Quality Improvement - Case of Copac Inc Paper Manufacturers - Assignment Example

Quality Improvement A Case Study of Copac Inc. Paper Manufacturers Presented In order to be competitive and remain relevant in the current rapidly changing market, companies have to put in place measures to ensure the entire goods or services making process is a value creation process to customers. This is only possible in quality improvement. QI requires companies to undertake strategic actions aimed at identifying various problems, determining their actual cause, planning how to solve these problems, implementing the solution and making the relevant follow-up to ensure the problem does not reoccur. QI is a step by step process that has to be carried out in detail, and the effectiveness of the intervention method weighed using relevant data collection methods to ensure its effectiveness. Most companies with the right approach to QI have been able to claim a competitive edge in the market and achieve major benefits raging from reducing costs, to increasing the quality of goods, adding value of the entire process in goods or service manufacturing. Therefore, QI is a value proposition approach aimed at satisfying customers and facilitating effective business operations. Quality Improvement In any organization, continual improvement in systems and process to ensure quality has to be made part of the organizational culture. Continual improvement requires management to determine the problem in an organization, seek ways to solve the problem, plan implementation of the plan, and then ensure system checks to uphold quality in systems and processes. This leads to the principles of quality improvement. Quality improvement story may be described as systematic plans and procedures taken by a company with an aim of improving quality in goods production or services, to offer more value proposition to customers, while at the same time reducing costs to the company. An example of this is the Just in time (JIT) system, which is a Japanese quality improvement process that reduces inventory costs, resulting in reduced operating costs to the company, increased efficiency, and more value to customers. The quality improvement process as defined by Omachonu & Ross (2004) involves seven systematic steps that have to be taken to solve a specific problem. These are identifying a problem, planning how to solve the problem and putting long term measure to ensure the problem does not reoccur in the process again. Quality improvement story involves the use of the quality improvement wheel that requires checking, doing, planning, and acting as a continuous process aimed at improving systems and ensuring quality (Dessler & Farrow, 1990). Mainly, there are four reasons behind the use of QI story. The story helps team members to organize, gather and analyze the data in a more logical fashion; it monitors the status or progress of a specific team, it facilitates understanding by the non team members; and lastly it helps a standardized presentation of problems and its solution to the management (Omachonu & Ross 2004). In demonstrating the QI story, the paper investigates the steps taken by Copac Inc, a paper manufacturing plant it turn around its diminishing sales and profitability through QI. Indentify the Problem area. Copac Inc, a paper manufacturing company utilized conventional methods in paper making, where they used tree logs, crushed them and take the chips through required pulping and minting process to form paper pulp, which was then bleached to obtain the normal paper used in books, news prints and other stationery. However, since the year 1995, the company realized a drastic drop in sales and profits, while most customers mostly related to news print companies were no longer interested in their products. A market survey by the company indicated much of the papers used in the market were direct importations from china, which retailed at a lower price, and portrayed better quality as the bleaching quality was much better than Copac’s bleaching. This bleaching affected many news prints and books in that after a short time, the bleached paper turned yellowish in color, meaning books and other news prints once exposed to the sun were susceptible to bleaching and discoloration. Most clients both local and international had over the time raised this issue, and as the company delayed to respond, customers shifted to imported papers, which portrayed higher quality characteristics. Observing and indentifying the Problem cause. The company under the sales and marketing team established most papers from china and other sources were of higher quality as the type of bleaching was an oxidation process, compared to a weaker reduction type used by the company (E. Willson Personal Communication May 5, 2012). The main cause of this problem as identified was due to the outdated nature of the Copac machinery, while advanced paper minting and pulping machines were used in developed and larger economies such as china, and Brazil. In addition, the new manufacturing technology was much cheaper in power consumption, maintenance and servicing, and the labor requirement; this meant Copac Inc had a relatively larger work base making production costly, in addition to the use of outdated technologies that made the entire process too expensive. The survey noted companies were rapidly shifting their grounds towards cheaper and more quality paper, leaving Copac at a loss. Analyzing, Indentifying and verifying the root cause of the problem. After the above survey, three issues were lastly agreed by the department as the root causes of the misfortunes in the company and presented to the board of directors. These were; use of outdated minting and pulping machines