Question:

John Smith, president of Smith Toy Company, Inc., in South Carolina, has just reviewed the design of a new pull-toy locomotive for 1- to 3- year-olds. John's design and marketing staff are very enthusiastic about the market for the product and the potential of the follow-on circus train cars. The sales manager is looking forward to a very good reception at the annual toy show in Dallas next month. John, too, is delighted, as he is faced with the layoff if orders do not improve.

John's production people worked out the manufacturing issues and produced a successful pilot run. However, the quality testing staff suggests that under certain conditions, a hook to attach cars to the locomotive and the crank for the bell can be broken off. This is an issue because children can choke on small part such as these. In the quality test, 1 to 3-year-olds were unable to break off these parts; there were no failures. However, when the test simulated the force of an adult tossing the locomotive into a toy box or a five-year-old throwing it on the floor, there were failures. The estimate is that one of the two parts can be broken off four times out of 100,000 throws. Neither the design nor the material people know how to make the toys safer and still perform as designed. The failure rate is low and certainly normal for this type of toy, but not at the Six Sigma level that John's firm strives for, and, of course, someone, someday may sue. A child choking on the broken part is a serious matter. Also, John, was recently reminded in a discussion with legal counsel that U.S. case law suggests that new products may not be produced if there is "actual or perceivable knowledge of the problem" with the product.

The design of successful, ethically produced, new products is a complex task. What should John do?