Focusing Only On Price Can Kill…
I've been tempted a few times to post about the pet deaths from contaminated pet food — the contaminated ingredients came from China. This article caught my eye last week:
Fed up with weeks of Americans bashing their food safety standards, Chinese government and industry officials say that bargain-hunting U.S. food companies share blame if contaminated Chinese ingredients wind up in food.
On this blog, we often talk about companies chasing cheap labor to China and how that's often NOT the lowest total cost solution. In this case, where the contamination was intentional on the part of the Chinese company, it would be easy to blame the Chinese company, end of story right? Well, the Chinese are fighting back and saying, basically, “if you weren't so damn cheap, we wouldn't be pressured into doing stuff like this.”
“Officials like me in the Chinese government can supervise the producers here, but U.S. companies doing business with Chinese companies must also be very clear about the standards they need, and don't just look for a cheap price,” says Yuan Changxiang, a deputy director in the ministry responsible for inspecting imports and exports.
Here are the Chinese lecturing us, basically the same thing that Dr. Deming always preached in his 14 Points, he always said:
End the practice of awarding business on the basis of price tag alone. Instead, minimize total cost in the long run. Move toward a single supplier for any one item, based on a long-term relationship of loyalty and trust.
Now, it's one thing to buy cheap components for a PC or some other somewhat disposable consumer product. It's another thing altogether to do business in a way that indirectly leads to poisoned food.
Thousands of cats and dogs in the USA may have died from eating foods made with tainted ingredients imported from China.
Inspectors are on the lookout for melamine, a chemical used in making plastics, and related compounds that were used to artificially raise the apparent protein level of flour so it could be sold as high-priced wheat gluten and rice protein concentrate to brokers in the USA. They then sold the products to pet-food companies.
The Chinese companies gamed the system. They figured out a way to make their product appear to be more expensive than it really was. It's a shame we can't always count on people to do the right thing, to do business in the right way. Being cheap has consequences.