Statistical Process Control Tools Measure The Quality Process Commerce Essay


Statistical process control is an analytical tool that determine the process is run smoothly or not and then making decision on it. The SPC has the ability to identify the quality, production efficiency, productivity of the employees, maintenance of the machinery and others. [1] 

There are two tool of Statistical Process Control used by Tasek Emas. The first SPC tool used by the Tasek Emas is Process Flow Diagram. Process Flow Diagram is a graphical tool that giving a picture of the steps of process. Through the flow charts, the determination of the relationship between the steps of process can be identified easier. This chart can used to improve the quality of products as well.

Figure 1.0 Process Flow Diagram

The second SPC tool used is cause-and-effect or fishbone diagram. The cause-and effect tool is a tool use to control the quality of products or processes by identify and analyze the potential cause of a major problem in the process. The figure below is the sample of cause-and-effect diagram that used by Tasek Emas.

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Unstable quality of the output of process



Figure 2.0 Cause-and-effect Diagram

Why the company choose the tool(s)?

As a manufacturing company, there are several steps or procedures that need to complete by the employees of Tasek Emas. Tasek Emas realized the importance of clarify the process of production. They think that the understanding of how the production process done is very important for every single employees and employers as well. They think that process flow diagram is the most suitable tool used to describe the production process. They decided to use the flow chart to describe the manufacturing process. Process flow diagram is utilized by Tasek Emas for a better understanding of the production process. It gives a clearer picture for the employees on how to produce the outputs of the process. It also mention about the time required for every steps in the production process. The efficiency, effectiveness, quality of output of the manufacturing process and the productivity of employees can be improved due to the flow chart. Moreover, the flow chart is simple but useful for them. They do not need to hire other expert to do the flow chart. They can do a simple and nice flow chart by the any internal employees who know well about the manufacturing process. This tool reduces the unnecessary cost or expense and thus increases the profit margin of the company. In addition, it can improve the consistency of product quality. [2] 

As a food industry, the standardization of the product’s quality is the concern of consumers. Consumers can detect easily when the quality of the food products is different. Thus, Tasek Emas was observing and measuring the output of the production process. The motive of the observation and measurement is to test the quality stability of the products. They decided to do the test by randomly pick the finished product for certain amount and then compare them. After comparing a certain amount of the products, they found out that the quality of their products was not very stable. Since they already figure out the main problem of their products, they want to know the potential factors for the unstable quality of products and they would like to improve it. After considered on other tools, they think cause-and-effect tool is the most suitable tool for the current situation. [3] They think analyzes are required to ensure the outcome is accurate. They also think that among all the tools of statistical process control, cause-and-effect tool provide better understanding for Tasek Emas in identifying the potential causes for the quality instability. They believe they can solve the quality problem by applying this tool. [4] 

How the SPC can help/benefit the company to do their capacity planning.

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Capacity planning can be defined as a tool used to identify the total amount of output of a process that require to produced by estimating the demand of a product. Statistical Process Control plays an important role in capacity planning because the identification of the capacity planning required precise and accurate information and data about a production process. There are two types of capacity of a process that can be measured. One is design capacity. Design capacity is the maximum output rate or the ceiling of an output in production or service process which capacity planning designed for. Another one is effective capacity. Effective capacity is the maximum output rate minus the allowances such as personal time, maintenance and others. To measure these two types of capacity, data and information of actual output, design capacity and efficiency capacity is required. The accuracy of the data is very important because the measurement could be wrong when the data provided is not precise and accurate. That is why the statistical process control is very important. It helps in collecting the required data and analysis of the data. After applied statistical process control, Tasek Emas has more precise in the time required to accomplish every step in the production process, the number of employees required, the productivity of employees, the capability of the machinery they had and so on. This enables the company or factory to decide the best capacity plans for different season such as peak season and off-peak season. The effective capacity planning with the assistance of SPC can help in balancing the purchase of resources, the maintenance of production facilities, the hiring of labor, and the final output. This is required to ensure the demand of the customers is fit with the supply of the company. At the same time, capacity planning can increase profit margins by eliminating unnecessary waste, including the excess supply in production. [5] 

Explain Once the company used the tools is there any change in that company (changes in the environment) for example the organization structure, the organization quality standard measurement, the employee management and machinery arrangement...

