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Customer Care

Enhance Product Safety to Survive the Changing Marketplace

How technology can be harnessed to promote product stewardship

Published: Friday, August 30, 2013 - 08:42

Increasing product recalls, regulatory fines, and penalties have made product-safety compliance a top priority for many manufacturers. The Consumer Product Safety Improvement Act (CPSIA) and other global and regional product-quality regulations have subjected consumer-product companies to increased scrutiny. Today, the onus is on these companies to adopt a more proactive, sustainable, and agile approach to product safety, quality, and compliance.

The digital and information revolution, globalization, and a multitude of local and international laws, have transformed the consumer-products marketplace. Here are a few key characteristics of this marketplace that necessitate a greater focus on product-safety compliance:

Increased consumer communication and data accessibility. Consumers have quick and easy access to wide-ranging information about companies and products. Government consumer databases such as RAPEX (the European Commission’s rapid-alert system for nonfood products), the U.S. Consumer Product Safety Commission’s (CPSC) consumer database, media reports, consumer groups, and nongovernmental organizations provide comprehensive information on various products and brands. Consumers are more empowered to question, challenge, and sometimes mistrust corporations.

Meanwhile, burgeoning social media networks, blogs, and online forums facilitate real-time communication between companies and their consumers, as well as among consumers themselves. Although companies benefit if consumers post positive online reviews of their products and services, even a single incriminating comment is enough to ruin companies’ reputations.

Heightened political awareness. In 2007 and 2008—widely dubbed “the years of the recall”—children’s products, plastics, chemicals, and substances designed for ease of manufacturing and consumer convenience came under intense scrutiny for quality and safety issues. This culminated in the Consumer Product Safety Improvement Act (CPSIA), passed in 2008, an election year in the United States. The legislation was unparalleled and proved how issues such as consumer concerns about product safety can even drive the election agenda.

More complex regulatory environment. The regulatory environment globally is becoming increasingly complex and subject to change. Companies must grapple with environmental laws, consumer product laws, and varying regulatory definitions and guidelines governing the quality and safety of various products. Many of these laws differ from one region to the next, making it even more difficult for companies to manage compliance.

An expanding distribution model. With globalization, the product distribution model has changed from a straight supply chain to a multilayered supply web spread around the globe. As a result, companies have limited control over sales methods in different geographies. Online buying and selling has further complicated the distribution challenge.

Elements of a product safety compliance program

A truly credible company has a measurable safety and compliance program that contains the following critical elements:

Comprehensive policies. Policies outline a company’s objectives on consumer safety. They are usually drafted by the senior management, whose unreserved support is essential for the successful implementation of policies across the enterprise. A well-outlined set of policies help reinforce the message of “protecting the customer,” and thereby, “protecting the brand.”

A robust risk management program. Consumer-product companies must clearly determine their willingness to accept risk at each level of product development, and factor in acceptable risk thresholds while making business decisions. Methods such as design hazard risk analysis and failure modes effect analysis (FMEA) for design and production should be mandatory during product development to reduce the risk of consumer-safety hazards and regulatory noncompliance.

Well-defined product specifications. Product specifications are used in the design stage to define the product and identify required testing parameters. They help avoid errors during the design and manufacture of a product, and also help ensure that the product meets all regulatory requirements and industry standards. Product specs usually include a description of the product; design elements; a bill of materials (BOM), which is a list of all the raw materials that would be used in the end-product; expected product functions; details of the geographic markets to which the product will be marketed; the age grading and labels a company intends to use; and the expected life of the product.

Thorough certification and production testing. Certification and production testing are key elements to a safety compliance program at the preproduction and production stages. Certification testing is performed to demonstrate that a product meets prescribed industry standards. Some products are required to be tested and certified after the finished-goods stage by a third-party or in-house tester, depending on where a company’s distribution market is and what type of product is being made.

Proactive remedial action. Remedial action plans should include both corrective and preventive actions. They are used when a product fails testing during production, when there are field complaints about the product, and for any other issues in between.

A corrective action procedure. This identifies the cause of the failure and the actions taken to resolve the issue, be it reworking the existing product, scrapping the product, or issuing a stock recovery or recall from the distribution center.

