Reengineering The Gspi's Information Systems: A Whitepaper

MSU-Iligan Institute of Technology Andres Bonifacio Avenue, 9200 Iligan City

Reengineering the Information Systems: A Whitepaper In partial fulfillment of the course requirements in Management Information Systems and Expert Systems in Business [BA 292] of the Master in Business Management program

Submitted to:

Royce S. Torres, Ph.D. Professorial Lecturer

Submitted by:

Arturo B. del Ayre, R.E.E. MBM Candidate

16 October 2006

Executive Summary This whitepaper is an analysis of Global Steel Philippines [SPV-AMC], Inc. or GSPI’s Information Systems and Services Department (ISSD) from the viewpoint of a user, an outsider looking in. It details the known facts disseminated through GSPI’s corporate communications network, actual usage of the new in-house developed information systems, additional related literature research, and comprehensive analyses of the various systems applying the theories and concepts learned in the course: Management Information Systems and Expert Systems in Business. GSPI’s ISSD and National Steel Corporation’s Information Systems Department (ISD) is presented for comparative purposes only. As there are no published facts on Information Systems of Ispat Industries Limited (IIL) or Global Steel Holdings, Ltd. (GSHL), the mother company of GSPI, the recommendations are anchored on best practices from published resources on the World Wide Web; benchmarks from international manufacturing corporations, global leaders in the steel industry, and world-recognized standard-giving bodies; and intimate knowledge of the existing GSPI’s management information systems, augmented with research and personal interviews with users and developers.

Table of Contents 1. Corporate Profile .................................................................................................... 6 1.1. Products .............................................................................................7 1.2. Manufacturing.....................................................................................7 1.1. Quality and Management Technology ................................................8 2. NSC’s Information System................................................................................... 10 2.1. Facilities Management......................................................................10 2.2. Systems Development......................................................................11 3. Ispat’s Information Systems ................................................................................ 13 4. GSPI’s Information Systems Services ................................................................ 15 5. System Analysis ................................................................................................... 16 5.1. Standards .........................................................................................16 5.2. Management ....................................................................................17 5.3. Information Processors.....................................................................18 5.3.1. GSPI Management Information Center [GMIC].................... 19 5.3.2. Computerized Maintenance Management System [CMMS]. 20 5.3.3. Timekeeping Profile and Management System [TPMS]....... 21 5.3.4. Procurement System............................................................ 23 5.4. Input and Input Resources ...............................................................24 5.4.1. Computer Hardware............................................................. 24 5.4.2. Communications Hardware.................................................. 25 5.4.3. Operating Systems Software ............................................... 25 5.4.4. Application Software ............................................................ 25 5.5. Transformation Processes................................................................33 5.5.1. Rolling Mills Production Process.......................................... 33 5.6. Output Resources.............................................................................36 5.6.1. Printers................................................................................. 36 5.6.2. Plotters................................................................................. 36 5.7. Outputs.............................................................................................36 5.7.1. Data Archiving...................................................................... 36 5.7.2. Documentation..................................................................... 36 5.7.3. Media Storage...................................................................... 37 6. Hardware Requirements....................................................................................... 38 6.1. Computing Devices by Type.............................................................38 6.2. Laptops/Notebooks...........................................................................39 6.3. Mobile Phones / PDAs......................................................................39 6.4. Networks ..........................................................................................40 7. Software Requirements........................................................................................ 41 7.1. Operating Systems of Microcomputers.............................................41 7.2. Office Automation Software..............................................................42

7.3. Operational Oversight / Administrative Systems...............................43 7.4. Operational Strategic Information Systems ......................................44 7.5. Databases ........................................................................................44 7.6. Security ............................................................................................45 8. Summary / Recommendations ............................................................................ 47 8.1. Hardware: .........................................................................................47 8.2. Software ...........................................................................................47 8.3. Systems Development......................................................................48 8.4. Security Policy ..................................................................................48 Appendix A. NSC Plant Facilities ............................................................................ 49 Appendix B. Hot Strip Mill Process Flow................................................................ 50 Appendix C. Cold Rolling Mill Process Flow.......................................................... 51 Appendix D. Electrolytic Tinning Line Process Flow ............................................ 52 Appendix E. Cold Rolling Mill Business Process .................................................. 53 Appendix F. Survey of GSPI’s Information Systems Components ...................... 54

List of Figures and Tables Fig. 2.2.1. Ispat's Global Presence .............................................................................13 Fig. 5.2.1. GSPI’s Information Systems’ Organizational Chart ................................17 Fig. 5.3.1. Traditional Communication Chain ............................................................18 Fig. 5.3.2. Sample Screen of GMIC’s CRM: Production Module ..............................19 Fig. 5.3.4. Computerized Maintenance Management System ..................................20 Fig. 5.3.5. Application for Leave of Absence Entry...................................................21 Fig. 5.3.6. Overtime [OT] Application Entry Screen ..................................................22 Fig. 5.3.7. GMIC Purchase Requisition Module .........................................................23 Fig. 5.4.1. Corporate Intranet ......................................................................................27 Fig. 5.4.2. Corporate Web Site ....................................................................................28 Fig. 5.4.3. Screenshot of GSPI's Knowledge Management Home Page ..................30 Fig. 5.5.1. GSPI’s Information Systems’ Components..............................................33 Fig. 5.5.2. Data Flow Diagram: CRM Production .......................................................33 Fig. 5.5.3. Data Flow Diagram: Overtime Monitoring System ..................................34 Fig. 5.5.4. Data Flow Diagram: Supply and Procurement.........................................35 Table 6.1.1. Computing Devices by Type ..................................................................38 Table 7.1.1. Operating System for Workstations ......................................................41 Table 7.1.2. Operating Systems for Servers ..............................................................41 Table 7.2.1. Software Application Packages .............................................................42 Table 7.3.1. Operational Oversight / Administrative Systems .................................43 Table 7.5.1. Databases (Existing and Proposed) ......................................................44

11..C Coorrppoorraattee P Prrooffiillee Global Steel Philippines (SPV-AMC), Inc. [GSPI], a subsidiary of Global Steel Holdings Limited (Global Steel or GSHL) traces its roots from the National Steel Corporation [NSC]. GSHL is a global corporation operating and managing businesses in the iron and steel, coke, mining and minerals, metals, energy and infrastructure sectors located in five countries across Europe, Africa and the Asia-Pacific. Prior to liquidation, NSC’s plant occupies 450 hectares in Iligan City and 11.8 hectares in Pasig City. National Steel Corporation was organized on 22 February, 1974 from the assets of Iligan Integrated Steel Mills when the later was subsequently foreclosed by the Development Bank of the Philippines. NSC acquired the cold rolling facilities of Elizalde Steel in 1978 and its tinning lines three years later. In 1981, the National Development Company assumed full ownership of NSC. Two phases of Five-Year Expansion Projects [FYEP] in 1983-1988 and 1991-1992 brought steel production capacity from 151,000 tons in 1974 to 0.8MTPY in 1988 then 1.2MTPY tons in 1992. The steel industry 1 particularly the basic iron and steelmaking integrated with slabmaking, and flats production, among others, were considered pioneer status in the Foreign Investment Act of 1991 (R.A. 7042). On August 8, 1991, the President Corazon C. Aquino signed into law R.A.7103, Iron and Steel Industry Act, calling for the boost in making the industry “the springboard and basis for launching Philippine industrialization” through the full and efficient use of the country's human and natural resources taking into consideration its critical impact on employment, indigenous resources utilization, foreign exchange and balance of payments position. Privatization plans for NSC began as early as 1990 and were successfully approved by the Philippine government with Malaysia’s Wing Tiek acquiring controlling interests in November 1994. Wing Tiek sold its entire 69.2% state to Hottick in December 1996 while NDC optioned its own 12.5% stake to the latter on February 1997. On 15 October 1997, the Philippine Economic Zone Authority declared 2 NSC as a Special Economic Zone, pending Presidential Proclamation, with downstream steel products manufacturing and fabrication industries and related sectors as preferred industries. Two years later, amidst proposed backward integration plans, equipment and technological modernization, and employee value-enhancement programs, NSC officially underwent a liquidation plan resulting in the retrenchment of 1,400 employees. On October 2000 3 , the Securities and Exchange Commission of the Philippines ordered the liquidation of Malaysian-owned NSC citing that NSC was unable to make 1 2 3

Myrna S. Austria, (1998). “The Emerging Philippine Investment Environment.” Discussion Paper. Manila: Philippine Institute of Development Studies, Series No. 98-27; July, 1998 Lilia B. de Lima, (1999). Economic Zones: Creating Employment & Other Opportunities Particularly in the Countryside, 8th Mindanao Business Conference, 12-14 August 1999, Iligan City, Lanao del Norte. Travis Q. Lyday, (2000). “The Mineral Industry of the Philippines.” Research Paper. USA: US Geological Survey, 2000, p. 3.

