Project and Operational Management Assignment

The purpose of this research is to determine the operation management method, concept, and approach used by HOCHIMINH CITY METAL CORPORATION - JSC (VNSTEEL). VNSTEEL was founded by combining the steel industry's production and commercial units in Vietnam, Metallurgical Corporation and Steel Corporation. The founding of Vietnam Steel Corporation - JSC is linked to the development of the country and the metallurgical sector, laying a solid foundation for the growth of the domestic steel industry.

ASSIGNMENT 1 FRONT SHEET
Qualification BTEC Level 5 HND Diploma in Business
Unit number and title Unit 16: Operations and Project Management (528)
Submission date 25/01/2021 Date received (1st submission)
Re-submission date Date received (2nd submission)
Student name Dinh Hong Son Student ID GBH190436
Class GBH0908 Assessor name Nguyen Thi Ngan
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I certify that the assignment submission is entirely my own work and I fully understand the consequences of plagiarism. I understand that
making a false declaration is a form of malpractice.
Student’s signature: Son
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Table of contents
I. Introduction...................................................................................................................................4
II. Operational management and relationships with functions in the business...............................4
2.1. The definition of operations, operations management and operations function...............4
2.2. Operational processes.......................................................................................................5
2.3. Operational Process in VNSTEEL.....................................................................................6
2.4. Principles of modern operational management.................................................................8
III. Continuous improvement in the business context...................................................................12
3.1. The concept approaches to operations management.....................................................12
A, TQM and PDCA process.............................................................................................12
B, Lean production...........................................................................................................13
C, Six sigma and DMAIC process....................................................................................13
D, Scientific Management................................................................................................14
3.2. Business Process Reengineering - BPR........................................................................15
3.3. The benefits and drawbacks of Lean and Six Sigma have led to a trend of incorporating
Lean Six Sigma into modern operational management.........................................................15
3.4. Six sigma method is applied to Vnsteel...........................................................................17
3.5. Evaluation the roles of Lean Production in Vnsteel in operations management.............18
IV. Continuous improvement plan for Vnsteel...............................................................................18
4.1. The role of process technology in Vnsteel......................................................................18
A, Apply management software ROSY............................................................................18
B, The Role of ROSY......................................................................................................19
4.2. Evaluation and Recommendation....................................................................................19
A, The Evaluation of Six Sigma at Vnsteel......................................................................19
B, Proposal for additional methods.................................................................................21
V. Conclusion................................................................................................................................21
References....................................................................................................................................22

I. Introduction
Working for Ernst & Young, one of the world's most prominent consulting organizations, as an
operational and management consultant. The goal of this study is to identify HOCHIMINH CITY
METAL CORPORATION - JSC's operation management method, concept, and operation
management approach (VNSTEEL). VNSTEEL was formed by integrating the steel industry's
production and business units, Metallurgical Corporation and Steel Corporation, in Vietnam. The
establishment of Vietnam Steel Corporation - JSC is linked to the country's and the metallurgical
sector's development, laying a firm foundation for the growth of the domestic steel industry.
VNSTEEL is currently organized as a joint-stock company with almost 40 linked units,
subsidiaries, and associated businesses (VNSTEEL, 2021). This report is broken down into
three sections. The essential ideas of operations and operations management are presented in
the first section. The following part focuses on VNSTEEL's operational management processes
implementation. Finally, make recommendations on ways to improve VNSTEEL's operational
management capability.
II. Operational management and relationships with functions in the business
2.1. The definition of operations, operations management and operations function
Slack and Johnston (2001) define operations as "any activity related with the transformation of
goods, information, or customers." The operation, to put it another way, is the process of
converting materials (input) into products or services (output).
Operations management is vital, according to Slack, Chambers, and Johnston (2007). It is
concerned with the delivery of products and services that we all rely on. And the very reason for
any organization's operation, whether large or little, manufacturing or service, for-profit or not-
for-profit, is to provide products and services. Consequently, most businesses are now aware of
the significance of operations. This is because they have understood that effective operations
management can increase profits while also allowing for more efficient production of goods and
services. Any firm understandably values the mix of increased income and reduced costs.

