Research In Management Of Technology And Business Vol. 0 No.

0 (2000) 000–000
© Universiti Tun Hussein Onn Malaysia Publisher’s Office

RMTB
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e-ISSN : 0000-0000

GROUP: 8

APPLICATION OF QC TOOLS AND

MANAGEMENT TOOLS IN
IMPROVING PRODUCTION LINE IN NAM
HIN COMPANY: CASE STUDY

Lau Shu Jie (AP210206)1, Cheng SuYee (AP210119)2, Hee

Yong Kang (AP210339)3, Leong Suk Yee (AP210418)4, Low
Zheng Xuan (AP210412)5, Pang Chia Xuan (AP210270)6, Yong
Lie Heng (AP210442)7

1,2,3,4,5,6,7
Department of Production and Operations Management,
Faculty of Technology Management and Business,
Universiti Tun Hussein Onn Malaysia,
86400 Batu Pahat, Johor, MALAYSIA.
Email: mohdfauzi@uthm.edu.my

Abstract: Quality control (QC) tools are used to assess quality. Quality can be
judged using a range of characteristics, including performance, dependability, and
ease of use. These tools are critical for monitoring and regulating output quality.
They contribute to the detection and resolution of quality issues. The goal of this
group assignment is to identify the main problem, the sources of the problem,
recommended solutions, and prioritize the options. Nam Hin Company was chosen
by our group for this case study, and the person in charge, Lee Chin Hock, was
interviewed to acquire the essential information. According to Pareto's study, the
primary issue in the company is productivity, which accounts for 33.33 percent of
the overall problems. The Ishikawa diagram and relationship diagram indicated four
primary causes: (1) a lack of good training, (2) a lack of working experience, (3) a
lack of standard operating procedures, and (4) dependability issues. 18 improvement
 options have been proposed based on four significant causes. Following that, five
priority solutions were chosen based on matrix diagram evaluation: (1) using
benchmarking, (2) excellent working environment, (3) internship, (4) providing
workshops, and (5) job transfer. This paper will serve as a reference for industrial
organizations trying to optimize their processes.

Keywords: Quality, manufacturing, QC tools

1. Introduction
Seven quality control instruments (QC) are utilized in the 6 Sigma or quality management process in
order to methodically discover and comprehend the risks present in it, evaluate the risks, limit product
quality fluctuations, and then propose solutions to prevent future failures. This is done to ensure that
the hazards associated with it are effectively managed. Due to their position in ensuring the seamless
administration of the company's day-to-day operations, these are crucial to the success of any
organization. Utilizing seven quality control instruments concurrently to enhance quality management
may be beneficial to the PDCA cycle, six sigma implementation techniques, quality management, and
quality improvement processes.
The seven quality control methods refer to a set of statistical techniques that can be applied to various
issues with ease. The seven quality control tools utilized to address quality-related issues are Pareto
diagrams, cause and effect diagrams, histograms, control charts, scatter diagrams, and process flow
diagrams. Furthermore, check sheets are used. Researchers have developed a range of quality control
tools, including Affinity Diagrams, Interrelationship Diagrams, Tree Diagrams, Matrix Diagrams,
Prioritisation Matrices, Process Decision Program Charts, and Activity Network Diagrams. In
addition, they have developed seven novel quality control tools. Each of these instruments is
considered essential and is widely utilized in the manufacturing industry. Each of these instruments
plays a crucial role in monitoring overall operations and implementing ongoing changes in the
manufacturing process. One of the most efficient procedures is the installation of seven quality control
instruments, which can be completed in a relatively short amount of time. Efficiency is attained
through the implementation of a data-driven methodology and a customer-centric approach. The study
has identified four objectives, namely: to identify the primary issue in the company, to determine the
root causes of the problems, to propose recommended solutions, and to evaluate the priority of the
solutions.
1.1 Background of the study
Nam Hin Company is a stainless steel product manufacturer. It is located at No. 269A, Jalan
Gemas Batu 1/4, Kampung Tampin Tengah, 73000 Tampin, Negeri Sembilan. Nam Hin is owned by
Lee Chin Hock. This company was founded in 1992. The company has been around for almost 30
years, and its product has inspired client trust. Their company primarily wholesales products to
agents, who then resell them to grocery shops, supermarkets, and other retailers.