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repayments on its $350 million debts. NSC also was under staunch competition from cheaper steel imported from South Africa and Russia. In his privilege speech during the First Special Session of the Thirteenth Congress of the Senate, Joker Arroyo states “National Steel, for the record, was sold to an undercapitalized Malaysian firm which, in turn, borrowed heavily from local sources. The Malaysians left and the government is left holding the bag.” On 03 December 2003, the Global Infrastructures Holding Ltd (GIHL) team with McLellan consultants arrived for a plant overview and due diligence. GIHL, with President Gloria Macapagal-Arroyo in attendance, inaugurated Global Steelworks Infrastructures, Inc (GSII) exactly three months later, taking over the assets of the former National Steel Corporation for PhP13B ($244M) over eight years. GSII became officially known as Global Steel Philippines, [SPV-AMC], Inc. on August 19, 2005. 1.1. Products Aside from being the country’s leading producer of billets, the raw materials for rebars and wire rods, NSC was the dominant flat-rolled producer in the Philippines and was the country’s only tinplate producer. In 1992, NSC enjoyed considerable leads in market shares, particularly HRC (29%), CRC (72%) and tinplates (53%). By 1999, moreover, market shares slid down to 0%, 22% and 18%, respectively. NSC’s manufacturing plant occupies 450 hectares in Iligan City and 11.8 hectares in Pasig City. NSC primarily produced flat and long steel products. Flat products consist of hotrolled coils [HRC], hot-rolled plates [HRP], cold-rolled coils [CRC], and tinplates. Billets represent the long products. 4 Based on its historical financial data, NSC’s sales of HRC and plates considerably declined from PhP2,001 million in 1994 to a meager PhP274M in 1999. CRC sales dropped from PhP5,849M in 1994 to PhP1891M in 1999. During the same period, sales of tinplates fell to PhP1,037M in 1999 from PhP2,484M in 1994. 1.2. Manufacturing Three facilities produce the flat products of NSC, namely: hot rolling mills, cold rolling mills and the electrolytic tinning lines [ETLs]. 5 The 1.7 million tons per year (MTPY) hot-rolling mills process slabs to HRCs and plates. [see Appendix B: Hot Strip Mill Process Flow] In 1999, only the 1.2MTPY Hot Strip Mill No. 2 was operational. The 0.5MTPY Hot Strip Mill [HSM] No. 1 was mothballed due to economic reasons, although plans were made to dedicate this facility to hot-rolled plates and special steel markets. Commissioned on 17 July 1993,

4 5

National Steel Corporation, (2000). NSC Databank. All NSC’s information and statistical data are taken from this vast databank, collated from 1999-2004 by the Plant Facilities Preservation team. Arturo B. del Ayre, (2005). Flat Carbon Steel Production of National Steel Corporation from its Privatization in 1995 to its Liquidation in 1999. Unpublished Thesis Proposal, MSU – IIT MBM Program, Business Research course.

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President Fidel V. Ramos in his speech 6 during the inauguration ceremonies said, the Hot Strip Mill No. 2 is “the final phase of NSC’s expansion effort and the vital link to the full integration of the steel industry in the Philippines.” By 30 March 1995, HSM2 attained its all-time highest daily production of 5,182 metric tons (MT). HSM production slid from 792,767MT in 1996, an increase from the all-time high production of 644,552MT in 1994, to a meager 91,601MT in 1999. Brazil, Australia, Korea, Mexico, Europe, Russia and China supplied NSC with slabs on a spot market basis, but the Asian crisis in 1997 frustrated NSC’s attempt of a slab supply agreement. In cold rolling, the 1.0MTPY cold strip mills [CSM] produced coils, sheets and TMBPs from the HRC produced primarily from the HSMs or from imported HRCs. [see Appendix C: Cold Rolling Mill Process Flow] Finished products at CSM reached its daily peak on 23 November 1994 with 3,448MT. Production volume fell more than 75% from 513,002MT in 1995 to 121,514MT by 1999, compared to an all-time high of 415,420MT achieved in 1993. NSC’s 0.26MTPY ETL produce tinplates from imported tin-milled black plates or from its local cold rolling production. [see Appendix D: Electrolytic Tinning Line Process Flow] The TMBPs are processed at 0.15MTPY ETL No. 3 in Iligan. The 0.11MTPY ETL No. 2 in Pasig was closed in May 1998 due to economic factors. ETL3 production output in 1995 of 81,464MT, the highest since 80,506MT attained in 1992, declined to 26,926MT in 1999. NSC also imported TMBP from Japan, Korea, Australia and Brazil. From 1992 to 1999, raw materials imported by NSC generally exhibited a declining trend, except for intermittent upturn between 1995 and 1996. 1.1. Quality and Management Technology Prior to NSC’s privatization 7 , several management technologies were in place. Foremost of them was Total Productive Maintenance [TPM], a Japanese model of maintenance policy promising high mill availability and reduced maintenance cost. TPM, which was part of NSC’s Total Quality management, started on 13 February 1993 and culminated with the 3rd Maintenance Conference on 5-6 May, 1995. TPM at NSC envisioned that by the year 2000, NSC’s maintenance practices will have evolved from 10% corrective, 6% predictive, 68% preventive and 16% breakdown in 1995 to 20% corrective, 50% predictive, 25% preventive and only 5% breakdown. From January to March 1994, the 5S Program was introduced as a foundation to TPM. TPM also introduced the Operator-Mechanic-Inspector [OMI] concept which led to the “1:7 in ‘97” program in 1996, a quest for leaner structure characterized by a decentralized, autonomous, and accountable organization. Other technologies under the NSC’s TQM were the Seven Basic Habits, Interaction Management [IM], Self-Enrichment Workshops, Kaibigan, Statistical Process 6 7

NSC, (1993), Steeling Our Resolve for Philippines 2000, transcript of speech delivered by President Fidel V. Ramos, Hot Strip Mill No. 2 Inauguration Ceremonies on 17 July 1993, excerpts printed by NSC News, July 1993.. Arturo B. del Ayre, (2005). Flat Carbon Steel Production of National Steel Corporation from its Privatization in 1995 to its Liquidation in 1999. Unpublished Thesis Proposal, MSU – IIT MBM Program, Business Research course.

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Control and ISO 9000. By 1995, the cold strip mill and the two ETLs, including the billet steelmaking plant, were ISO9002:1994 certified. The Hot Strip Mill division was in the process of certification prior to NSC closure.

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22.. N C’’ss IInnffoorrm NSSC maattiioonn SSyysstteem m An analysis of GSPI’s Information System would not be complete without understanding the history behind the many systems. GSPI’s management information systems trace its roots from the remnants of NSC’s Information Systems. NSC started computerization during the 1980s, using the latest hardware and software at that time. By 1990, a year after the 486™DX processors were available in the market, almost 80% of NSC’s desktop computers were upgraded, although the remainder use 386™DXbased models and a number of XT-based computers, which were retained to communicate with the IBM Mainframe until 1998. When Wing Tiek took over, the first order of the day was to upgrade to Pentiumbased systems, but Pentium® III-based computers were limited to Finance, Engineering and Information Systems. During the outbreak of the Y2K frenzy, the IBM Mainframe was decommissioned but no definitive plans were adopted because an upgrade would have cost Wing Tiek huge sums of money, after grueling transformation of various systems from Mainframe-based to Microsoft/Oracle-based systems. When NSC closed shop, a number of systems were still operational, maintained by the Plant Facilities Preservation Teams; recommendations for rehabilitation 8 were left to prospective new owners. Most of the XT-based desktops were disposed of, either donated to far-flung communities in Iligan City, or some 286™DX PCs and other hardware peripherals were given to the local government units, such as the Iligan City Fire Station or sold in auction to former NSC employees. In GSPI’s Asset Purchase Agreement, signed 10 September 2004, with NSC’s Liquidators, the following are included, with GSPI having the first option to purchase or refuse: 2.1. Facilities Management NSC’s Information Systems Facilities included telecommunications facilities, computer networks, and timekeeping system. 1. Telecommunications Facilities consisted of (a) Corporate PABX System (Telephone System) included PABX e-Cards, Microwave Link, and Back-up Batteries, although the Firmware/ hardware needed to be upgraded to BC8 system. (b) Telephone Cabling System included cables from the Data Center to various sites in the manufacturing plants. Mobile Equipment Services, Shore Line Guard Posts, Billet Steelmaking Plant Sale / Warehouse / Ship Breaking, Booster Pump, Administration Building 1 to Guest House to Blue House, and Blue Housing Area cable system needed to be replaced. (c) 8

NSC, (2003). Excerpted from Plant Facilities Preservation: Information Systems: Assessment, Rehabilitation and PreStart-up Costs. National Steel Corporation. Unpublished Microsoft Excel file for NSC’s Liquidator, December 2003.

