Management of Suckwell Vacuum Cleaners Company - Case Study Example

Suckwell Vacuum Cleaners, Ltd. QUALITY MANAGEMENT REPORT Introduction The company manufactures and assembles vacuum cleaners for household s. The annual production of the company is around 300,000 units which are sold at 40.00 each. Each vacuum cleaner consists of plastic bodies that came from a subcontractor which are loosely packed in large boxes. Small scratches are ignored when they are received while severe scratches are reworked. The company has no incoming inspection procedure and report such that plastic bodies are directly passed to production. Other problems that occurred in the company include chipped paint, inadequate suction and perforated bags. Chipped paints happen during the assembly stage. Furthermore, the company experienced missing instructions during the final packaging and shipment. Also, missing serial numbers, broken switches and damaged insulation on main cable are identified as occurring problems in the finish product. Figure 1 summarizes the importance and difficulty to solve with regards to the identified problems. Categories of Problems Identified Inadequate suctions and damaged to insulation cable are the most difficult to solve and of high importance because the problems require downgrading of product and replacement of cable as a rectification. Units with suction problems are sold at half the price of a new unit but without Suckwell identity markings. Other problems such as missing instructions and broken switches are considered important but easy to solve because these can be corrected during the assembly stages as well as final inspection of finish products. Perforated bags and scratches on the plastic are also considered as important because they provide aesthetics to the product. On the other hand, missing serial number and paint chipped are categorized as problems of lesser importance because serial numbers are considered as additional information of the product for purposes of traceability while chipped paints can be prevented along the assembly line. Figure . Importance/Difficulty Matrix of Problems Identified Pareto Analysis The frequency and costs incurred with the problems identified are summarised on figure 2. The estimated annual costs are also tabulated when such problems occur. Sorting the problems identified in Figure 1, the Pareto analysis showed that scratches on the plastic body are the most recurring problem and incurs the highest cost of non-conformance. Thus, this paper will focus on solving the problem with regards to scratches. Figure 3 illustrates the Pareto analysis conducted on the problems identified. A Pareto Analysis requires the utilisation of a chart which is designed by Vilfredo Pareto which also follows the 80:20 rule. The analysis rates the problems according to importance, frequency and impact of the problem to the company. According to Pareto's rule, if a company prevents the cause of only 20% of the cause-effect pairs, they can reduce the number of defect incidents by 80% (Kemp, 2006). In other words, the company separates the vital few from the trivial many where the vital few are considered as the most important problems that need to be addressed (Reliability Analysis Center, 2004). Figure . Frequency and Costs of Non-conformances Problems Identified Frequency Cost of Non-conformance Cost to Rectify Complaints Annual Costs 1. Scratches on plastic body (SC) 340 1,360.00 70,720.00 2. Paint chipped (PC) 150 150.00 7,800.00 3. Perforated bag (PB) 130 130.00 650.00 7,410.00 4. Missing instructions (MI) 20 10.00 520.00 5. Broken switch (BS) 130 71.50 26,000.00 29,718.00 6. No serial number (NS) 12 3.60 187.20 Total Cost 782 1725.10 26,650.00 166,355.20 Figure . Pareto Analysis Cause and Effect Diagram As previously mentioned, the most important as well as part of the vital few problem is the scratches on the plastic body of the vacuum cleaners. Figure 4 is an Ishikawa diagram or a fishbone diagram that illustrates the several causes to the problem. The diagram is named after the inventor - Kaoru Ishikawa (Reliability Analysis Center, 2004). The diagram employs the 5M1E variables which are measurement, materials, methods, machines, manpower and environment. The function of the diagram is to identify the factors that are causing the undesired effects which are the scratches on the plastic body. The causes identified are then focused upon in order to improve the quality or to achieve the desired results. Figure . Fishbone Diagram on Problem - Scratches on Plastic Body Action Plans As part of improving the process and product quality of Suckwell vacuum cleaners as well as reducing costs of the company's operations, this paper recommends the following action plans to be undertaken and implemented. Creation of a Quality Assurance Team Quality is seen as order-winning and important criteria in most products. However, it is also a major contributor to operational costs. There are costs associated with poor quality, of which the cost of rejected goods is perhaps the most obvious, but quality management and improvement also involve cost. It is essential for a company to create a team that focused on improving the product quality from start to finish - from raw materials to finish goods. (Rowbotham, Galloway, & Azhashemi, 2007) Quality management is not just a system but a practice of the organisation that implements principles that centres on customer focus, continuous improvement and teamwork in order to improve the product and services (Prajogo & McDermott, 2005). At Suckwell Company, the task of the Quality Assurance Team is to establish a quality plan that includes inspection of incoming raw materials, work-in-process products and finish goods. Quality planning includes defining what processes are required to deliver the product that meet or exceed specifications, putting them in order by linking outputs of one process to inputs of the next. Furthermore, it involves defining of each process with requirements and tolerances on all key variables so that all outputs of al processes are on specification. (Nookabadi & Middle, 2006) Quality assurance includes activities to evaluate and improve processes, re-engineer work to eliminate unnecessary processes or steps, ensure effective communication and mutual understanding throughout the supply chain as well as auditing and reviewing in order to ensure all processes are maintained to standard and improved (Kemp, 2006). Thus, the main objective of the quality assurance team is not just to inspect and detect defects