The operations function, according to Porter (2009), is the part of the organization responsible
for the production or delivery of goods and services. Because every business produces
commodities and/or services, this means that all organizations engage in operations activities. In
reality, the operations function is crucial in addressing customer needs and plays a significant
role in the organization's overall performance.
2.2. Operational processes
According to Slack & Johnston (2001), the operating process is understood that the input-
conversion-output process must be executed flawlessly to maintain the company's continuous
competitiveness. Simply explained, operations are processes that use a set of inputs to
transform something or convert outputs of services and products into outputs of services and
products. Even while all operations follow the same fundamental input-conversion-output
architecture, the nature of their inputs and outputs differs. In the case of commercial businesses,
the new process devotes a significant portion of the company's resources to offering consumer-
oriented services.
The different kinds of inputs to any operations process are transformed and transforming
inputs. Raw materials that are transformed into goods that are loved and demanded by the
marketplace are known as transformed inputs. Transformed resources, as the term implies,
are raw materials that undergo a change in order to be converted into marketable shapes.
Consequently, both end products and raw materials are classified as changed goods. All
buildings, machinery, hardware and software, and other related objects that are utilized to
change raw materials into end products are classified as transforming resources (Slack and
Johnston, 2001).
Davis, Kee & Newcomer (2010) pointed out that a transformation process is any action or set
of activities that takes one or more inputs, transforms and adds value to them, and produces
outputs for consumers or clients. It is generally easy to recognize the transformation involved
when the inputs are raw materials, such as when milk is turned into cheese and butter. The
nature of the change may be less evident when the inputs are information or people. A hospital,
for example, converts unwell people (the input) into healthy patients (the output) (the output).

The process's output is the product or service. Products are usually tangible items, whereas
services are primarily actions or processes. A product is something like a car, a newspaper, or a
restaurant meal, but service is the conduct of the client who uses or consumes that commodity.
Some services are unrelated to the product. A consultation, like a haircut, is a series of steps
(although some products may be offered to support the service, such as reports or hair gels).
Furthermore, while most things can be stored, at least temporarily, service is only provided when
it is consumed or used. So, if a hotel room is not sold that night, the reservation will be canceled;
if a restaurant table is not filled that evening, the reservation will be canceled (Slack, Chambers,
and Johnston, 2007).
Although all active processes change the input, they differ in some ways. Production volume,
output variety, output demand fluctuation, and customer visibility are all required features for any
operational processes that affect the input (4Vs). The first is in terms of volume, which relates to
how much of a certain product must be produced to meet the industry's total demand. The
physical number of units or goods produced is referred to as this. The second factor is variety.
This refers to the wide range of goods and services that will be manufactured and supplied to
clients. Selling a diverse range of products and services allows businesses to expand their sales
and profit potential while reducing their reliance on one or two products, which can lead to
organizational collapse if demand for that product dwindles or disappears. The next step is
variation, which refers to how much demand fluctuates over time as a result of external causes.
Several factors, however, make it difficult to predict variance. Finally, there's visibility. This
refers to the entire value chain of a company's procedures. Customers must be able to try out
the company's goods or services. In comparison to the manufacturing industries, the service
industries have a strong presence in the market (Slack and Johnston, 2001).
2.3. Operational Process in VNSTEEL
In this section, the steel production process will be used as an example for the main analysis.
The transformed input to be converted in this process is the raw material (scrap). The scrap
processing stage is a crucial and decisive step in the formation of slag, and it is also a significant
step in the usage and consumption of raw materials for manufacturing slag, to have a good slag
product with high metal recovery. Southern Steel scrap comes from two domestic and

international sources. Domestic scrap amounts for 45 to 50 percent, imported scrap accounts for
more than 50 to 55 percent, and recovered scrap accounts for about 1%. Southern Steel uses a
technique to eliminate scrap impurities before putting them into the furnace, reducing
consumption and protecting the environment (VLXD.org, 2018). In addition, the staff of the
production department is those who work directly with the technology and operation of the steel
production process in terms of input transforming. Assign specific tasks, each equipment area,
work for each individual from shift leader, team leader, to technology technician, accurately
reflecting equipment status, coordinate with the electromechanical workshop to regulate
production to promptly repair, minimize abnormal production due to equipment breakdowns, and
maintain good equipment utilization efficiency for both lines in the management and use of
equipment (Minh, 2022).
Vnsteel's steel transformation process is separated into four steps. Scrap collecting is the
initial stage; businesses collect scrap both domestically and internationally. The next step is to
manage the quality of slag additives, the volume of slag-forming additives, as well as expertise
in operation and data processing, to make a choice, which is considered an important "secret" in
the problem of slag creation. The most effective method for generating slag. To create "white
slag" in the LF furnace, it is also necessary to calculate how to give the best volume of slag-
making materials, strictly control the source of raw materials to create "white slag," and separate
the steel in the slag so that when moving to the next stage, the slag and impurities, iron is
minimized. The third stage involves using a casting machine system to produce various billets
(semi-finished raw steel). Finally, the square billet will be rolled into completed construction steel,
including rebar and coil, at the Steel Rolling Plant (VLXD.org, 2018). The output of this
operation is cast iron.