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CDM Wireless Telephone System included Base and Controller Units at Cold Strip Mills. 2. Radio Communication Facilities consisted of (a) Conventional Repeater, included an existing GE Repeater but excluded Air-time timer (anti-jam) and license; (b) Trunk Radio System included Channels, Base Radio and Controller Systems, but excluded license. (c) Mobile / Portable Radios included Motorola units but excluded license, spare parts and batteries. 3. Communication Center Operations included trunk lines to/from Iligan plant and excluded operating materials and supplies, and subscription. 4. Computer Networks consisted of (a) Enterprise Communication Backbone included Fiber Optics cabling system, Coaxial and UTP network links but excluded a lease of Makati - Iligan Voice/ Data Link. (b) Corporate Servers included CDM HP Server and network links to divisions but excluded the SAP Server. Additional network links are needed for the following routes: Cold Mill [CDM] to Mobile Equipment Shop[MES] to Carpentry, Hot Strip Mill [HSM] to Structural Fabrication Shop [SFS] to Waste Water Treatment Plant [WWTP] to Hydrochloric Acid Regeneration Plant [HARP], Billet Steelmaking Plant [BSP] to Yards and Materials [Y&M] area to BSP Warehouse, BSP to Scale House #2 [RG8], BSP to Booster Pump, Electrolytic Tinning Line No. 3 [ETL3] > Air Separation Plant [ASP] to Training and Education Department [TED] to Infirmary/Clinic, CDM to Advanced Research & Technology Department [ARTD] to Administration Building 1 [ADM1] to Guest House [GH] to Blue Houses [BH], Administration Building 2 [ADM2] to Central Warehouse to Foundry. (c) Work Stations included Desktop Computers on various manufacturing offices, dumb terminals at Data Center, printers and other peripherals. 5. Timekeeping System included all remaining MagCard log-box / CAC, and timekeeping stations. Upgrade of firmware and hardware were excluded. 6. Comprehensive Maintenance Agreement included maintenance plan of plant-wide PC and peripherals, Corporate Servers (Compaq-based SAP servers and HP-UX Servers), and Application System / RDBMS (SAP and Oracle); but excluded a maintenance agreement with any outsource company. 2.2. Systems Development The following includes NSC’s proprietary software applications developed inhouse by Information Systems Department’s Systems Developers. Except for integrated system, all others are system-ready applications.

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1. Integrated system for Finance, HR, Supply, and Product Distribution included Oracle DB/HPUX System, Oracle Developer 2000 software application, but excluded site terminals and front-end application installation. 2. SAP System (FI/CO - ready system) included SAP System, Oracle software application, but excluded contract renewal with SAP, account payment with Oracle and monthly maintenance cost for ABAP. 3. BSP Production Tracking System included software and hardware but excluded fine-tuning or program revision, reporting subsystem, library buildup, application simulation, terminals, server memory and hard disk upgrade. 4. Slab Monitoring System included an Oracle DB/HPUX system, Oracle Developer 2000 software application, but excluded site terminals and frontend application installation. 5. MASS1- HM included an Oracle DB/HPUX system, Oracle Developer 2000 software application, but excluded site terminals and front-end application installation. 6. MASS2 - CDM included Oracle DB/HPUX System, Oracle Developer 2000 software application, but excluded site terminals and front-end application installation. 7. MASS2 - ETL included Oracle DB/HPUX System, Oracle Developer 2000 software application, but excluded site terminals and front-end application installation. Ad hoc Systems were included in the APA for use during the rehabilitation phase of NSC’s plant facilities. These included (a) Supply System, a FoxPro 2.6-based Supply System with Reports Module plus a Windows NT – Server; and (b) HR Leave Module included an Oracle DB/HPUX-based system, a temporary Oracle Developer 2000 database and Windows NT desktop to populate library data as required. When GSPI took over NSC’s assets in 2004, most of the Liquidator’s offers were relinquished citing these were overpriced. The ad-hoc Supply System was, however, used primarily during the rehabilitation works of various plant assets until the deployment of GSII’s GMIC system; only a part of the Wide Area Networks were retained, particularly interconnecting HSM2, CSM and ETL3 to ISD, plus the purchase of the remaining operational workstations and antiquated, yet still usable, desktop computers, mostly 486™ PCs running Windows 95/98 or NT with Microsoft Office 95.

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33.. IIssppaatt’’ss IInnffoorrm maattiioonn SSyysstteem mss

Fig. 2.2.1. Ispat's Global Presence

GSPI’s looks up to Ispat Industries Limited (IIL) as its mother company. Headquartered at Mumbai, IIL employs a total of 2000 people and is the India’s leader in special steels market. IIL's core competency is the production of high quality steel employing cutting-edge technologies and stringent quality standards. It produces worldclass sponge iron, galvanized sheets and cold rolled coils, in addition to hot rolled coils, through its two state-of-the art integrated steel plants, located at Dolvi and Kalmeshwar in the state of Maharashtra. 9 The 1,200-acre Dolvi complex houses the 2.4MTPY hot rolled coils plant combining the Conarc process for steel making and Asia’s first compact strip process (CSP). It hosts a 1.4MTPY sponge iron (DRI) plant commissioned in 1994, a 2MTPY blast furnace and a mechanized multi-functional jetty for raw material handling. Kalmeshwar complex houses a 0.5MTPY cold rolling including a galvanized plain/ galvanized corrugated (GP/GC) lines and India’s first color coating mill. 10 Per internet research, Global Steel Holdings Ltd (GSHL) is owned by Lakshmi Mittal, while other sites 11 states M.L. Mittal and Pramod Mittal promoted GSHL, a company which manages over 14 million tons (MT) of steel-making capacities located in five countries namely Bosnia and Bulgaria in Europe; Libya and Nigeria in Africa, and 9

Ispat Industries Ltd (2006). Corporate Profile. Corporate Web Site. http://www.ispatind.com 10 Financial Express (2005). “Ispat Industries expands.” Financial Express. February 01, 2005 quoting http://www.ispatind.com/WhatsNewart13.asp 11 Menadzerijada 2006 http://www.menadzerijada.co.yu/html/gshl.htm

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the Philippines, besides India. Global Steel holds 54 percent of the equity stake in Ispat Industries Ltd, the India-based flagship company of the M.L. Mittal-Pramod Mittal Group. Pramod Mittal said 12 the consolidation process in Global Steel is likely to be concluded within the next 6-9 months (November 2006-February 2007). Only thereafter would the performance of the subsidiary companies (probably including GSPI’s?) be reflected in the balance sheet of Global Steel. With regard to information systems, IIL have no published documents on its corporate web site, and no data were shared by expatriates to local GSPI’s employees. IIL’s corporate web site consists of a corporate profile, focused more on products and manufacturing processes, a single-page on social responsibility, links to current and previous annual reports on its investor relations portal, plus a fleeting reference to a steel glossary, a sitemap, and career offerings. Similar situation is also found on GIHL or GSHL, wherein a single web page is only used as a portal for the Ispat’s corporate page. 13 Recent attempts this current year to view the site proved futile as the domain name itself is no longer available on the internet. Interconnection between GSPI and the GSHL headquarters at United Kingdom is through mobile technology or through leased video conferencing facilities. Email communications between various subsidiaries are through various free Internet-based email providers, such as Yahoo!, Google, Rediff mail; GSPI’s mail domain; or through expatriates previous email accounts at Ispat.com. No published resource states a proposed inter-corporate internet connection to and from the mother company, GSHL, or among the subsidiaries.

12 13

Menadzerijada 2006 http://www.menadzerijada.co.yu/html/gshl.htm GSHL (2004). Corporate Web Site. http://www.gshl.co.uk Accessed November 2004.

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44.. G PII’’ss IInnffoorrm GSSP maattiioonn SSyysstteem mss SSeerrvviicceess Most of the components such as the Local Area Network [LAN], Management Information Systems [MIS], Supply and Procurement System [SPS], Human Resource Information Systems [HRIS], Computerized Maintenance Management System [CMMS], and Facilities Management System [FMS] of the liquidated NSC were transformed into GSPI’s own respective version, initially by changing all the NSC’s headers and logos into GSII or Ispat. A year after, when GSII became GSPI, same thing happened: change the logos first then deal with the contents later. Up to this day, remnants of NSC still exist although slowly or piece-by-piece new systems are being created, but unfortunately still using NSC’s model as basis, while some of NSC’s systems are being redesigned or totally revamped. Interestingly, some software application still bears the GSII logo and name instead of the SEC-registered GSPI. GSPI’s Information System is an amalgam of Ispat components and NSC remnants. When GSPI inherited NSC’s systems, it also inherited all its idiosyncrasies, problems and challenges. In conjunction with the name change last August 2005, GSPI announced 14 that it has formed a new Corporate Communications Department which will manage all aspects of the company's brand identity program. An integrated corporate framework for GSPI’s Information Systems Services is still to be designed to show the interrelation of various subsystems: marketing, manufacturing and engineering, finance and accounting, human resource, research and development, and information services, into one cohesive model to serve the mission and objectives of the various corporate functions.

14

IMN (2005). “GSII Changes Name to Global Steel Philippines.” International http://www.industrialnewsupdate.com/

Manufacturing News. August 19, 2005.

