Application of TQM to Ajaokuta Steel Company

CHAPTER ONE

INTRODUCTION

1.1 Background to the Study

Ajaokuta Steel Company was established in the late ‘70s. It is

located on the West bank of River Niger; it covers about 800

hectares of land. The adjoining villages are Geregu to the North-

East, Adogo to the West, Ajaokuta Village to the South, and

Kporoko to the North. The Steel Company was set up with the

objective to produce 1.3 Million tonnes of liquid Steel per annum

at the first stage of production via the backward integration

approach and this was believed to be more than the country

consumption requirements.

The relevance of the steel sector for technological development

of any economy cannot be overemphasized. The industrialized

nations in the world today all started by effectively managing

their steel sector as a base for their development. Realizing the

importance of the sector for emerging economy like Nigeria, the

Federal Government of Nigeria in the 1970's established the steel

1

companies to serve as a base for its economic development. The

objective was to establish a good foundation for sustainable

development of Nigerian economy. Companies that immediately came

up include; Ajaokuta Steel Company, Delta Steel Company, Oshogbo

Steel Rolling Mills, Katsina Steel Rolling Mills, Jos Steel

Rolling Mills and National Iron Ore Mining Company Itakpe among

others. This was a great vision for the country that plays a key

and central role in the economic development of an entire

continent (Africa). The then Government and the subsequent ones,

the public and the private sectors, the industrialists and non-

industrialists and indeed the entire nation were proud of the

initiative.

Little wonder, the then Head of Government of the Federation in

1985, General Ibrahim Badamasi Babangida, said when he visited

one of the companies –Ajaokuta Steel Company “The completion of

this project (Ajaokuta Steel Company) is a must to the industrial

take–off of this nation and it must be supported”. In pursuant

of this objective his Government strived until it had the project

ninety-eight percent (98%) technically completed by 1992, (Obaka,

2008). Unfortunately, about 18 years after, a project that was

98% technically completed is yet to be commissioned. More than

thirty (30) years after the establishment of the steel companies,

it is obvious that the objective is not yet to be achieved as

almost all the steel companies in Nigeria are not functioning.

The Ajaokuta Steel Company which, is supposedly the primary

processor, has not even been commissioned. What actually went

wrong, and what is the way forward? These are two fundamental

questions which should be of interest to all well-meaning

Nigerians. These questions also form the basis of this study.

1.2 Production Design Review of Ajaokuta Steel Company

The company is made up of two sections, primary and secondary

sections.

1.2.1 Primary Section

The Primary section comprises mainly of Five (5) Shops namely:

i. Lime Plant (LP)

ii. Sintering Plant (SP)

iii. Coke-Oven & Bye-product plant (COBPP)

iv. Blast Furnace (BF)

v. Steel Making Shop (SMS) or Converter shop.

i) Lime Plant (LP)

The main feed of these plants is Calcium Carbonate i.e. CaCO3

(Limestone). The Limestone is caffeined and briquetted ready for

use in the Converter or SMS.

ii) Sintering Plant (SP)

This shop utilizes Iron-Ore concentrate and Fluxes (Dolomite,

Limestone, and Coke breeze) to produce sinter for use in the

Blast Furnace.

iii) Coke-Oven & Bye Product Plant (COBPP)

Uses coking coal to produce coke which also serves as one of the

feeds of the blast furnace.

iv) Blast Furnace (BF)

This uses coke from COBPP, sinter from SP, as well as additives

mainly limestone traces and manganese to produce pig-iron.

v) Steel Making Shop (SMS) or Converter Shop (CS)

The SMS or converter shop is the heart of steel production. It

utilizes the pig-iron from BF, scrap from the scrap yard, lime

from the lime plant and ferro-alloys to produce liquid steel.

1.2.2 Secondary Sections

The secondary sections consists of the Rolling Mills and the

Engineering Repair Complex. These are collectively called the

“Revenue Yielding Tail-End Units”.

a) The Rolling Mills

There are Four Mills namely:

i. Light Section Mill (LSM)

ii. Wire Rod Mill (WRM)

iii. Billet Mill (BM)

iv. Medium Section and Structural Mill (MSSM)

i) Light Section Mill (LSM)

This mill was commissioned in 1983, it uses billet (100 x 100mm)

to produce round-bars, ribs, squares, and hexagonal bars.

ii) Wire Rod Mill (WRM)

Commissioned in 1984, it uses Billet of the same dimension as

LSM. It serves as the main feeder to wire drawing industries.

iii) Billet Mill (BM)

Commissioned in 1987, it uses Bloom (260x260mm) to produce billet

which serves as feed to the other mills.

iv) Medium Section and Structural Mill (MSSM)

This Mill though completed in 1988 has never been commissioned

to date. When commissioned, it will use bloom (260x260mm) to

produce bars, strip, rails, channels, I-beams, among others.

b) Engineering Repair Complex

The Engineering Repair Complex was incorporated into the design

of the steel plant to cater for fast wearing parts to reduce

dependence on importation thereby conserving foreign exchange.

The Complex comprises of Four Shops namely:

i. Power Equipment Repair Shop (PERS)

ii. Foundry & Pattern Shop (FPS)

iii. Forge fabrication & Rubberizing Shop (FFRS)

iv. Machine & Tool Shop (M&Ts)

i) Power Equipment Repair Shop (PERS)

This shop has the capability to effectively handle the repairs

of electric motors and generators up to a power rating of 800KW.

Other repairs that are carried out here includes power

distribution transformers, ventilation unit, cable lines up to

132 kW (oil filled), industrial and domestic compressors.

ii) Foundry & Pattern Shop (FPS)

Produces iron, steel, and non-ferrous castings: It is equipped

with two (2) electric arc furnaces for melting, a crucible

induction mixer, an induction type electric furnace as well as

other supporting equipment for casting, moulding, pouring,

fettling, and heat treatment. It has a melting capacity of 36,000

tonnes of ferrous castings and 3,000 tonnes of non-ferrous

castings per annum.

iii) Forge fabrication & Rubberizing Shop (FFRS)

This shop has the capacity to forge well above 4000 Tonnes of

different materials annually. The rubberizing section can produce

various types of oil seals and adhesives. It can also vulcanize

various types of conveyors belts.

iv) Machine & Tool Shop (M&Ts)

This shop is equipped with a group of general purpose machines.

It has the capacity to manufacture new spares. Facilities are

also available in this shop for heat treatment & electroplating.

1.2.3 Power Plant

In addition to the primary and secondary sections discussed

above, the steel plant is incorporated with a power plant with

installed capacity of 110MW. This plant is functional and part of

the electricity generated here is given to Power Holding Company

of Nigeria, (PHCN). In the recent years the generation has

increased to about 75MW i.e. 68% of installed capacity.

1.2.4 Viability of the Ajaokuta Steel Company

As regards the viability of the steel company, there is no doubt

that the company is very viable and capable of meeting the

country’s expectations. Although the Steel plant is yet to

produce steel which is the objective for which it was set up due

mainly to the fact that it is only about 98% technically ready,

the stand alone or the revenue yielding tail-end units as

highlighted are ready for commercial use.

1.3 Importance and Scope of the Study

Ajaokuta Steel Company is used as a case study because it is an

engineering industry which might serve as basis of Nigeria

technological developments and a need for quality management

effectiveness is necessary. The research covers ISO 9001 Quality

Management Systems approach to Total Quality Management (TQM).

The result of the study is to be used by the Management of

Ajaokuta Steel Company, and other steel companies in Nigeria to

harmonise their operations with international practices for

sustainable growth and development. The study will also assist

Ajaokuta Steel Company or any other company that requires

certification/registration to Quality Management System standard

based on ISO 9001 (certification or registration process by any

accredited certification body like Standards Organization of

Nigeria, Bureau Veritas, SGS Inspection Agency, UKAS, etc that

assess and issue certificate of conformance with the requirement

of ISO 9001) to structure their processes in line with the

requirements of the international standard in readiness for the

certification assessment by the certification body if required.

The study can also be used by other sectors, including public

sectors, to structure their processes in line with

internationally established practices that will ensure

sustainable growth.

1.4 Objective of the Study

In view of the importance of the steel sector to economic

development and the fact that the sector is currently in jeopardy

as regards its survival, this study is to:

i. Investigate the operation of the steel sector

ii. Identify the root causes of the problems that have hindered

the progress of the sector.

iii. Assess the possibility of using best practices, particularly

the Quality Management System based on ISO 9001 Standard,

for sustainable development of the sector.

iv. Identify gaps in the operation of the sector as compared

with international best practices.

v. Suggest ways to resolve them in line with the requirements

of the Quality Management System.

CHAPTER TWO

LITERATURE REVIEW

2.1 Quality

Total quality is a major factor in the business quality

revolution that has proven itself to be one of the 20th century

most powerful creators of sales and revenue growth, genuinely

good new jobs, and soundly based and sustainable business

expansion, (Feigenbaum and Feigenbaum, 1999). This underscores

the relevance and role quality plays in business success and

sustainable development. Quality has thus become a household name

beyond the boundaries of manufacturing into other nooks and

corners of life. You thus can hear things like quality player,

quality speech, quality music, quality service, etc. This raises

a fundamental question on what quality is. There seems to be no

universally accepted definition for quality as the word quality

has a variety of interpretations and use. Ask anybody what is

quality and he tells you he knows it when he sees or feels it or

when he smells or tastes it, among others. This has made many

people to define quality in several ways. The dictionary

definition of quality is the standard of something when compared

with other things like it or good characteristics (Hornby, 1995).

Some known definitions of quality in view of reknown writers

include among others the followings:

i. Degree to which a set of inherent characteristics fulfils

requirements, (ISO, 2005).

ii. Accepted Quality Level, (BSI,1991).

iii. Fitness for purpose/use, (Juran,1988).

iv. Quality is durability of products (Deming, 1981).

v. Quality is a measure of product and service delivery system

performance, (Edosomwan, 1999).

vi. Conformance to agreed and fully understood requirements,

(Crosby,1979).

vii. Quality consist of the capacity to satisfy wants,

(Edwards, 1968).

viii. Quality means best of certain conditions: (a) the actual

use, and (b) the selling price, (Feigenbaum, 1983).

ix. Quality means that the organization’s culture is defined by

and supports the constant attainment of customer

satisfaction through an integrated system of tools,

techniques and training, (Sashkin and Kiser, 1993).

x. Quality digest magazine defines quality as the ongoing

process of building and sustaining relationships by

assessing, anticipating, and fulfilling stated and implied

need, ( www.qualitydigest.com/html/qualitydef.html ).

xi. According to Barrie, (2003); it is when one gives complete

customer satisfaction; Betz Dearborn’s Ltd definition or

Providing customer (internal and external) with products

and services that fully satisfy their negotiated

requirements; Rank Xerox’s (UK) definition.