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 Nam Hin makes a wide range of stainless steel items, including pots and pans, flatware, tube,
pipe, and so on. Then, stainless steel is split into numerous types, including austenitic stainless steel,
ferritic stainless steel, duplex stainless steel, and others. Furthermore, several grades of stainless steel
exist, such as the 300 series and 400 series. The objective of the company is to supply consumers with
higher-quality, more inexpensive stainless steel items.
According to the company's owner, Lee Chin Hock, the idea for creating this company originated
from his brother. Before starting this company, he and his brother worked in Kuala Lumpur, where
they felt stuck because they were continuously working for others. However, on the advice of his
brother, he learned that this industry is growing in Malaysia. As a result, they decided to quit their
employment and use the money they gained in Kuala Lumpur to start their own business. When they
originally launched their firm, they relied solely on known relatives to make stainless steel products.
As a result, the products produced at the time were not as diverse as they are now. So far, the Nam
Hin company has around 30 employees, a diverse selection of products, and its performance is
improving. Mr. Lee is still looking for a large facility because they do not have enough space to
produce more products.
Furthermore, the owner, Lee Chin Hock, and his brother, Lee Chin Sheng, are the most powerful
people in the production process. They have over 30 years of experience, and any production process
concerns may be resolved swiftly. They will be in charge of ensuring product quality. Furthermore,
the apprentices employed by their company will learn alongside them, allowing them to digest
information more quickly and improve the quality of their products.
2.0 Problem Statements
The problems faced by Nam Hin Company are listed below in Table 1 and Figure 1 based on the
Pareto diagram. There are about 5 problems faced in the company. They are (1) Low Productivity, (2)
Inconsistent Quality, (3) Cost or Financial Problems, (4) Safety problems, and (5) Employee
Motivation.

PROBLEMS FREQUENCY CUM. FREQUENCY ACCUMULATED

BIL PERCENTAGE

1 Low Productivity 10 10 33.33%

2 Inconsistent Quality 8 18 60.00%

3 Cost/ Financial Problem 7 25 83.33%

4 Safety Problem 4 29 96.67%

5 Employee Motivation 1 30 100%

Table 1: The Problems During the Production in Nam Hin Company

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 Figure 1: Pareto Chart
Table 1 and Figure 1 illustrate the feedback obtained from the employees of Nam Hin
Company. The most critical problem of the process is low productivity which stands for 33.33 percent
or 10 feedbacks from the overall 30 feedbacks. This shows that low productivity is the main problem.
The next critical problem with the second highest ranking is an inconsistent quality which is 26.67
percent or 8 voting out of 30 votings. Cost and financial in the production line is the third highest
problem faced by the company which is 23.33 percent or 7 voting from all of the voting. The fourth
problem is the safety problem which is 13.33 percent or 4 feedbacks. The least problem faced by the
company is employee motivation. It stands for 3.33 percent or 1 vote.

Table 2: Check Sheet of Defects in Nam Hin Company

Table 2 shows the Check Sheet of Defects in Nam Hin Company. Based on the check sheet, every
three hours will record the number of times or how frequently the defects occur to the head of the
production line. Five defects may happen during the production line. The highest number of defects
that occur in a production line is inaccurate shapes 8 times every three hours. Other than that, the
unbalanced material cutting happened five times in the production line. Every three hours, material
deformation will happen 4 times in the production line of Nam Hin Company whereas bad welding
will happen 2 times every three hours. Lastly, the lowest number of defects in the production line is
inconsistent in size, which only occurs 1 time in three hours.

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3. 0 Methodology
3.1 Research Design

The method of interviews was conducted with the owner of Nam Hin Company.