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55.. SSyysstteem mA Annaallyyssiiss The technical quality of NSC’s Information Systems was good as far as reengineering 15 is concerned. Functional quality, however, deteriorated after the Y2K debacle and the subsequent liquidation of NSC’s assets in1999. During the Plant Facilities Preservation phase in year 2000 to 2004 under the Liquidator, a lot of hardware peripherals were belatedly attended to that most hard disks, software applications, historical databases gathered literal and figurative dusts that proved detrimental and unusable when GSPI took over. A few systems, however, survived the preservation phase that they have been successfully revived and presently used. Other systems were of good functional quality but technically poor in quality. Through reverse engineering, the latter, however unavoidably, became the theoretical basis of new systems now in development phase under GSPI’s stewardship. 5.1. Standards Global Ispat’s Vision is “to be a knowledge-based organization that continuously achieves economic value for stakeholders by optimizing resources through operational excellence, enabled by continuous innovation and driven by technology to meet customer satisfaction.” Global Ispat’s Mission is “to attain and maintain leadership in the steel industry through technological and product superiority to maximize value addition at competitive cost.” Furthermore, Global Ispat’s mission for NSC facilities is “to attain and maintain leadership in the steel industry through technological advancement; start-up the steel complex with immediate effect; make NSC an integrated steel complex; contribute in the Improvement of economy of Iligan, nearby areas and Philippines; stop brain drain by providing employment and trickle down effect resulting in growth of ancillary communities.” GSPI’s Values are namely: Leadership, Bias for Action, Market Connect, Cost Consciousness, Empowered Employees, Transparency, Innovation & Technology, Stakeholders Satisfaction, Group Synergy, and Concern for Environment. Congruent to the Global Ispat’s Vision and Mission, GSPI’s Information Systems Services Department [ISSD], is spearheading the thrust for GSPI to become a knowledge-based organization. ISSD’s battle cry “I Love This Job!” is synonymous to giving users state-of-the-art electronic and technological innovations and services.

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David Sharon, (1991). “The Psychology of Reengineering,” IEEE Software 8 (November 1991), USA: IEEE, p. 74.

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5.2. Management Information Systems Services Department is headed by a Head of Department (HOD), a manager, who supervises Database Administrator, System Developers, Webmaster, Systems Analyst, Network Specialist, Programmers, Technicians and Operators. There is no GSPI’s designated Chief Information Officer, CIO, although the HOD, ISSD assumes this role. Most of the System Developers and Programmers are contractual workers. The whole department is subdivided into three main groups 16 : Technical Architecture, Systems Architecture, and eServices. Technical Architecture comprises of Network Specialist and Technicians responsible for the technical side of the information facilities. The Systems Architecture group comprising of System Analysts, Developers, Programmers and DB Administrators are responsible for designing and maintaining the overall corporate information systems. Two expatriates handle the SAP and GMIC. The eServices offer electronic and internet-based services, such as Lotus Mail, Intranet, portal to the World Wide Web and Knowledge Management. Head of Department Help Desk Assistant System Analysts System Developers

Database Administrator

Programmer

Webmaster

Knowledge Mngt Administrator

Internet/ Intranet Administrator

Network Specialist Network Technicians

Fig. 5.2.1. GSPI’s Information Systems’ Organizational Chart

The System Analyst is also a System Developer and a Database Administrator. The Webmaster acts as both the Knowledge Management Administrator and Intranet/Internet Web Content Administrator. The Network Specialist manages the all facilities to include Telecommunications, Local Area Network, Network Servers, Hubs, Routers, and Firewall; lends PC/Workstation support and troubleshooting. Three (3) Network Technicians work on shifts for the regular maintenance checks, repair and replacement, installation, PC/Workstation support and other network-related activities. One System Analyst manages the Proxy Server Maintenance, Internet Usage Monitoring, GMIC Data Back-up, and Lotus Notes Administration. Another System 16

GSPI Intranet (2005). Departments-ISSD. GSPI

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Analyst handles System Support to GMIC Users, modification and data fix of GMIC modules, WIP/FG Stock clean-up, Resolution of CRM Report Discrepancies and GSPI Intranet Update/Enhancement. A System Developer is responsible for all Hot Strip Mill information systems. Another System Developer is in charge of Management Initiatives modules and Personnel Skills Monitoring system. The Help Desk Assistant is responsible for the administrative functions of the department, such as personnel matters, connecting users to system developers, handling complaints, requests, and sundries. Delineation of various functions is not evident because the organizational structure itself is a complex web of matrices, whereby duties and responsibilities of one functional position is shared by one or two persons. It is only this year that the activities and tasks listing of various job positions are being done. Furthermore, GSPI is financially constrained to hire additional personnel to fill all the vacancies within the company, which organizational structure is limited for viewing to strategic positions. 5.3. Information Processors

Fig. 5.3.1. Traditional Communication Chain

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The traditional communication chain is the adopted method, whereby the development of application systems is only done by the Systems Analysts and System Developers, the user only interacts with the computer through front-end applications. Meanwhile, during NSC’s era, end-user computing was prevalent during the Y2K migration period which allowed the respective user to program various applications for their own use. 17

Raymond McLeod, Jr. and George P. Schell, (2004). Management Information Systems, 9th edition, USA: Prentice Hall, Inc.

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The current limitation is inconsistent with the corporate vision of developing a knowledge-base entity much more empowering users by optimizing resources through operational excellence. Most of the former NSC employees rehired by GSPI have accumulated years of experience and tapping these experiences for system development is not maximized to the fullest extent. In contrast, newly hired contractual System Developers have few years experience in actual manufacturing processes, in general, or steel manufacturing, in particular. Thus, expectedly there is a noticeable gap between the user-friendliness of emerging in-house applications compared to information systems existing during NSC era. Mostly, the issue redounds to lack of basic information processors, antiquated computer systems for business-critical activities, non-licensed software applications, non-existent information security policy, management’s myopic vision on computer as a tool and insufficient developers’ intimate knowledge of the manufacturing processes, that would have lead to innovation if triggered by end-users bottom-up instead of relying on a top-down scheme of doing things. 5.3.1. GSPI Management Information Center [GMIC] COBOL was the first choice in developing the various GSPI’s information systems. The GSPI Management Information Center (GMIC) is the primary application for all the manufacturing processes systems. The GMIC system consists of modules generally serving production monitoring, mill scheduling, limited purchasing functions and management reporting. Most of the latter, moreover, have to be downloaded from GMIC then reformatted to suit the nuisances of a number of managers, each with their own respective requirements of reports’ contents.

Fig. 5.3.2. Sample Screen of GMIC’s CRM: Production Module

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The CRM Production Module consists of Production Recording, Quality Inspection Reporting, Delays Monitoring, Material and Quality Yield Monitoring, Coil Tracking and History, and Work-in-Progress Monitoring. The HSM Production Module similarly consists of the same with the addition of Slab Input Tracking, Slab Cost Tracking and interface with Computerization Level 2. By June 2005, the migration from COBOL to Oracle was piloted in Cold Rolling Mills. Hot Strip Mill followed months thereafter. It is planned that the migration will take until the end of this year, and by year 2007, all systems will be Oracle-based. For now, the two systems: GMIC and Oracle are running parallel. 5.3.2. Computerized Maintenance Management System [CMMS] CMMS 18 is basically a computer-based maintenance information system that serves as an essential tool in maintenance management towards improving maintenance quality and productivity and in providing cost-effective maintenance services to customers.

Fig. 5.3.4. Computerized Maintenance Management System

Managed by a CMMS Database Administrator, the system is still under development. At present, although databases are still for build-up. The libraries such as Location, Skills, Currency, Unit of Measure, Facility, Group, Job Type, Equipment, Assembly Class, Standard Practices and Instructions codes are online. Only 20 percent 18

GSPI (2005). Computerized Maintenance Management System Online Help. Coded by RE Casanillo.

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of the designed software application is complete. There is a whole lot of development for a full application. Discerning from the existing user interface, the CMMS application envisions close coordination with HRD’s Training and Seminars plus a link to Total Productive Management (TPM) in the form of Kaizen and One-Point Lessons monitoring. 5.3.3. Timekeeping Profile and Management System [TPMS] The TPMS, or more commonly called Attendance and Leave Monitoring System, is currently on the limelight with the online implementation of the Overtime Preparation starting last June 2006. Although the TPMS is already being used, it is relegated to computers which could host the Oracle Server, has interconnection to the local area network, and the memory and hard disk space for the temporary files to spare. The Timekeeping Module replaced NSC’s MagCard system. There are at least seven (7) stations where employees can log in or log out, although there are desktop versions installed on several sections, mostly support offices. Data from this module are interconnected to the Payroll System and the Intranet. A printed copy of the attendance logs, using a database report form, is distributed each 15-day cut-off for the employees and heads’ signature and authentication. Paper-based Time Log Waiver, Change of Rest Day / Work Schedule, and Compensatory Time-Off forms are the support documents when the attendance logs, erroneously still called the MagCard listing and even the header states it as such, are submitted to Payroll for computation of salaries and wages. An online screenshot of the 15-day logs are also available on the Intranet, using the Blackberry server.