Figure 2: The steel transformation process at Vnsteel (Vnsteel, 2021)
Vnsteel performance characteristics are examined using four operations process characteristics
(4V).
In terms of output volume, in 2020, construction steel production and consumption will reach
approximately 110% of the set plan and decrease by 2-3% over the same period, partly because
from June 2020, the total The company divested from Tay Do Steel Company, thus reducing the
Corporation's overall output. Consumption of construction steel reached over 3.25 million tons;
in which there is a significant contribution of steel production units from electric furnaces (steel
block /V/, Vinakyoei) accounting for a large proportion of the Corporation's total construction
steel (Do, 2021). Second, in terms of variety, VNSTEEL is the most important company in the
field of steel production and trade, contributing significantly to the development of Vietnam's
steel sector. Vnsteel's steel products include U steel, smooth round bar steel, rebar steel, roll
steel, billet (Vnsteel, 2021a). The steel industry's variation came next. VNSTEEL will develop
the market, maintain market share of V-shaped steel in the South region, and export to continue
to boost output and make up for the shortage by establishing Southern Steel Company as the
core unit. Investing in a new factory or merging and acquiring with the steel mill capacity module
1.0. – 1.5 million tons/year with modern, environmentally-friendly technology is estimated to
boost V-shaped steel production by roughly 1.5-2.0 million tons/year between 2020 and 2025.
(Minh, 2021). As a result, VNSTEEL's V-steel volatility is in great demand. Finally, there's
product visibility to consider. Southern rebar steel, for example, is widely utilized in the
construction of civic, industrial, and high-rise buildings, as well as bridges and roadways. D10,
D12, D13, D14, D16, D18, D19, D20, D22, D25, D28, D29, D30, D32, D35, D36, D38, D40, D41,
D43 are the several types of southern rebar. Commercial lengths are 11.7m and 12m, or as
needed by the customer, southern simple round bar, 14mm to 50mm in diameter
(TONTHEPSANCHINH, 2020). As a result, VNSTEEL's rebar products can be created based on
ready-made samples or customer specifications, resulting in regular product visibility normal.
2.4. Principles of modern operational management
Craft production is the process of making things by hand, using or not using tools. Craft
production refers to a manufacturing technique used in handicrafts as a pastime with small

quantities but it was also a common way of manufacture in the pre-industrialized world, such as
in the creation of pottery (Bartholdi & Eisenstein, 2005). According to Blackman, Stein &
Vandiver (1993), mass production is the application of specialization, division of labor, and part
standardization to the manufacture of goods. These manufacturing procedures provide a high
volume of product at a low cost per unit, with reduced costs projected as volume increases. The
flexible specialization is aimed at the production for the specialized markets of a wide and
changing range of products in small quantities (including single items) using highly specialized
equipment and a higher and diverse qualification of workers, which can be regarded as a
modern form of handicraft production (Paul & Jonathan, 1991). Lean production is a
management style that focuses on reducing waste while maintaining quality. This method can be
used in any part of a company, from design to production to distribution (Nicholas, 2005). The
term "mass customization" is described as "customer-oriented and individualized mass
production for a huge market, satisfying the diverse needs of each buyer of these items at prices
equivalent to regular mass production" (Piller, 2004).
Agile manufacturing is a manufacturing process that focuses heavily on quick customer
response, converting speed and agility into a fundamental competitive advantage. It's an
intriguing strategy to gain a competitive advantage in today's fast-paced economy. Short
windows of opportunity and rapid changes in client demand are significantly easier to exploit for
an agile organization (Booth, 1996). Employee training and implementing standardized best
practices to boost productivity were among the groundbreaking concepts created by the
scientific management movement at the time. Taylor's hypothesis was dubbed scientific since
he developed it using botanist and chemist skills including analysis, observation, synthesis,
rationality, and logic (Spender & Kijne, 1996).
It is clear from the theories of the above principles that Vnsteel has implemented the mass
production principle to the enterprise's steel production process. According to Vnsteel, the Covid-
19 epidemic scenario is multifaceted, lengthy, has a large reach across the country, and is
spreading quickly and dangerously in the first nine months of 2021, especially in the third quarter.
Because most of the Corporation's units are in provinces and cities that must undertake social
distancing in line with Prime Minister's Directive 16/CT-TTg during this time, the Corporation's
production and business activities are also substantially impacted. However, in 9 months, the