It is thus clear that there is no universally accepted

definition of quality. But all the definitions are about

the characteristics of the products in relation to the

message the originators wants to pass across. Some of the

http://www.qualitydigest.com/html/qualitydef.html

definitions are customer, product, process or system based

while others are value, performance or management based.

The important thing is that all parties involved should be

clear of characteristics of the product or service in

question.

2.1.1 Importance of quality

Why is quality important? According to Dale (2003), to answer

this question one just need to consider the unsatisfactory

examples of products and/or service that you have experienced,

the bad feelings it gives, the resulting actions taken and the

people you told about the ugly experience and the outcome.

Goodman et al, 2000, outlined two arguments that are effective in

selling quality to senior management. First, quality and service

improvements can be directly and logically linked to enhanced

revenue within ones company, and secondly higher quality allows

companies to have higher margins. Quality seems to be more

appreciated from its negative side. Thus the cost of quality i.e.

the cost of not doing it right the first time is very wide.

According to Dale and Plunkett, 1990, quality related cost ranges

from 5 to 25 percent of company annual sales turnover out of

which ninety five percent is expended in appraisal and failure

costs. Hence reducing failure costs and subsequently appraisal

cost by the application of cost effective quality management

system can reduce the cost to one-third.

2.1.2 Quality and Sustainability of Organizations in Nigeria

The problem of sustainability is a big one to companies in

Africa, particularly in Nigeria. The percentage of companies that

existed about 50 years back which are still surviving is

extremely very low when compared with those of the developed

countries in the World. Companies spring up every day but most

barely survive ten years period of meaningful existence. They

collapse and pack up or bought over by others whose own survival

may not necessarily be better.

The biggest challenge to companies in Nigeria and particularly in

the steel sector is their ability to survive after ten years of

establishment. Although it is not the intent of this research to

exhaustively analyse the causes of their failures, it is a common

belief that lack of quality management system plays a key role.

Many companies do not have a structured way of running their

businesses. The absence of quality management system has left

their survival to chances. Sustainability has direct bearing with

quality not just with the product of the organization but even

with the associated services that go along with it. It should

therefore interest all companies to find out how they will manage

the quality for their survival.

2.2 Evolution of Quality Management System

The vital positions of quality in business performance of

companies have necessitated extensive research in ways to improve

quality. Subsequently, systems for improving and managing quality

have evolved rapidly in recent years. According to Dale (2003),

four fairly discrete stages in progression of managing quality

can be identified; inspection, quality control, quality assurance

and total quality management. Their relationships can simply be

presented as in figure 2.1, below.

KeyI InspectionQC Quality controlQA Quality assuranceTQM Total Quality

I

QC

QA

TQM

Management

Figure 2.1: The Four Levels in the Evolution of TQM (Dale,2003)

2.2.1 Inspection

According to ISO 9000 (2005), inspection is the conformity

evaluation by observation and judgement accompanied as

appropriate by measurement, testing or gauging. Under inspection

based system, one or more characteristics of product, service or

activity are examined, measured, tested, or assessed and compared

with specified requirements to assess conformity with a

specification or performance standard. It is applied to incoming

goods and materials, manufactured components and assemblies at

appropriate points and before finished goods are passed into

warehouse, Dale (2003).

2.2.2 Quality Control

Quality control is the part of quality management focused on

fulfilling requirements, ISO 9000 (2005). Quality control is a

control, such as inspection or testing, introduced into an

industrial or business process to ensure quality, or it is a

system of control meant to guarantee, by periodic inspections,

that a certain amount of quality is being maintained during the

production of the product in question; materials, procedures,

tools, etc., as well as the product itself are inspected,

( www.en.wiktionary.org/wiki/quality_control ). Under a system of

quality control one expects to find in place a detailed product

and performance specifications, paperwork and procedures control

system, raw material and intermediate-stage product testing and

reporting activities, logging of elementary process performance

data, and feedback of process information to appropriate

personnel data. Organizations whose approach to management of

quality is based on inspection and quality control are based on

detection-type mode (i.e. finding and fixing mistakes), Dale

(2003).

2.2.3 Quality Assurance

According to ISO 9000 (2005), It is part of quality management

focused on providing confidence that quality requirements will be

fulfilled. Additional features acquired when progressing from

quality control to quality assurance are a comprehensive quality

management system to increase uniformity and conformity, use of

the seven quality control tools (histogram, check sheet, Pareto

http://www.en.wiktionary.org/wiki/quality_control

analysis, cause and effect diagram, graphs, control chart and

scatter diagram), statistical process control, failure mode and

effect analysis and the gathering and use of costs. Above all,

there will be a shift from detection to prevention of non

conformances, Dale (2003). It is a program that is intended, by

its actions, to guarantee a standard level of quality, or it

refers to planned and systematic production processes that

provide confidence in product's suitability for its intended

purpose, ( www.yourwebassistant.net) .

2.2.4 Total Quality Management

The fourth and the highest level is the total quality management

which involves the application of quality management principles

to all aspects of the organization, including customers and

suppliers, and their integration with business process. Quality

Management System can be expressed as the organizational

structure, procedures, processes and resources needed to

implement quality management,

(www.en.wikipedia.org/wiki/Quality_management_system). According

to Dale (2003), total quality management requires that the

http://www.en.wikipedia.org/wiki/Quality_management_system

principles of quality management should be applied in every

branch and at every level in the organization with an emphasis on

integration into business practices and a balance between

technical, managerial and people issues. It is a company-wide

approach to quality, with improvements undertaken on

continues basis by everyone in the organization. There are many

interpretations and definition of TQM. Dale (2003), simply put it

as mutual co-operation of everyone in an organization and

associated business processes to produce value for money products

which hopefully meets and exceeds the expectations of customers.

2.2.5 Why the evolution of TQM?

A major influence on industry since the 1980s has been the

quality movement. The quality revolution has grown over two

decades, beginning in quality technology and proceeding through

the quality circles movement. It has stabilized over the past 10

years or so under the general titles of total quality control

(Hancock et al. 1992), or total quality management (Evans and

Lindsay 1993). Quality itself is defined as meeting or exceeding

customer expectations (fitness for use) or conformance to specifications

(manufacturing quality). TQM is seen as having both technical and

managerial components, in that quality requires both technical

knowledge and organizational knowledge. The most basic quality

requirement is freedom from design error, or ‘‘off-line

quality,’’ as Taguchi and Wu (1979) characterize it. Agricultural

products, manufactured goods, and delivered services must meet

the needs of their customer over a wide range of customer

environments. Products must be functional and must be free from

user / product mismatches because any mismatch is by definition a

design error. The implications are that designers know their

customers’ needs and have the techniques to turn these needs into

product design. For test and inspection the implications are

largely in the design stage, where human factors test and

evaluation is an important component of customer service (O’Brien

and Charlton 1997).

Secondly, globalized production cannot work unless all elements

of the company’s global operations fit together without error.

Thus, new production systems based on pervasive computer-mediated

design and manufacturing can assemble parts from up and down the

supply chain without first-time errors of fit. Modern civil and

military aircraft production give prime examples of this freedom

from physical error. In a customer-oriented system, any over-cost

or delayed delivery is an error with the same effects on company

performance as a defective product. The implication for test and

inspection is that we must be able to measure these customer

needs and convert them into measurable precursors of error

states.

2.3 Quality Management in Organizations

In quest to assist organizations to find solution to how best to

manage quality, researchers have come up with many models for

quality management. Some of the popular ones include among

others:

i. Balance score card

ii. Business Excellence model

iii. Quality Management System

iv. Six Sigma

The principles from these models are the various approaches which

the originators through researches have established as road maps

on how to manage quality for the benefits of the organization as

well as the customers. The models have several similarities and

focus and all seem to play around management style, business

strategy, process management, result generation and objective

achievement. The various researches seem to indicate a strong

link between success and quality. There seems to be a strong link

between managing quality and its success. The various segments in

the models are principles established by the originator on

related issues and are therefore linked by the way he views the

issue in relation to quality of the final product. Some of these

models are examined in the subsequent sub-clauses.

2.3.1 Balance Scorecard

The balanced scorecard is a strategic planning and management

system used to align business activities to the vision and

strategy of the organization, improve internal and external

communication, and monitor organizational performance against

strategic goals. It is a tool used to execute and monitor the

organizational strategy by using a combination of financial and

non-financial measures. According to Juran et al (1999), gone are

the days when financial results were all that mattered. In

today’s world, organizations must deliver a combination of

financial and nonfinancial performance outcomes. Organizations

who do not understand the new scorecard of performance will fall

into the three main traps of a financial-only approach to

performance management:

i. Unsustainability: Achieving sustained organizational

performance demands outcomes and results that benefit all of

the constituencies that matter. Shareholders provide

opportunities and rewards to people of the enterprise to

deliver value to customers, who generate returns to

shareholders, who in turn provide opportunities to the

people of the organization, and so on. If you substitute

citizens or beneficiaries for customers of the enterprise,

you can apply this concept to profit and not-for-profit

organizations. Focusing solely on financial measures will

create shortfalls in customer service, employee

satisfaction, or product / process quality. The wise

executive looks at financial measures as lagging measures

and seeks other more direct measures of contributing

performance to serve as leading measures.

ii. Demotivation: Executives at the top are motivated by

performance measures because they also receive big paydays

from achieving them. But today’s competitive environment

requires tremendous energy and contribution from people

throughout the organization. For most people in the

organization, financial measures are a too-distant indicator

of success or failure, to which many have contributed.

Concentrating solely on the financial dimension of

measurement is not motivating. It can go further toward

being demotivating if people suspect that leaders are

concentrating on financial measures out of self-interest.

iii. Confusion: People need to see how and why their

contributions make a difference. Financial goals alone will

not reach or connect with very many individuals or groups.