but to make sure that it defects will be minimised if not eliminated through the best possible flow of the assembly line at the least probable cost. Addressing the Root Cause As reflected on the Ishikawa diagram, one of the causes of scratches in the plastic body is the lack of incoming inspection as well as an established standard for acceptable and unacceptable size of scratches. It would be the job of the quality assurance team to create standard criteria and guidelines for inspection where results will be monitored regularly in a quality control program. Quality control includes all forms of checking, ensures that outputs and processes meet requirements, that defective output is reworked or scrapped, and that all key variables of the processes are adjusted and restored to work within tolerances (Gustavsson & Wanstrom, 2009). By checking, it means inspection as well as statistical quality control. The objective of both practices is conformance to specifications. They require clear specification of each attributes in the process that determines if the result matches the requirements or fall within tolerances. Quality control also feed information back to the manufacturing processes so that future and similar problems can be prevented by bringing the process under control and applying preventative solution (Khalil, 1998). Deming said that quality comes not from inspection but from improvement of the process by building good quality in (Walton, 1988). Deming's point was not about eliminating the activity of inspection but to use information from inspections to do more than just move the defective product into the scrap or rework pile. Useful information from inspection can improve the process and the way the company do things in order to build quality in the assembly line. On the other hand, statistical quality control is an inspection method that is employed when large quantities of identical components or products pass through the line. Statistical control employs the use of run charts with limits that measures with precision the quality of the whole lot by inspecting a few representative samples. (Waters, 2002) Involving the Supplier Total quality management does not only occur within the company and its manufacturing or assembly practices. Total quality management also involves the supplier in providing quality raw materials as much as it involves the customer in satisfying their needs and expectations. An assembly plant is considered as the customer of all its subcontractors and suppliers that impart the necessary component (Chase, Jacobs, & Aquilano, 2005). At Suckwell, the company does not report its findings of defects such as scratches, defective switches and damaged cables to the suppliers. Such information is vital in maintaining a good vendor relationship management. When the supplier is aware that the company they are supplying is strict in terms of product quality or when they are conscious of the defective products that they sell, such supplier will be compelled to improve their product line and intensify its products and services (Chandra & Kumar, 2000). However, when the company is lax in its inspection as well as feedback reporting, then such supplier will assume that the component they are supplying are within the acceptable standard of the company. Case at point, the simple report to the supplier of loosely packed plastic bodies in large boxes could have prevented the scratches on the body by triggering the supplier to improve their packaging. In such a simple communication, the Suckwell Vacuum Cleaners, Ltd could have saved on its costs of rework. Implementation Phases Total quality management is not an easy tasked and cannot be completed overnight. However, the following phases identified and developed by Nicholls (1993) are interesting to note for Suckwell to consider. Phase 1 The target at phase 1 is conformance to specification by employing quality systems such as quality assurance, statistical process control and even ISO 9000. This phase is essentially a product-focused and cost-focused orientation seeking to get things right on what are presently done. Phase 2 This phase uses quality definition based upon fitness of purpose. It achieves this by beginning to develop a team focus and involvement. Systems are more concerned with functions and with ideas such as 'right the first time', but the focus is still essentially inward to the company and its products. Phase 3 The aim is now meeting customer requirements. Quality systems based upon value chain and customer satisfaction are added. The team focus develops into wide interdepartmental cooperation. The viewpoint is now outwards and the whole organisation should be customer-focused. Phase 4 This phase carries customer focus to its limit, with a quality definition such as maximising customer value. Organisational re-engineering brings about an integrated partnership focus and maximises staff empowerment. Quality systems will be transparent to the customer and control will be based upon value added measurement. References Chandra, C., & Kumar, S. (2000). Supply Chain Management in Theory and Practice: A Passing Fad or a Fundamental Change. Industrial Management & Data Systems , 100 (3), 100-114. Chase, R., Jacobs, F., & Aquilano, N. (2005). Operations Management for Competitive Advantage (11th ed.). New York: McGraw-Hill Companies. Gustavsson, M., & Wanstrom, C. (2009). Assessing information quality in manufacturing planning and control processes. International Journal of Quality & Reliability Management , 26 (4), 325-340. Kemp, S. (2006). Quality Management Demystified. Chicago: McGraw-Hill Companies, Inc. Khalil, F. (1998). The information requirements of total quality management. Total Quality Management , 9 (6), 445-461. Nookabadi, A., & Middle, J. (2006). An integrated quality assurance information system for the design-to-order manufacturing environment. Total Quality Management , 18 (2), 174-189. Prajogo, D., & McDermott, D. (2005). The relationship between total quality management practices and organizational culture. International Journal of Operations & Production Management , 25 (11), 1101-1122. Reliability Analysis Center. (2004). Quality Tools, The Basic Seven. New York: Reliability Analysis Center. Rowbotham, F., Galloway, L., & Azhashemi, M. (2007). Operations Management in Context (2nd ed.). Oxford: Elsevier Ltd. Walton, M. (1988). The Deming Management Method. New York: Putnam. Waters, D. (2002). Operations Management: Producing Goods and Services. New Jersey: Prentice Hall. Read More