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Vincent Mak prepared this Case under the supervision of Dr. Chi Kin (Bennett) Yim for class discussion. This Case is not
intended to show effective or ineffective handling of decision or business processes.
This Case is part of the Trade & Industry Department SME Case Series funded by the Hong Kong Special Administrative Region
Trade and Industry Department SME Development Fund. Any opinions, conclusions or recommendations expressed in this
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Ref. 04/189C
1
SIMON LAM
MANFIELD COATINGS CO. LTD.: QUALITY
MANAGEMENT AS THE WINNING FORMULA
Introduction
Manfield Coatings Company Limited (Manfield) was a niche player in the paint and coatings
industry, producing customised industrial coatings for various industrial products such as toys,
mobile phones, TV cabinets, washing machines, etc. As a supplier to manufacturers of such
products, Manfield had to meet not only stringent safety and quality standards but also
customers’ requirements for short production lead-times. To meet such demands, Manfield
had developed a quality management structure that delivered its core value of “Prompt and
Reliable” supply and service. In recognition of its commitment to quality, the Company
gained ISO 9001 certification in 1997, received the Certificate of Merit in the Hong Kong
Industry Department’s Quality Award in 1999, was awarded Q-Mark Licences from the Q-
Mark Council from 2000 onwards, and was awarded the Certificate of Merit in the Hong
Kong Management Association’s Quality Award, the 2000 version of ISO9001 and the
Encouragement Award of China National Quality Award in XXXXXXXXXXBut Mr. Yuen Shu-Wah,
Manfield’s founder and Managing Director, was not resting on his laurels. In 2003, Manfield
submitted an application for ISO14001, and approval was pending.
Manfield Coatings: Stressing Quality from Day One1
Yuen was a chemical engineer by training. Before establishing his own company, he worked
for a UK paint company, where he learned to become an expert in paint. By the early 1980s,
1 Hulpke, John F., 1998. Manfield Coatings, Hong Kong, China: new century, new challenges?
http:
home.ust.hk/~mnhulpke/yuen.doc
HKU311
For the exclusive use of P. Kashyap, 2022.
This document is authorized for use only by Prerna Kashyap in OPMT 620 - Fall XXXXXXXXXXtaught by Farnoosh Bagheri, University Canada West from Oct 2022 to Nov 2022.
04/189C Manfield Coatings Co. Ltd.
2
Yuen saw that there was demand in Hong Kong for high-quality paint that could support local
production. And at one point, he convinced his employer to build a plant in Hong Kong.
However, the UK firm eventually changed its mind. So, in 1982 Yuen quit and started
Manfield Industrial Company, the non-limited forerunner of Manfield Coatings Co. Ltd., with
just HK$200,000 (US$25,000) and five people (including Yuen himself). The limited
company was incorporated in 1986.
Manfield’s first customers were in the toy-manufacturing industry. With Yuen’s expertise,
Manfield was able to meet the customers’ colour and quality specifications, and the relevant
safety standards, exactly (customers in the toy industry generally followed the European
EN71 or the American ASTM standards regarding the heavy-metal content of its products).
Yuen commented, “While we have to be competitive, price-wise, we never really compete on
price.” Even when its paint was used on inexpensive products, Manfield was still adamant
about quality. Given such tenacity regarding quality, Manfield soon established a reputation
for quality and professional service, and its customer base also expanded to include
manufacturers of electronics and kitchenware, which set very high standards.
Under Yuen’s leadership, the Company continued to expand. However, during the heydays
of the Hong Kong economy in the mid-1980s, Yuen experienced great difficulty in hiring
staff. As he recalled, “For almost a year we had an ad running in the Hong Kong newspapers,
seeking non-experienced labourers to be trained as colour-matchers. Only 10 responded, of
whom only four reported for duty. All of those four left within a few days to take other jobs!”2
In 1986, a factory was opened across the Chinese border in Shenzhen, with only semi-
processing capabilities and a limited capacity. It took time to gradually train up the workforce,
expand the capacity and capability, and instil a quality culture in the Shenzhen facility.