Figure 2: Research Design

3.1.1 Interview
Researchers conducted interview methods in this study. The interview method was conducted by
asking several questions to the owner Mr. Lee Chin Hock from Nam Hin Company. Researchers
interviewed Mr. Lee Chin Hock through Google Meet on 10 May 2023 at 8.00 pm.
3.3 Data Analysis
The data and information for this study were collected from the interviews. Researchers present
data in the form of seven QC tools to analyze data from the interviews such as diagram, flow chart,
check sheet, pareto, Ishikawa diagram, Affinity diagram, relationship diagram, three diagram and
matrix diagram. Moreover, the owner has been interviewed by the researchers to get more information
on the ways the company operates.

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4.0 Results
4.1 To Understand the Process Flow (Flow-chart)
First and foremost, the researchers need to understand the process flow occurring in
producing stainless steel products of Nam Hin Company. The detailed processes are shown in Figure
3. It is important to look through the causes and the sources of defects that occurred in the processes.

Figure 3: Process flow of stainless steel products

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4.2 To Determine the Main Causes of the Problems
The affinity diagram, similar to the Cause-and-Effect Diagram (Figure 4), categorizes the
issues into workplace, worker, machine, materials, and method. Based on feedback from 30
employees and management opinions, low productivity is identified as the most significant factor. The
opinions of workers, who are closely involved in the production process, provide valuable insights
into the root causes and potential solutions. Nam Hin Company categorized the reasons into worker,
materials, machine, method, and workplace groups in the affinity diagram. Within the worker
category, issues such as inadequate training, lack of experience, unreliability, and high turnover
contribute to low productivity. In the machine category, factors like insufficient maintenance, lack of
machines, poor machine cleanliness, frequent breakdowns, and improper machine layout affect
productivity. In the materials group, issues such as high costs, unreliable material quality, excessive
inventory, and fluctuating market prices impact inconsistent product quality. The method group is
influenced by the absence of standardized operating procedures, allowing employees to manufacture
products according to personal preferences without proper supervision. Additionally, the semi-
automated process and lack of employee protective gear have a significant effect on productivity.
Lastly, the workplace group includes factors such as improper machine layout, lack of cleanliness,
inadequate storage space, disorganization, poor ventilation, and noisy conditions, all of which affect
stainless steel production.

Figure 4: Affinity Diagram

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Researchers utilized the Ishikawa diagram (Figure 5) and identified that low productivity is primarily
influenced by five categories of causes: workers, machine, workplace, method, and materials. In terms
of workers, factors such as inadequate training, lack of experience, and reliability issues were found to
contribute to low productivity. Within the machine category, issues like poor machine cleanliness,
frequent breakdowns, and improper machine layout were identified as sources of low productivity.
The workplace environment, characterized by lack of cleanliness, disorganization, noise, poor
lighting, and ventilation, also played a role in low productivity. Several methods employed in sheet
metal production, such as the absence of standard operating procedures, lack of employee protective
gear, and reliance on semi-automated processes, were found to impact productivity. Lastly, the
materials used in production were identified as a significant factor, with problems like high raw
material costs, fluctuating market prices, and unreliable quality affecting inconsistent product quality.
It is crucial for researchers to further analyze the key causes from the various significant factors and
propose appropriate remedial actions based on factual evidence.

Figure 5: Ishikawa diagram

The interrelationship diagram, shown in Figure 6, illustrates the cause-and-effect connections
among the identified cases in the Affinity diagram. Each cause is systematically analyzed to
determine its influence on other elements by drawing outgoing arrows. Conversely, incoming arrows
indicate the factors that affect the cause. The goal of the interrelationship diagram is to establish
connections between causes and identify the most significant ones from a large number of factors. For
instance, in the case of Nam Hin Company, lack of good training is identified as a key factor, as

