Case; Romeo Engine Plant ( REP)

Team: ( process - color code)

Swamy – black
Bhupesh K – green
Sreenivas – Blue
Sajith – orange
Biju – consolidate

A-1)
Romeo Quality Process (RQP) has the objective of ensuring customer
expectations are met by understanding their product preference and deploying it
in the manufacturing process.

RQP is a disciplined approach to total process design and planning to achieve

minimum in-process variation and deliver to the customers zero defect engines.

Continuous production and quality process improvement:-

Flexible work assignment and commitment to production
Waste and scarp elimination
Cost reduction activities
Increased thru put by removing bottleneck

A-2)
Forming teams responsible for manufacturing, engineering, Quality Control,
Production systems and supplier relationships.

Laid down target levels for product and process characteristics adapting a Zero
defects philosophy.

Defective engines during the manufacturing process were scrapped adapting a

no rework approach.
Engine Exchange Program ; In case of engines which are already delivered to
the customer or are already fitted into cars, where there are problems which
cannot be solved by minor repair, engines are exchanged with new ones and the
complaint ones are brought to the factory for evaluation.
Complaint form and Action plan; Quality problem are logged in to a complaint
form and action plan were prepared. Action plans has to be prepared within 24
hours and shall specify the defect, the solution and steps to prevent recurrence.
Quality problems originating from out side the plants called for action plans of
less than 24 hours. There for problems at the customer level are considered as
more grieve than at plant level and are attended immediately.
Knowledge based integrated design and engineering with process staff
integration of very high level.
Bench marking of Romeo engines against engines used in competitors’ luxury
cars and making continuous improvements there by achieving best-in-class
quality and performance.

LEC : Life Education Centre within the plant offering courses from high school
equivalency to graduate technical and management skills. Taught on a regular
basis, mission/team concept, Quality101, Team problem solving and
Productivity101.
Product development structure: Adopted a do-it-differently philosophy by think –
problem solve- quality assurance methodology.
Encouraged initiative, creativity and prudent risk taking by production staff and
mangers.
Information system: Highly customized, integrated and real time systems with 5
Digital Equipment Corporation, VAX Computers plus 350 personal computers in
the plant. Soft wares developed and adapted for Romeo application.
MMS and paging systems: Machine Monitoring Systems integrated to automatic
gauging equipments with automatic fault code indicators. Computers installed to
send page message to the concerned operators with fault code and machine ID.
This also enabled the operator to focus on solving the problem than wondering
what went wrong.
Check Book System: Worked like a charge card with nominal daily limit with each
team receiving an authorization for how much they spend an indirect material.
Teams negotiated directly with supplier for parts they wanted.
Weekly meetings: focus on Quality, productivity, Scrap. Reviewed results of
action plans and workings during weekly meetings.
Pareto Analysis: On defects frequency and focused on the major causes.

Continuous production and quality process improvement:-

Processes in Romeo were automated and the employee’s main job is to improve
the production and quality processes through team formation in the business
units.
The team member’s main job is to perform tool checks, quality checks and
problem solving.

Flexible work assignment and commitment to production:-

Romeo had 11 labor and 2 skilled trades’ classification. This eliminated barriers
between management and laborers. This flexible approach helped initiatives,
creativity and risk taking to support growth in capabilities and continuous growth.
Feedback from workers is often taken for better production environment.

Waste and scarp elimination:-

The system formed in Romeo is to make sure defect is identified and the causes
are deducted through pare to analysis and weekly team brainstorming.
Consistent supplier defects will be punished by charging the overhead expenses
related to the problem.

Cost reduction activities:-

Check book system with authorization system for the release of indirect material
were followed. This helps in reducing the overhead expenses. The respective
team is responsible for this control. Also, the teams were given freedom to
purchase indirect materials from suppliers through negotiation which help in
controlling expenses. Teams got the expense report charged to their department
which helps in monitoring the cost.

Increased thru put by removing bottleneck:-

Romeo followed the principle of improving the overall through put of the pant by
concentrating on the bottleneck operations and uplifting the same by removing
the constraint.

A-3)

Suppliers were billed for full loss caused by defective parts supplied by them
Scrap cost were assigned to work team responsible for the process. .This aligned
to their no-rework policy and also to their team approach and responsibility
sharing where the supplier and the work group suffer the costs.
.
24 hour response: The departments concerned have to prepare action plans
within 24 hours of receiving a complaint form and within less than 24 hours for
complaints receiving from outside the factory. Daily tracking system of quality
problems reported from assembly plants and dealers. This ensured that quality
issues are attended quickly and on an urgent basis. Weekly review of complaints
form and respective action plans.
Information systems and Auto paging; Automatic unmanned machines with
automatic gauging equipment to signal defective part /jammed material which
also display the status and fault code. Computer sends automatic page message
to the operators. The team Manager got automatic page message on
critical/bottleneck resources. Auto generated MMS signaled failure, machine ID
and fault code. Ensured a continuous feed back mechanism that ensure
preventing bottlenecks, quality, customer focus and minimal product performance
variance.

