Moral and morale issues
Moral issues are determinations of what is ethically right or wrong. Even if a product meets specifications, there may be
lingering doubt regarding the product, and the "right thing" may be not to release the product or to have a market withdrawal.
Morale issues, on the other hand, are internal issues that keep the employees dedicated and happy with their employer.
Morale and moral problems are not easily measured in financial terms. The short-term and long-terms effects could be devastating
for a company's competitive superiority, new product development, and associated product quality. Recurring recalls, a regulatory
notice about a company's product quality, adverse publicity, and imminent punitive actions can have a negative impact on the
morale of company personnel. These actions adversely affect all personnel across the organization including R&D, operations,
sales and marketing, and other departments.
Insufficient attention to quality may lead to distrust between workers and their management. Failures to meet acceptable quality
guidelines (i.e., cGMP) and failure to develop and follow proper guidelines and standards may be perceived by some employees
as a direct consequence of lack of proper support by management. This may result in the loss of key employees and lower productivity
by employees who choose to stay and remedy the deficiencies. Loss of knowledgeable and experienced people also results in
loss of know-how and technology to competitors eager to attract experienced and talented workers. The damages resulting from
such loss may be significant but hard to quantitate. Overall, the productivity of the company may drop significantly not only
due to lost employees but also due to negative impact on employee behavior. This need may result in overburdened employees
taking on additional workload to support ongoing and future business needs. These potential problems can be avoided, or at
least minimized, by strong governance by top management, and a relentless focus on quality as an overarching business objective
to ensure satisfied customers, government regulators, and satisfied employees.
Reputation and credibility
Negative regulatory actions (i.e., audits by regulatory authorities pointing to noncompliance observations, excess recalls,
warning letters, and product seizures) cause extreme stress on the company, its management, and its employees. Customers question
the quality of production of not only a product that failed specifications or had to be recalled, but also the company's operations
in general. FDA may decide to not approve or accept any new filings, and the various government organizations (e.g., Veterans
Administration) may not accept any product from a company that is under a warning letter or other punitive actions from FDA.
Management concerns include loss of confidence in certain areas, moral issues concerning product safety, and their own image
in the regulatory, professional, and business worlds. Management must develop strategies to address the situation on hand,
to motivate employees, to communicate with suppliers and vendors, and to deal with national and international regulatory agencies
where company products are sold. They also have to deal with ever-present challenges to keep employees motivated, productive,
and dedicated to resolving regulatory problems. In addition, they must develop plans to alleviate employee issues and stop
the loss of talent and technology to competition. The situation may deteriorate to an extent that a good number of experienced
employees leave the company and key supervisors must be replaced. This may have a significant negative operational effect
with an immeasurable cost to the company. Replacing an experienced employee is not only financially costly but may lead to
lower employee morale. If not well trained and sufficiently experienced, a new employee may have a relatively small chance
of success under difficult circumstances and may introduce his own issues in dealing with other employees and management with
Examples of challenges faced by a company after receiving an FDA Warning Letter or a similar regulatory noncompliance notification