The embarrassing Shanghai Husi scandal – Chinese media revealed workers repackaging date-expired meat for sale through restaurant chains such as McDonald’s and KFC – is a classic example of what industrial consultant Paul Midler has described as “quality fade.”
Chinese companies often start out supplying high-quality products, but then start cutting corners, sometimes in alarming ways, to improve their profit margins.
The lesson, the WSJ comments, is that managers “must always distrust and verify what their suppliers tell them. Regularly scheduled inspections are useless, as the factory will be spruced up for their visit. Surprise visits and spot checks are the only defence against fraud and fakery.”
source On Target by Martin Spring