Corporation produced 1,755,628 tons of steel billet, or 69 percent of the year's plan; up 3% from
the previous time; and used 444,966 tons, or 64 percent of the year's plan; down 15% from the
previous period. Finished steel: 2,921,231 tons produced, or 75% of the year's plan, a 1%
decrease over the same period last year (Le, 2021).
2.5. The relationship between operational functions in the enterprise in general
Figure 2: The relationship between the operations function and the organization's other core and
support functions (Slack, Chambers, and Johnston, 2001)
The operations function is critical to the management of organizational activities because it
generates the commodities and services that are the organization's raison d'être, but it is not the
only function. It is, nevertheless, one of any organization's three essential functions. The first is
the marketing (including sales) function, which is in charge of presenting the company's products
and services to its target markets to develop client demand. Following that is the product/service
development function, which is in charge of developing new and modified products and services

to meet future customer service demands. The third function is the operational function, which is
in charge of achieving customer service requirements through the production and delivery of
products and services.
There are also support functions that allow core functions to work properly. Accounting and
financial functions are examples of these, as they provide data to aid in making economic
decisions and managing the organization's financial resources. And there's the human resource
function, which recruits, develops, and looks after the organization's employees. In short,
practically every organization will have three main activities, because every firm must offer
services, satisfy consumers, and produce the means to fulfill customers in the future goods.
2.6. Application for Vnsteel
On the basis of specific interactions between functions and activities in general, the relationship
between operational functions in Vnsteel is also intimately associated and performs admirably
together for the business to operate and thrive for many years. The operational function stated in
Section II.2.3, for example, must be linked to other basic functions in order for manufactured
steel goods to be operable. Product/service development experts will examine and propose
numerous types of steel for each industry, such as construction and shipbuilding, based on
parameters such as low cost and construction time. Construction is quick, and maintenance is
inexpensive. In addition, Vnsteel's marketing staff must gather market data in order to assess
market demand, target markets, and new markets. Determine the market scope for existing
products and forecast demand for new products and goods, trends in product consumption and
sales, research volume and demand structure, and determine the specificities of regions and
segments of the market to assist businesses in understanding the market and, as a result,
offering appropriate steel products to each customer.
Furthermore, steel production necessitates the involvement of business support functions in
order to complete the process. First and foremost, a company's finance department must assess
its capital and cash flow in order to define production targets and make economic year decisions
from which funds can be used to invest in the manufacturing process. Therefore, the human
resources of this department play a large role in efficient production when they operate the

equipment and inspect the input scrap and the output completed product is iron and steel to
ensure quality.
III. Continuous improvement in the business context
3.1. The concept approaches to operations management
TQM, Lean Production, Six Sigma, and scientific management are the four basic approaches to
continuous improvement discussed in this section.
A, TQM and PDCA process
"An approach to improve an entire organization's competitiveness, effectiveness, and flexibility,"
according to TQM. It is simply a method of organizing, planning, and comprehending each action,
and it is dependent on each person at each stage" (Oakland, 1993). TQM entails making the
client the center of operations. Its goal is to increase process performance constantly in order to
meet client needs (Bennis, 1992). It entails communicating and deploying objectives from the
bottom up, as well as implementing continuous improvement initiatives from the bottom up. The
concept of process management, as well as the existence of internal suppliers and customers
within organizations, are at the heart of TQM. TQM-adopted organizations are more likely to
have established a thorough grasp of their processes and strive to make the customer the focus
of improvement efforts (Oakland, 1993).
PDCA is a quality management technique that is widely used in the service and manufacturing
industries as a continuous improvement tool. PDCA activities are made up of four steps: Plan,
Do, Check, and Act, which is repeated in a circle. The PDCA method of continuous improvement
is widely employed in the service and manufacturing industries. The PDCA cycle starts modest
to check for potential system effects, but eventually develops to greater and more focused
changes. The PDCA method's outputs can be used to address problems with qualitative and
quantitative data, and it's extensively used in the service and industrial industries for continuous
improvement and as a work pattern for enhancing a process or system in an organization and
increasing productivity (Isniah, Purba, & Debora, 2020).