Fig. 5.3.5. Application for Leave of Absence Entry

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The Leave Monitoring Module was successfully deployed in early 2005 replacing the paper-based Application for Leave of Absence [ALA] for Vacation Leaves [VL] or Sick Leaves [SL]. A provision for Emergency Leaves [EL] is also present but only the HR Department can access for security reasons. The ALA Module also includes entry/cancellation, endorsement, and approving/disapproving, status and balance inquiries, in addition to several versions of report printing: per employee, per section or department, a summary of reasons for leave. The Overtime Monitoring Module is still on beta-testing. The Module includes Overtime [OT] application entry; individual or group OT status inquiry; endorsing, approving, disapproving, or cancelling transactions; tagging of OT for payment; and printing of reports: pre-approval, OT profiles per employee or per section, department or division.

Fig. 5.3.6. Overtime [OT] Application Entry Screen

Initially the system delegated the approval of regular extensions of duty on a work week to the Division Heads, while all work scheduled on rest days and holidays were subject to GSPI President’s approval. The pre-approval was a recent inclusion in the module during the plant’s slowdown due to market forces. All OT were to be pre-approved, through a printed copy of a summary of all OT for the day, by the HR HOD prior to actual rendition of overtime. This practice effectively defeated the purpose of online approval. As the market lull passed, the pre-approval continued and the approval previously done by respective Division Heads was not reinstated.

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Users, encoders and supervisors, have continually recommended revisions of the OT Module interface, to make it more user-friendly. The revisions, however, have been long in realization. Almost four months after initial deployment, the Module is still full of “bugs” such as the database contains employees no longer employed or belonging to different sections or not included in the group where they are actually assigned; the extreme difficulty of editing previously encoded OT applications using the query-then-edit mode; cancellation of OT prepared is restricted to the approving officer; the flawed procedure of OT requestor inability to encode OT requested; incorrect timing of validation of encoded entries; the unlimited time the OT application remaining on the system waiting for endorsement and approval; and the 48 opportunities for errors the 30-minute interval of time of OT period the module offers.

Fig. 5.3.7. GMIC Purchase Requisition Module

5.3.4. Procurement System The Procurement Policy 19 of goods and services aims to establish the procurement activity into a strategic business activity by alignment with needs of operating environment by developing skills, knowledge and leadership essentially required in the operating personnel. Its main objectives are: 19

GSPI (2005). Policy on Procurement. Corporate Intranet.

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1. Make available the goods and services by using sound business practices by fair, ethical and equitable transactions (5R's): right material, right quality, right time, right source and right price. 2. Align purchasing procedures in available environment to meet business needs, particularly (a) Value addition to the various activities; (b) Continuous reduction in lead time; (c) Value for money; (d) No loss of production for want of material; and (e) Strong, committed procurement team with long term relationship with vendor. 3. Build partnership with suppliers. 4. Regular interaction with the supplier on issues of mutual interest. 5. Assist suppliers to tune to our needs and providing assistance to them, 6. Provide techno commercial support to vendors to optimize cost and improve quality service for us. 7. Proactive to "vulnerabilities" Although there the Oracle-based Purchasing software application is also running parallel, the GMIC version is still used for Material Issue Vouchers, called Materials Requisitions, Issuance Services [MRIS] during NSC’s time. 5.4. Input and Input Resources 5.4.1. Computer Hardware NSC’s antiquated hardware components are still being used at GSPI. These includes 386™DX, 486™DX, and all operational Pentium® (S, R, II and III models) desktop PC systems. The Compaq Reliant, HP UX servers are being used as Oracle and SAP stations. By 2004, GSPI commenced the upgrade of various hardware systems and peripherals starting with the purchase of the RAID® storage systems at Hot Strip Mill No. 2. IBM-compatible hardware facilities are also upgraded. 5.4.1.1. Corporate Servers and Corporate Network Offices plant-wide are interconnected using a 155 mbps fiber optic line. For work areas far from the main network hub, a long-reach Ethernet technology is used, such as the Wireless network for Blue houses, where all expatriates and their respective families reside, and similar network connectivity for clubhouse residents. Proxy servers have been purchased in 2005, installed and running. 5.4.1.2. Workstations and Desktops Except for Purchasing, Production Planning, Finance and Accounting, Information Systems Development and major departmental offices are afforded with Windows® XP workstations, at least one or two per department. 5.4.1.3. Laptops and Notebooks Beginning 2004, GSPI, then GSII, started procurement of IBM laptops and notebooks for managerial staff mostly for the exclusive use of expatriates. When the expatriates arrived from India, their first official act was to requisition for the purchase of a laptop/notebook, specifically an IBM IntelliStation Pro or an IBM ThinkPad, with a HP

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compact colored printer. Unfortunately, these resources are only used for routine administrative purposes such as report writing, preparing PowerPoint presentations, instant messaging or browsing the internet. 5.4.2. Communications Hardware Recently, the use of mobile communications and other handheld devices have been deployed up to supervisory levels. Supervisory personnel are issued a common per area mobile phone, particularly a Nokia 3100, Siemens 9i or some other equivalent. Heads of areas, departments and other managerial staff are issued their personal cellular phones with international roaming capability. All cellular phones are subscribed to Globe Communications. Most of these phones have no issued chargers that one need to scout one to recharge the battery. 5.4.3. Operating Systems Software Remnants of NSC’s Information Systems inherited by GSPI include the use of Microsoft® Windows®-based systems of a myriad of flavors: Windows® (3.1, 95, 98, 98SE, ME, 2000, NT); and Oracle® and SAP®. Windows® XP Professional and Corporate editions are used in a number of key departments, such as Finance and Accounting, Information Systems, Purchasing and Supply, Production Planning, among others. Most of the Windows® XP Professional and Corporate editions, however, are unlicensed or pirated copies of the same. Only Windows® 3.1 and Windows® 95 have legitimate corporate volume license, although the latter is limited to 100 users only. Furthermore, the Windows® XP are either the raw version, or applied with Service Pack 1 or Service Pack 2. There is no uniformity in its deployment. Per a recent memo received from ISSD, the supposedly designated Information Security Officer stated that “We can’t easily identify who is using the SP1 or the raw XP so it is the responsibility of the user to request for an upgrade,” when asked by this writer why the Windows® XP have several versions installed on computers plant wide. Other versions of Windows® are similarly deployed, i.e., various PCs with different service packs installed. Logistically, it is much easier to maintain, less costly and faster to update if all similar systems [say, all Windows XP with SP2, all pre-Windows XP with SP4], are installed with similar service packs. With ISSD’s very lean, but talented, technical personnel, doing it centrally is much more desirable at present rather than doing it the hard way: troubleshooting every type of problem on different system environments. 5.4.4. Application Software 5.4.4.1. Systems Development Oracle DB is the programming language of choice for GSPI’s various system development environment. Several System Developers were contractually hired for this purpose. Hired System Developers’ contract ends after a certain project is terminated. Thus, the update or revision in any one of the “completed” projected is apportioned to

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Systems Developers still employed, this while the remaining System Developers are creating their respective projects. 5.4.4.2. Office Automation With various operating systems and software applications at GSPI, installed versions of Office Automation are also of different configurations. A number of systems still use Microsoft® Office 3.1, 95, 2000 including several versions of Microsoft® Office Word, PowerPoint, Excel, Access, Project, Visio, Outlook and Internet Explorer. Only Windows® Office 95 Standard Edition’s Word, Excel, Outlook and PowerPoint, have legitimate corporate volume license, although it is limited to 100 users only. During the recent BSA crackdown on piracy in Iligan City last November 2005, GSPI removed all unlicensed software from all desktops and installed an open-source beta-version of OpenOffice® by IBM sponsored-consortium, OpenOffice.org. Moreover, the use of the licensed-version of Microsoft® Office95 Word, PowerPoint, Excel, and Outlook continued presently. With the growing number of workstations and desktop, the limitation have been exceeded sometime in January 2006. For a month or so, trial versions of Office2003 were installed on different PCs because the OpenOffice® was incapable of doing Object Linking Embedding (OLE) functions as much efficient as the Microsoft Office suit. Meanwhile, with the purchase of a corporate volume license for Microsoft Office XP or Office 2003 still pending after a year and the common realization of the OpenOffice®’s lack of functionality, the reinstallation of unlicensed Microsoft® Office98, Office2000 and even Office XP or Office2003 are slowly creeping in. Unlicensed versions of Microsoft® Project are also used for scheduling various rehabilitation activities, project implementation, and maintenance work orders. Others resort to using Excel to simulate these scheduling activities which proved to be insufficient, if not impossible. A Microsoft® Office Excel-generated bar graph does not provide the viewer an instant snapshot of the Critical Path, or the work loads of individual activities as clearly as a Microsoft® Project file. 5.4.4.3. Corporate Communications Corporate Messaging. GSPI’s Corporate Messaging uses Lotus Notes Domino Version 6.5 with 64 existing user licenses with a 220 target user licences. An IBM™ eServer xSeries 336 Blade with Intel Xeon 3 Ghz CPU and 1GB memory is used as a corporate communications server. All supervisors and manager have Lotus Notes access; however, no workstations are available to all local supervisors and managers. Lotus Notes v.6.5’s requires a Windows® XP-based system. A Blackberry System is also used for mobile Lotus Notes users. The official e-mail address is gsii.org.ph, that is most often used to communicate with its clients, partners and the general public. Some expatriates still use their Yahoo! Mail account appended with “_ispat”, e.g. [email protected].

