[MYCRON STEEL BERHAD]

Quality Control
[SMU 3813]

Quality Practices In Industry

[Khairil anuar bin zainal, Mohd Shahfiq Bin Ali Hassan, Mohd Hazim Bin A Rahman

[Mycron Steel Berhad, an investment holding company, engages in the manufacture

and trade of cold rolled steel sheets in coils in Malaysia. It offers surface finishes,
edges, and oiled cold rolled sheet coils. The company is based in Shah Alam,
Malaysia. ]

Khairil anuar bin Zainal 880623 – 01 - 5873

Mohd Shahfiq Bin Ali Hassan 881118 – 12 - 5929

Mohd Hazim Bin A Rahman 890613 – 01 - 5123
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Mycron Steel Berhad

Mycron Steel Berhad is a Malaysia-based company engaged in investment holding and the
provision of management services to its subsidiaries. The Company, through its subsidiaries
is engaged in manufacturing and trading of cold rolled steel sheets in coils. Its subsidiaries
are Mycron Steel CRC Sdn Bhd, which is engaged in manufacturing and trading of cold
rolled steel sheets in coils, and Silver Victory Sdn Bhd. In addition, the Company also has an
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associated company namely PMP Galvanizers Sdn Bhd, which is engaged in manufacturing
and trading of galvanized metal.

Mycron Steel Berhad, an investment holding company, engages in the manufacture and trade
of cold rolled steel sheets in coils in Malaysia. It offers surface finishes, edges, and oiled cold
rolled sheet coils. The company is based in Shah Alam, Malaysia. Mycron Steel Berhad is a
subsidiary of Melewar Industrial Group Berhad.olly owned subsidiary, Mycron Steel CRC
Sdn Bhd

(MSCRC), was incorporated in Malaysia under the Companies Act on 6 January 1989 and
commenced production in June 1990. MSCRC is the first CRC manufacturer in Malaysia and
operates from its cold rolling mill factory located on an 18 acre site located in Shah Alam,
Selangor Darul Ehsan.

Installed facilities include the following :-

Continuous Pickling Line

  Hitachi 6-High Cold Reduction Mill
  Electrolytic Cleaning Line
  Batch Annealing Furnaces
  Recoiling Line
  Combined Skinpass Mill & Tension Levelling Line

All the facilities were newly bought from respective mill makers.

MS ISO 9002 certification was achieved on 1 October 1996 for the manufacture of
Cold Rolled Steel Sheet in coil.

On 1 October 2002, the company’s quality management system was upgraded to MS

ISO 9001:2000 standard.
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Type of Steel Product Available

Quality
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Commercial Quality
The commercial quality cold rolled steel sheets and coils are made of carefully annealed low
carbon steel coils. They have a good surface finish, workability and excellent flatness.

Drawing Quality
This quality is used for applications that require drawing properties that are better than those
of the commercial quality. They are produced from high grade materials by carefully
controlled manufacturing process.

Deep Drawing Quality

Made from strictly selected materials and manufactured with the most exacting quality
controls, this quality has the highest attainable quality for drawing use.

 Surface Finishes

Dull Finish (Matte Finish)

This does not have any luster and is actually made rough intentionally so that the lubricant
will stick to it during press forming, thereby facilitating fabrication. This finish is also
suitable for paint adhesion. With these characteristics, cold rolled steel sheets and coils with
this finish are most extensively used.

Commercial Bright Finish

The smooth texture of the surface makes it best suited for metallic plating and coating.

 Edges

Edges produced during the hot rolling process in the manufacturing of hot rolled coils.

Slit Edge (Trimmed Edge)

Edges produced by trimming or slitting at the final stage after the cold rolling process.
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Oiling

Cold rolled sheet coil are oiled by the Electrostatic Oil Coater at our recoiling line in order to
provide maximum protection against rusting. However, order are accepted for products
without oiling.

DOS coating (FDA approved) are also available for cold rolled steel coils to be used in
making food grade packaging containers.