B, Lean production
Lean production is a way for reducing waste and increasing productivity in a production system.
Anything that buyers do not believe will bring value and for which they are unwilling to pay is
called waste. Reduced lead times, lower operational costs, and increased product quality are
some of the advantages of lean manufacturing (Azadeh, Yazdanparast, Zadeh & Zadeh, 2017).
The five concepts are defined as "defining value," "mapping the value stream," "creating flow,"
"establishing pull," and "pursuing perfection" (Womack, Jones, and Roos, 2007).
The first step is defining value. It's crucial to understand what value is to grasp the first concept
of customer value. The customer's willingness to pay is the measure of value. The importance of
determining the customer's current or projected wants cannot be overstated. Customers may not
know what they want or be unable to express it. The second method is value stream mapping,
which aims to identify all actions that contribute to consumer values as a starting point. Wasteful
activities are those that do not bring value to the end client. Third, create flow, once the waste
has been removed from the value stream, the next step is to guarantee that the remaining steps
flow smoothly and without interruption. Then establish pull, which is a pull-based system that
allows for just-in-time manufacturing and distribution, where the product is manufactured just
when it is needed and in the exact quantity required. Pull-based systems are always designed
with the end-user in mind. The pursuit of perfection is the fifth principle, which makes Lean
thinking and continuous process improvement a part of the organizational culture. While
providing products based on consumer needs, every employee should strive for perfection. The
company should be constantly learning and striving to improve daily (Womack, Jones & Roos,
2007).
C, Six sigma and DMAIC process
Dumitrescu & Dumitrache (2011) pointed out that Six Sigma is both a statistical measure of the
variation in a process and a business management technique developed by Motorola in 1981 to
improve quality, identify root causes of errors, and reduce variation and defects within its
production processes. Six Sigma programs are designed to improve competitive positioning and
increase the recognized profitability of a firm by customers.

Smętkowska & Mrugalska (2018) pointed out that DMAIC is an acronym for Define-Measure-
Analyze-Improve-Control. This strategy is based on the Deming cycle for process improvement.
It is the improvement of many various aspects of the company's processes. Define the problem,
improvement activity, improvement opportunity, project goals, and customer (internal and
external) requirements first. The second, measure process performance. The gather information
stage is concerned with gathering information on the processes that will be enhanced. It focuses
on the information required to better understand all of the organization's operations, customers'
expectations, supplier specifications, and the identification of potential issue areas. Next,
analyze the process to determine root causes of variation and poor performance (defects). The
fourth step is to improve process efficiency by recognizing and removing root causes. The
purpose of this stage is to gather the information needed to formulate and implement an action
plan to improve the organization's operating, financial elements, and customer-related concerns.
The fifth step is to maintain control over the enhanced process and its future performance. The
control stage verifies the quality of the improved process to see if the modifications made during
the improvement stage are sufficient and continuous (Smtkowska & Mrugalska, 2018).
D, Scientific Management
Scientific management is a management philosophy based on the process of evaluating and
integrating work processes to improve labor efficiency, as described in Section II.2.4. This page
will solely discuss Ferderick Taylor's theory (2004), although many scientists have researched
this idea and assigned different characteristics to it; nevertheless.
Taylor examined labor phases, monitoring procedures, and worker weariness using time-and-
motion experiments. A time-and-action study entails identifying and quantifying worker activities
while they do a job, as well as analyzing the outcomes. Operations that slow down the
manufacturing process shall be reduced to a minimum. One of the objectives of time-and-motion
research is to create an efficient and cyclical task (repetitive). The reduction of time, money and
other wastes required to make the product has been achieved by eliminating wasteful bodily
motions during work and describing the specific outputs of tasks (Taylor, 2004).
Taylor's management philosophy is reflected in two publications, "Shop Management" (1903)
and "Principles of scientific management" (1911), and can be summed up in four points: First,

