation, a
focused response.
Contrast this scenario with one which occurred much more
recently. In fact, it's a real hometown story. The fire chief
in Benton Harbor, Michigan, where Whirlpool world headquarters
is located, came to the company with some concerns following
three mysterious home fires in the area. In each of the fires,
clothes recently dried but removed from the dryer had suddenly
ignited. There was no evidence of dryer involvement and, in
fact, none of the dryers were manufactured by Whirlpool.
Clearly, neither our product nor our competitors' was the
"culprit," yet Whirlpool aggressively underwrote and undertook
a study targeted at finding the fires' origin. In doing so, we
learned that lifestyle changes can pose as great a threat to
safety as misuse. The change in this case was from the use of
saturated to unsaturated cooking fats, the unsaturated fats
being more volatile. It seems that in each case, the consumer
had used vegetable oil and, in the process of cleaning up
afterwards, soiled a dishtowel or piece of clothing.
Subsequently, the soiled article was tossed into the washer for
cleaning and from there into the dryer.
What our study revealed was that vegetable-oil soiling
requires hot water and suds cleaning instead of the warm water
washes typically specified for today's fabrics, and that
without that cleaning, fabrics soiled with oil catch fire if
heated, whether in a hamper, by a dryer, or near a space
heater. Whirlpool provided this information to allied industry
groups, the soap and detergent organizations, the Association
of Home Appliance Manufacturers, and, of course, to the CPSC.
The CPSC then made a public announcement warning consumers.
Whirlpool continues to warn dryer users with our product
labeling and literature.
Our proactive approach to safety today, however, goes far
beyond any single action we might take with regard to an
isolated, potential area of concern. Instead, our approach has
really become a continuum of activities, from training to
retrieval, if necessary, weaving safety across a broad spectrum
of functions and contacts with consumers.
A very important activity in this continuum is the
training and education of our product designers, developers and
marketers. Over the past year, we completed extensive analysis
into the root causes of product failures that we've experienced
historically at our operations worldwide. We then took that
analysis and turned it into focused, intensive and required
training for our people. This training includes a series of
detailed design checklists for every product in every product
category we manufacture.
In addition to training, we established aggressive design
criteria targeting safety and the way in which those criteria
are employed throughout our design and development process.
For example, we place great emphasis on robust product design;
we integrate early and frequent testing into the way consumers
use our products as an important part of our design evaluation;
and we maintain constant communication with consumers to enable
us to refine our designs, if necessary.
Once a design has received approval for the marketplace,
we stress aggressive, continuous process improvement to deliver
products with ever-increasing levels of quality and that
operate as intended for safe use. During the past couple of
years, we've drilled our folks on statistical process control
to greatly diminish product variation. We're covering the same
ground today with design of experiments to enable us to achieve
dramatic improvements more quickly.
Let me note that, as we're improving our product quality
and safety from the "micro" perspective -- that of individual
interactions with products -- we're also contributing to the
broad, "macro" safety concern we share for the environment.
With less variation comes less rework, less scrap, with the
result that we're using up fewer materials and expending less
energy.
Even with this strong emphasis on prevention, we must
still be ready to respond should a safety issue arise.
There is not just a single program on which we, and
ultimately the consumer, depend if a safety issue arises, but
rather, an interweaving of a number of programs. Several years
ago, it became apparent that the first factor affecting our
ability to respond would be the existence of a plan for rapid
response. It's obvious, I think, that the worst time to try to
plan is when you're faced with a crisis. Therefore, people
from a broad spectrum of the functions within our company who
would be involved in any such response sat down to define
carefully what their roles were, how to coordinate those roles
and what steps each must follow should a consumer safety issue
arise. This defined process enables each member of our
response team, whether in marketing, communications, consumer
affairs or engineering to take the appropriate actions
immediately upon alert.
Continual monitoring and contact with consumers provide us
the data to mount such alerts if a safety issue arises.
Concerns may surface from a variety of sources -- testing, our
service network, our distribution network, or our consumer 800
number. Any consumer complaint targeting potential safety
issues that arrives via our 800 number reaches the desk of
Whirlpool's director of product safety each morning. This
daily monitoring enables him, and our company as a whole, to
get on top of whatever potential issue has arisen just as soon
as it comes to light. It enables us to make judgments and act
faster to protect consumers.
If we determine that there is a potential for failure that
will affect consumers, then we move aggressively, and in a
number of areas to protect them.
We make every effort to intercept a product before it ever
reaches the market by putting a "hold" on the model in question
through the distribution system. In some cases, the product
may already have reached consumers. In those situations, our
extensive consumer data bank proves invaluable by making it
possible for us to move quickly to reach that product. Once
we've identified consumers who own the model in question, we
relentlessly pursue them.
In order to make the product right and to make the owner
feel comfortable and confident in its use, the earlier in the
product's life we identify a problem, the easier it is to
retrieve. But regardless, we never stop looking for a product
that has the potential for failure related to consumer risk.
We're getting very good at it, in fact. In 1988, we
experienced a problem with some of our dishwashers. It took us
some 20 months to retrieve 85 percent of the product in
question. During 1993, by contrast, when some of our
microwaves surfaced with a potential problem, we were able to
retrieve 90 percent of the product in just four months. And
last year, when we raised a concern regarding a compressor
issue with our suppliers, we were able to retrieve 95 percent
of the compressors in question in three short months! So our
process, our responsiveness has greatly improved.
Today, the emphasis we place on safety throughout our
company underscores the fact that safety truly is at the center
of our culture. Regardless of publicity, government agencies
or the courts, Whirlpool will continue to pursue and produce
the same appliances with the same level of concern for users'
safety.
In closing, I offer that Whirlpool believes in
aggressively pursuing safety because it's "the right thing to
do," and because we feel our consumers expect, even demand,
safe home appliances.
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J. C. Anderson was named Corporate Vice President for
Manufacturing and Technology, North American Appliance Group,
in March 1995. He has been with Whirlpool since 1968.