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indicated by six outgoing arrows and one incoming arrow. Similarly, lack of working experience is
connected to various outcomes such as reduced productivity, unreliable quality, high turnover,
machine breakdowns, low machine cleanliness, and disorderliness. Workers who underperform in
their roles tend to make more mistakes, especially in the production line. Additionally, negative
attitudes from colleagues, regardless of their competence, impact the company's turnover rate.
Environmental factors like noise, poor lighting, ventilation, and untidiness can affect employees'
emotional state and hinder clear thinking, indirectly impacting production. Furthermore, resistance to
change, particularly among older and experienced workers, is observed in the semi-automated
process. This negative attitude can manifest as emotional fluctuations, dissatisfaction with tasks, and
resistance to current job responsibilities. By analyzing the outgoing and incoming arrows for each
factor, the interrelationship diagram highlights the most important sources of the problem. In the case
of Nam Hin Company, the reliability problem emerges as the most crucial element, with six outgoing
arrows and three incoming arrows. This problem influences product productivity, disorderliness, low
machine cleanliness, high costs, high turnover, and lack of cleanliness. To address their process issues
and promote effective growth, the group members have developed a tree diagram of solutions. This
diagram provides valuable insights into resolving the identified problems and enables Nam Hin
Company to enhance its operations effectively.

Figure 6: Interrelationship diagram

4.3 To Propose Solutions to the Problem (Tree Diagram)
A tree map is a type of data visualization that represents hierarchical data Treemaps provide
an effective way to visualize complex hierarchical data and quickly identify patterns, trends, and
anomalies. The head problem of Nam Hin Company shown in the tree diagram is the effects of
product productivity. Low product productivity will bring many problems and it will also affect the
efficiency of the company. There are four major causes that will affect product productivity which are

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lack of working experience, lack of good training, reliability problems, and no standard operating
procedure.
Firstly, the company can provide workshops at events to overcome a lack of work experience.
When the employees lack work experience, they will not be strong enough to handle their work, and
also, they can’t solve problems quickly and easily. So, the company can provide them with some
seminars or events regarding their specialized field to help them improve their experiences, skills, and
knowledge. This can help them become more professional in their field and they can share their
experience and they will gain their working experience. The second solution for lack of work
experience is an internship. The employees can be interning with a company when they are university
students to gain hands-on experience to find out what they like and what is suitable for them. The
company will offer allowance and basic salary to the university students. So, they not only can gain
experience and knowledge through the internship but also can earn some money. One of the
advantages of the internship is to help university students gain more practical experience and
knowledge to make their resumes more advanced and compete with others in the future. Thirdly, the
company can implement job transfers. The company can make the horizontal movement of the same
grade employees from the old job to the new job without changing their salary and responsibility. This
is because the employees can perform different jobs with new responsibilities that need different skills
to gain experience.
Next, the solution for the lack of good training is to provide online training for the employees
to overcome the lack of good training. Online training refers to a form of education or skill
development that is delivered and conducted primarily over the Internet or through online platforms.
Online training platforms will incorporate interactive elements such as videos, simulations, quizzes,
and gamification. These interactive features enhance employee engagement and participation,
promoting better knowledge retention and application. Secondly, provide on-the-job training. On-the-
job training is defined as training provided by the public or private sector to an employee. At the same
time, they engage in production work and provide some knowledge, experience, and essential skills
for complete and adequate job performance. This will also help the employees gain more experience
from the lecturer or trainers, increase their performance and productivity and work more efficiently
and effectively. One-the-job training not only improves their skill and knowledge but also builds their
confidence in their abilities. Thirdly, the solution to the lack of good training is the company offers
cross-department training for the employees. Cross-department training can let the employees
understand other positions’ roles and responsibilities. Cross-department training can improve
productivity because the communication between departments and departments will become more
effective.
For reliability problems, the company creates an excellent working environment for the
employees. When a department has unreliable employees, it will cause productivity to decrease. So,
the company can create an ideal environment for employees because a good environment can
motivate the employees and make them enthusiastic while working. This will also help to increase
product productivity. Secondly, the solution to the reliability problem is to allow flexible work for the
employees. The company can provide flexible working for the employee such as leaves and
sabbaticals, and gradual retirement. This is because offering flexible working can ensure they work
flexibly and hit the maximum output required by the manager. In addition, flexible working
empowers employees by granting them autonomy and trust. This autonomy can boost motivation, job
satisfaction, and overall engagement, leading to higher levels of commitment and loyalty to the
organization. The third solution for the reliability problem is the company can use the clock-in