instead of relying on experience, scientific working methods are used to replace previous
standards of operation to learn the fundamental parts of human activity. Second, instead of
allowing people to determine their working ways, managers should specify their planning
function. Next, rather than encouraging individual efforts and paying by the piece, scientifically
select and train people and foster a cooperative atmosphere. The fourth step is to split the work
between the administration and the employees so that each party does the best job possible for
them, resulting in increased efficiency (Taylor, 2004).
3.2. Business Process Reengineering - BPR
Petrozzo and Stepper (1994) stated that Business Process Reengineering (BPR) entails the
simultaneous redesign of processes, organizations, and their supporting information systems to
achieve significant improvements in time, cost, quality, and customer perceptions of the
company's products and services.
The seven principles of BPR (now known as methods), as proposed by Hammer and Champy in
their book, are as follows: The first concept is to plan for results rather than tasks. The second
step is to identify all of an organization's processes and rank them in order of redesign urgency.
The next step is to incorporate information processing activities into the actual work that
generates the data. The fourth step is to treat resources that are spread throughout different
places as though they were centralized. Fifth, rather than just combining the outputs of
concurrent tasks in the workflow, link them together. The sixth step is to make performance the
most important criterion and to incorporate control into the process. And the principal final, the
main goal is to obtain information only once and from a reliable source (Hammer & Champy,
1993).
3.3. The benefits and drawbacks of Lean and Six Sigma have led to a trend of
incorporating Lean Six Sigma into modern operational management.
The fundamental benefits of Six Sigma above other approaches to quality control, based on the
philosophy presented in the previous section, is that it is customer-oriented. Six Sigma has the
advantage of addressing the full process of producing an item or completing a service rather
than just the result. It is proactive rather than reactive, as it seeks to identify ways to improve

even before errors or omissions are identified (Singh & Khanduja, 2012). However, there are
certain drawbacks to Six Sigma. Because Six Sigma is used to improve all elements of the
manufacturing and planning processes, it can result in rigidity and bureaucracy, which can cause
delays and discourage creativity. Furthermore, their customer-centric approach can be taken to
an extreme, with internal quality control methods that are important to a firm being ignored in
favor of achieving high levels of customer satisfaction. Six Sigma is used to determine customer
satisfaction. For example, a low-cost measure with a slightly higher risk of error may be
discarded in favor of a higher-cost measure that achieves Six Sigma but hurts profitability
(Padhy, 2012).
The following are some of the benefits of lean production. For starters, lean manufacturing can
help a manufacturing facility decrease waste. This is, without a doubt, the greatest significant
advantage of lean manufacturing. Second, lean infrastructure means you just deal with a few
components: buildings, tools, supplies, equipment, and personnel to meet short-term inventory
demands. Third, lean focuses on loyal customers' issues and solutions for reducing unnecessary
procedures (Dabhilkar & hlström, 2013). Lean manufacturing, on the other hand, has the
following drawbacks: Failure of the equipment: There isn't much space for error in Lean.
Failures in equipment or manpower can result in serious conflicts and cause entire operations to
lag. Then there's the issue of delivery unreliability. Lean manufacturing, which is linked to
equipment breakdowns, might result in distribution anomalies. Companies may not have enough
raw materials to meet client demand if deliveries are late, resulting in late delivery (He, Zhou &
Gao, 2006).
The concept of Lean Six Sigma as a method of process improvement has yet to mature into a
distinct field of study (Bendell, 2006). In practice, it can be claimed that the majority of efforts to
fully and comprehensively implement a lean Six Sigma strategy have fallen short (Smith, 2003).
This failure to maintain a change toward continuous improvement can be attributable to many
factors, one of which being management's lack of commitment (Cusumano, 1994; Kotter, 1995).
In the case of integrating lean and Six Sigma, the two techniques have frequently been applied
separately (Smith, 2003), resulting in the emergence of lean and Six Sigma subcultures within
the organization, which can lead to a conflict of interest and a drain on resources (Bendell, 2006).

