Executive Summary

S. Germar Construction Supply and General Merchandise, a hardware situated in A.

Soriano Hi-way, Capipisa, Tanza, Cavite was currently facing some problems in terms of their
products specifically deformed plywood and iron sheets, corroded pipes and steel bars, defective
light bulbs, cracked hollow blocks and poor-quality cement. These problems affect their
productivity and profitability as a firm.
This study particularly deals in identifying the major causes correlated with the product
defects inside the construction supply through Pareto Analysis and Fishbone diagram. It aims to
provide possible solutions to the problems and minimize the defect rates through critical analysis
of data and evaluations.

From the five problems encountered in the firm, results showed using Pareto Analysis that
the two main causes mainly contributing to the problems were the deformation and corrosion of
materials and through the Fishbone Diagram, factors that affect these defects were evaluated.
The result of the analysis specified inefficient management, substandard materials, poor storage
condition of the products, reckless deliveries and improper behavior of the workers as causes of
these defects.

I. Introduction

Problem solving tools form an integral part of continuous improvement of processes.

These tools include the Pareto Analysis, Fish Diagrams, Gantt Charts, PERT charts and Job
Analysis guides.

This study merely focuses on two problem solving tools: Pareto Analysis and Fishbone
Diagrams. Pareto analysis is a statistical technique in decision-making used for the selection of
a limited number of tasks that produce significant overall effect. It uses the Pareto Principle (80/20
rule) whereby doing 20% of the work, generates 80% of the benefit of doing the entire job. It
prioritizes possible changes by identifying the problems that will be resolved by making these
changes.

Another problem solving tool is the fishbone diagram or cause and effect diagram, a
visualization tool for categorizing the potential causes of a problem. This diagram is used in
process improvement methods to identify all of the contributing root causes likely to be causing a
problem.
 These tools were used in this study to determine the possible causes of the problems that
contributes to the problems in the firm.

II. Objectives

This study aims to identify the potential root cause of the problems/ the major defects on
products using Pareto Analysis and Fishbone Diagram.

Specifically, this study aims the following objectives:

 To determine the factors that cause the defects of the products.

 To find out possible solutions to the problem

III. Area of study

The study was conducted in R.S. Germar Construction Supply and General
Merchandise, a hardware located in A. Soriano Hi-way, Capipisa, Tanza, Cavite. This
hardware was founded by Mr. Reynaldo S. Germar in 1993 and recently owned and managed
by Mrs. Aviegail Catubig. It sells a variety of construction materials including cements, gravel
and sand, paints, pipes, roofing materials, plywood, iron sheets, wires and many other building
materials.

However, defects were encountered in terms of their product and this study aims to
determine its causes.

IV. Problem Identification

The data for this study was collected through a brief interview with the owner of the
construction supply to determine the problems encountered inside the firm. Product defects
were determined through an inventory of defects asked from the owner with all confidentiality.
Deformed plywood and iron sheets, corroded pipes and steel bars, defective light bulbs,
cracked hollow blocks and poor-quality cement were the problems/product defects identified
in the study.

The inventory obtained was then categorized and evaluated. Descriptive statistics
such as frequency count, cumulative frequency, mean, and percentage were considered.
Data was graphically illustrated for the Pareto Analysis and Fish bone diagram to know the
primary causes of the problems.

V. Pareto Analysis
 The following data presented reflect the results obtained from the inventory in the
construction supply. Listed were the product defects inside the firm with its equivalent
frequency count, percentage and cumulative frequencies.

Using pareto analysis, data was graphically illustrated as follows to know what
causes contribute to the problems. The following graph can be interpreted that the
deformed and corroded materials causes 80% of the problems.

Table….…

Figure 1. Frequency distribution table of the product defects

Graph………

Figure 2. Pareto Analysis Diagram of the product defects

Figure 1 shows the frequency distribution table of the listed product defects which is
mainly used in the Pareto analysis. On the other hand, Figure 2 shows the Pareto Analysis
Diagram of the defects which aids in determining the main problems of the firm.

VI. Fishbone Diagram

Based from the Pareto analysis, it was found out that the two main causes that generates
80% of the problems are the deformed plywoods and iron sheets and the corroded materials.

The following are the fishbone diagrams of each product defects:

FBD 1…

Figure 3. Fishbone Diagram for Problem 1 (Deformed Plywoods and Iron sheets)

FBD 2…

Figure 4. Fishbone Diagram for Problem 2 (Corroded pipes and steels)

Figures 3 and 4 show the cause and effect relationship between the product defects and
the factors that causing it.

VII. Analysis of results

The result of this study was mainly based from the Pareto analysis and fishbone diagram
constructed through critical analysis of data and evaluations.
 The result of the Pareto Analysis showed the two factors that mainly contributed to the
existing problems which were the deformed plywoods and iron sheets (41% of the product
defects) and corroded pipes and steel bars (25% of the product defects). These two product
defects primarily caused 80% of the problems in the firm.

Moreover, the fishbone diagrams revealed the factors that caused the problems/product
defects inside the firm. Man, materials, management, methods and environment were considered
in enumerating the causes of the deformation and corrosion of materials. The probable causes of
the product defects were low quality or substandard materials as well as the poor storage
condition of the products.

Reckless deliveries also account to the deformation of the materials because of the
improper behavior of the workers in carrying out the supplies in the firm along with their
inattentiveness and lack of concentration during work periods. Aside from that, the health
conditions of the workers also affect their work performance and therefore influence the product
quality.

Additionally, inefficient management is also one of the causes of the product defects.
Having poor supervisory practices results to poor quality products if there will be no time allotted
for maintenance and inspection of materials.

These factors significantly affect the problems encountered including the deformation
and corrosion of the materials.

VIII. Recommendations

After a thorough analysis of the study, possible solutions were formulated that would help
the firm in solving the problems that they were currently facing.

One important thing to consider in solving the problem was the result of the pareto
analysis. The firm should primarily focus in solving first the two main problems (deformed
materials and corroded supplies) which were found out in the Pareto Analysis Diagram.

Based from the analysis of the results, certain factors prominently affect the problems
encountered in the firm. The construction supply could examine the causes stated in the fishbone
diagram to further improve their product.

One effective solution to the problem was having an efficient management and a schedule
for inspection of materials. The firm must also ensure that the storage condition of their products
 is well-maintained. This would help the firm to prevent the materials from any deformation or
corrosion.

IX. Conclusions

Pareto Analysis and Fishbone Diagram are effective tools in identifying the potential root
causes of the problems. Main problems and its causes are easily determined through these
techniques.

Based from the results of the study, efficient management is needed to prevent the
problems/product defects from recurring, knowing that the main problems are specified through
Pareto Analysis. Different factors including man, materials, management, methods and
environment must always be considered in knowing the prominent causes of problems.

Pareto Analysis and Fishbone Diagram are also approaches that aid in determining the
appropriate solutions to existing problems for improvement and development of processes. These
are also convenient in ascertaining the most significant problems affecting quality of services and
product. Using these tools will most improve the circumstances in any business enterprises or
establishments and thus increase its productivity and profitability.
Photograph 1. Photograph with Mrs. Aviegail Catubig, owner
of the construction supply

Photograph 2. S. Germar Construction Supply and

General Merchandise