Polaroid - case study.

University Degree Business and Administrative studies

Backdrop

Polaroid is manufacturer of photographic equipment, accessories and related items used in instant photography. The organization was divided into two main divisions – The Consumer Photography Division and the Technical and Industrial Division with each of these divisions contributing around 40% of Polaroid’s revenues of $ 1.3 billion in 1984.

The company produced two main types of films:

The peel apart film which required the user to physically pull the film out of the camera and,
The integral film, which came out of the camera automatically.

The integral films were manufactured in the R2 building at the Waltham Massachusetts site. The operations at R2 included production of sheet metal springs, pods, plastic cartridges and plastic end caps and then assembled these into film cartridges. R2 ran three shifts, five days a week, employing approximately 900 workers out of which 700 were part time.

Quality and Process Control Procedures at R2

All films were vetted by the Quality Control Department before being released into the market. The QC procedure included sampling of 15 finished cartridges (each containing 10 frames) out of every lot of 5000 cartridges. If the sampled cartridges contained defects in excess of allowable limits, the lot was held and further testing was done. Additional testing usually led to reworking, or rejection of a portion or all of the lot. Subsequent lots were the subjected to even more rigorous testing by increasing the sample size tested.

Quality checks were not the sole responsibility of the QC department. The operators usually sampled around 32 samples out of every lot. If the measurements went against the knowledge of the operator, the sample was rejected.

After process control was initiated in R2 in the late 1970’s, process engineering technicians were made responsible for gathering data and making rough analyses.

Problems with Existing Quality Control

Since the testing of cartridges was destructive, it resulted in sampled scrap. This, along with the product that failed acceptance sampling resulted in $3.28 million in 1984. Another issue was that sampling did nothing to improve quality, it only improved the AOQ. In fact, due to the large production and low defect rates, if the production and quality control sampling were halved, the outgoing defectives would be 0.03% of production. On the other hand, increasing the AOQ further would lead to prohibitively high costs due to increased sampling.

The sampling process employed was also inaccurate. Time was spent on trying to reduce beta or consumer risk. Cartridges which were inspected and passed were sent back to production to be repackaged. But the handling of these cartridges itself increased the chances of their developing defects which resulted in a vicious cycle of tests and retests and did not contribute to improving quality significantly while increasing costs considerably. To avoid losing production, operators often ‘salted’ boxes.

Operators did not record frequently collected data and if they were in doubt, they would pass the component on to the QC Department believing that they would be able to detect the defect and reject the component if the defect was serious enough.

“Tweaking” machines was an accepted practice in the plant. The objective of the exercise was to enable machines running and different speeds and variations to produce at their maximum capacity.

The QC department did not focus on defects that were normally detected by consumers. For example, the most stringent auditors tested for excess reagent by flipping the film over right after exposing it, a defect that would not be noticed by a consumer. These stringent auditors averaged about 10% defectives.

The conditions under which the tests were simulated were also out of sync with current market ...