3.4. Six sigma method is applied to Vnsteel
VNSTEEL has consistently invested in new and replaced outdated equipment with sophisticated
technology and equipment to improve and maintain product quality over the years, based on the
criterion of first-class product and service quality protection of the environment. Specifically,
VICASA Steel Joint Stock Company - VNSTEEL.
Because the Company's rolling mill system has been in use for a long period, the technology is
relatively antiquated when compared to modern steel rolling procedures. The metal loss from
segmental cutting in the continuous casting process, as well as the cutting head in the rolling
process, is significant, resulting in unsteady output and low productivity. The rolling mill's highest
capacity is about 140,000-150,000 tons per year, although the steel mill's capacity is nearly
200,000 tons per year. This demonstrates a manufacturing process imbalance between
workshops, which has a direct impact on output product productivity and quality (vicasasteel,
2020).
With a budget of 40 billion VND, the company has invested in a cluster of vertical roughing
machines to replace the current rough rolling cluster, bringing the factory's rolling line capacity to
160,000 tons of products per year. Simultaneously, the Company replaced the rough rolling
assembly from a 3-axis rolling mill with 7 times rolling with a rough rolling type with 6 longitudinal
racks, 2-axis rolling rack with 6 times rolling, and a rear cutting machine. At the same time,
upgrading and moving auxiliary equipment such as Induction heating devices for hot workpieces,
a system of billet guiding rollers... to suit the new cluster of 6 rough rolling machines with new
vertical racks. Employees in the workshops work closely together to ensure that new machinery
and equipment is installed in sync with existing equipment, without disrupting the production
workshop's stages (vicasasteel, 2020).
VICASA has access to innovative technology thanks to this vertical rough rolling system, which
has improved production skills. When the enhanced machinery and equipment system went into
operation, it assisted the Company in lowering production costs and reducing metal consumption,
increasing capacity and product quality, and stabilizing production to boost product
competitiveness in the market. Each year, the Company receives up to 8 billion VND in benefits
(vicasasteel, 2020).

3.5. Evaluation the roles of Lean Production in Vnsteel in operations management
In a real and practical sense, Vnsteel has made several accomplishments through the use of Six
Sigma in operation management throughout many years of operation, contributing significantly
to the company's earnings. Because there are now insufficient records to demonstrate that this
bank is using lean manufacturing for operations management, this section will assess the
advantages that Vnsteel will get from implementing more Lean Manufacturing. When
organizations utilize lean in the process of managing operations, as outlined in Section III.3.3,
they get many advantages.
As a result, the steel sector should adopt a lean approach to standardize operations and
decrease waste. Vnsteel continues to continuously monitor the market and analyze flaws to
overcome challenges, maintain market share, and improve financial efficiency. The corporation's
units must work together effectively to ensure inheritance. To reduce damage, it is vital to
restructure production and operations fast in response to market signals, raise competitiveness
through cost savings, improve corporate governance ability to lower costs, improve product
quality, and locate additional export markets. At Viet Trung Minerals and Metallurgy Company
and Thai Nguyen Iron and Steel Company, resources should being pooled to address current
issues. Vnsteel may also boost employee autonomy, offer workers with increased decision-
making capabilities, and equip them with the tools and processes to do so by implementing Lean.
Detecting waste, eliminating inequities, enhancing staffing, and quantifying cost and value are
just a few of the advantages that firms may receive by using Lean Manufacturing in their
operations management.
IV. Continuous improvement plan for Vnsteel
4.1. The role of process technology in Vnsteel
A, Apply management software ROSY
Since 2015, HOCHIMINH CITY METAL CORPORATION - VnSteel has officially deployed
ROSY management software with basic modules to manage materials - spare parts; purchase
manager; sales management & receivables; Financial management accounting - asset