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Video Conferencing. The proposed video conferencing will link Iligan plant to Global Ispat Headquarters. It will use a VSX 7000e Top-of-the-line video conferencing system ideal for ViewSonic flat panel displays with Polycom PowerCam camera. As of October 2005, installation costs were being surveyed.

Fig. 5.4.1. Corporate Intranet

Corporate Intranet. Intranet is “a private network that is contained within an enterprise. It may consist of many inter-linked LANs. The main purpose of an intranet is to share company information and computing resources among employees”. 20 The GSPI corporate intranet is provided as an avenue of communication to personnel, except that most personnel are not provided access to any computer resource. The web site is not user-friendly because advanced web technologies such as Java applets, even advanced versions of Java scripts, Shockwave Flash, animated images are an anathema to antiquated hardware. The portal consists of pages on corporate profile, production processes, members of management staff, a short profile of each department, management initiatives activities, latest steel news, list of available trainings and seminars offered by HRD, in addition to various links to other corporate sites, such as Knowledge Management, the Corporate Internet Web Site, Lotus Mail; plus links to essential software downloads, free email providers, search engines, steel leaders’ corporate web sites, and the like.

20 http://searchwebservices.techtarget.com/sDefinition/0,,sid26_gci212377,00.html

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The intranet web site is optimized only for Internet Explorer (IE) 6.0. Using other browser makes the whole site unusable or unstable. Customized error pages are not generated, instead a generic error regarding erroneous CSS code is shown. Even the use of IE 5.0 makes the loading crawl to a halt and only to show a blank page. This is due to half of the page code is allotted for lengthy scripts, such as JavaScripts, Visual Basic, CSS or XML. There is a peculiar line wherein a JavaScript for the navigation menu (stmenu.js) is replicated 39 times, making the script reload 39 times.

Fig. 5.4.2. Corporate Web Site

Corporate Website. The Corporate Internet web site has been created since October 2005, but also need a different server. Although a domain name, gsii.org.ph, was purchased from Yahoo!, the domain is only used for the mail server. The domain name needs also to be changed to reflect the existing change from GSII to GSPI. To access the Internet, a proxy server connects users to the World Wide Web through a leased line and a WiFi, for those residing at the Hilltop. It is the general policy of GSPI to take advantage of Information Technology (IT) as a means for enhancing efficiency and productivity. The Internet, as a vast source of technical information and as a means for global communication, is one of those IT tools considered beneficial to the company. GSPI, therefore, supports regulated access to the Internet for official company business purposes. Internet access shall conform to control measures instituted to ensure proper usage and to safeguard our own network from possible misuse and/or security breaches.

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Services that are or would be available are the following 21 : 1.1 Browsing – or surfing, refers to access to the Internet using graphical browsers such as Internet Explorer, Netscape, Opera. This allows users to visit various websites to access the following information such as steel manufacturing processes, new technology; equipment and material specifications from suppliers and vendors; benchmarking; and other relevant business-related information. 1.2 Email – or electronic mail, allows users to sign-up for free web-based mails such as yahoo, hotmail and send or receive mails with other Internet users anywhere in the world. This is applicable in the absence of GSII Internet email service. 1.3 Voice and/or Video Conferencing – using additional devices, this type of service maybe made available as the need arises. Voice and/or Video Conferencing are for Division Heads only, although video streaming is available for Hilltop users, using WiFi or mobile connections, for a limited time. 1.4 E-commerce – this allows users to transact business over the Internet like inquiry of bank accounts, fund transfer, online purchases. 1.5 File Transfer - downloading of large files (more than 50MB) is discouraged. Downloading of large files should be scheduled during off-peak hours, i.e., 5p.m. or later. Access to the Internet shall be given to employees whose job function requires them to: 2.1 Officially and frequently communicate with people or institutions outside the company such as customers, suppliers, providers, vendors, government agencies. 2.2 Research for solutions, innovations, materials and supplies, equipment pricing/costing, steel-making technologies and other information needed by the company. Access is also given to expatriates’ family members. ISSD, being the custodian of the corporate network resources, act as the Internet Service Provider for the company. It is responsible for establishing, operating and maintaining Internet services and related facilities, including enforcement and administration of Internet policies. ISS also issues additional guidelines as necessary, to ensure optimum use and maximize benefits of the Internet service. For maintenance and monitoring, ISSD keeps a log of Internet usage such as websites visited by users. Periodic reports are provided to Department heads to highlight their group’s use of the Internet. Access to some Internet sites maybe blocked; including sites that are found to contain materials that are not directly related to company use.

21

GSPI (2005). Policy on Internet Access. Corporate Web site.

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5.4.4.4. Knowledge Management

Fig. 5.4.3. Screenshot of GSPI's Knowledge Management Home Page

GSPI embarked to develop knowledge management (KM) system for the purpose of achieving a competitive advantage. GSPI regard KM as another type of system to be developed as an information system that gathers knowledge, stores it and makes it available to users. It was introduced in October 2005 whereby the Dolvi model is used as the benchmark. GSPI’s Knowledge Management is in limbo at present. There are no guidelines for its use or utility. At present, even the home page is very rudimentary containing only Ispat-generated documents. There is not a single GSPI-generated input. Most of the links are dead except for redirection on to the Intranet or Internet. Neither is userfriendliness a feature; try using another browser in lieu of IE 5.0 or 6.0, the site is in disarray, as shown above. 5.4.4.5. Management Initiatives Total Productive Management [TPM] was re-introduced in 2004 to Iligan plant. GSPI unknowingly prided itself that Global Ispat brought this technology with them for deployment to Iligan plant for the first-time ever. It can be noted that NSC’s TPM effort dated back in 1995, but unfortunately did not proper because of financial difficulties. GSPI’s TPM department was developed on April 2004, then by July that year the start of Jishu Hozen on model equipment was launched after the first domestic dispatch on May. A draft of the Master Pillars was issued on September 2004; then a Kick-off Ceremony, attended by Ito San, a Japanese consultant on TPM, was held on December

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2004. The 1st GSPI Kaizen Conference last May 28, 2005 was participated by all major divisions. The 2nd GSPI Kaizen Conference was recently held on September 2006. Six-Sigma, invented by Motorola 22 as a methodology for business improvement, was initially introduced in the Iligan plant in 2004. Motorola created the Six Sigma process in 1986 as a way to achieve its goal of a hundred-fold improvement in quality within five years. The application of Six Sigma contributed to Motorola’s winning the Malcolm Baldrige National Quality Award in 1988. Since then, the impact of Six Sigma on Motorola business performance has been dramatic and well documented. It has resulted in savings of more than $16 billion for Motorola. At its core 23 , Six Sigma revolves around these key concepts: Critical to Quality: Attributes most important to the customer Defect: Failing to deliver what the customer wants Process Capability: What your process can deliver Variation: What the customer sees and feels Stable Operations: Ensuring consistent, predictable processes to improve what the customer sees and feels Design for Six Sigma: Designing to meet customer needs and process capability Six-Sigma, particularly focusing on DMAIC process, at GSPI was initially deployed with a four-hour awareness session on February 2004. The first 3-day Green Belt training was conducted in April 2004, while the Champions and Black Belt training commenced May 2005. All rank-and-file personnel have undergone one-day training sessions since 2004. On October 2005, 15 “Turbo” Six-Sigma projects closed with $1.82M/year in potential benefits, another 31 DMAIC projects are forthcoming completion. Of the total 46, 18 projects dealt with Productivity Improvement, 17 dealt with cost reduction, 8 on Quality and the remainder on process improvement. Both these management initiatives, TPM and Six Sigma, are computer-intensive users, but unfortunately there are a limited number of computers. TPM requires the monitoring of fuguais, kaizens, one-point lessons, among others; plus CMMS deployment, spares and tools during project implementation. Six Sigma employs powerful computer, i.e., memory-intensive, for data analyses and ERP deployment. 5.4.4.6. Information Security Before the BSA crackdown, a number of security software was installed on respective workstations and personal computers. These applications were from diverse vendors, such as Norton, Symantec, McAfee, BitDefender, TrendMicro, AVG, or eTrust. Some computers are even installed at least two or even all free antivirus software 22 23

Motorola, (2002). Motorola Six Sigma® Business Improvement Campaigns – for Breakthrough and Sustainable Results! © 2003 Motorola University. General Electric, Inc, (1999). What Is Six Sigma? The Roadmap to Customer Impact. Portable Document Format# 199914381. p. 4.