Previously, the decision on the amount of output of process was based on the request from the customers. The request had decided the total amount of output that need to be produced for a day because the company or factory will only operate when there are request from the customers. This is because the expectation of demand for the finished products is hard to predict for Tasek Emas in the beginning of the business and the company has no ability to predict the demand of the products. Many of its customers are not loyal to this brand and consider the product as a substitute product for other products. Therefore, the demand as well as the output for the process is fluctuated from month to month in the beginning of the business. The company is making effort on improve the quality of products and promote the products at the same time. That is why the company makes use of the statistical process control (SPC) and marketing strategy. Tasek Emas After a time period, the business and the number of customers become stable due to its effort. Then, Tasek Emas’s total output is increasing and now the output of process is not relied on the demand of the customers again. Tasek Emas changed its strategy on deciding the output of process. This condition was shown the effectiveness of the application of SPC and marketing strategy as well.

There are indicators showing that the demand for the Tasek Emas will increase continuously. This leads to environmental changing. The changing environment for Tasek Emas can be categorized into 3 categories. There are human resources, advance in technology and the production rate. This is because Tasek Emas was implemented the lead strategy in capacity planning. This is a capacity planning strategy that adding capacity to the production to maximize the efficiency of the production process and ensure the supply of production is met with the demand. [6] Due to the increase in demand, Tasek Emas noticed the necessary of adding the capacity of human resources in order to produce the total amount of finished products that is able to support the demand. Thus, the company hired 3 more labors. The labors are increase from 3 persons to 6 persons. Other than that, Tasek Emas also decided to setting up and implement safety and quality policies. They provide a guideline for the employees after applied SPC. Standard was set and guideline was given to maintain the quality of the finished products by Tasek Emas. In order to maintain the quality of products, training was given to the current and new employees.

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Besides that, the company realized on the lacking of capacity has limited its capability of the output of the process. Due to the increasing in demand and advanced in technology, Tasek Emas decided to bring in more machinery and replace certain steps of process that required employees by machinery. For example, the dough of keropok lekor is rolling into a long line by employees previously. Now, Tasek Emas is planning on buy a new machine to replace the employees to the machinery since that technology is available now. They think this can shorten the time for produce the products. In addition, the quality standard of the products will be more stable by using machinery. Last but not least, the production rate which can be defined as the total production can be produced in a given period also increases due to the adding capacity in the human resources and the machinery. The total output of Tasek Emas is increase from around 80kg to 120kg a day. The production rate can be maintained by the increase of skills of employees and the machinery. Tasek Emas is targeting to produce 1 Tan of finished products a day. The company or factory will continue on adding the capacity to ensure the capability of facing with the increase demand. Another changing factor for Tasek Emas was the company was applying for Halal license. The hygiene is one of the factors they need to consider in order to get the license. Thus, the company or factory decided to improve the infrastructure by cover the factory with hygienic and sanitary design factory building. The equipments for production process also take in consideration in hygienic factor. In fact, Tasek Emas noticed that they need the involvement, commitment and cooperation from the management and every employee in order to support the operation of production process as well as other functions in business.

Explain what is the strategic capacity planning they can use and implement.

Strategic capacity planning is a technique use to measure the capacity of production. It is important to help Tasek Emas to meet their company future requirements and help company to maintain the minimum level without affect the quality of lekor cracker. Besides, strategic capacity planning also ensures that Tasek Emas can achieve their long-term plan at the same time can remain competitive. There are three strategies that Tasek Emas can use and implement, which are lead strategy, lag strategy and match strategy.