management - costing reports to increase competitiveness, improve position and reputation, and
improve the image of enterprises. Not content with that, the Company continued to research and
build 22 additional management and operation modules with tremendous zeal and commitment
(VLXD.org, 2021).
B, The Role of ROSY
To this point, the program has contained all of the Company's current management procedures,
the modules have been inherited and synced, and the data has not been duplicated or
conflicting. Controlling the purchase, import, and export of raw materials for production,
specifically controlling the purchase price compared to previous purchases; controlling the
quantity of the request, there is no duplication between departments and technicians; inventory
of materials and spare parts are strictly controlled, reducing inventory time, reducing inventory,
and avoiding waste in the use of spare parts are just some of the features provided by ROSY
management software. Finished products are meticulously maintained down to the bundle and
roll level, resulting in accurate and fast traceability for quick claim resolution and a reduction in
fatalities (VLXD.org, 2021).
Production output grew dramatically as a result of boldly investing in technology and controlling
and operating more flexibly. Steel billet production output, for example, was 619,321 tons, up
93.14 percent over the same period in 2019 and up 03 percent from the 2020 plan. Construction
steel output totaled 536,165 tons, up 101.55 percent from the same period last year and 7%
more than the 2020 forecast. Profit before taxes was 216,504 billion VND, up 128.33% from the
same period last year and on track to reach 280.72 percent of the plan in 2020. ( Building
Materials.org, 2021).
4.2. Evaluation and Recommendation
A, The Evaluation of Six Sigma at Vnsteel
The following are some of the advantages of Vnsteel using the Six Sigma approach. Six Sigma
allows a corporation to minimize input material costs, technical and economic indicators, boost
production capacity, stabilize product quality, and improve market competitiveness. The

Company's Board of Directors and specialist departments have concluded that the entire system
of longitudinal roughing machines has to be improved. Furthermore, this strategy allows the
corporation to gain up to 8 billion VND in profit. Its restriction, on the other hand, is quality
improvement rather than cost reduction. Quality improvement and defect elimination can be
costly in terms of increasing production costs and additional machinery investment. The
corporation will have to invest in totally replacing the 3-axis rolling stock's rough roll assembly. -
harsh rolling 7 times with 6 vertical racks and 2 shafts - After rolling and cutting six times, the
investment expenses are expensive. Furthermore, it has the potential to stifle fresh ideas that
promote creativity and innovation and necessitate taking risks to implement.
Hoa Phat Group (HPG) has implemented the TQM system in the management process to
enable Hoa Phat company make several achievements in recent years, compared to steel
enterprises of similar size. First, ISO quality management systems such as ISO 9001: 2015
(Quality management system), ISO 17025: 2017 (General requirements for the competence of
testing and calibration laboratories), and ISO 14001: 2015 (Environmental management systems)
are used to strictly control every process at Hoa Phat's facilities from input to output
(Environmental management systems). The finished products are then subjected to more
stringent testing, with only the highest-quality items being supplied to buyers. Export products, in
particular, now comply with international quality standards such as JIS GS3505:2004, JIS
G3112:2010 (Japan), BS 4449:2005 (UK), and ASTM A615 (USA) (Vuong & Hong, 2019).
Besides, Hoa Phat focuses on investing in modern equipment lines, regularly developing and
upgrading equipment, and evaluating and testing quality systems with advanced machinery and
equipment, the most current in the world, in order to attain such high quality. In addition, Hoa
Phat not only invests in technology, equipment, and management software but also in training
and increasing staff skills and competencies. Through collaboration with Vocational Colleges,
Professional Centers, and some local units, tens of thousands of employees at member
organizations are trained on a regular basis in various specializations to develop professional
abilities. Newly graduated engineers and inexperienced young employees will receive
comprehensive professional training at the plant, with many possibilities for hands-on experience
with equipment and machines, as well as many hours of technical practice before accepting the
job. In addition, every year at Hoa Phat's facilities around the country, various training sessions

on 5S regulations in manufacturing, quality control, safe operation, and so on are held (Vuong &
Hong, 2019).
B, Proposal for additional methods
The TQM approach is the recommended method for Vnsteel. When organizations implement
and use Vnsteel, the TQM management system will help it be extremely beneficial for business
activities. As a result of implementing TQM, businesses have earned a slew of positives. TQM
results in better-quality, reduced products. The use of high-quality data to improve operations
eliminates efficiency and saves time, saving time and money that may be passed on to
customers in the form of lower prices. Companies that successfully use TQM may decrease
change, providing customers with the stability they expect. This fosters customer loyalty and
encourages them to do business with the organization again. Employee satisfaction is the
consequence of a concentration on involvement at all levels, which keeps costs down on training
and novice mistakes while also reducing income.
V. Conclusion
In short, after weighing the benefits and drawbacks of the company's current process of
continuous improvement, the report recommended that Vnsteel utilize more TQM. In addition,
the study discusses operational management philosophy as well as continuous quality
improvement methodologies.

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