MARKET AND CUSTOMER:

The Group is confident of the long-term growth potentials, for the manufacturing,
electronic, palm-oil and petroleum industry of Malaysia. All these industries require Cold
Rolled Coil (CRC) as a core component, either in the form of a raw material, or in the form
finished products, like oil drums, and it is the view of the Group, that demand for its CRC
products, will enjoy similar long-term growth prospects. To feed the country’s manufacturing
appetite for CRC, Malaysia has been a substantial importer of CRC, with 2009 showing
CRCrelated product imports of 1.43 million tonnes (2008: 1.62 million tonne). With such a
large amount of imported CRC, the opportunities for the Group, to penetrate new markets,
and play its role in import-substitution, is tremendous. (MSCRC), was incorporated in
Malaysia under the Companies Act on 6 January 1989 and commenced production in June
1990. MSCRC is the first CRC manufacturer in Malaysia and operates from its cold rolling
mill factory located on an 18 acre site located in Shah Alam, Selangor Darul Ehsan.

QUALITY PRACTICES IN THE COMPANY:

1. EHSQ Certification ISO 9001

MYCRON integrated EHSQ Management Systems is a key foundation for its ongoing
performance and sustainable growth. They are certified to ISO 14001 (environment), OHSAS
18001 (health and safety) and ISO 9001 (quality). These are the three internationally recognised
management systems that utilises the PDCA (Plan, Do, Check and Act) process approach for
management of EHSQ functions. Implementation of these standards in all MYCRON operating
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sites ensures that health and safety risks, environmental aspect and impacts, and quality systems are
managed with rigor, leading to continuous improvement in their performance.

Environment, Occupational Health, Safety and Quality Policy

 In particular, they strive for continual improvement in their operations and business
practices to:
 Achieve zero injuries and illnesses through prevention and risk reduction
 Minimize impact on their environment by preventing pollution, reducing use of natural
resources, and promoting recycling; and
 Deliver superior value by partnering with customers to provide high quality solutions.
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They are passionate about the following guiding principles and hold every employee
accountable for success in achieving their policy objectives. They will:
 Commit to total customer satisfaction by fully anticipating, understanding and meeting their
needs and expectations;
 Commit to a safe, clean and healthy workplace for employees, contractors and visitors;
 Comply with all applicable EHS regulations, requirements and their own high standards;
 Measure and review their EHSQ performance and set challenging objectives for continuous
improvement towards the goal of zero defects;
 Continually improve the effectiveness of their management systems;
 Foster an environment where employees take ownership for EHSQ performance by
providing education, training and resources, and by encouraging employee involvement.
Their commitment and focused actions will make them an industrial role model in environment,
health, safety and quality management, and bring them sustainable results.

COMMON PROBLEMS FACED BY THE COMPANY ARE:

I. Production: MYCRON investing to upgrade its milling facility. MYCRON recently

invest in upgrading its sheet and foils milling facility to enable the group to produce
higher value-added products and expand its customer base.
II. Manufacturing Capability: MYCRON faced difficult market condition, which they
will need to enhance their manufacturing capability to build sustainable competitive
advantage and maximizing value for shareholders. This due to the increase of low-
priced imports from Japan. The raw materials (steel ingots) is the highest percentage
of companies’ operating cost (60% - 80%), depends on the price of steel.
III. Finance Risk: The Group is exposed to currency risk as a result of the foreign
currency transactions entered into by any of the Group companies in currencies other
than their functional currency. The Group’s foreign exchange risk management seeks
to protect cash flows and shareholder value by limiting the impact from adverse
exchange movement whilst sharing in the benefit from favourable movements. Aside
from natural hedges, the Group also enters into forward foreign currency exchange
contracts to limit their exposure on foreign currency receivables and payables, and on
cash flows generated from anticipated transactions denominated in foreign currencies.
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SUGGESTION TO IMPROVE QUALITY:

a) Control of documents

    Having control of documents in a company or organization is essential.   Controlling

documents issued is essential to assure the current revision is being followed and also that

no unauthorized revisions are taking place.  Control also means a system where changes to

documents can be initiated and by whom.    The control of documents also must have a

process where individuals can submit proposed changes based on their knowledge of the

affected subject.   In controlling documents there must be some identifying characteristic to

indicate that when someone is looking at it that it is the current one to be followed.  

b) Management review

    The subject of management review involves a process where management reviews the

system and policies in place to assure one that they are current and are being followed.  It is

also the responsibility to review current procedures/instructions and policies to assure that

any changes in process, contractual or other events are addressed within the system.

Contractual changes such as becoming ISO certified will affect how a company does
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business and how that is documented applicable to their specific operations.

    

c)    Identification %26 traceability

      Identification and traceability is something that is needed for a manufacturing facility.