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applications with the mistaken belief by some users, and even the designated Information Security Officer, that it could protect the system more effectively or efficiently. Furthermore, Microsoft’s Antivirus Defense in Depth whitepaper cited four problems caused by interoperability issues of running antivirus applications from a number of different application vendors on the same machine, i.e., memory overhead, system crashes or stop errors, performance loss and loss of system access. 24 By September 2005, ISSD installed the Symantec Antivirus Corporate Server then deployed client modules to individual users. With the outbreak of the Brontok worm variants A to C beginning October 2, 2005, this server developed system difficulties that a year later has yet to be resolved. Although there was a noble attempt to contain Brontok through the ISSD’s “unofficial” deployment of GData's AntiVirenkit of Poland, the latter could only remove Brontok variants A and C. To this day, the worm replicates to various systems and goes round-and-round the GSPI’s corporate network. A user pointed these facts to ISSD, however, except for a generic response; the feedback remained unattended or simply ignored by ISSD. [Refer to Lotus Notes thread] There is also no official ISSD dissemination of the differences between a virus, a worm, a spyware or a Trojan horse, much less than an issuance of an official Information Security Policy. Users have to fend for themselves and attempt to protect their respective computer systems when these security threats attack. Virus Alerts from ISSD were issued and sent to Lotus Notes users previously but these were quoted verbatim from the whole webpage and without due acknowledgement of the author's copyright or the source. Moreover, most of those mentioned viruses, worms and spywares in the ISSD’s Virus Alerts are not those too critical to operations. Technical Controls such as access control is very rudimentary: for individual accounts, the user needs only a combination of one’s initials and employee number, both as user account name and password, to access most of the online applications. Although there is a utility designed to change the user password, this is seldom used; thus most users have default values for their respective account names and passwords. Even the company-issued IDs during the GSII phase blatantly displayed the birth date of each personnel, for incomprehensible and unknown purpose. Whereas without access to Lotus Notes electronic messaging, most users applied individual e-mail accounts at Yahoo! Mail, which unfortunately uses the birth date as its prime security feature. Thus, a novice hacker knowing a GSPI employee’s birth date, needs only the respective employee’s Yahoo! username, could then change the password and deny the employee use of his Yahoo! account.

24

Microsoft (2006). Antivirus Defense in Depth. Whitepaper. Microsoft Corporate Web Site. http://www.microsoft.com/technet/security/topics/serversecurity/avdind_0.mspx

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5.5. Transformation Processes The Transformation Process from Data to Information is through the use of either the GMIC application or the Oracle-based software. At present, the following systems are online and running. 5.5.1. Rolling Mills Production Process

Fig. 5.5.1. GSPI’s Information Systems’ Components.

A sample Data Flow Diagram during Production on a typical production line is shown below. Similar diagram is applicable to Hot Rolling Mills.

Fig. 5.5.2. Data Flow Diagram: CRM Production

During Production, raw data are entered to the GMIC database by the QA Inspector. Shift Production Report is generated every end of shift.

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Fig. 5.5.3. Data Flow Diagram: Overtime Monitoring System

The OT System is still on beta-testing that bugs littered the application. The system itself is too complicated versus the paper-route deployed previously. Whereby the problem of the lost paper-OT permits was eliminated, it transformed into OT permits not approved, i.e., still for endorsement, thus remaining unpaid for months on end.

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Fig. 5.5.4. Data Flow Diagram: Supply and Procurement

The Material Issuance Voucher [MIV] undergoes a number of signatories, that securing them takes a long time. Funds availability is usually checked for the purpose of procuring additional stocks. Finance also verifies whether the MIV is included in the requisitioner’s budget. Stock inventory at Stores are not accurately captured by the system, thus users frustration mounts after going all the trouble of finding signatories then to find that there are no spares available.

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5.6. Output Resources 5.6.1. Printers NSC’s operational printers and plotters are also used at GSPI. Various models littered the plant, namely from Epson 300, EX, and LQ line printers; HP DeskJets, LaserJets, and BubbleJets serial-port printers. Most laptops are connected with HewlettPackard DeskJets. 5.6.2. Plotters Roland plotters are used by the Engineering Department, although these are old units inherited from NSC. Most of the operating spares materials and supplies to operate the Roland Plotters have been depleted during the rehabilitation phase and have yet to be replenished. All drawing reproductions, for now, are outsourced to Iligan Blueprinting. 5.7. Outputs Most of the outputs of these systems are documents and reports summarizing, detailing or presenting various user-inputted data into useful management information. 5.7.1. Data Archiving Archiving in general is a process that will ensure that information is preserved against technical obsolescence and physical damage. It will also help conserve very expensive resources and ensure that the research potential of the information is fully exploited. During NSC era, microfiche archives were also explored. Microfiche is a sheet of microfilm (a film bearing a photographic record on a reduced scale of printed or other graphic matter) containing rows of micro-images of pages of printed matters. 25 GSPI has yet to standardize its data archiving system. At present, archiving is the responsibility of the end-user. Data are manually printed on paper, and/or saved electronically. Although there are disaster recovery plans espoused by the Internal Auditor, there are no indication that these are carried out in the operating lines. 5.7.2. Documentation Corporate documents are of several types: Publications such as Annual Report, Statistical Report, etc.; Letters, memorandum orders, communications, etc.; Public documents (civil registration forms, passports, land titles, etc.); Audio-visual recordings; Unprocessed/Raw Data; Maps and Drawings; Photographs and Others, are either saved electronically on user’s desktop computers or laptops/notebooks.

25

http://www.m-w.com/cgi-bin/dictionary?book=Dictionary&va=microfiche

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There is no centralized unit handling most of these documents, except the Vault Room, a legacy of NSC, where plant drawings, building plans, location, maps, specification sheets, operating and maintenance manuals are centrally kept and archived electronically. Most office memorandum orders and other corporate communications are coursed through the corporate Lotus mail system, unfortunately only available to those personnel with Lotus mail accounts. The orders or communication documents are scanned offline and transformed into either Adobe Acrobat Portable Document Format [PDF] or Microsoft Office Document Image Writer-output in Tag Image File Format [TIFF]. Unfortunately, both these software packages are unlicensed or cracked versions hence limited in functionality. Consequently, transformed documents tend to be uncompressed and occupy bigger footprints on the hard disks and the mail servers. 5.7.3. Media Storage Optical disks, e.g. CD-R, DVD, are used for media storage. This is the employed storage method especially for laptops / notebooks equipped with CD/DVD writers and a number of Pentium 4 desktops at ISSD. Hard disks are also primarily used as storage devices, consuming the previous space for essential programs and software applications. Floppy disks are also used although limited to 1.4 MB, and USB flash disks are gaining popularity among users but subject to its temporary nature and perceived security risks. With more and more users relying on PowerPoint Presentations, the USB flash memory disks are used to transport the file from manufacturing lines to the conference room, as no network link available at the board or conference room for computers or laptops brought during meetings and conferences. More often than not, resident malware on USB flash disks are propagated during these transfers. Once the computers and laptops are brought back online, these malware continues its journey again.

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Information Systems

66.. H waarree R Haarrddw meennttss Reeqquuiirreem The hardware, software, and network requirements take into account the overall corporate environment of GSPI. No particular system is aimed at providing the requirements because with availability of computer resources, GSPI hopes to generate much more knowledge-based innovation on application development compared to the present level. The survey is loosely based on NCC’s National Government Information & Communications Technology (ICT) Resources Survey in 2004. 26 The survey detailed different computers used commonly in Information and Communications Technology, instead of creating a new survey form. 6.1. Computing Devices by Type Computing devices 27 include mainframes, minicomputers and microcomputers i.e. desktop personal computers (PCs), notebook PCs or laptops, and handheld devices like mobile phones and Personal Digital Assistants (PDAs) or palmtops. 28

Table 6.1.1. Computing Devices by Type TOTAL NUMBER COMPUTING DEVICE TPYES OF UNITS

Mainframe Minicomputer/Server Desktop PC Above 1GHz (Pentium 4, AMD Athlon K-7, Athlon XP)

Above 450MHz to 1GHz (Pentium 3, Celeron, AMD Duron, Mac G3, G4)

233MHz to 450MHz (Pentium 2, AMD K6)

Below 233MHz (P54C, P55C, AMD K5, 486, 386, 286, XT)

NUMBER OF FUNCTIONING UNITS USED BY

ADDITIONAL REQ’MENTS IN UNITS

ADMINISTRATIVE

TECHNICAL

0 7 141

6 109

1 32

73

65

8

2

1

1

0

2

1

1

0

64

42

22

0

3 80

Laptop / Notebook PC 34 34 Mobile Phone 77 77 Palmtop / PDA 8 8 Administrative staff includes the management and those performing general support functions, including clerical and secretarial staff. Technical staff refers to all employees directly doing frontline, production or maintenance, functions and science 26 27 28

National Computer Center (2004). National Government Information & Communications Technology (ICT) Resources Survey in 2004. http://www.ncc.gov.ph/files/availbty_use_barriers2k4.doc http://www.howstuffworks.com/question543.htm The survey used the LAN to count PCs and Laptops for a week. No actual inspection of units was done on site.