These people can become confused and resort to activity-

based goals to fill their void.

This new scorecard was first popularized by Kaplan and Norton

(1995). All organizations have multiple constituencies such as

shareholders, customers, employees, and strategic partners. Each

of these constituencies has performance needs and concerns that

must be met if the organization hopes to survive and thrive.

Kaplan and Norton’s scorecard emphasizes the need to convert an

organization’s strategy into a series of linked performance

metrics and outcomes across a 4D logic that suggests that a

firm’s financial results directly arise from results that matter

to customers, which in turn arise from results of internal

processes, which in turn arise from results that matter to the

people of the organization in terms of learning and growth.

Smith (1999), fundamentally improved on Kaplan and Norton’s

thinking by suggesting that the balanced scorecard can be both

more balanced and more integrated by replacing the linear logic

of people-to-process-to-customer-to-shareholder with a

reinforcing, integrated logic wherein results for each

constituency both leads and lags results for others. Accordingly,

managing performance in a sustainable way looks more like Figure

2.2, which depicts a philosophy for never-ending success.

Figure 2.2: Performance cycle (Smith, 1999)

When viewed in this way, financial and nonfinancial goals all

reinforce and link to one another. Moreover, the goals support a

narrative or story of success that will not fall victim to

unsustainability, demotivation, and confusion. The balance score

card is therefore designed to translate vision and strategy into

objectives and measures across four perspectives,

i. Financial

ii. Customer,

iii. Internal Business Process

iv. Learning and growth.

The Balanced Score Card gives a frame work ensuring that the

strategy is translated into coherent set of performance measures.

The implementation involves four processes.

i. Translating the vision into operational goals

ii. Communicating the vision, and linking it to individual

performance

iii. Business planning

iv. Feedback and learning, and adjusting the strategy

accordingly.

The model has identified the need for Key Performance Indicators

(KPI) for the four perspectives as follows.

(http://en.wikipedia.org/wiki/Balance Score Card

i) Financial

a. Cash flow

b. ROI

http://en.wikipedia.org/wiki/Balance%20Score%20Card

c. Financial result

d. Return on capital employed

e. Return on equity

ii) Customer

a. Delivery performance to customer by date

b. Delivery performance to customer by quality

c. Customer satisfaction rate

d. Customer loyalty

e. Customer retention

iii) Internal Business Processes

a. Number of activities

b. Opportunity success rate

c. Accident ratios

d. Overall equipment effectiveness

iv) Learning and Growth

a. Investment rate

b. Illness rate

c. Internal promotions

d. Employee turnover

e. Gender/racial ratios

Figure 2.3: Balance Scorecard Model, (Akanya, 2005).

Customer:To achieve one vision,how should we appear to our

Financial:To succeed financially, how should we appear to our

Vision and Strategy

Learning and Growth:To achieve our vision, how willwe sustain to achieve our vision, how will we sustain our

Internal Business Processes:To satisfy our shareholders and customers, what business

All clausesaddressesObjectivesMeasuresTargets

2.3.1.1 Benefits of Applying Balanced Scorecard

The benefit of implementing this model includes among others

the following:

i. Balanced scorecard provides a framework to focus on

key perspectives that will lead to success, and

provides a framework to constantly assess performance

against targets.

ii. Balanced scorecard helps align key performance

measures with strategy at all levels of organization.

iii. Balanced scorecard provides management with a

comprehensive picture of business goals and strategies

at all levels of an organization.

iv. Competency-driven performance management systems

v. Competency-driven 360-degree feedback programs

vi. Coaching and counseling ,

(www.mactayconsulting.com/th/talentp.php)

2.3.2 Business Excellence Models

Several models, tools, and techniques are available for improving

the quality of products and services and managing the total

quality leadership process. The business excellence models are

found to be increasingly relevant to the central message of

quality improvement. They are a way to portray the lessons from

the work of DeGeus and Collins and Porras. Greene (1993),

reviewed quality practices in Japan and the United States and

claims to have identified about 24 dimensions of total quality

management (TQM). Edosomwan (1998), identified several TQL tools

for improving quality and performance at the individual, work-

unit, and organizational levels. The Malcolm Baldrige National

Quality Award performance excellence criteria have been widely

used as a model for total quality leadership and a tool for

achieving performance excellence. The Malcolm Baldrige Award has

created a Performance Excellence Framework (National Institute of

Standards and Technology, 1999). The Baldrige criteria and model

focus on leadership as a driver of quality. Other aspects of the

model include information and analysis, strategic planning,

process management, human resource management and development,

customer and market focus, and business results. Edosomwan

(1998), developed a more comprehensive performance excellence

model, shown in Figure 2.4, that has been utilized by both

public- and private-sector organizations for improving all

aspects of performance. This model is based on augmented,

expanded performance criteria, an expanded scoring system, and a

defined implementation methodology. The categories and key

components of EPEM, described below, retain the components of the

Baldrige criteria while providing a more comprehensive, universal

criteria and performance-improvement system for both public- and

private-sector organizations.

Figure 2.4: Edosomwan Performance Excellence Model (EPEM). (Edosomwan, 1998)

Another example of Business Excellence Model is the nine-box

model, originally developed by the European Foundation for

Quality Management (EFQM). Its purpose is to "support the

management of Western European organizations in accelerating the

process of making quality a decisive influence for achieving

global competitive advantage" The model is bases on 9 Criteria, 5

of which are enablers and 4 are results. The enabler criteria

cover what an Organization does, while the result criteria cover

what the organization achieves. The results are caused by enabler

and the enablers are improved by using feedback from the results.

High performing organizations have management frameworks which

define what they do and explain why they do it. The EFQM

Excellence Model is the most widely used organizational framework

in Europe and it is the basis for the majority of national and

regional Quality Awards. Used as a tool for assessment, it

delivers a picture of how well the organization compares to

similar or very different kinds of organization. Used as a

management model it can be used to define aspirations for the

organization’s capability and performance. A typical example of

the model is as shown in Figure 2.5 below.

Figure 2.5: EFQM Excellence model

How does the Model work?

The idea is that you conduct a Self-Assessment by comparing your

organization to the Model. The Model presents a plausible logic.

Results-financial, customer satisfaction, people satisfaction and

impact on society are achieved through acting on Enablers-

leadership, policy and strategy, people management, resources and

process management. By improving the ‘how’, it is argued,

improved results - the ‘what’ - will follow. The model

emphasises self assessment which has been criticized by some

early users as not producing results. Critics like John Seddon,

have adopted a more radical approach to self assessment as

depicted in Figure 2. 6 below. According to peters (2001), the

self-assessment provides benefits; however, an assessment

conducted by an outside resource provides a greater sense of the

big picture in terms of objectivity and completeness.

Figure 2.6: Performance Improvement Self Assessment

2.3.3 Benefits of Business Excellence Model

Research indicates that organizations with a business excellence

approach obtain significant benefits

(http://www.businessexcellencetools.com/be_benefits.html). This

research includes that conducted in US, Europe, Australia and NZ.

Beyond improvement in financial indicators, other benefits

include:

i. Product reliability

ii. Enhanced innovation and idea generation

iii. Increased customer satisfaction

iv. Organizational growth (employees)

v. Increase employee satisfaction and involvement

vi. Improved efficiency and effectiveness

vii. Product reliability

Notwithstanding these benefits, of which there is considerable

evidence and also debate, one key benefit of award-based models

http://www.businessexcellencetools.com/be_benefits.html#nz

http://www.businessexcellencetools.com/be_benefits.html#oz

http://www.businessexcellencetools.com/be_benefits.html#eu

http://www.businessexcellencetools.com/be_benefits.html#us

http://www.businessexcellencetools.com/be_benefits.html

is that they provide a ‘balanced scorecard’ of criteria and

measures against which organizations can objectively evaluate

their management systems and performance, and compare that

performance with world standard benchmark levels, or with the

performance of other organizations,

(http://www.systemsthinking.co.uk/6-3.asp).

2.3.3 ISO 9000 Family of Standards

Another model of Quality management is the ISO 9000 series of

standards. It is a product of International Organization for

Standardisation (ISO), and this model of Quality Management

System was developed based on eight (8) principles, namely:

i. Customer focus

ii. Leadership

iii. Involvement of people

iv. Process Approach

v. System Approach to Management

vi. Continual Improvement

http://www.systemsthinking.co.uk/6-3.asp

vii. Factual approach to decision making

viii. Mutually Beneficial suppliers Relationship

The ISO 9000 family of standards currently contains over 20

standards and documents (Smith, 2001). By the end of the year

2000, a new version of the ISO 9000 quality management standards

was issued. The three primary standards in the Year 2000 ISO 9000

are:

i. ISO 9000: Quality management systems—Fundamentals and

vocabulary

ii. ISO 9001: Quality management systems—Requirements

iii. ISO 9004: Quality management systems—Guidance for

performance improvement.

These standards (primary standards) have all been reviewed again

in 2005, 2008 and 2009 respectively. These standards though can

be used independently, are consistent pairs that support each

other. ISO 9000 contains the basic concepts and definition of

terms that will assist the implementer to understand the concept

of the model. ISO 9001 is the most recognized and the only

standard in the family that contains requirements which an

organization must meet to have complied with the model. It

specifies requirements for Quality Management System of an

organization that needs to demonstrate its ability to

consistently provide product that meets customer and applicable

regulatory requirements and aims to enhance customer

satisfaction

through the effective application of the system, including

processes for continual improvement and of the system and the

assurance of conformity to customer and applicable regulatory

requirements. The third member (ISO 9004) gives explanation and

provides guidelines for organization that with to go beyond

meeting requirements by improving their internal processes and

performance, (ISO, 2000).

2.3.3.1 International Organization for Standardisation

(ISO)

ISO (International Organization for Standardization) is the

world's largest developer and publisher of International

Standards. It is a network of the national standards institutes

of 162 countries, one member per country, with a Central

Secretariat in Geneva, Switzerland, that coordinates the system.

