CASE: BAYFIELD MUD COMPANY In November 1994, John Wells, a customer service representative of Bayfield Mud Company, was

summoned to the Houston warehouse of wet land Drilling, Inc., to in spect three boxcars of mud-treating agents that Bayfield Mud Company had shipped to the Houston firm. (Bayfield s Corporate Offices and its largest plant are locate d in orange, Texas, which is just west of the Louisiana-Texas border.) Wet-land Drilling had filed a complaint that the 50 Pound bags of treating agents that it had just received from Bayfield were short-weight by approximately 5%. The light-weight bags were initially detected by one of Wet-Land s receiving clerks, who noticed that the rail road side scale tickets indicated that the net weight s were significantly less on all three of the boxcars than those of identical sh ipments received on October 25, 1994. Bayfield s traffic department was called to de termine if lighter-weight dunnage or pallets were used on the shipments. (This m ight explain the lighter weights.) Bayfield indicated, however, that no changes had been made in the loading or palletizing procedures. Hence, Wet-Land randomly checked 50 of the bags and discovered that the average net weight was 47.51 pou nds. They noted from past shipments that the bag net weights averaged exactly 50 .0 pounds, with an acceptable standard deviation of 1.2 pounds. Consequently, t hey concluded that the sample indicated a significance short-weight. (Students m ay wish to verify this conclusion.) Bayfield, was then contacted, and Wels was s ent to investigate the complaint and issued a 5% credit to Wet-Land. Wet-Land management, however, was not completely satisfied with only the issuanc e of credit for the short shipment. The charts followed by their mud engineers o n the drilling platforms were based on 50-pound bags of treating agents. Lighter -weight bags might result in poor chemical control during the drilling operation and might adversely affect drilling efficiency. (Mud-treating agents are used t o control the pH and other chemical properties of the open during drilling opera tions.) This could cause severe economic consequences because of the extremely h igh cost of oil and natural gas well-drilling operations. Consequently, special use instructions had to accompany the delivery of these shipments to the drillin g platforms. Moreover, the light-weight shipments had to be isolated in Wet-Land s w arehouse, causing extra handling and poor space utilization. Hence, Wells was in formed that Wet-Land Drilling might seek e new supplier of mud-treating agents i f, in the future, it received bags that deviated significantly from 50 pounds. The quality control department at Bayfield suspected that the light-weight bags may have resulted from growing pains at the orange plant. Because of the earlier energ y crises, oil and natural gas exploration activity had greatly increased. This i ncreased activity, in turn, created increased demand for products produced by re lated industries, including drilling muds. Consequently, Bayfield had to expand from one shift (6 A.M. to 2 P.M.) to a two-shift (2 P.M. to 10 P.M.) operation i n mid 1992, and finally to a three-shift operation (24 hours per day) in the fal l of 1994. The additional night shift bagging crew was staffed entirely by new employees. T he most experienced foremen were temporarily assigned to supervise the night shi ft employees. Most emphasis was placed on increasing the output of bags to meet the ever-increasing demand. It was suspected that only occasional reminders were made to double-check the bag weight feeder. (A double check is performed by sys tematically weighting a bag on a scale to determine if the proper weight is bein g loaded by the weight-feeder. If there is significant deviation from 50 pounds, corrective adjustments are made to the weight-release mechanism.) To verify this expectation, the quantity control staff randomly sampled the bag output and prepared the following chart. Six bags were sampled and weighted each hour. S.N0 Time Average Weight (Pounds) Range

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59

6 AM 49.6 7 50.2 8 50.6 9 50.8 10 49.9 11 50.3 12 Noon 48.6 1 PM 49 2 49 3 49.8 4 50.3 5 51.4 6 51.6 7 51.8 8 51.0 9 50.5 10 49.2 11 49.0 12 Mid Night 1 AM 47.6 2 47.4 3 48.2 4 48.0 5 48.4 6 48.6 7 50.0 8 49.8 9 50.3 10 50.2 11 50.0 12 Noon 50.0 1 PM 50.1 2 49.7 3 48.4 4 47.2 5 46.8 6 46.8 7 50.0 8 47.4 9 47.0 10 47.2 11 48.6 12 Midnight 1 AM 49.6 2 50.0 3 50.0 4 47.2 5 47.0 6 48.4 7 48.8 8 49.6 9 50.0 10 51.0 11 50.4 12 Noon 50.0 1PM 48.9 2 49.8 3 49.8 4 50.0

Smallest 48.7 50.7 49.1 51.2 49.6 51.4 50.2 51.8 49.2 52.3 48.6 51.7 46.2 50.4 46.4 50.0 46.0 50.6 48.2 50.8 49.2 52.7 50.0 55.3 49.2 54.7 50.0 55.6 48.6 53.2 49.4 52.4 46.1 50.7 46.3 50.8 48.4 45.4 44.3 49.7 44.1 49.6 45.2 49.0 45.5 49.1 47.1 49.6 47.4 52.0 49.2 52.2 49.0 52.4 49.4 51.7 49.6 51.8 49.0 52.3 48.8 52.4 49.4 53.6 48.6 51.0 47.2 51.7 45.3 50.9 44.1 49.0 41.0 51.2 46.2 51.7 44.0 48.7 44.2 48.9 46.6 50.2 47.0 50.0 49.8 48.2 48.4 51.7 49.0 52.2 49.2 50.0 46.3 50.5 44.1 49.7 45.0 49.0 44.8 49.7 48.0 51.8 48.1 52.7 48.1 55.2 49.5 54.1 48.7 50.9 47.6 51.2 48.4 51.0 48.8 50.8 49.1 50.6

Largest

50.2

50.4

60 61 62 63 64 65 66 67 68 69 70 71 72

5 47.8 6 46.4 7 46.4 8 47.2 9 48.4 10 49.2 11 48.4 12 Midnight 1 AM 47.4 2 48.8 3 49.6 4 51.0 5 50.5

45.2 44.0 44.4 46.6 47.2 48.1 47.0 47.2 46.8 47.2 49.0 50.5 50.0

51.2 49.7 50.0 48.9 49.5 50.7 50.8 46.4 49.0 51.4 50.6 51.5 51.9

49.2

Discussion Questions: 1. 2. What is your analysis of the bag weight problem? What procedures would you recommend to maintain proper quality control?