Quality Steel Inc

8/18/2019 Quality Steel Inc

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Quality Steel

Individual assignment TMQU31

Prajwal Shankar

(prash968)


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Contents

1. Introduction..........................................................................1

2. Organizational Structure........................................................1

3. Analysis of Quality Steel........................................................1

3.1 Procureent and !inance.....................................................................1

3.2 Production............................................................................................... 3.2.1 Data analysis....................................................................................................3

3.3 Quality Assurance..................................................................................6

3." Sales and #arketing..............................................................................!

". Suggested i$ro%eents.......................................................&

'. (onclusion.............................................................................)

*eferences................................................................................+


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"ra#$al %han&ar ' TMQU 31

1. Introduction

Quality Steel are manufacturers of tool tips for lathes and milling machines whorepresent a minor percentage of the market share. The majority of sales are towardsthe ‘antastic !echanical products"# which accounts for $%& of the total sales of thecompany. There are a few other products with sum up the entire sales of theircompany.

To gain higher footing in the market# the company has decide to focus on Quality astheir primary o'jecti(e to attract more customers. This report assess the decisionstaken 'y the all the departments of the organi)ations with Statistical Quality controlaspects and how it indi(idually can contri'ute to the ultimate goal of 'etter*ualitati(e products 'y e(aluating their strengths and weaknesses. inally some

suggestions for impro(ement are pro(ided 'ased on analysis of data and proposedtheories in such cases.

2. Organizational Structure

The organi)ation is di(ided into fi(e departments# namely

•Sales and !arketing

• +rocurement and inance

• Quality control

• Quality ,ssurance

• +roduction

3. Analysis of Quality Steel

our factors 'ased on departments which play major roles in contri'uting towardsthe *uality of the products manufactured 'y the organi)ation are discussed in detail

3.1 Procureent and !inance

This is an integrated department 'etween finance and procurement. The departmenthas - purchasers and the manager is also a financial controller. The trend followed tochoose suppliers for procurement are low cost and precision for deli(ery. Theorgani)ation chooses procure raw martials from a single customer and the customeris e(aluated *uarterly. hereas the financial controller e(aluates the in(estment onmachinery.

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• ith ha(ing a single pro(ider of raw materials# it

eradicates the (ariation 'etween deli(eries which is a first step towards

elimination of defects.

• The criteria on which the organi)ation choses the suppliers ha(e chances in

jeopardi)ing the *uality of the process e(en 'efore it reaches the production

line. The supplier is chosen 'ased on low cost# 'ut an initial *uality check has

to 'e performed on the incoming raw material and this data should 'e

considered during e(aluation of the supplier. This in an important step that

has to 'e incurred in the process. The precision of deli(ery is a (alid criteria

and it should 'e well appreciated.

• rom Deming# a process 'ased on cheap materials will lead to further

discrepancies and it is essential to cut down costs along the process and not at

indi(idual places. This decision lies with the finance controller# the decisions

has to 'e further e(aluated for clarity on criteria of procurement 'ased on

production method# *uality and process # and not just the price

• Deeming says that a trust needs to 'e esta'lished with the suppliers and

ha(ing long/term agreements with suppliers keeps 'oth parties on good terms.

3.2 ProductionThe department is also responsi'le for logistics and warehousing and of course theproduction of parts. The department has two principally identical lines with a sloganof ‘)ero defects" as their motto. They ha(e a completely through procedure of checkingeach and e(ery part that is produced with 'onuses in terms of treats 'eing handed outfor least defects among the produced products among the employees. 0n case of defect the entire lot is *uarantined until the root cause is determined 'y the *uality circle.

•

The procedure to check e(ery part produced on the production line increase*uality costs 'ut contri'utes limitedly to the cause and reason 'ehind this

issue. This process can only record the defects of all the products# this is a good

method to record data on defects 'ut *uality checks should 'e performed on a

lot si)e as suggested 'y Deming and !ontgomery.

• Quality checks ha(e to 'e implemented along the length of the process instead

of at the end of the process# this makes the process completely futile according

to Deming.

• The slogan of )ero defects tend to ha(e a re(erse effect on the process as it iscompletely useless until an action plan is stated and the manager should lead

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'y eample as a true leader in diminishing

defects rather than saying that there can 'e no

defects at all. These situations lead to counterproducti(e production lines in

the end.

• a(ing a 'onus system encourages the employees to concentrate on only their

part of the jo' and this process is only temporary as it does not contri'ute to

the main cause of decreasing defects to a minimum. This further leads to

ri(alries 'etween employees and disrupts the group dynamics of the

department. Deming suggests that remo(ing working standards among peer

employees gi(e way to highly producti(e results.

• +eriodic checks ha(e to 'e carried out on the machinery to make sure that the

instruments ha(e no part to play in the caused defects. The finance team ha(e

to in(estigate this data to arri(e at a decision to repair or completely replacethat machinery.

• Quality circle is a group of managers from all their resprecti(e departments

formed to determine the root cause of the defect. This is a fantastic initiati(e

to de(elop interdepartmental discussions and relationships. The root cause

analysis pro(ides (alua'le data 'ut# this has to 'e documented and should 'e

utili)ed to educate the employees.

• Deeming insists that educating and encouraging employees pro(ides a 'etter

work en(ironment and thus resulting in 'etter results.

• ith production responsi'le for logistics and warehousing# measures ha(e to

'e taken to ensure that the work is not neglected and prioriti)ed 'ased on

re*uirement.