that consumed too much power making operation costs to be much higher than normal, use of poor bleaching techniques making the paper to lose quality after a short time, and a large labor force required to operate the conventional machining and process, increasing the operational costs and eating rapidly to the profitability of the company (E. Willson Personal Communication May 5, 2012.). according to Willson, this survey involved company representatives being sent on a mission to some paper manufacturing companies in China to collect data on operation costs incurred in the use of new pulping and minting technologies, which revealed wide discrepancies between how Copac operated compared to pulping companies in China . Planning and Implementing Preventive action The board of directors after receiving the report proposed major radical changes. Due to the capital intensive nature of required plant machinery that would make paper production competitive in the market, the first decision was corrective actions targeting the bleaching process to improve paper quality by doing the necessary modifications to the paper process. The second proposal was preventive measures where the board agreed to import new pulping process machinery that was relevant in the current technological market, and which would aid in reducing costs. Thirdly, the board planned to gradually reduce the workforce in a three year plan to maintain a lean workforce that was in accordance with the new machinery, which required much less manpower. To facilitate this, the company had to take a loan with a development bank. Check effectiveness of the action Before importing the new machinery, data from corrective measures taken immediately to improve the bleaching process was compared to the convention process. The data portrayed drastic improvement in quality of manufactured paper. Several media companies wee supplied with the improved paper and the data collected portrayed quality had drastically improved, with and more media companies showing more interest in the new product. After three years, capital intensive process machinery was imported, and new personnel trained on their usage and operations. A six months test run operated by the machinery makers together with Copac portrayed costs could be reduced by up to 50%. This was because, the new machinery could use up to 40% less power compared to convention machines; since larger part of the process was being automated with a control panel to observe and troubleshoot the process, the new machineries drastically reduced the number of employees required in the process, and the labor costs was estimated to be reduced by as much as 60% automating the entire process through the new machinery (B. Martin Personal Communication 5 may, 2012). The new manufacturing process was therefore found to be much appropriate in solving the above problems. Standardize process improvement. Having carried out the test run and proving the effectiveness of the new machinery, the company undertook to educate the remaining workforce through proper training and recruiting trained service personnel to ensure smooth process operations. The pulping and minting process was thus switched from the old conventional machinery, which were replaced by the new machinery. In addition, relevant mechanism of data collection on daily basis, trouble shooting and quality inspection on the entire process were initiated to ensure the process was smooth and quality was guaranteed at the end of the process. Most of the employees in the company were enrolled in training programs mostly related to automation and computer Numerical controlled machinery, while more experienced graduates were actively being recruited specifically on the new process management and troubleshooting. This was to ensure competent and trained personnel were in charge of the entire process. Determine future Action To ensure the system runs optimally and its sustainability to the future, the company initiated a program of regularly carrying out a detailed troubleshooting and process evaluation after every three months, with a new sub-department dealing in process maintenance being created and staffed with both experienced and qualified staff. The company in addition initiated plans to overhaul other departments such the management, human resources, sales and marketing, inventory and purchases to embrace highly automated systems in communication, record keeping, as well as integrating every department to each other; this move further reduced costs, wastages in materials, and enhanced effectiveness in sending and receiving information. Generally, the company in a 10 years period was able to automate most of its departments, in a move that resulted in efficiency, reliability and cost cutting, making the company relevant in the market and compete effectively with other paper manufacturing companies. Quality Improvement (QI) involves seven strategic and systematic steps aimed at identifying the problem, noting and determining the principal causes, laying down the solution and follow up of the process to ensure it does not reoccur. In the QI, each step is supposed to be a value adding step, meaning after the end of the QI story, a company ends up solving most of inherent problems and laying down plans for future actions. QI is therefore a paramount necessity in any company to remain competitive in the market today. References Dessler, G., & Farrow, D. L. (1990) Implementing a Successful Quality Improvement Programme in a Service Company: Winning the Deming Prize, International journal of Service Industry Management, l(2),pp. 45-53. Omachonu, V.K. & Ross, J.E., (2004). Principles of Quality Management- Text with cases, 3rd ed. London: Butterworth Heinemann Read More