BS/020624/SH-Kickoff(2000)ImproveProductQualityatHRCLeanmanufacturingpilotkickoffdocument–productqualitymoduleCONFIDENTIALJuly1,2002Thisreportissolelyfortheuseofclientpersonnel.Nopartofitmaybecirculated,quoted,orreproducedfordistributionoutsidetheclientorganizationwithoutpriorwrittenapprovalfromMcKinsey&Company.ThismaterialwasusedbyMcKinsey&Companyduringanoralpresentation;itisnotacompleterecordofthediscussion.BS/020624/SH-Kickoff(2000)2TABLEOFCONTENT•DiagnosticresultsofproductqualityandqualitymanagementsystematHRC•Aspirations,approachesandworkplanforqualityimprovementatHRCBS/020624/SH-Kickoff(2000)3TABLEOFCONTENT•DiagnosticresultsofproductqualityandqualitymanagementsystematHRC•Aspirations,approachesandworkplanforqualityimprovementatHRCBS/020624/SH-Kickoff(2000)4CURRENTLYHRCPRODUCTQUALITYIMPROVEMENTCAPABILITYISNOTENOUGH,PRODUCTQUALITYVARIATIONISBIG0%5%10%15%20%25%2000JanFebMarchAprilMayJuneJulyAugSepOctNovDec20012002TemporarylockrateReworkRateFinalblockrate2050HRCJanFebMarchAprilMayJuneJulyAugSepOctNovDecJanFebSource:BaoSteel;TeamAnalysisBS/020624/SH-Kickoff(2000)5MAJORQUALITYPROBLEMSREOCCURRENCEFREQUENCYISSTILLVERYHIGH,ANDNOTUNDERCONTROL37.83.52.44.34.64.84.74.15.810.75.86.87.38.710.97.250.146.01.520002001276,969ton2050Rework(withoutfinishing)Qualityproblemcompositionanalysis240,024ton100%=FlatnessFoldWidthEdgelossUnevenCoilingRollingbreakCoilingtemperatureScratchTowershapeOtherSource:BaoSteelBS/020624/SH-Kickoff(2000)6ITTOOKALONGTIMETOSOLVECRITICALQUALITYPROBLEMSSources:Baosteelltd.0102030405060708090100110120TimeRolls9199920002001Thekeyishowtodevelopasystematicandstandardizedimprovementimplementationplantoconsolidatecurrentresults.1011121234567891011121234567891011121220022yearsCurrentqualityisstableEstablishmentofimprovementteamQualityimprovementeffortsObjectivesBS/020624/SH-Kickoff(2000)7COMPAREDWITHHISTORICALRECORD,HRCDOWNGRADINGRATEHASLARGEIMPROVEMENTPOTENTIALDowngraderatePercent1580HRC1.20.60.82001*Bestachieved3monthrollingaverageBestachievedmonth*Thehistoricalrecordreferstothe26monthsfromJan,2000toFeb,2002Source:BaoSteel;TeamAnalysis1.01.12.02050HRC2001*Bestachieved3monthrollingaverageBestachievedmonthBS/020624/SH-Kickoff(2000)8LIKELY,HRCREWORKRATEALSOHASLARGEIMPROVEMENTPOTENTIAL1580HRC9.55.94.3ReworkratePercent2001Best*achieved3monthrollingaverageBestachievedmonth*Thehistoricalrecordreferstothe26monthsfromJan,2000toFeb,2002Source:BaoSteel;TeamAnalysis8.74.15.02050HRC2001Best*achieved3monthrollingaverageBestachievedmonthBS/020624/SH-Kickoff(2000)95321418188HRCPLANTHASSIGNIFICANTIMPROVEMENTPOTENTIALINPRODUCTQUALITYWITHLARGEROOMFORCOSTREDUCTION3850Short–termcostreductiontargetanalysis(rmbmillion)1580热轧产品2050热轧产品2001qualitycostReworkimprovementScrapreductionCustomerscomplaintreductionTargetcost41486112429DowngradingimprovementQualityimprovementeffortshouldfocusontheindowngradingandreworkimprovementRmb35millionincostsavingsSource:BaoSteel;TeamAnalysisBS/020624/SH-Kickoff(2000)10THROUGHANALYSISOFROOTCAUSEOF“BREADSHAPECOIL”,THEDIAGNOSISTEAMCONDUCTEDDEEPRESEARCHOFHRCQUALITYCONTROLSYSTEMTODEMONSTRATETHEROOTCAUSEOFTHEPROBLEMANDGIVESUGGESTIONSFORCORRECTIONProductqualitydiagnosisworkKeyactivities•Analyzerootcausesof“breadroll”generationbyfishbonediagramsystemthroughbrainstorming•Reviewandanalyzepreviousprojectsofproblemtacklingof“breadroll”bysystemati...