Nonetheless, when most of Yuen’s customers also moved their manufacturing plants in early
to mid-1990s, Manfield was well established to serve them. By 1995, the combined
workforce of Manfield in Hong Kong and its production arm in Shenzhen reached 480, and its
annual turnover was in excess of HK$150 million (US$19.2 million). That year, Yuen was
awarded the Hong Kong Young Industrialist Award.
Embarking on the Road to Quality Management
While most of Manfield’s customers were in Hong Kong or Mainland China, the Company’s
products were sold all over the world. As competition among manufacturers became keener,
their demand to their suppliers, in turn, got higher as well. As Yuen recounted, “In the old
days, customers would be satisfied with a five-to-seven-day order lead time; soon they started
asking for shorter lead-times.” By the mid-1990s, Manfield was able to achieve an order-to-
delivery lead-time of three days, but customers were still demanding even shorter lead-times.
In 1996, Yuen attended the Chiang Foundation Manufacturing Leadership Training
Programme held at the University of Southern California in the United States. At the time,
Yuen realised that Manfield was having similar problems to those that Chrysler (one of the
iggest car manufacturers in the US) once had, e.g., a lack of co-ordination between
functional departments and an inability to respond quickly to challenges. Yuen knew that
Manfield needed to be “big and efficient”. He also learned how United Parcel Services
handled 11 million packages, offered a 24-hour worldwide delivery guarantee and provided
customers with information about the real-time status of each delivery. He realised that “big
and efficient” was achievable, though it required good planning, determination and
2 Hulpke, John F. (1998).
For the exclusive use of P. Kashyap, 2022.
This document is authorized for use only by Prerna Kashyap in OPMT 620 - Fall XXXXXXXXXXtaught by Farnoosh Bagheri, University Canada West from Oct 2022 to Nov 2022.
04/189C Manfield Coatings Co. Ltd.
3
commitment. Upon his return, Yuen immediately discussed this with his senior management,
and the decision was made to embark upon the road to quality management.
The first goal was to become ISO 9001-certified. Soon afterwards, outside consultants were
hired to provide training and to set up a quality management system. This, fortunately, was
acked by Manfield’s continual investment in and use of management information systems.
Nevertheless, “unless the mindset improves, we can never make real achievements,” said
Yuen. Thus, significant emphasis was placed on training. For one thing, managerial staff
members were expected to effectively ca
y out managerial duties such as planning,
organisation, human resources allocation, command and control [see Exhibit 1 for the
complete training programme for managerial staff]. For another, training and education for
all employees had to be comprehensive, i.e., not only did it have to include job-specific and
elated training, it also had to communicate Manfield’s value system and way of thinking.
Later in 1997, Manfield was audited and successfully certified for ISO 9001 (version 1994).
The same year, the motto “Prompt and Reliable” was made the centrepiece of Manfield’s
service strategy.
In real terms, Manfield made significant progress in enhancing productivity. To Manfield,
productivity enhancement was achieved by leveraging cost controls very effectively in order
to maximise value creation. To its customers, the greatest value was speed. Previously, a
one-day order-to-delivery lead-time was nearly unattainable. In the second half of 1997,
Manfield successfully fulfilled 222 one-day orders, compared to only three in the first half of
the year. For two-day orders, the number fulfilled rose from 79 in March 1997 to 459 in
December XXXXXXXXXXThe average monthly rate for delayed deliveries fell from 15.15 per cent in
1996 to just 1.68 per cent in XXXXXXXXXXThese achievements did come with some degree of trade-
offs in production costs. Such trade-offs, however, were carefully evaluated and were done
without compromising the value to customers or employees’ salaries and benefits.
Quality Management at Manfield Coatings
In the ensuing years, Yuen continually pitched the Company against audits and examinations
through award applications. According to Yuen, this achieved two purposes: first, it helped
them see areas of weaknesses where they did not normally see;