According to Smith et al (2001), The International Organization

for Standardization (ISO) has been developing technical standards

over many sectors of business, industry, and technology since

1947. With the exception of ISO 9000 and ISO 14000, the vast

majority of ISO standards are highly specific. They are

documented agreements containing technical specifications or

other precise criteria to be used consistently as rules,

guidelines, or definitions of characteristics. The goal of these

standards is to ensure that materials, products, processes, and

services are fit for their purpose. Then in 1987 came ISO 9000,

followed nearly 10 years later by ISO 14000. These two standards

are very different from the majority of ISO’s highly specific

standards.

ISO 9000 and ISO 14000 are known as generic management system

standards. Management system standards provide the organization

with a model to follow in setting up and operating the management

system. ISO 9000 is concerned with quality management, whereas

ISO 14000 is concerned with environmental management. Quality

management regards what the organization does to ensure that its

products conform to the customer’s requirements. Environmental

management regards what the organization does to minimize harmful

effects on the environment caused by its activities. Both ISO

9000 and ISO 14000 concern the way an organization goes about its

work, and not directly the result of this work. That is, ISO 9000

and ISO 14000 concern processes, and not products, at least

directly. Both standards provide requirements for what the

organization must do to manage processes influencing quality (ISO

9000) or the processes influencing the impact on the environment

(ISO 14000).

ISO is a non-governmental organization that forms a bridge

between the public and private sectors. On the one hand, many of

its member institutes are part of the governmental structure of

their countries, or are mandated by their government. On the

other hand, other members have their roots uniquely in the

private sector, having been set up by national partnerships of

industry associations. Therefore, ISO enables a consensus to be

reached on solutions that meet both the requirements of business

and the broader needs of society,

(http://www.iso.org/iso/about.htm).

2.3.3.2 Structure of ISO 9001 Standards

The ISO 9001 has eight main clauses; the first three which are

common to all ISO standards covers the Scope, Normative Reference

and Terminology. The remaining five clauses which forms the five

main parts of the standard are

i. Quality Management requirements

ii. Management responsibility

iii. Resource Management

iv. Product realization

v. Measurement, analysis and Improvement

The clauses cover the application of the principles that have

been reduced into 234 requirements. The structure of the ISO 9001

is as in Figure 2.7 below.

http://www.iso.org/iso/about.htm

Figure 2.7: Model of a process based Quality Management System

(ISO 9001)

2.3.3.3 Internal Benefits of ISO Certification

Whether certification is required or not, ISO 9000 series

certification provides a variety of internal benefits.

http://www.referenceforbusiness.com/encyclopedia/Int-Jun/ISO-

9000.html. First, ISO 9000 certification leads to better

documentation of company processes. This, in turn, leads to more

efficient production processes and less waste. Both save money

for a company.

Second, managers and other employees become more aware of

quality. They begin to view operations through a "quality of

management" lens. This leads to a more efficient company that can

be more competitive in the marketplace.

Third, employee morale improves. When employees feel that they

are part of the process, they accept responsibility for quality.

This creates an incentive for workers to do a better job and

makes the company more efficient.

http://www.referenceforbusiness.com/encyclopedia/Int-Jun/ISO-9000.html


Fourth, cooperation and communication are improved. Documenting

procedures facilitates communication and promotes cooperation.

Fifth, production processes can be made more efficient. When

there is better coordination of processes, there is less "down

time," and resources are shared among departments more

efficiently.

Sixth, fewer defective products are produced. Better quality

results in fewer defects, less scrap, and, therefore, lower

production costs. Finally, documentation of safety standards

results in fewer accidents. In turn, there is less downtime for

employees. The ultimate results are more efficient workers and

lower costs of production.

2.3.3.4 External Benefits of ISO Certification

According to encyclopaedia of business,

http://www.referenceforbusiness.com/encyclopedia/Int-Jun/ISO-

9000.html, there are many potential external benefits. The first

is that company prestige increases. Companies following ISO 9000

series standards are perceived as "good corporate citizens" that



produce higher quality products. Thus, they gain prestige that

can help retain old customers and attract new ones.

Second, it improves customer satisfaction. Higher quality means

higher customer satisfaction. Further, the manufacturer of a

product is certified, a customer may feel better about the

product even if it is, in fact, of no higher quality than that of

a non-certified manufacturer.

Third, it creates a higher level of trust. Customers perceive a

certified company as being more trust worthy than a non-certified

company.

Fourth, it reduces the need for customer audits. With

certification, a company has already been audited. Therefore,

customers will not feel a need to audit every time they want to

do business with a company. This can result in major savings. For

example, it is reported that in some industry segments in the

United States, a facility may be subject to dozens of audits per

year; in some cases it may be as many as 30 per month.

Fifth, it can help a company increase its market share. Certified

companies gain access to markets that require ISO certification

and they can deepen penetration of existing markets. Finally, the

company can respond more quickly to market needs. With better

quality procedures, it is easier to develop and market new

product lines.

2.3.3.5 Alignment of ISO 9000 Management Principles with

Business Excellence Model

According to Hoyle (2001) there is a very close match between the

eight quality management principles and the business excellence

model used by the British Quality Foundation and the EFQM. The

model consists of nine criteria that are used to assess overall

strength of an organization and measure its progress towards

“best in class”. The model is based on the premise that customer

satisfaction, people (employee) satisfaction and impact on the

society are achieved through leadership driven policy and

strategy, people management, partnership & resources and

processes leading ultimately to excellence in business results.

These are the nine criterias and supporting these are eight

fundamental concepts that have some similarity with eight

management principles as shown in Table 2.1 below.

The difference between the business excellence model and ISO 9000

are small enough to be neglected if you take a pragmatic

approach. If you take a pedantic approach you can find many gaps

but there re more benefits to be gained by looking for synergy

rather than for conflict, Hoyle (2001).

Table 2.1: Comparisons between ISO 9000 and Business ExcellencePrinciples

Business excellence concepts ISO 9000 principlesCustomer focus Customer focusLeadership and constancy of

purpose

Leadership

People development and involvement Involvement of peopleManagement by processes and facts Process approach

System approach Factual approach to decision

makingContinues learning, innovation and

improvement

Continual improvement

Partnership development Mutually beneficial supplier

relationshipPublic responsibility No equivalent principleResults orientation No equivalent principle

2.3.4 Six Sigma

Another model of Quality management system is the Six Sigma. The

six sigma Model seeks to identify and remove the causes of

defects and errors in manufacturing and business processes. It

uses a set of quality management methods, including statistical

methods, and creates a special infrastructure of people within

the organization (Black Belts, Green Belts etc) who are experts

in these methods. Each Six Sigma Project carried out within an

organization follows a defined sequence of steps and has

quantified financial targets, cost reduction or profit increase,

(http://www.isixsigma.com/library/content/c020815a.asp).

http://www.isixsigma.com/library/content/c020815a.asp

2.3.4.1 Origin of Six Sigma

The roots of Six Sigma as a measurement standard can be traced

back to Carl Frederick Gauss (1777-1855), who introduced the

concept of the normal curve. Six Sigma as a measurement standard

in product variation can be traced back to the 1920's when Walter

Stewart showed that three sigma from the mean is the point where

a process requires correction. Many measurement standards (CPK,

Zero Defects, etc.) later came on the scene but credit for

coining the term "Six Sigma" goes to a Motorola engineer, named

Bill Smith. (Incidentally, "Six Sigma" is a federally registered

trademark of Motorola).

In the early and mid-1980s with Chairman Bob Galvin at the helm,

Motorola engineers decided that the traditional quality levels-

measuring defects in thousands of opportunities-didn't provide

enough granularities. Instead, they wanted to measure the defects

per million opportunities. Motorola developed this new standard

and created the methodology and needed cultural change associated

with it. Six Sigma helped Motorola realize powerful bottom-line




http://www.isixsigma.com/forum/showmessage.asp?messageID=7235

http://www.isixsigma.com/forum/showmessage.asp?messageID=7235

results in their organization - in fact, they documented more

than $16 Billion in savings as a result of the Six Sigma efforts.

2.3.4.2 Characteristics and methodology of Six Sigma

The features that set up six sigma apart from the previous

quality management includes

i. A clear focus on achieving measurable and quantifiable

financial returns on any six sigma projects.

ii. An increased emphasis on strong and passionate management

leadership and support.

iii. A special infrastructure of “Champions”, “Master Black

Belts”, “Black Belts”, etc to lead and implement the six

sigma approach.

The widely accepted definition of the Six Sigma process is one

that produces 3 to 4 defects parts per million opportunities

(DPMO). Six Sigma has two key methodologies: DMAIC and DMADV both

inspired Deming’s PLAN-DO-CHECK-ACT Cycle.

2.3.4.3 Define, Measure, Analyse, Improve and Control

(DMAIC)

The DMAIC is used to improve an existing system. The basic

methodology consists of the following steps

i. Define process improvement goals that are consistent with

customer demands and the enterprise strategy.

ii. Measure key aspects of the current process and collect

relevant data.

iii. Analyse the data to verify cause-and-effect

relationships. Determine what the relationships and

attempt to ensure that all factors have been considered.

iv. Improve or optimize the process based upon data analysis

using suitable techniques like design of experiments.

v. Control to ensure that any deviations from targets are

corrected before they result in defects. Set up pilot

runs to establish process capability, move on to

production, set up control mechanism and continuously

monitor the process.

2.3.4.4 Define, Measure, Analyse, Design and Verify (DMADV)

The DMADV is used to create new product or process design. The

basic methodology consist of the following five steps

Define design goals that are consistent with customer demands and

enterprise strategy.

Measure and identify characteristics that are critical to

quality, product capabilities, production process capability, and

risks.

Analyse to develop and design alternatives, create a high level

design and evaluate design capability to select the best design.

Design details, optimize the design, and plan for design

verification. This phase may require simulations.

Verify the design, set up pilot runs, implement the production

process and hand it over to the process owners

2.3.4.5 Benefits of Six Sigma

Unlike other operational strategies, the implementation of Six

Sigma on a company structure will produce both tangible and

intangible results.

