Report on Quality Management of SABIC Company

Introduction

             Nowadays quality improvement programs are really important for organizations. Organizations are adopting changes in their process and systems to ensure efficiency in production or selling process with the aim to enhance profitability in the long-run. In the beginning companies spend on quality improvement programs, employees training, and testing systems but after the effective implementation such efforts results in long-term benefits of the company (Duplock, Yarlagadda, Ajuhani, & Karim, 2011). Without improvement in the quality of product or services, a company can never win the market. Profitability, customer satisfaction, and productivity are prime goals of the organizations that can be accomplished through quality improvement. In this paper, quality improvement programs are discussed in detail. Paper will also discuss reasons and outcomes of selected quality improvement program in the SABIC Company.      

Background information on Organization

              SABIC company is a Saudi Arabian company having operations in the industry of petrochemicals. SABIC company came into the existence in 1976 by the support of Royal Decree. The main aim behind starting a petrochemicals manufacturer company was to fulfill the needs of Saudi industries (Duplock, Yarlagadda, Ajuhani, & Karim, 2011). In the beginning, the company was not able to offer a large product line because of the limited resources and lack of experience in the petrochemicals. Somehow, with the passage of time executives and directors managed to increase the product line (Sabic.com, 2019). Currently, the company is offering products related to metals, specialties, chemicals, Agri-nutrients, and polymer. The following mentioned table represents the major products of SABIC Company.

           According to the Saudi stock exchange, more than 70% shares of the whole corporation are under the ownership of the Saudi Government (Sabic.com, 2019). The company is famous as one of the largest companies in Saudi Arabia. There are more than 35000 people working in different departments of this company.  SABIC Company is operating successfully is more than 50 countries of the world. The target market includes countries in the United States, Middle East, Asia, and Europe.     

Reasons for Quality program

              Quality improvement is the basic need of each company that is working in a highly competitive market. We all know that competition never let people take rest. Similarly, in the business sector, continuous improvement in quality is necessary if the company want to remain sustainable in the market (Duplock, Yarlagadda, Ajuhani, & Karim, 2011). Customers are highly concerned with quality. Even customer loyalty cannot save a company from bad fortune if the quality is not good (Sabic.com, 2019).

            Customers always search for the best services and products. The decrease in products or services quality can cause to shut down a business. SABIC company is working in the Middle East that is the center of petrochemical products manufacturing (saudigazette.com.sa, 2018). There are a number of other companies and small entrepreneur’s working in this sector therefore competition is high. Somehow, other than competition another important reason to pay focus on quality is environmental and human safety (Islam, Baoum, & Hasan, 2016). Company deals with chemical products that other manufacturers use to pack products, fertilize crops, and testing process. Poor quality of these products can cause serious health concerns.

         Quality improvement programs related to customer focus and continuous improvement will definitely help out the organization bring improvement in their performance and to ensure high safe products for human use. At the same time, continuous quality improvement program will work on quality control systems engaged at each level of organization to imposed quality improvement (Sabic.com, 2019). There are several reasons to select a continuous improvement program for SABIC Company.

           One of the major reason to select this program is that it is the only program of quality improvement that is not only concern with long term goals but also concerned with activities required to be done in future also (Duplock, Yarlagadda, Ajuhani, & Karim, 2011). According to this program quality improvement efforts are not limited for a period of time but in fact, it dictates that executives and employees at each level of the organization need to work on quality as continues process with no end (Islam, Baoum, & Hasan, 2016).     

           Secondly, continuous improvement program is selected because it also deals with control strategies. Program emphasis on control measures for errors, defects, and repair. The program also deals with refinement, renovation, reinvention, and system repair (Sabic.com, 2019). Basically, the idea of working on the continuous improvement program is to bring improvement in the processes and designs to control quality cost.

           We all know that defects cause to double a product cost (the first cost a company spent on manufacturing and the second cost that a company spent to remove defect and make the product useful and deliverable) (Duplock, Yarlagadda, Ajuhani, & Karim, 2011). Continuous improvement program will work on process designing, product testing, production process, and supply chain process to eliminate the chances of error. Gradual but continuous improvement can result in the improvement of performance outcomes also (Islam, Baoum, & Hasan, 2016).        

            Another reason to implement continuous quality improvement program in the SABIC Company is reduce in waste. Continuous quality improvement program will work on lean management to ensure waste management. Lean management will help out the managers of SABIC Company to reduce wastage of resources in the production sector. SABIC Company deals with chemicals and petroleum that are important natural resources (Duplock, Yarlagadda, Ajuhani, & Karim, 2011).

            Even Saudi Arabia has unlimited natural resources of petroleum and oil but still company cannot afford to waste such scarce natural resources (Duplock, Yarlagadda, Ajuhani, & Karim, 2011). Other than importance of these natural resources another reason to control waste is to reduce cost of operations. Waste production material, and lack of employee productivity reduces overall production in a single production run as result of this cost of operation increases and profit margin goes towards decrease (Islam, Baoum, & Hasan, 2016). While opposite to this quality management program will bring efficiency in the resources use to reduce waste and cost of production. Quality improvement program will help out the organization to manage these resources and avoid wastage.           

Quality program and organization’s performance

            Overall organizational performance of SABIC Company will enhance as a result of the quality improvement program. Continuous quality improvement program is based on the principles of total quality management  (Duplock, Yarlagadda, Ajuhani, & Karim, 2011). It includes the implementation of six sigma, lean management, just-in-time, zero-defect, and quality control systems. The program will reduce error and defect chances that will reduce the cost of production. Thus, through reducing cost company will leverage financial benefit also  (Duplock, Yarlagadda, Ajuhani, & Karim, 2011). Furthermore, a quality improvement program will bring refinement in the overall performance of employees and workers that will enhance productivity in the organization.

           Moreover, the program will also help in enhancing organizational performance in the market by improvement in product quality. Improvement in quality will increase customer satisfaction and maximize market shares of SABIC Company in the targeted segment (Jameel, 2017). Therefore, it is clear that the program will enhance production, remove errors, increase customer satisfaction, develop a positive image in the market, and promote overall organizational profitability.  

Conclusion on Quality Management

           The whole discussion concludes that continuous quality improvement program will support SABIC Company to successfully maintain their business in the petrochemical industry. Quality management program will reduce errors and defects in the production process that will enhance customer satisfaction and production process. In short, continuous improvement program will bring improvement in the operations of SABIC Company.