Companies who provide products to the public or organizations must have a method of

identifying when a part has been made.  Problems sometimes arise after products have been

placed in the hands of customers.  Sometimes internal situations identify a problem which

warrants customer notification there needs to be some way of identifying those products

affected.   Identification and traceability also affects documents as previously stated and the

traceability factor can be important in a manufacturing environment.   One example may be

where contractual requirements were not addressed within the operational instructions and

changes are required to bring the process into compliance.  Having traceability such as lot

numbers or process numbers on a manufactured product is a way of segregating the affected

products.  Other examples have been where the auto industry has recalled numerous

vehicles with deficiencies within certain manufacturing dates.  This is an example of the

benefits of identification and traceability in the manufacturing world.

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Lean Six Sigma combines two well-known

1. Lean Six Sigma
approaches the practice of continuous improvement. The

Lean' component of Lean Six Sigma focuses mainly

on the elimination of waste and non-value-added

activities in a process. By eliminating waste, Lean

helps to reduce process leadtimes, inventories and

ultimately costs.

The 'Six Sigma' component focuses more on the

Focus of Lean Six elimination of variation in a process. Many quality

Sigma  problems and defects are rooted in unstable processes or

processes with excessive variation. By tackling variation,

the Six Sigma methodology helps to resolve complex

quality problems, reduce defects and improve process

capability. Statistically, a process operating at Six Sigma

level is one that generates only 3.4 defects per million

opportunities.  

Lean Six Sigma combines the effect and power of two key
strategies:-
1) The focus of Lean is to reduce lead time and
control costs
2) The focus of Six Sigma is to improve quality
and reduce costs.
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A Value Based Approach

The Lean Six Sigma continuous improvement process is a value-based approach. Improvement

opportunities are identified by carefully listening to the voices of our customers, employees and

processes. These opportunities are screened through using value-based criteria, prioritized and

finally assigned to project teams led by trained experts. These experts are referred to as Black Belts

or Green Belts. Under the leadership of the Black Belt or Green Belt, these teams applies a rigorous

D-M-A-I-C problem-solving approach to come up with breakthrough solutions.  

TPM is another major pillar of MYCRON's overall continuous improvement system. Whereas

Lean Six Sigma focuses on improving speed and quality, TPM focuses on machine and plant

reliability through a process of identifying and eliminating losses. Our TPM journey is driven from

the top and aims at achieving a complete cultural change, from the traditional “I operate – you fix”

operation to one where operators take pride of ownership in their machines.

2. Total Productive Maintenance 

TPM Goals:

1) TPM aims to maximize equipment effectiveness.

2) TPM establishes a thorough system of Preventive Maintenance (PM) for the

equipment’s entire life span.

3) TPM is cross-functional, implemented by various departments (engineering, operators,

maintenance, and managers).

4) TPM involves every single employee.

5) TPM is based on the promotion of Preventive Maintenance through the motivation of

management and autonomous Small Group Activity (SGA).

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Holistic Measurement & OEE

All losses that have an impact on equipment performance are measured e.g. machine not being

available when needed; not running at an ideal rate, and not producing the right quality on the first

pass. OEE %( Overall Equipment Effectiveness) is used to measure how productively a machine is

being utilised. In principle, OEE is calculated as: -

OEE = Availability x Performance Rate x Quality Rate

Availability = Required Production Time – All Recorded Downtime

Required Production Time 

Performance Rate = Actual Production Rate  Quality Rate = Good Output 

Standard Production Rate  Good Input

Workplace Ownership

Through autonomous maintenance and small group improvement activities, employees

acquire new skills and can detect and rectify minor machine problems before they cause further

machine deterioration and failures. Employees also take greater pride in a safer and cleaner

workplace.
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Formal Continuous Improvement

With OEE as a measurement index, continuous improvement activities are undertaken to

fix problems at machine centres. Simple problems are directly solved by shopfloor teams

using small group activities. More complex problems are escalated to management and

support staff and resolved using more advanced problem-solving tools.

The main objectives of Autonomous Maintenance are:

1) Machine in ideal condition: Any departure from normal condition must be identified

immediately. Operators are trained to capture abnormalities using the fugue tag 

2) Knowledge based work force: Utilising the training and education pillar, workers are

trained to “Know My Machine” with the eventual aim of becoming a knowledge

based worker 

3) Cultural change: shop floor operators begin their continuous improvement quest by

rectifying abnormalities, eliminating root causes and making improvements to prevent

recurrence. The eventual target is to maintain and have ownership of a machine which

is in tip top condition