Here are a few results that you can expect

(www.sixsigmaonline.org/six-sigma-training).

i. Increase in customer loyalty: Better products result in

more satisfied customers, and

ii. that means customers who return to your business.

iii. Increased bottom line: Receiving Six Sigma certification

will mean a dedication to efficient processes across the

board. Fewer resources are allocated to correction and

more towards production, meaning more products for sale

and fewer defects.

iv. Shareholder value: The increased customer loyalty and

increased revenues will result in a rise in company stock

prices, therefore an increased value for your

shareholders.

v. Customer satisfaction: Your customers will get what they

paid for every time. In addition, they will receive it at

a higher value or a lower cost.

vi. Increased employee satisfaction: Any company has to worry

about the costs for employee turnover, and certification

through Six Sigma has proven to increase employee

satisfaction. Positive returns of quality work prove to

be highly motivational, and motivation reduces burnout.

vii. Benefits to the supply chain: Supplier and customers both

benefit from the creation of a better product through

adherence to the Six Sigma principles, achieved in

certification.

CHAPTER THREE

MATERIALS AND METHODS

3.1 Introduction

This study critically examined the processes of Ajaokuta Steel

Company through administering of questionnaires developed from

the requirements of ISO 9001 standard. The study involved

inspection monitoring and examination of the structure,

facilities, processes, procedures, practices and documentation

of Ajaokuta steel company and three other companies (SWIPHA,

NOCACO and ARMECO) in line with international practices with the

aim of identifying level of compliance and to identify areas of

improvement that will enable establishment, implementation and

maintenance of sustainable quality management system that will

guarantee growth and survival of the company. This model of

quality management system has been chosen based on the following

reasons:

i. It is the only model that has been successfully applied in

Nigeria

ii. It was developed by a body comprising 162 countries in the

world that are represented by their standards bodies

iii. It is the most widely used model in the world

iv. It is accepted worldwide

v. It has the highest number of certificates issued based on

compliance to this model (standard) than any other model in

the world

vi. It is simply to implement than most other models

vii. It is reviewed for continual improvement at an interval of

about five years

viii. It is applicable to all organizations regardless of size,

product or complexity.

ix. The knowledge of its application and the associated man

power requirements are readily available in the country

3.2 Development of Questionnaire

The questionnaire was developed that covered the requirements

spread in the standard from clause 4 to clause 8 in the

following five areas:

i. Quality Management System and Documentation Requirements

ii. Management .Responsibility

iii. Resource Management

iv. Product Realization

v. Measurement, Analysis and improvement

The questionnaire was developed and structured in line with the

requirements of the standard (ISO 9001) for ease of reference

and application (Appendix A)

3.2.1 Quality Management System and Documentation

Requirements

This part of the standard specifies requirements are the

following:

i. The required structure of the organization

ii. Determination of processes and resources

iii. The minimum documentation requirements

iv. The required controls for documents

v. The required controls for records

3.2.2 Management Responsibility


following:

i. The required commitment from top management on quality

ii. The requirements for quality determination based on

customer requirements

iii. Policy requirements by management

iv. Requirements for definition of responsibilities and

internal communication

v. Requirements for Regular progress review

3.2.3 Resource Management


following:

i. Determination and provision of resources (including

budgeting)

ii. Competence and trainings

iii. Equipment and maintenance

iv. Work environment

3.2.4 Product Realization


following:

i. Customer relation

ii. Product design

iii. Purchasing

iv. Production processes (including quality assurance processes

and product preservation)

3.2.5 Measurement, Analysis and Improvement


following:

i. Four monitoring and measurements to be done

ii. Controls for deviations and anomalies

iii. Corrective and preventive actions

iv. Data analysis and usage

3.3 Continual Improvement

The study identify the following tools for improvement of the

system and sustainable development

i. Process capability reviews

ii. Product performance review

iii. Suppliers’ assessment

iv. Internal audit

v. Customer compliment and feedback

vi. Inspection

An improvement form was designed for application of these tools

that will ensure capturing of process performance into useful

data and subsequently analyzing and using it for improvement.

The form contains information about the process or product,

potential or actual defect identified, correction or remedial

action taken, study section that identifies the root cause of

the problem, plan of action to eliminate the root cause of the

problem, implementation and documentation of the result and the

review of the action taken for effectiveness ( Appendix B).

CHAPTER FOUR

RESULTS

4.1 Compliance Results

The questionnaire was administered in Ajaokuta Steel Company and

three (3) selected companies to see the level of their

compliance. The result is in table 4.1 below and the

corresponding charts are as shown in figure 4.1. The values in

the table were obtained by comparing the number of requirements

complied with (Y), partially complied with (P), not complied

with (N) and the ones that were not applicable (NA) to the total

requirements as per the clauses of the standard.

Table 4.1: Summary Results of Questionnaires

Clause

TR ASCL SWIPHA NOCACO ARMECOY P N NA Y P N NA Y P N NA Y P N NA

4.1 8 7 1 0 0 8 0 0 0 8, 0 0 0 8 0 0 04.2 25 17 7 1 0 24 1 0 0 23 0 0 2 25 0 0 05.1 4 3 1 0 0 4 0 0 0 4 0 0 0 4 0 0 05.2 4 2 2 0 0 4 0 0 0 4 0 0 0 4 0 0 05.3 3 2 1 0 0 3 0 0 0 3 0 0 0 3 0 0 05.4 6 4 2 0 0 6 0 0 0 6 0 0 0 5 1 0 05.5 12 6 5 1 0 12 0 0 0 11 1 0 0 10 2 0 05.6 6 5 1 0 0 5 1 0 0 6 0 0 0 6 0 0 06.1 4 0 4 0 0 4 0 0 0 4 0 0 0 4 0 0 06.2 9 4 5 0 0 9 0 0 0 9 0 0 0 9 0 0 06.3 2 0 2 0 0 2 0 0 0 2 0 0 0 2 0 0 06.4 10 2 7 1 0 10 0 0 0 10 0 0 0 9 1 0 07.1 6 6 0 0 0 6 0 0 0 6 0 0 0 6 0 0 07.2 12 8 4 0 0 12 0 0 0 12 0 0 0 11 1 0 07.3 18 0 0 0 18 18 0 0 0 18 0 0 0 17 0 0 1

7.4 11 4 5 2 0 11 0 0 0 11 0 0 0 11 0 0 07.5 14 11 3 0 0 14 0 0 0 11 0 0 3 14 0 0 07.6 1 1 0 0 0 1 0 0 0 1 0 0 0 1 0 0 08.1 1 1 0 0 0 1 0 0 0 1 0 0 0 1 0 0 08.2 17 16 1 0 0 17 0 0 0 17 0 0 0 17 0 0 08.3 6 4 2 0 0 6 0 0 0 6 0 0 0 6 0 0 08.4 2 2 0 0 0 2 0 0 0 2 0 0 0 2 0 0 08.5 10 10 0 0 0 10 0 0 0 10 0 0 0 10 0 0 0

191

115

53

5 18 189

2 0 0 185

1 0 5 185

5 0 1

Figure 4.1 (a): Total requirements chart

Figure 4.1 (b): ASCL Compliance chart

KeyClause: Clauses of ISO 9001 ASCL: Ajaokuta Steel Company LimitedTR: Total requirements SWIPHA: Swiss Pharmaceutical Nigeria LtdY: Yes or fully implemented NOCACO: Northern Cable Manufacturing Company

Figure 4.1 (c): SWIPHA compliance chart

Figure 4.1 (d): NOCACO compliance chart

Figure 4.1 (e): ARMECO compliance chart

Figure 4.1 (f): Compliance chart for ASCL, SWIPHA, NOCACO and ARMECO

KeyC = complianceP =partial complianceN =non-compliance

4.2 Compliance graph

The compliance cumulative frequency distribution of the results from the two companies as compared with the total requirements isas presented in Table 4.2 and the corresponding graphs are shown in Figure 4.2. The values in columns 2, 3 and 4 are obtained as follows

y2 =y1 + r

Where y2 =cumulative sum of requirements complied with up to the current clause.

y1 = cumulative sum of requirements complied up to the previous clause.

r = requirements complied with as per current clause (obtained from columns 2, 3 and 7 of Table 4.1).

Table 4.2: Frequency distribution of quality compliance

Clau

se

TR ASCL SWIPHA NOCACO ARMECO

4.1 8 7 8 8 84.2 33 24 32 31 335.1 37 27 36 35 375.2 41 29 40 39 415.3 44 31 43 42 445.4 50 35 49 48 505.5 62 41 61 59 615.6 68 46 66 65 656.1 72 46 70 69 696.2 81 50 79 78 786.3 83 50 81 80 806.4 93 52 91 90 897.1 99 58 97 96 957.2 111 66 109 108 1067.3 129 66 127 126 1237.4 140 70 138 137 1347.5 154 81 152 148 1487.6 155 82 153 149 1498.1 156 83 154 150 1508.2 173 99 171 167 1678.3 179 103 177 173 1738.4 181 105 179 175 1758.5 191 115 189 185 185

Figure 4.2: Compliance graph

Theorem

If r satisfies

Then

(4.1)

Equation 4.1 is the correlation coefficient

Test for correlation coefficient

Test for r in case of two dimensional normal distribution t is anobserved value of random variable that has at t distribution withn-2 degree of freedom.

