Product Recall: A Nightmare On Your Street

By D E Fenton

Jason Vorhees. Freddy Krueger. Michael Myers. Three classic horror movie villains that can send shivers down the spine with the mere mention of their names. But nothing strikes fear in the heart of product managers everywhere more than one thing: Recall.

A product recall is a nightmare no business wants to go through. They are scary because there's uncertainty surrounding the situation, particularly for the unsuspecting and uninitiated. Uncertainty with the depth of the issue, uncertainty with how the problem will be corrected and uncertainty with the lingering after-effects once the initial crisis is over.

Recalls are also scary because of the financial implications. They are expensive on many fronts: product return and/or replacement, consumer compensation and legal fees—not to mention loss of consumer trust that can impact sales for years to come.

Like a horror movie, a recall is often a case of the known evil versus the unknown evil—the less you know about it, the more frightening the thought may be. But once you know who—or what—is behind the mask, you can take control of the situation and dispel the fear.

So who drives the Recall Nightmare Express? Recalls are generally instituted by federal agencies—such as the U.S. Food and Drug Administration (FDA), National Highway Traffic Safety Administration (NHTSA) and the Consumer Product Safety Commission (CPSC)—which were created to protect end-user consumers. And contrary to urban legend, recalls are seldom the complete removal of a product from the market—and they are almost never a surprise.

Recalls are typically broken down into levels, based on severity of threat. For the FDA, Class I involves life-threatening situations of harm. Class II is a potentially threatening harm, but one that won't kill you. And Class III is a non-serious hazard. Both NHTSA and the CPSC follow similar models, although the CPSC escalates evaluation of a product risk to which a child is exposed, particularly for young children who don't have the cognitive skills to differentiate between "safe" and "not safe."