A preventive action plan. This plan identifies the actions that should be taken to minimize the recurrence of similar failures or issues in continuing or future production. Its elements could include a design revision, material replacement, or change in the production method.

Relevant documentation. All the documents related to product safety and regulatory compliance, such as product specs, test reports and results, and incident data, should be retained for the full government-specified time period or, in some cases, the client-specified time limit, or corporate policy limit, whichever is higher. Companies may have varying document-retention policies, depending on their corporate philosophy or legal requirements. The CPSC, for example, specifies five years for retaining documentation about children’s products, and even more time for products that might cause injuries.

Effective tracking programs. Tracking programs are used throughout the supply chain, from product development to distribution, to validate the origin of raw materials, identify and quarantine defective products and stock recovery, or manage public product recalls. This kind of product tracking is mandatory in some regions and for some products such as children’s products. An effective tracking program oversees raw materials and their sources, product specs, production runs, factory codes, and the labeling on unfinished goods and packaging. It’s important to know the source-material companies and their performance record, including involvement with failed products.

Intelligent market surveillance. Market surveillance is a powerful tool to protect consumers from unsafe products. Different stakeholders can be involved in this exercise. For instance, national authorities and government agencies can maintain oversight of the consumer marketplace to ensure that companies are complying with regulations. Companies, in turn, can actively involve their suppliers’ support and capabilities to conduct premarket surveillance of raw materials. They can also leverage post-market surveillance in targeted global markets, to create variations of their products to suit multiple markets.

Integrating safety and compliance in the product life cycle

It’s important to break down the various elements of product safety and compliance, and integrate them into the different stages of the product life cycle—right from concept creation and through to disposal. How this is done is briefly explained below.
Concept creation: Identify the general requirements of the products.
Design development: Define the regulatory and corporate requirements around product safety and compliance. Write test plans, and identify the required certifications, warning statements, and labeling requirements.
Production: Incorporate safety process controls and audits. This involves preproduction and production testing of raw materials, tracking and tracing of raw materials and components, authorization of shipments based on successful audits and tests, and implementing corrective and preventive actions.
Shipping and distribution: During shipping, track the products as much and as far as possible.
Post sales: Follow up on and analyze customer complaints. During a crisis, follow a stock-recovery or product recall plan, and identify the key players in this exercise.
Disposal/end of life: Conduct a thorough post-mortem of the whole product life cycle to determine areas of improvement. Ensure that the company is following all legal and environmental compliance requirements, as well as corporate environmental stewardship programs such as reuse and recycle.

Leverage technology for consumer product-safety compliance

Regulations Governing Product Safety


Two important areas of product safety are packaging and labeling. A few significant legislations governing these areas are:
• CPSIA
• Environmental Protection Agency (EPA) regulations
• Fair Packaging and Labeling Act (FPLA)
• California Proposition 65
• Model Toxics in Packaging Legislation
• Federal Hazardous Substances Act (FHSA)
• Poison Prevention Packaging Act (PPPA)
• Consumer Packaging and Labeling Act (CPLA) of Canada
• EU-wide Registration, Evaluation, Authorization and Restriction of Chemicals Regulation (REACH)
• Restriction of Hazardous Substances Directive (RoHS)
• An exclusive set of rules for children’s products, such as the EU Toy Directive

Technology has become an indispensable tool for consumer-product companies to simplify, consolidate, and streamline their product-safety compliance initiatives while also improving cost-efficiency and brand value. An advanced technology framework provides end-to-end functionalities for managing all compliance activities, right from assessing and mitigating risks, to monitoring quality, to complying with regulatory requirements.

Companies can use technology to adopt a systematic approach to product safety and compliance management across the enterprise, as well as suppliers, vendors, and business partners. Technology helps companies integrate the various elements of product safety operations into the different stages of the product life cycle, gain real-time visibility into each stage, consistently track the progress of safety and compliance, and identify areas of improvement.

Key areas where technology enables and drives product safety compliance

Regulatory compliance management. Technology enables companies to simplify compliance with all local and international product-safety regulations. It can be used to centrally manage all compliance requirements—including testing and reviewing products and raw materials, facilitating global surveys to ensure compliance, tracking compliance status, and proactively identifying and resolving compliance issues. Technology can also offer a structured and more streamlined method for monitoring and documenting compliance through periodic audits, surveys, and self-assessments.