Simple covariance is

(4.2)

Where x j= is the independent variable

x = is mean of independent variable

yj = is the dependent variable

ỹ = is the mean of dependent variable

and r = (4.3)

The computed values from the results of study is as given in table 4.3

Table 4.3 (a): Computed Data for Correlation Analysis

Clause

TR ASCL

SWIPHA

x d1=x-x

d12 yi d2=

y- ỹ

d22 d1d2 yj d3=yj- ỹ d3

2 d1d3

4.1 8 -0.304

0.0924 7 2 4 -0.608 8 -0.217 0.471 0.0660

4.2 25 16.696

278.7564 17 12 144 200.352 24 15.783 249.1031 263.5130

5.1 4 -4.304

18.5244 3 -2 4 8.608 4 -4.217 17.7831 18.1500

5.2 4 -4.304

18.5244 2 -3 9 12.912 4 -4.217 17.7831 18.1500

5.3 3 -5.304

28.1324 2 -3 9 15.912 3 -5.217 27.2171 27.6710

5.4 6 -2.304

5.3084 4 -1 1 2.304 6 -2.217 4.9151 5.1080

5.5 12 3.696 13.6604 6 1 1 3.696 12 3.783 14.3111 13.9819

5.6 6 -2.304

6.3054 5 0 0 0 5 -3.217 10.3491 7.4119

6.1 4 -4.304

18.5244 0 -5 25 21.52 4 -4.217 17.7831 18.1499

6.2 9 0.696 0.4844 4 -1 1 -0.696 9 0.783 0.6131 0.5449

6.3 2 -6.304

39.7404 0 -5 25 31.520 2 -6.217 38.6511 39.1919

6.4 10 1,696 2.8764 2 -3 9 -5.088 10 1.783 3.1791 3.0240

7.1 6 -2.304

5.3054 6 1 1 -2.304 6 -2.217 4.9151 5.1080

7.2 12 3.696 13,6604 8 3 9 11.088 12 3.783 14.3111 13.9819

7.3 18 9.696 94.0124 0 -5 25 -48.48 18 9.783 07.4761 94.8559

7.4 11 2.696 7.2684 4 -1 1 -2.696 11 2.783 7.7451 7.5030

7.5 14 5.696 32.4444 11 6 36 34.176 14 5.783 33.4431 32.9399

7.6 1 -7.304

53.3484 1 -4 16 29.216 1 -7.213 52.0851 52.7129

8.1 1 -7.304

53.3484 1 -4 16 29.216 1 -7.213 52.0851 52.7129

8.2 17 8.696 75.6204 16 11 121 95.656 17 8.783 77.1411 76.3770

8.3 6 -2.304

5.3084 4 -1 1 2.304 6 -2.217 4.9151 5.1080

8.4 2 -6.304

39.7404 2 -3 9 18.912 2 -6.217 38.6511 39.1919

8.5 10 1.696 2.8764 10 5 25 8.48 10 1.783 3.1791 3.0240

∑ 191

- 812.8692 115

- 492 466 189

- 777.6763 798.4781

n=23, ẋ=8.304 N=23, ỹ =5.00 N=23, ỹ = 8.217

Table 4.3 (b): Computed Data for Correlation Analysis

Clause

TR NOCACO ARMECO

x d1=x-x

d12 yi D4=y-

ỹd2

2 d1d4 yj D5=yj- ỹ d32 d1d5

4.1 8 -0.304

0.0924 8 -0.043

0.00185 0.013072

8 -0.043 0.00185 0.013072

4.2 25 16.696

278.7564 23 14.957

223.71185

249.722072

25 16.957 287.539849

283.114072

5.1 4 -4.304

18.5244 4 -4.043

16.345849

17.401072

4 -4.043 16.345849

17.401072

5.2 4 -4.304

18.5244 4 -4.043

16.345849

17.401072

4 -4.043 16.345849

17.401072

5.3 3 -5.304

28.1324 3 -5.043

25.431849

26.748072

3 -5.043 25.431849

26.748072

5.4 6 -2.304

5.3084 6 -2.043

4.173849

4.707072

5 -3.043 9.259849 7,011072

5.5 12 3.696 13.6604 11 2.957

8.743849

10.929072

10 1.957 3.829849 7.233072

5.6 6 -2.304

6.3054 6 -2.043

4.173849

4.707072

6 -2.043 4.173849 4.707072

6.1 4 -4.304

18.5244 4 -4.043

16.345849

17.401072

4 -4.043 16.345849

17.401072

6.2 9 0.696 0.4844 9 0.957

0.915849

0.666072

9 0.957 0.915849 0.666072

6.3 2 -6.304

39.7404 2 -6.043

36.517849

38.095072

2 -6.043 36.517849

38.095072

6.4 10 1,696 2.8764 10 1.957

3.829849

7.233072

9 0.957 0.915849 0.666072

7.1 6 -2.304

5.3054 6 -2.043

4.173849

4.707072

6 -2.043 4.173849 4.707072

7.2 12 3.696 13,6604 12 3.957

15.657849

14.625072

11 2.957 8.743849 10.929072

7.3 18 9.696 94.0124 18 9.957

99.141849

96.543072

17 8.957 80.227849

86.847072

7.4 11 2.696 7.2684 11 2.957

8.743849

10.929072

11 2.957 8.743849 10.929072

7.5 14 5.696 32.4444 11 2.957

8.743849

10.929072

14 5.957 35.485849

33.931072

7.6 1 -7.304

53.3484 1 -7.043

49.603849

51.442072

1 -7.043 49.603849

51.442072

8.1 1 -7.304

53.3484 1 -7.043

49.603849

51.442072

1 -7.043 49.603849

51.442072

8.2 17 8.696 75.6204 17 8.957

80.227849

86.847072

17 8.957 80.227849

86.847072

8.3 6 -2.304

5.3084 6 -2.043

4.173849

4.707072

6 -2.043 4.173849 4.707072

8.4 2 -6.304

39.7404 2 -6.043

36.517849

38.095072

2 -6.043 36.517849

38.095072

8.5 10 1.696 2.8764 10 1.957

3.829849

7.233072

10 1.957 3.829849 7.233072

∑ 191

- 812.8692 185

- 716.956529

772.523656

185

- 778.9562639

807.566656

n=23, ẋ=8.304 N=23, ỹ =8.043 N=23, ỹ = 8.043

Calculations

Now,

,

,

And

Also

,

,

,

Hence

,

,

But,

Therefore ASCL has a moderate correlation (0.73) as against SWIPHA, NOCACO and ARMECO that have strong correlation (1.0),

CHAPTER FIVE

DISCUSSION, SUMMARY AND RECOMMENDATIONS

5.1 Discussion of Results

The summary of the major findings and implications as it relates

to growth, survival and sustainability of ASCL, SWIPHA, NOCACO

and ARMECO is as presented in below:

Clause

Title Finding implicationASCL SWIPHA NOCACO ARMECO

4.1 QMS Structure

Lack of proper control on outsourced processes

adequate

adequate

adequate

The required controls on outsourced processes like calibration, maintenance, etc was not in place in ASCL. This will result in failure of these processes and subsequently other related process

4.2 Documentation

Inadequate document and record control

adequate

adequate

adequate

Document and records when properly controlled supportscoordination, process performance and reduction inwastages

5.1 Management commitment

Inadequate determinationand provisionof resources

adequate

adequate

adequate

Planning of resources (budgeting) helps in proper determination of resources and channelling resources through the right course. Deficiency in this by ASCL will result in mismanagementand wrong channelling of resources.

5.2 Customer focus

No adequate considerationon customer requirements

adequate

adequate

adequate

Not having a definite methodfor determining what the customer wants and providinghim with what he wants will result in ASCL losing customers’ loyalty and subsequently market share.

5.3 Policy No proper adequat adequat adequat A policy giving unity and

Direction disseminationand understandingof company policy

e e e direction to any organization must be understood and accepted by all the staff before it can make impact. Lack of adequate dissemination will result in multiple objectives being pursued by individuals at the expense of organizations objective.

5.4 Planning No adequate documentationof objectivesand its understandingby staffNo successionplan in placeto ensure continue and maintenance of integrity of the system

adequate

adequate

adequate

Better result is achieved through objective and targetsetting and monitoring the achievement of the objectives and target at defined intervals. This ensures sustained stepwise achievement. In addition, making the system independent of individuals will ensure that changes in the system (planned or unplanned) do not result in collapse of the system. Absence of these in ASCL will deprive it of these benefits.

5.5 Responsibility, authority and communication

Non delegation ofresponsibilities and authoritiesPoor communicationmeans and effectiveness

adequate

adequate

adequate

Poor delegation and assignmentof responsibilities affects the effectiveness and efficiency of processes. Worsestill, it may result in some functions not being carried out. Communication is Also keyand central to working harmonyas well as effective control of processes. These are eminent in ASCL with the associated repercussion.

5.6 System Review

Performance not reviewed at regular interval

adequate

adequate

adequate

Review of Organizations performance to ascertain levelof its performance, identify problems and deviations so as to make necessary corrections and identifying opportunities for improvement is a neglectedsuccess factor. The similitudeof this is like a farmer who sows his seeds and only goes back during the harvesting period.

6.1 Provision of resources

No systematicway of determining, providing andusing resources

adequate

adequate

adequate

Absence of proper implementation of budget normally results in resources being allocated based on relationship and not on needs.This results in poor management and chaotic workingrelations.

6.2 Competence

Training not provide strictly based on competency requirementsInternal transfer not based on the needs of the job

adequate

adequate

adequate

Training when not provided based on needs results in duplications, provision of irrelevant trainings and resource wastages. It also results in favouritism with associated internal friction and lack of confidence.Again when transfers are done not based on the needs of the organisation, they are perceived as victimization. These can cause a system

breakdown like he case of ASCL.

6.3 Infrastructure

Inadequate provision of infrastructure and maintenance structure

adequate

adequate

adequate

Provision of infrastructure especially machineries and support services when not doneat beginning of project receives very low attention. Amore disturbing aspect is lackof maintenance of infrastructure when provided. These have led to breakdown ofthe infrastructure as is the case in ASCL when buildings, machineries and associated utilities have all collapsed due to lack of proper maintenance.

6.4 Work environment

Work environment not maintained toensure quality production

adequate

adequate

adequate

Absence of conducive work environment especially the condition of service affects the performance of an organization. Employees offer their bests only when the physical, human and environmental aspects are to deliver the right product.

7.1 Production planning

Adequate adequate

adequate

adequate

As expected, the initial planning of product by all organizations is normally properly done.

7.2 Customerrelated processes

Customer request not reviewed to ensure capacity availability

adequate

adequate

adequate

Request from customers must be reviewed to ensure that they areadequately defined. In addition,organization must review its capability to ensure that it canmeet the quality requirements including time lines to avoid disappointment to the customer.

7.3 Design and development

Not applicable

adequate

adequate

adequate

Design of new products and modification of existing products is sometimes unavoidable. For organization like ASCL with multiple planned products to say that it is not applicable may put challenges on their ability tomeet the ever-changing needs

of customers.7.4 Purchasi

ngSuppliers notpatronized based on ability to supply quality productSupplied materials notinspected or tested to confirm quality

adequate

adequate

adequate

To ensure consistent supply ofraw materials, suppliers must be competent selected based ontheir ability to supply quality products. They must beevaluated at defined intervalsto ensure their continued relevance. In addition e very supply must be inspected/tested to ensure compliance to purchase request. Patronizing quack suppliers result in supply of inferior materials with subsequent production of low quality products.

