A system study on the production department of Polaris Steel Corporation

• Main Author: Gregorio, Sheila
• Format: text
• Language: English
• Published: Animo Repository 2001
• Online Access: https://animorepository.dlsu.edu.ph/etd_bachelors/1802
• Institution: De La Salle University

Polaris Steel Corporation is a small-scale steel firm dealing mainly with manufacturing rolled and round steel bars. It has been serving steel products for more than 15 years. The study done on Polaris Steel Corporation focuses on the steel bar production. From the WOT-SURG analysis done, the deviation chosen was that of excess scraps produced. From July 1999 to June 2000, Polaris Steel Corporation had an excess of scraps of about 3.64% from the standard allowance of 5%. The company lost a total of P 98,837.61 due to the scraps bought and are sold at a lower price. In addition to this, the company has an opportunity loss of about P 462, 982.40. The possible causes and effects of the problem contributing to scraps were presented. After a careful analysis and validation, the true causes were concluded to be the following: malfunctioning of the machine, errors in performing manual operations, and machine breakdown. After looking into the causes of the problem, several alternative solutions were generated. These include: the introduction of maintenance policy as well as improvement of workers in performing operations, reprocess scraps produced, invest on new products, and purchase new and modern machines. Using Kepner-Tregoe Approach, the decision on what solution to choose has been presented. The chosen alternative is that of the introduction of maintenance policy as well as improvement of workers in performing operations. This is done through a three-day seminar. The company continuously applies the implementation. The costs incurred by the company is about P79,960.00 each year and the profit this could give to the company is P 601,756.72. With these cash flows, the company could have a net present value of P 825,637.61 over a period of 2 years and the payback period is only 1.94 months.