Toy Recall Tests Mattel IT

Eckert will likely have to talk about what the recalls will do to Mattel's business. He is scheduled to outline the company's prospects at investment bank Oppenheimer in New York next week and again the following week at Bank of America.

Making substantial use of the Web will help Mattel maintain good relations with retailers, says John Quelch, business administration professor at Harvard Business School.

For example, to avoid relying heavily on Wal-Mart, Toys "R" Us and other stores to answer consumer questions, Mattel has set up recall websites with details on product names and manufacturing codes, as well as photos and clickable quizzes to help customers figure out if they own a bad toy. Then Mattel offers consumers prepaid mailing labels sent via e-mail to return the toys.

Quelch admires the way Mattel is handling the public relations surrounding the recall but notes that the company has to be careful. "The last thing Mattel wants to do is have millions of products handed to retailers, which causes a huge logistics problem there," Quelch says. That, in turn, could detract from any goodwill between retailers and Mattel, he says, and "could result in fewer products being sold this holiday season."

Hasbro, meanwhile, has intensified toy testing, according to the Reuters news service, to try to avoid landing in the same recall mess as Mattel. Hasbro's IT and business leaders, no doubt, should also use their business intelligence systems to find ways to capitalize on their rival's pain.