7.5 Production/ service provision

Inadequate provision of suitable production and monitoring equipment

adequate

adequate

adequate

Availability of adequate work instruction, work methods, suitable work equipment as well as monitoring and measuring equipment are necessary for production of quality products. The absence of these will result in production of low quality products, frequent reworks high quantity of wastages

7.6 Calibration

Adequate adequate

adequate

adequate

ok

8.1 Customersatisfaction monitoring

No established mechanism forobtaining customer feedback

adequate

adequate

adequate

Customers do not normally complain, instead, they grumble and start looking for alternative. Deliberate attempt must be made through an established method to get feedback from the customer so that their concerns can be addressed before they loose faith in the organization . Customer feedback is a key success factor.

8.2 Process and product monitori

Adequate adequate

adequate

adequate

ok

ng8.3 NC

product monitoring

No adequate control of Nonconformingproducts

adequate

adequate

adequate

Nonconforming products discovered during internal processing or after supply must be controlled. Quality control process must be established to handle this in such a way that the organization do not loose image. Inadequate control likein ASCL will result in low quality products being supplied to customers.

8.4 Data analysis

Adequate adequate

adequate

adequate

ok

8.5 Improvement

Adequate adequate

adequate

adequate

ok

5.2 Conclusion

For organizations to excel, have a sustainable growth and

compete favourably with its competitors, it must have a

structure and operational methods that is comparable with

international practices. From the results and discussions in

chapter four, it is obvious that ASCL has appreciable

differences with international practices in areas of:

i. Structure and organization

ii. Documentation problems including record keeping

iii. Communication (internal and external)

iv. Policy formulation and implementation

v. Objective setting of realistic targets

vi. Resource management

vii. Customer relation

viii. Staff training and development

ix. Planning especially, succession planning

x. Infrastructure and equipment maintenance

xi. Purchasing and Supplies management

xii. Process control, especially production processes

xiii. Quality control, especially control of nonconforming

products

xiv. Monitoring and measurement of product and processes

xv. Implementation of corrective and preventive actions

Although organizations may not necessarily have the same

structure and operational methods to succeed in business,

neither are any two organizations expected to be exactly the

same; however,

successful organizations have been found to observe some

management principles that have been internationally recognized.

In addition, those organizations have some common

characteristics that are sometimes tagged international best

practices. Organizations are therefore forced to structure their

organization and align their operations and practices to meet up

with these practices for fair competition and sustainable

growth. Ajaokuta Steel Company (ASCL) have, from the results of

this study, deviated from these principles by about fourty

percent (40%). This is a very large percentage, compared to

Swiss Pharmaceuticals Limited (SWIPHA), Northern Cable

Manufacturing Company (NOCACO) and Arewa Metal Company (ARMECO)

that deviated by only about one percent (1%) and three percent

(3%) each respectively. The correlation between the operations

and practices of the company as compared to the established best

practices were also found to be 0.736 for ASCL and 1.00 for

SWIPHA, NOCACO and ARMECO. These represent a moderate result for

ASCL and a very strong correlation for SWIPHA, NOCACO and

ARMECO. This explains why the three companies are doing very

well, while Ajaokuta Steel Company is moribund.

5.3 Recommendations

Based on the results of this study, it is recommended that:

i. Total Quality Management (TQM) based on ISO 9000 Quality

Management System, be established in Ajaokuta Steel Company

for growth and sustainable development.

ii. A further study be carried out that will apply corrective

actions on the identified lapses and the impact it will

have on the company (ASCL).

iii. Total Quality Management (TQM) be established in all the

steel companies in Nigeria for the perceived benefits.

iv. A similar study should be carried out using other

Management System Models like Six Sigma, Business

Excellence model among others.

v. Total Quality Management be established in all sectors in

Nigeria (public and private) especially the small and

medium enterprises (SMEs).

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APPENDIX A

4.1 General Requirements Y P N NA Remarks

Are all the key processes in the systemdetermined?

Are sequence and interaction of these processesdetermined?

Are the criteria and methods for effectiveoperation of these processes determined?

Are resources necessary for effective operationof these processes identified and provided?

Are the performances of these processesmonitored, measured an analysed?

Are there deliberate planned actions to causeimprovements in these processes?

Are outsourced processes identified and therecontrols defined?

Are the controls implemented and monitored foreffectiveness?

4.2 Documentation Requirements

4.2 General (documents that are covered by thesystem)

Is there a quality manual containing the policiesof the organisation?

Do the policies in the manual address therequirements of ISO 9001:2008?

Is there a documented quality policy statement inplace that defines the overall objective of theorganisation and gives direction to the entireorganisation?

Are corporate objectives of the Organisationdefined and documented?

Are there documented procedure for documentcontrol, records control, internal audit,preventive action, corrective action and controlof nonconforming products?

Are there other documented procedures considerednecessary for effective operation of processes.

Are there other procedures that are notdocumented but are well established i.e. wellknown to all the people involved?

Are there other procedures that are known to onlyone or few people that are involved?

Are results from the operation of these processesdocumented (records)?

Do the records include the 19 records required byISO 9001 standard?

4.2.2

Quality Manual (Scope, processes, exclusion,reference to procedures)

Is the scope of the Organisation well defined inthe quality manual?

Does it contain the 6 documented proceduresrequired by ISO 9001 or reference to them?

Does the manual contain adequate description ofinteraction of the identified processes?

4.2.3

Control of documents (approvals, issuing,availability, amending and obsolete withdrawalcontrol)

Are documents (manual, procedures, workinstructions, forms, registers, etc) reviewed andapproved before use?

Are documents reviewed and updated to accommodatechanges like methods, technology, etc?

Are documents properly identified and theirstatus well defined?

Are documents and other relevant informationalways available at the points where they areneeded?

Are external documents (letters, equipmentmanuals, specifications, standards, publications,books, journals etc) identified; theirdistribution controlled and are made availablewhere they are required?

Are the documents that are no longer relevant orsuperceded (obsolete documents) promptly removedfrom the system?

Are the obsolete documents discarded in acontrolled manner e.g. shreaded.

4.2.4

Control of records (identification, protection,retention time and maintaining evidence ofactivity)

Are records properly identified and traceable tothe processes where they originate?

How easily are records retrieved when requiredurgently?

Are all records properly stored and wellprotected? Is it common for all the variousdepartments and units?

Are the retention periods for each recorddefined?

How are records disposed?

Is the disposition method common to all theprocesses in the organisation?

5 Management Responsibility

5.1 Management Commitment (showing direction throughpolicy, target setting, resource provision andreviews)

Are statutory and regulatory (Federal GovernmentPolicies and Regulations) requirements sourced adcommunicated to relevant people throughout theorganisation?

Has management established the quality policy andquality objectives?

Are Management reviews conducted?

Are resources determined and provided by the topmanagement?

5.2 Customer Focus (responsibility given for marketinformation generation and use, monitoring ofcustomer satisfaction)

Are the organisation customers distinctlyidentified?

Are customer requirements determined? If yes howare they determined?

Do to management ensure that the determinedcustomer requirements are met or provided?

Are competitors’ activities monitored? If yes,what is the means of monitoring?

5.3 Quality Policy (understanding of the applicationto each job)

Is the quality policy established?

Does the policy include the nature of thebusiness of the organisation, commitment toexpectation of the customer, commitment tostandards and regulatory requirements andcommitment to continual improvement?

Is the policy communicated to the staff and dothe staff understand the policy?

5.4 Planning

5.4.1

Quality objectives (objectives setting andmeasurement of critical activity performance)

Are objectives at various levels (departments,sections, units etc) documented and known to allthe relevant staff?

Are targets set for the various objectives?

5.4.2

Quality management system planning (systemplanning and change management)

Are planning done for all activities?

Does the planning take cognisance of the qualityobjectives and expectations of the customer?

Are there succession plan for all positions inthe Organisation?

Are changes influenced only by requirements foreffective performance of the Organisation (i.e.not biased or sentimental)?

5.5 Responsibility, authority and communication

5.5.1

Responsibility and authority (Organogram, jobdescription, WI)

Are responsibilities well spelt out for allstaff?

Are these responsibilities communicated to staff(issued job descriptions)?

Are responsibilities delegated to subordinates atappropriate stages?

Are responsibilities backed with authorities?

5.5.2

Management representative (member of managementthat maintains the system and causes awareness)

Is there a quality champion (QC) for theOrganisation (management representative)?

Doe the QC have the necessary management backing?

Does the QC report on the performance of thesystem to Top Management?

Are programmes in place to ensure that staff areenlightened on their roles and expectations ofthe customer?

5.5.3

Internal communication (information flowing fromtop to bottom and from bottom to the top)

Are communication means identified and providedor instituted?

Are there means of finding out whether thecommunication is effective?

Are there general and departmental meetings?

Are suggestion boxes in use?

5.6 Management Review

5.6.1

Review of performances, suggestions and causingchanges

Is there a forum or means where top managementreview the performance of the entire system?

Is the interval defined?

Is the interval adhered to?

Are records of management review maintained forreference purposes and as basis for next review?

5.6.2

Review input (Agenda)

Does the agenda for the review include Audit results Customer feedback Process performance and product conformity Status of preventive and corrective actions Follow up actins from the previews review Changes that could affect the system Suggestions and recommendations for

improvement

Review output

5.6.3

Does the output of the review include decisionson

Requirement for process performance improvement

Requirement for product performance improvement

Resource needs.

6 Resource Management

6.1 Provision of Resources

Are resource needs for each process identifiedand consolidated into yearly budget?

Are the resources provided and processedaccording to the budget?

Does the budget consider emergencies?

Is the implementation monitored?

6.2 Human Resources

6.2.1

General (competence required for employment)

Is recruitment based strictly on competence?

Are responsibilities assigned strictly on thebasis of competence?

Is competence in the Organisation defined interms of appropriate education, skill trainingand experience?

6.2.2

Competence, training and awareness

Are job quality appraisal done to determinerequired competence?

Are trainings provided based on the needs of thejob or identified gaps?

Are internal transfers based on the needs of thejobs and after careful assessments?

Are performances on the job evaluated afterprovision of training and internal transfers?

Are records of training, experience skills andappropriate education maintained and internaltransfers?

Are records of evaluations and actions arisingfrom the evaluations maintained?

6.3 Infrastructure (identification, provision andmaintenance)

Are appropriate infrastructures (buildings,workspaces, equipment, tools, transportation andcommunication means etc) determined and provided?