Statistical Quality control tools can 'e made use of# to ha(e a 'etter understanding of the pro'lem. This data should 'e e(aluated 'y the 'oard mem'ers and further actionshould 'e taken 'ased on the comments.

3.2.1 Data analysis

The data analy)ed is that of the defects from 'oth production lines. The data isanaly)ed for normal distri'ution from the histogram# 0/! processes is used to check if the process is under control or not and the 4!, chart to show if a trend can 'efound from the data we ha(e.

Histogram

rom figure 1# the histogram depicts that 'oth data (alues for production line 1 and 2are normally distri'uted as the 'ell formation at the center of the columns is e(ident.

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Figure 1: Histogram

I-MR Chart

The chart is plotted for 'oth production lines as shown if figure 2 and 3. +roductionline 1 is in control with more than a few mo(ing range (alues on the lower controllimit and there are no (isi'le trends either. hereas in case for production line 2there is one point out of the upper control limit and a few (alues lying on the lower

control limit.

Figure 2: I-MR chart for Production Line 1

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Figure 3: I-MR chart for Production Line 2

EWMA chart

There are no trends (isi'le for production line 2 (alues in figure 5# 'ut we can see anupward trend for production lines 1 chart in figure -# and it can 'e predicted that it

will soon 'e out of the control limits.

Figure 4: EWM chart for Production Line 1

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Figure !: EWM chart for Production Line 1

The data pro(ides another insight to the process that the trends differ for 'othproduction lines and we may infer that there may 'e a pro'lem for the firstproduction line as the defects are 2% in comparison to 21 in line 2 with ha(ingidentical production lines. This is a key data which has to 'e presented to the

financial team for further analysis.

3.3 Quality Assurance

This department is responsi'le the o(erall Quality !anagement System for theorgani)ation. The main task of the department is to pro(ide documentation regardingthe procedures that ha(e to 'e followed in all cases and scenarios. This is done 'y pro(iding the Statement of +urpose 6S7+8 documents for each department. The Q, team is responsi'le for accessing all the other departments within the organi)ation.

• 0t is a good initiati(e to assign one indi(idual responsi'le for pro(iding the

S7+"s for each department. This indi(idual has to 'e aware of the processes

within that particular department to make implement the procedures to 'e

followed.

• 0t is also an apprecia'le decision that only the manager of the Q, team can

appro(e S7+"s for the departments and the o(erall organi)ation as this is not

something to 'e taken lightly.

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• Documenting the data of defects for production

lines 1 and 2 has helped in analy)ing the current

situation. The Q, team should 'e responsi'le for documentation of these

tasks.

• The pareto chart pro(ided in the case is the result of good documentation and

usage of SQ: tools to 'etter percei(e the pro'lem. rom the pareto chart# it is

looks to 'e that the most defects are from the product %9 !4. The reason

'ehind it is responsi'le for $%& of o(erall production and would therefore

ha(e more defects when compared to the other products.

• De(eloping a knowledge data'ase of learnings from oot :ause ,nalysis

should 'e considered. These should 'e shared with employees as it may help

a(oid further repetition of the same error.

3." Sales and #arketing

This department is responsi'le for putting the product on the market andmaintaining a good image foe Quality Steel among other competitors.

• The team should meetup with current customers to find if there can 'e any

impro(ements in *uality is desired and implement those changes in the

process.

• 0nitiate marketing strategies 'y predicting the potential changes in the

economic situation in the market. This keeps the organi)ation afloat and a(oid

one of the se(en disease put forth 'y Deming.

• 4(en with the production responsi'le for logistics the sales team should 'e

held responsi'le for recei(ing confirmation form the customer on recei(ing the

shipment.

• ,n important task would 'e to re*uest for customer feed'ack# which would

pro(ide the organi)ation on how satisfied the customer is and how it can 'eimpro(ed.

• They should meet up with potential customers and identify their needs and

make sure that their needs align with the process in the organi)ation.

". Suggested i$ro%eents

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;isted 'elow are a few areas in which there needs to 'eimpro(ements to impro(e the *uality of the

organi)ation 'ased on theories of Deming and !ontgomery.

• e(ise criteria for selecting suppliers and 'uild long term relationships that

would 'enefit 'oth parties.• educe cost 'y implementing process changes and not at only certain places

on the process.

• ocus on process control rather than on inspection.

• :onduct cali'ration of machinery to eradicate the errors that may 'e caused 'y

erratic instruments.

• 0mplement *uality checks along the process and not only at the end of the

process.

• !inimi)e 'onus systems for employees and insist on teamwork.

• 4ncourage employees and the managers should lead 'y eample rather than

sticking to slogans.

• :onduct yearly appraisals to impro(e morale among employees and this

should 'e 'ased on documented data alone.

• :reate a 'etter communication system 'etween departments for a 'etter

understanding among managers.

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*eferences

Quality Steel 0nc.

!ontgomery# D 62=128# Statistical Quality :ontrol> , !odern 0ntroduction# $ th4dition 0nternational Student ?ersion# @ohn iley A Sons.

Deming# .4.# 61BB38# The Cew 4conomics# !0T +ress.

iley college tutorials# http>www.wiley.comcollegescreidchap9 62=198

B

http://www.wiley.com/college/sc/reid/chap6http://www.wiley.com/college/sc/reid/chap6


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Quality Steel Inc