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software. The company can use the clock-in software to track the employee which makes sure they go
to work on time and do not leave early. So, the human resource can view the habits over time of the
unreliable employee through the clock-in software.
The solution for no standard operating procedure for the company is using benchmarking.
Benchmarking means a process to measure the performance, services, products, and procedures of the
company against another company that is considered to be the leader in the industry. The company
can identify the area where they want to improve their business and use benchmarking to compare
current performance against the competitors. It can help the company gain strategic advantages,
exceed the competitors, and increase the business’s advantages. Secondly, the company can use the
decision-making method to solve this problem. Everyone has different ideas on the problem, but they
can discuss it together and develop the best solution to solve the problem. This will help the company
make a wise decision and bring benefits to the company. Last but not least, the solution to no standard
operating procedure is to promote a clear procedure. The top management can promote the company’s
procedure because clear procedures outline the step-by-step processes and guidelines for completing
tasks or projects. When employees have a clear understanding of how to perform their work
consistently and to a set standard, it minimizes errors, reduces ambiguity, and ensures that work is
executed efficiently and accurately across the organization.

Figure 7: Tree Diagram

4.4 To Evaluate the Priority of the Solutions (Matrix Diagram)
A matrix diagram is a visual tool used to analyze and display the relationships between
different statements. The intersections of rows and columns are then filled with data or symbols to
represent the relationships, strengths, or correlations between the corresponding categories or
statements. The matrix diagram helps visualize complex information, identify gaps or overlaps,
prioritize actions, and make informed decisions based on the relationships between
different statements.

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 Based on the interrelationship diagram as shown in Figure 6, there are four criteria for this
assignment lower cost, productivity, time, and priority. The first criteria for the company are lower
cost. The company wants to minimize the cost of production because big problems and mistakes in
the production line will influence the cost of production. Thus, low cost is given with the biggest
impact, which is 10. The second criterion is productivity. Productivity means reliability all of this
solution is giving can increase the productivity and sales of the company. Productivity is also one of
the important criteria in the matrix diagram and it was the source of income for the company,
therefore the impact has been set as 8 marks. The third of the criteria is time. Time is very important
for the company due to make sure all the employees are in the specified time or takes a shorter time to
finish all the production. Time is the third highest impact in the criteria which is 6 marks. Lastly, the
impact of priority takes a lower mark in the evaluation purpose. Priority means the company needs to
solve the problem urgently and contribute to significant improvement. The impact of priority only
takes 5 marks due to the company does not have a serious problem that will influence the company
and they did not take part in this criterion.
Based on 12 solutions with the four criteria, three stated ranges have been set to select the
best solution for the study. The circle is highly impacted by giving 6 marks. The triangle is a medium
impact with 4 marks and the square brings the low impact in this range with only 2 marks. The
formula for counting is multiplying the high impact with the low-cost criterion plus the high impact
from the productivity criterion plus the high impact for the criterion of time and the lower impact of
the priority criterion to get the final rank. For example the criteria ‘using benchmarking is [(6x10)
+(4x8) +(4x6) +(6x5)] =146.

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 Figure 8: Matrix Diagram
5.0 Discussion
In this study, various tools were utilized, including the Pareto diagram, Process Flow diagram,
Check sheet, Affinity diagram, Interrelationship diagram, Cause-effect diagram, Tree diagram, and
Matrix diagram. To begin, the challenges faced by Nam Hin Company were identified using a Pareto
diagram. It revealed that the main production difficulty, with 33.33 percent of the votes (10 out of 30),
was low product productivity. Next, the production process for stainless steel items was analyzed
through a Process Flow diagram. It revealed that the operations begin with the preparation of raw
materials, such as sheet metal and iron wire, and continue through machine setup to the final step of
packaging the finished product.
Other than that, a Check Sheet was employed to document and identify the most prevalent
flaws during the manufacturing of stainless steel items. By tracking the occurrence of defects, it was
determined that inaccurate shapes were the most common flaw, happening 8 times in a three-hour
period, while material deformation occurred twice during the same timeframe. The Affinity diagram,
Interrelationship diagram, and Cause-effect diagram were then employed to identify the root causes of
the difficulties. The causes were categorized into five groups in the Affinity diagram: worker,
workplace, materials, method, and machine. These categorized causes were further analyzed in the