Are they all maintained at defined interval (Arethere maintenance schedules)?

6.4 Work Environment (protection of the product andthe worker)

Are safety rules and use of protective equipmentencouraged and enforced?Are creative work methods and opportunities for greater involvement of people provided?Is the workplace location conducive and facilities made available for the workers?

Is ergonomics at workplace given adequateattention?

Are social activities encouraged?

Are heat, humidity, light, dust, ventilation etcadequately controlled for conducive workenvironment?

Is hygiene, cleanliness, freedom from noise,vibrations and pollution given adequateattention?

Is condition of service made available to allstaff?

Is the condition of service adequatelyimplemented?

Are there motivational programmes like bestsuggestion award?

7 Product Realisation

7.1 Planning of Product Realisation (all that hasbeen planned to see that information is receivedand converted to product)Are quality objectives and requirements for the product/project/contract determined right from inception of the product realisation process? Are the processes and documents (e.g. Quality plan) necessary for the product realisation determined?

Are resources specific to the product determined and provided?

Are acceptance criteria defined?

Are the necessary verification, validation, monitoring, inspection and tests activities specific to the product determined from the beginning?

Are records needed for the processes and the product determined?

7.2 Customer-Related Processes

7.2.1

Determination of Product requirements(information that goes into product specificatione.g. standard)

Are the requirements specified or required by thecustomer determined?

Are statutory and regulatory (legal) requirementsdetermined and considered?

Are requirements not stated by the customer likesafety factors, which are necessary for theintended use of the product, considered?

Does the Organisation include other features tosurpass the expectation of the customer?

7.2.2

Review of customer requirements (systemcapability for accepting order)

Are customer requests reviewed before acceptingto ensure that requirements are well defined andthe organisation has the capability to meet upwith the request including the delivery period?

Are verbal request confirmed through anappropriate means like invoice before acceptingto provide product?

If requests are changed, does management ensureproper documentation of the change andcommunication to the relevant staff of thechange?

Are records of the review maintained?

7.2.3

Customer communication (all communications withthe customer)

Is product information e.g. brochure madeavailable to the customer?

Is there designated unit that handles enquiriesand complains from customers?

Is there established customer feedback mechanism?

Are all customer complaints attended to?

7.3 DESIGN & DEVELOPMENT (product research or newproduct development)

7.3.1

Design & Dev Planning (Planning the stages,responsibilities, Activities of the design)Are design and development planed with the various stages well defined?Are the required review, verification and validation activities for each stage in the plan?

Are the responsibilities and authorities for design and development adequately assigned?

Are the interfaces and the groups involved well managed to avoid conflicts and failures?

7.3.2

Design & Dev Inputs – The required informationfor designDoes the design inputs include the followings:

Customer needs and expectations (performance)

Needs and expectations of other interested parties

Statutory requirements Supplier’s contribution User input to achieve robust design International or national standards Industry codes of practices Information from previous designs

7.3.3

Design & Dev Outputs – The result of the design

Are design and development output verifiedagainst acceptance criteria and approved beforeimplementation?

Does the output specify product characteristics?

Does the output include the acceptance criteria?

7.3.4

Design & Dev Review – Taking a look again to seeif designing will achieve expectations

Are design reviews conducted at appropriatestages of the design?

Does the review team normally include all theconcerned parties?

Are records of the review and action arisingthere from maintained?

7.3.5

Design & Dev Verification – Checking to see ifresult has met expectation

Are design outputs compared with plannedarrangement before approval?

Are records of the verification and actionarising there from maintained?

7.3.6

Design & Dev Validation – Checking performanceunder condition of use

Are sample of the design output produced(prototype) and tested under real condition ofservice before actual production?

Are records of the validation and action arisingthere from maintained?

7.3.7

Design & Dev Design Changes – Managing changesduring design

Where designs are changed, are they subjected tore-verification and revalidation as applicable?

Are records of the design changes maintained?

7.4 Purchasing

7.4.1

Purchasing process (initial evaluation ofsuppliers, periodic performance evaluation)

Are there set requirements for selection ofsupplier?

Is there set of approved suppliers that are usedfor supply of all the raw materials?

Are there criteria or evaluation of Suppliers inplace?

Are the suppliers evaluated at defined interval?

Is the extent of control on the supplier based onthe effect the supplied material will have onfinal product or merely based on economic values?

Are records of selection, evaluations and actionarising there from maintained?

.4.2

Purchasing information (approval of requests,review prior to communicating supplier)

Are purchase information adequately defined toavoid communication of misinformation?

Is there defined responsibility (e.g. reviewcommittee) for reviewing purchase informationprior to issue?

7.4.3

Verification of purchased product (Incomingmaterial inspection and test)

Are purchased material inspected and/or testedbefore acceptance?

Are suppliers of inferior materials blacklisted?

7.5 Production and Service Provision

7.5.1

Production process control (control of productioninputs e.g. machine, instructions, in-processchecks)Is information on product characteristics made available to the operatorsAre work instructions provided to the operators?

Are suitable equipment provided for the work?

Are monitoring and measuring devices available?

Is monitoring and measurement carried out?

Are release, delivery and post-delivery activities implemented?

7.5.2

Validation of Process for production (set processparameters tests before production starts inclosed system)Are special processes (processes that deficiencies become apparent only after the product is in use, it is impossible to verify theproduct or processes that cannot be repeated) validated before production and service provision?

7.5.3

Identification and traceability (identificationand batch number tracing; product statusidentification)Is the status of product known and identifiable throughout the production process?

Is it possible to trace a product that is alreadyin use or at least outside the organisation through a unique identification?

7.5.4

Customer property (control of anything fromcustomer for use in making the product)

Are customer properties identified, verified andsafeguarded?

Are customer informed if their properties arelost or found to be unsuitable for use?

Is record of customer properties maintained?

7.5.5

Preservation of products (Stores/warehouseactivities) Are the product preserve during internal processing by implementing processes that would prevent damage, deterioration or misuse during

handling, packaging,

storage

and delivery?

7.6 Control of Monitoring and Measuring Device(calibration of measuring devices)

8 Measurement, Analysis and Improvement

8.1 General

Are statistical techniques parts of the methodsused for data analysis?

8.2 Monitoring and Measurement

8.2.1

Customer satisfaction monitoring (gettinginformation from customer without waiting for himto complain)

Are the key customers identified?

Is there established relationship between theOrganisation and its customers

Is the perception of the customers monitoredthrough appropriate mean like questionnaires,customer forum, interviews etc?

Are records of the results of the monitoringmaintained?

8.2.2

Internal system audit (looking for opportunitiesto improve; acting on the findings and closingout)

Are there trained QMS auditors?

Is there defined interval for auditing thesystem?

Are the audits planned based on the status andimportance of the processes?

Are auditors selected in such a way s to ensureobjectivity (e.g. auditors not auditing their ownwork)?

Is there documented procedure for internal audit?

Is the maximum period for taking correctiveaction by the process owners defined?

Do auditors normally carry out follow-up auditsto ensure that effective corrective action hasbeen carried out to eliminate any detected non-conformity?

8.2.3

Process monitoring using indicators (keepingcritical activities under control)

Are the efficiencies the identified processes inthe system monitored and measured forimprovement?

Are key performance indicators determined andused to monitor the performance of the variousprocesses?

Are plans in place to take correction andcorrective action when planned results are notachieved?

8.2.4

Product monitoring (QC inspection and testingactivities and approval for release)

Are the product characteristics and productacceptance criteria defined?

Is there defined releasing authority to confirmconformance with acceptance criteria beforeproduct release?

Are evidences of product conformance and productrelease maintained?

8.3 Control of Nonconforming Product (what to do withproduct that fails)

Are products that do not meet requirementsidentified and controlled to prevent itsunintended use or delivery to customers?

Is there a documented procedure for controllingnon-conforming product?

Is there defined authority to deal withnonconforming product?

Do the organisation handle non-conforming productthat was discovered after delivery?

When nonconforming product is corrected, is itsubjected to same inspection and/or testing asbefore?

Is record of nature of nonconformities andactions arising including concession maintained?

8.4 Analysis of Data (all data generated has to beanalysed and discussed in relation toperformance)

Are all data generated analysed and discussed inrelation to performance?

Does the analysis include? Customer satisfaction Conformity to product requirement Characteristics and trends of processes and

product Supplies

8.5 Improvement

8.5.1

Continual improvement

Are there deliberate planned actions to causeimprovements in the system?

Does the plan consider results of audit, analysisof data, results of management review, customersatisfaction monitoring results, complaints etcas input to the improvement process?

8.5.2

Corrective action (investigating to get the root-cause)

Are problems when discovered investigated to findthe root causes of them?

Are the root causes of the problems eliminatedthrough a planned action?

Are the actions taken evaluated foreffectiveness?

Are records of the actions taken maintained forreference purpose?

8.5.3

Preventive action

Are processes reviewed and investigated forpossible problems that can happen?

Are root causes of such problems identified andeliminated through a planned action?

Are the actions taken evaluated foreffectiveness?

Are records of the actions taken maintained forreference purpose?

KEY

Y …… Yes or fully implemented

P……. Partially or implemented but not fully

N……. No or not implemented

NA….. Not applicable to the organisation

APPENDIX B: Continual Improvement Form

CONTINUAL IMPROVEMENT FORM

ASPECT/AREA/PRODUCTSHEET NO. DATE

REF.NO:

DESCRIPTION OF ITEM/PRODUCT/PROCESS/DOCUMENT

REF.NO.

DESCRIPTION OF FINDING (S) (EXACT DESCRIPTION OF IDENTIFIED POTENTIAL OR ACTUAL PROBLEM)

IINSPECTOR/AUDITORNAME SIGN DATERESONIBLE FOR SECTIONNAME SIGN DATE

FOLLOW-UP ACTION RECORDCORRECTION

NAME SIGN DATE

ROOT CAUSE OF PROBLEM

NAME SIGN DATEACTION PLAN TO ELIMINATE THE PROBLEM

NAME SIGN DATECORRECTIVE/PREVENTIVE ACTION TAKEN

NAME SIGN DATEREVIEW AND VERIFICATION OF CORRECTIVE/PREVENTIVE ACTION

NAME SIGNATURE DATE

Application of TQM to Ajaokuta Steel Company

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