Check book system: Acts as an authorization limit and check on indirect expense
and making teams responsible for controlling cost.

Weekly meetings: To focus on quality, productivity and scrap related issues on a

continuous basis. Continuous improvement and feed back mechanism moved
process towards zero defect philosophy. The function of tracking defects are
mostly automated. This gave workers and managers enough time and resources
to work on improving action, innovation and quality.

Romeo followed the interactive control system approach to avoid uncertainties.

The operations control system developed by Romeo was to get real time tracking
report for operational metrics like, m/c failures, time lost, failure codes through
the tools like
Machine monitoring system and paging system.

Also to achieve the quality process Romeo followed Diagnostic control systems
like establish targets for product and process reflecting customer expectations.

Cost control was achieved through checkbook system and authorization method.

Actual cost method is followed than labor and overhead report. This helps in
improvement in overall cost than improving the activities. Also, Romeo didn’t
follow the traditional variance analysis which concentrated on actual vs. budget
which didn’t help in overall unit cost reduction much as volume increased.
This approach helps in overall continuous process and cost improvement.

System was developed to conduct weekly meeting with each department team to
ensure proper feedback is given to the performance of the team and any
suggestions and initiatives are encouraged. The focus of the meeting is to
improve productivity, quality and scrap than focus on variances.

Also, Survey mechanisms were incorporated to bench mark Romeo engines with
competitors. This feedback mechanism helped in getting the Romeo engines
best ratings.

A-4)
Strength
Culture and Employee skills: Deep rooted quality consciousness and team spirit.
Highly skilled and high morale staff. Good labor elation with effective policies
leading to high level of enpowerment.

Information system: reliable and well deployed computers and information

system aligned to their total quality, zero defect philosophy. Automatic and
system generated fault detection and feed back systems.

Cost structure and control. Tight fungal cost structure with supported TQM and
zero defect interactive. Ensured competitive strength on the cost front. A
disciplined cost control approach.

Product quality: Superior Quality and performance when benchmarked to

competitors engines, Minimal product lines engine types. Best-in-class quality
and customer focus. High understanding of customer expectations as to engine
performance and reliability.

Supplier relationship: Excellent understanding with suppliers aligning REP’s

objectives of Zero defectives, product performance and fulfilling the customer
expectation.

Strong internal focus on R & D, Technology, Innovation and developing related

capabilities.

Strength of REP’s TQM

Customer expectations were captured through quality function deployment which

was incorporated in the manufacturing process and assembly process.
Process variations was minimized through disciplined approach of process
design and planning

Respond to all quality problems both external and internal customer.

Very good quality identifying, tracking, resolving and feedback mechanisms were
in the system.
Create problem solving spirit for improving quality as a continuous process.

Weakness
Over reliance on operational efficiency: Lack of strategic planning and
management expertise, over reliance on operational efficiency of the plant. May
prove to be a weakness over the long term. Efficiency improvement may not be
achieved continuously for a long term.

Automatic machine generated feed back control system: high dependence on

automated system.

High fixed cost; High manufacturing overhead of 23% as compared to direct

labor of 2% on cost of goods sold. Indicate high fixed cost on plant. The plant is
functioning just on the break even capacity for the last five years. Potential risk
case the demand fall or technology became obsolete.

Rigidity of structure and processes: Structure does not allow for manufacturing
many engine types and complex engines.

Weakness of REP’s TQM

Elimination of incoming inspection can be costly considering the customer impact

if the defect piece passes through and the increase in scarp cost

Engine exchange program is costly considering the actual defect reported was
very few compared to the returned engines. Service personnel’s could have
rectified the issues 90% of the time.

Dealers given the authority to tackle quality issues which created more engines
getting rejected.
Manual quality tracking by quality personnel’s

Suggestions

Maximizing strength :

Develop capability for new and complex engine type by leveraging on the
strength on R & D, Innovation, problem solving skills and customer focus.
Marketing initiative to become an OEM engine supplier to other car
manufactures. Enter into alliances and JVs, there by venturing into opportunities
available outside. This may insulate REP against risk off fall in demand from
ford.
Employing quality initiatives hike 6sigma, ……………….complimenting the
present quality drives.
Adopt an aggressive strategy to capitalization on external opportunities for selling
engines relying on quality and cost efficient engine manufacturing capability.

Over come weaknesses

Create a more flatter or matrix structure which will enable it toproduce more
complex operation and engine types.
Create a strategic intend and employ strategic management to capitalize
opportunities for producing new engine types.

Improvements suggested

Capture the cost of quality wrt to prevention, failure and Appraisal cost. For
improvements in Cost of Quality ("COQ"), manufacturers have been able to
reduce manufacturing costs by as much as 5% per year.

Institute training on the job along with offline training

Implement statistical process control to monitor and improve quality

Six sigma DMAIC approach can be implemented for tackling quality issues

A change in culture may also be necessary to ensure that all departments are
pulling in the same direction. That is, the urge to compete needs to be replaced
by a tendency to share.