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Interrelationship diagram, which identified dependability issues as the primary factor affecting
productivity.
Reliability issues have several effects on product productivity, disorderliness, low machine
cleanliness, high costs, high turnover, and lack of cleanliness. The causes were further classified into
five primary categories in the Cause-effect diagram: worker, workplace, materials, technique, and
machine, with each category being broken down into specific causes. Using the Ishikawa diagram and
interrelationship diagram, the significant causes were identified as (1) lack of working experience, (2)
lack of proper training, (3) reliability problems, and (4) lack of a standard operating procedure.
Moreover, the Tree diagram was employed to identify optimal solutions to the challenges at
hand. The key issue highlighted in the Tree diagram was the impact of product productivity, which
was influenced by various factors, including lack of working experience, lack of training, reliability
issues, and absence of standard operating procedures. Proposed solutions to address these causes
included providing seminars or events to address the lack of work experience, cross-departmental
training to tackle the training deficiency, implementing flexible working arrangements to address
reliability issues, and promoting clear procedures to overcome the lack of standard operating
procedures.
Lastly, the Matrix diagram was used to evaluate the proposed solutions. Four criteria were
defined in the Matrix diagram: reduced cost, productivity, time, and priority. Through this evaluation,
five priority solutions were identified: (1) online training, (2) promotion of clear procedures, (3)
creation of an excellent working environment, (4) on-the-job training, and (5) benchmarking.
Additionally, it was suggested that Nam Hin Company should adopt lean manufacturing, a
methodology focused on reducing waste in the production system while increasing productivity.
6.0 Conclusion
After conducting a Pareto analysis, it was determined that low productivity is the primary
issue at Nam Hin Company, accounting for 33.33% of all identified problems. The Ishikawa diagram
and interrelationship diagram aided in identifying four main causes: (1) Lack of working experience,
(2) Lack of adequate training, (3) Reliability problems, and (4) Absence of standard operating
procedures. Based on these causes, we proposed 12 solutions for improvement.
Furthermore, through evaluation using the matrix diagram, we identified five priority
solutions: (1) Providing online training, (2) Promoting clear procedures, (3) Creating an enjoyable
working environment, (4) Offering on-the-job training, and (5) Utilizing benchmarking methods. This
study serves as a valuable guideline for manufacturing companies seeking to enhance their production
processes in the future, leading to improved performance.

7.0 References
Rikke Friis Dam (May, 2022). Affinity Diagrams: How to Cluster Your Ideas and Reveal Insights.
From https://www.interaction-design.org/literature/article/affinity-diagrams-learn-how-to-
cluster-and-bundle-ideas-and-facts
The 7 basic quality tools for process improvement (Accessed: January 12, 2023) ASQ. Available at:
https://asq.org/quality-resources/seven-basic-quality-tools

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7 QC tools definition - ISIXSIGMA (Accessed: January 12, 2023). Available at:
https://www.isixsigma.com/dictionary/7-qc-tools
Sigeru Mizuno (2020). Management for Quality Improvement. From
https://doi.org/10.4324/9781003070450
Naukri.com. (Accessed: January 12, 2023). Available at:
https://www.naukri.com/learning/articles/seven-basic-quality-tool
Jenny Jones (2021, Oct 12). Seven Basic Tools of Quality for Process Improvement. From
https://unichrone.com/blog/quality-management/7-quality-control-tools/
Patricia Lotich (2019, May 8). 7 Management Tools for Quality Control. From
https://thethrivingsmallbusiness.com/seven-management-tools-for-quality-control/

8.0 Appendix

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