Policy management. An advanced and flexible technology framework can help streamline the creation and management of consumer product-safety policies. Technology can also support policy documentation, change management, communication, awareness, and training management, and facilitate integration of business processes with regulatory notifications and industry alerts. Integrated collaboration and workflow tools can help companies adopt a systematic and standardized approach to creating, modifying, reviewing, approving, and managing policy documents across the enterprise.

Product integrity management. Technology can help companies implement a transparent and closed-loop process for identifying, tracking, and resolving all product quality and safety issues within the company, as well as in the vast supply chain. Real-time reporting and flexible workflows help companies gather and record field complaints, detect product or process nonconformance incidents and supply-chain failures, and respond with a systematic cycle of investigation, root cause analysis, and appropriate remedial actions. Technology plays a key role in facilitating product recall management. It helps capture the complete details of each potential recall issue, allowing companies to determine if the product needs to be recalled. It also helps execute and document mitigation steps, and communicate the same to the appropriate vendors.

Testing and certification. Technology can help simplify the creation of product test plans and efficiently manage each stage of testing. An important characteristic of any testing management system is its ability to integrate with testing labs to import data automatically, and manage and store test plans, stages, and thresholds. The system should also be able to help quantify and analyze the quality and safety of products and suppliers to drive decisions that ensure compliance and business success.

Supplier management. A centralized supply-chain management system can help strengthen supplier information management, which in turn facilitates accurate tracking and traceability of raw materials. A robust supplier risk-management system is also important to help identify, evaluate, document, and monitor supply risks across the entire supply and subsupplier chain.

Audit management. Technology can help enhance the efficiency of consumer product audits, including product quality and safety audits and third-party audits. Some technologies have advanced functionalities for managing the complete audit life cycle, from risk assessments and audit planning, to audit scheduling, audit execution, field data collection, reporting, and review and implementation of audit recommendations. Audit reports should be provided in real time to enable auditors and managers to instantly track the status of product safety compliance.

Risk management. Technology can help companies simplify product-safety risk management across the global enterprise. Robust risk-management tools are extremely helpful in enabling risk profiling, risk assessments and analysis, control assessments, tracking of loss incidents, and outlining key risk indicators (KRIs). Comprehensive risk scorecards, configurable risk heat maps, dashboards, and reports are other useful tools for providing in-depth visibility into risk processes, and helping estimate risks for foreseeable product safety hazards.

In a nutshell

Ensuring product quality and safety is the cornerstone of consumer trust. However, ever-changing regulations and high industry standards have made this endeavor complex and challenging. Companies need an effective product-safety compliance program, driven by a comprehensive technology framework to avoid accidents, reduce product recalls, enhance the quality and safety of products, and build a competitive edge in the market.

The ultimate aim should be to establish the popular concept of product stewardship, wherein everyone involved in the product life cycle drives a concerted effort to minimize the environmental, social, health, and safety hazards of a product throughout its life cycle.

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About The Authors

Joan Mattson’s picture

Joan Mattson

Joan Mattson is the owner of a Chicago-based consulting firm that provides product regulatory compliance and safety process solutions to small manufacturer and retail supply chains. Mattson served as president and is a member of the International Consumer Product Health and Safety Organization (ICPHSO). Mattson has led the development and implementation of play equipment injury data analysis and reporting processes, and she was an ASTM subcommittee member for play equipment standards. She has also worked with a major Canadian corporation to establish product development, production, and distribution processes for children’s products.

Keri Dawson’s picture

Keri Dawson

Keri Dawson is the vice president of Industry Solutions and Advisory Services at MetricStream, developer of enterprisewide governance, risk, compliance (GRC) and quality management solutions. She leads the cloud-based content and consulting services across MetricStream’s ComplianceOnline business unit. Dawson also served as a director in GRC technologies at KPMG. She is a certified information systems auditor and has more than 15 years consulting experience in risk assessment, regulatory compliance, IT strategy, systems implementation, project management, and performance improvement. Dawson holds a bachelor’s degree in environmental science from the University of North Carolina, Chapel Hill.