Lead strategy is a process of adding capacity. This is because normally the demand of the product will increase within a given time frame. Based on this strategy, Tasek Emas can produce more lekor cracker due to the increases of demand in advance. At the same time, Tasek Emas need to make sure that the lekor cracker produce can be warehoused and meet the demand of the market.

The second strategy of capacity planning is lag strategy. Lag strategy is a strategy of how to meet the increased demand rather than prepare it in advance. For this strategy, Tasek Emas can meet the increased demand by increase their operating time. Tasek Emas can manufacture more lekor cracker when the operating time increases. Besides, they also can operate more machines. Tasek Emas can purchase more machines and operate it at the same time to maximize the output of the lekor cracker.

The last strategy is match strategy and it also known as a compromise between lead and lag strategy. By using this strategy, Tasek Emas can minimize the accumulating of unnecessarily of inventory.

Explain the value of the process that involve in this implementation.

The demand need to fulfill by the support of the supply capacity such as resources, labor forces, machinery and other inputs. The implementation of the capacity planning is very important because the difference of the capacity will influence the performance or output of the production process directly. It will also affect the costs, revenues, profit margins, quality of the products and others.

`Capacity planning is required to make sure the current capacity is the best fir for the current output of the production process. The company needs to make a decision on capacity planning in long- term as well as in short-term. The issue for the long-term capacity planning and the short-term capacity planning is different. For long-term capacity planning, the company or factory is required to make a decision on the necessary of invest in infrastructure and facility such as machinery. It is more on the strategy decision making by the top management of the company. The long-term capacity planning may be affected by the insufficiency of the short-term capacity planning. For example, Tasek Emas insisted to add on one machinery since the present machinery that owned by the factory was not sufficient to support the production process. It is the long-term action (buying a machine) stimulus by the short-term progress (insufficient of machine). The excess demand problem can be solved by the adding of capital- a new machine.

The short-term capacity planning is more toward the issue of scheduling, the amount of labor required and balancing the resources capacity. Seasonality is unavoidable in business world. There are certain periods in a year that the demand of the products will increase and the demand of the products will decrease as well. Capacity planning is a good strategic to deal with the fluctuation of the demand of products. Normally in the peak season, additional capacity such as extra labor force are required to ensure there is no shortage of supply of the products. [7] On the other hand, excess supply will occur in the off-peak season obviously. The additional finished goods will be stored in the warehouse and this will increase the operation cost and hence decrease the profit of a company. In order to increase the inventory turnover in off-peak season, the manufacturers need to give discount or other stimulus. The profit will be decrease as well. Dealing with the low in demand is a crucial thing for any company or factory. Capacity planning can help in this situation. With an effective capacity planning, the company or factory is able to figure out the best capacity plan for the company’s current situation. However, one thing need to be kept in mind is that the capacity planning is needed to be flexible because the current situation for the business can be fluctuated. Failure to do so will result in failure in capacity planning. [8] 

Explain how it will benefit the company process choice and design.

Capacity planning will benefit the company process choice and design. The one of the intrinsic benefits of capacity planning is to maximize the accumulating of an unnecessarily large inventory. This can make sure that there is no shortage or excess of the inventory stores. The effective amount of inventory can enables the company to operate effectively. It can help to reduce carrying costs, warehouse spacing requirements and also the clutter in the company workplace.

Besides, capacity planning also contributes to the improvement of quality and quantity of the product. By adding one more machine, Tasek Emas can produce more quality lekor cracker. The quality of lekor cracker will increase by using machines compare with handmade method. The lekor cracker produce by machines will be better than by using handmade method. This is because sometime worker will overcook the cracker and causes lose to the company. Besides, the quality of lekor cracker also will increase. Using machines of course is faster than using handmade method. At the same time, it also can produce more products. Tasek Emas plan to add one more machine to increase their productivity. This will enables the company to maximize their output to overcome the large demand of the market. Capacity planning is important and it brings benefits to the company in term of short and long term as discussed above.