Nutella Spreads the Word About Quality

Nutella Spreads the Word About Quality

A quality defect was detected in samples of Nutella spread and Kinder Bueno candy bars that led to a shut down of the Nutella factory in Normandy, France.

Despite the shut down of the factory, which produces one-quarter of the world’s chocolate-hazelnut spread, the supply of Nutella has not been interrupted.  Ferrero, the parent company of Nutella in Italy simply wants to take extra precaution to maintain its high quality standard.


Video Spotlight: Nutella is the driving force of Italy’s richest man


This post is based on the Fortune article, World’s Biggest Nutella Factory Shut Down Over ‘Quality Issues’, by Grace Dobush, February 21, 2019, and the YouTube video, Nutella Driving Force of Italy’s Richest Man, by Bloomberg, May 19, 2014. Image source: lynx/iconotec.com/Glowimages

Discussion Questions:

1. What are the costs related to the decision to shut down the Nutella factory when a quality defect was detected?

Guidance: The potential costs include production interruptions, production delay, quality investigation, scrap, rework, supply disruption, demand shortage, and customer dissatisfaction.

2. What kind of control chart will be appropriate to ensure Nutella’s production process is in control?

Guidance: This question can be used to prompt discussion of Continue reading

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Cost of Quality for Nike

Cost of Quality for Nike

Nike drew negative publicity when its sneaker fell apart during a college basketball game.

The shoe: the PG 2.5 PE.

The player: Zion Williamson, Duke University’s star basketball player.

Zion planted his foot to change direction during the game with North Carolina and injured his knee when the shoe came apart. Nike touted this as an isolated incident and at the time of this post was working to identify the root cause of the issue.


Video Spotlight: Nike’s Nightmare


This post is based on the Bloomberg article, Nike Basketball Shoe Blowout May Be a ‘Classic’ Liability Case, by Eben Novy-Williams and Steven Sellers, February 21, 2019, and the Bloomberg video, Nike’s Nightmare, by TicToc, February 21, 2019. Image source: © McGraw-Hill Education

Discussion Questions:

1. Discuss the importance of legal considerations in Nike’s product design.

Guidance: Nike must specifically design its sneakers to provide support for athletes to perform their best in competitive sports.  Any product malfunction or failure that causes injuries or damages will subject Nike to product liability litigation.

2. What are the potential costs related to Nike’s basketball shoe blowout incident?

Guidance: These include legal costs, settlement costs, warranty costs, Continue reading

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Poaching Constrains Supply of Elvers

Poaching Constrains Supply of Elvers

The supply chain of baby eels, called elvers, is facing tighter controls from Elver Fishery in Maine to Eel Dish in Japan.

The root cause? Illegal poaching.  A pound of elvers goes for more than a thousand dollars.

State law enforcement officers will oversee the weighing, packing and shipping of the eels to ensure elvers are legally harvested from participating fishermen within a quota of 9,688 pounds per fishery.


Video Spotlight: Poaching Threatens Maine’s Eel Fishing Industry


This post is based on the Washington Post article, New controls in Maine to prevent poaching of valuable eels, by Patrick Whittle, February 22, 2019, and the YouTube video, Poaching Threatens Maine’s Eel Fishing Industry, by AP, August 12, 2017. Image source:(c) Erica Simone Leeds

Discussion Questions:

1. Identify the unethical and illegal behaviors spotlighted in Maine’s baby eel supply chain.

Guidance: Examples of unethical and illegal behavior include poaching eels from rivers and streams, exporting poached eels to Asian aquaculture companies, exceeding eels quotas to profit from illegal sales, and tampering with eel shipments to bypass the state’s tracking system. Each of these behaviors is illegal, but student discussion can also focus on ethicality.

2. What steps Continue reading

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