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and technology-related work including research and development (R&D), engineering and systems design. Mainframe is a huge computer that could fill an entire room or even a whole floor. It was used in the early days of computing, and even at present, to process millions of transactions every day. Although, an IBM Mainframe sits idly in the Hilltop Administration Building, there is no indication that the unit will be revived for use. Minicomputers fall in between a microcomputer and a mainframe. Minicomputers are normally referred to as mid-range servers now. About seven (7) servers, excluding those used as process computers, are operational: Oracle server, Internet Proxy Server, Intranet Server, Mail Server, two (2) Blackberry Servers, and the NT Server at Supply. Desktop PC includes a PC that is not designed for portability and is expected to be set up in a permanent location. 29 Clock Speed, often measured in MHz (megahertz), is the rate of speed that a processor or central processing unit (CPU) executes commands. 30 Additional PC requirements assumed the replacement of all X86 and less than Pentium 4 PCs with Pentium 4 desktops or workstations. 6.2. Laptops/Notebooks Laptop, also called a notebook, is a portable PC that integrates the display, keyboard, a pointing device or trackball, processor, memory and hard drive all in a battery-operated package slightly larger than an average hardcover book. 31 Except for a few laptops/notebooks, most of these are issued to expatriates. All of these laptops / notebooks are of IBM brand, 450MHz to 1GHz processor speed. Almost every month expatriates come to GSPI to share their expertise to the locals, thus additional laptops/notebooks for these expatriates would redound to five (5) per month. 6.3. Mobile Phones / PDAs Mobile phone includes all handheld or wearable device integrated with common computer applications (email, database, multimedia, and calendar/scheduler). Mobile phones either corporate-owned or leased by GSPI are counted. 32 Most expatriates, managers and supervisors, are equipped with cellular phones. Palmtop, more commonly known as Personal Digital Assistant (PDA), is a tightly integrated computer, very lightweight with a reasonable battery life, which often uses 29 30 31 32

http://www.howstuffworks.com/question543.htm http://www.abilityhub.com/information/cpu.htm http://www.howstuffworks.com/question543.htm The count was based on published GSPI’s Telephone/Cellular Phone Directory.

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flash memory instead of a hard drive for storage. Some expatriates use the PDA to communicate with the Blackberry server while on travel abroad. 6.4. Networks Local Area Network (LAN) is “a group of computers and associated devices that share a common communications line or wireless link and typically share the resources of a single processor or server within a small geographic area (for example, within an office building)”. 33 Most of GSPI’s desktops, workstations, laptops and notebooks are connected to the LAN. The only remaining requirements are T-connectors, additional lines and paraphernalia for the additional PCs and notebooks on requisition. The Intranet needs to be hosted on a separate server instead of piggy-backing on another server for a different purpose. For now, with some desktop computers still using Windows 95/98/ME as operating systems, thus with older versions of Internet Explorer, resectively, the use of advanced web technologies such as Javascripts, XHTML, Shockwave, Macromedia™ Flash images should be minimized. Similarly, the Corporate Website needs to be hosted on a separate server, too. With it on separate and dedicated server it could host a lot of other web services. Ecommerce would also need a lot of hard disk space, bandwidth, and exclusive server access to create on-the-fly web pages. Some scripts could be server-based instead of employing client-based scripting which only hogs the bandwidth and uses more server resources.

33 http://searchsmallbizit.techtarget.com/sDefinition/0,,sid44_gci212495,00.html

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77.. SSooffttw waarree R meennttss Reeqquuiirreem 7.1. Operating Systems of Microcomputers Workstations include PCs attached to an office network (usually a Local Area Network) to differentiate it from Stand-alone PCs. For Type of License, (S) is for a single copy and/or user is allowed like OEM license; (M) for multiple copies and/or users are allowed like volume/site license and network license. Except for OEM license on available computers, there is no purchased volume license for corporate use. Table 7.1.1. Operating System for Workstations OPERATING SYSTEM TYPE OF LICENSE

Remarks

MS-DOS

OEM

Used by older process computers.

Windows 3.X

OEM

Used by older process computers

Windows 95

OEM

Used by 64 PCs

Windows 98

None

None

Windows ME

None

None

Windows NT

OEM

Windows XP

OEM for Laptops/Notebooks

UNIX

OEM

Used by Windows NT Serves No license for Pentium 4 PCs/WSs Used by Oracle/HP Servers

All Windows XP Professional or Corporate versions are bundled with GSPI’s purchased Pentium™ 4 desktop computers, but these are “cracked” versions thus limiting it to the raw (pre-Service Pack 1) or installed configurations, and no access to critical update support facility from Microsoft. On 10 October, 2006, Microsoft 34 ended assisted support and security updates for Service Pack 1 as part of the life-cycle policy for all Microsoft software. Moreover, operating system updates and security patches to older-than-Windows XP are no longer supported by Microsoft Updates, although they can still be downloaded from archived Microsoft Downloads. Table 7.1.2. Operating Systems for Servers SERVER

34

OPERATING SYSTEM

TYPE OF LICENSE

Mail Server

Unix

OEM

Corporate NAV

Windows Server

OEM

Blackberry Servers (2)

Blackberry OS

Purchasing – Supply

Windows NT

OEM

Internet Proxy

Windows XP

Multiple

Oracle Database Server

Unix

Multiple

Microsoft (2006). Life-Cycle Policy. http://go.microsoft.com/?linkid=5010744

Multiple

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Server includes a computer that has been optimized to provide services to other computers over a network. Similar to pre-Windows XP operating systems, Windows NT is no longer supported by Windows Update. Microsoft have already upgraded the Windows NT/2000 to Windows 2003, an upgrade to the latest versions would be to GSPI’s benefit instead of redeploying Windows NT. While, Windows 2000 offered three servers editions and one client; Windows 2003 offers four server editions and no client — that is, the client comes in the form of Windows XP Professional. According to Microsoft 35 , Windows 2003, Standard Edition targets departments and small businesses with IT departments for use as a general purpose server. It performs the usual server functions of ensuring that users can access data in all forms (e.g., through file and print services), housing database systems, running complex business processes, and providing a communications gateway, such as a VPN. 7.2. Office Automation Software These include ready-made software packages that support clerical and other common office tasks. Original equipment manufacturer (OEM) license covers software for stand-alone desktop PCs and laptops and MUST stay bundled with the computer system and NOT distributed as a separate (or stand-alone) product. This software will be identified or labeled "For Distribution Only with New Computer Hardware." Volume or site licensing enables organizations to acquire a license with specific rights to copy and use some software with agreements tailored to the number of products needed at the particular organization. Table 7.2.1. Software Application Packages SOFTWARE / APPLICATION PACKAGE

TYPE OF LICENSE

NUMBER OF LICENSES

ADDITIONAL REQUIREMENTS

Adobe Acrobat

Single

1

For Knowledge Mgt

Adobe PhotoShop

None

0

For Mgt Initiatives

Multiple

80

For Lotus Mail

MS Office 95

Single / OEM

1

None

MS Office 97

Multiple

100

Off2003 to replace

None

0

None

Laptop/Notebook OEM

24

SP2 upgrade

Laptop/Notebook OEM Trial

10

Volume License

None

0

For Technical use.

Lotus Pro

MS Office 2000 MS Office XP MS Office 2003 MS Visio 35

Jeremy Moskowitz (2003). Windows 2003: Active Directory Administration Essentials. IT Pro Windows & .NET eBooks. p. 3

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Only laptops/notebooks are bundled with MS Office XP. Some users, moreover, upgraded to MS Office 2003. A corporate volume license has been requisitioned for two years now but with insufficient funds to operate the plant, this one has been relegated to the least priority. With the plan to upgrade all X86 workstations to Pentium 4 class, a volume license for MS Office 2003 is a very necessary requirement. For Adobe Acrobat, only the Adobe Reader is free to use. The Acrobat software packages are used with cracked versions, or even older versions of Adobe PDF writers, namely version 3.1. This software, plus a licensed Microsoft Office, is essential to the development of Knowledge Management. 7.3. Operational Oversight / Administrative Systems These include systems that support development planning, fiscal and financial management and operations, auditing, personnel administration, and assets and supplies management. Examples are Payroll System, 201 File Information and Promotion System, Document Tracking System, Attendance and Leave Monitoring System, Financial Management Information System, Inventory System, or Records Management System. All these systems deployed by GSPI are legacy systems. No offthe-shelf systems are used, although a myriad of similar systems have been deployed by a number of large steel manufacturers and more established corporations. Table 7.3.1. Operational Oversight / Administrative Systems

NAME OF SYSTEM

OPERATING SYSTEM

WORKING ENVIRONMENT

Payroll System

Windows 3.1.

Stand Alone

GSPI Management Information Center

Cobol

Network

Timekeeping Profile & Management System

Oracle/Windows

Network

Supply and Procurement System

Oracle/Windows

Network

Computerized Maintenance Management System

Oracle/Windows

Network

Operating systems are DOS (D), Novell (N), Windows (W), Linux (L), Unix (U), Mac OS (M) or OS2 (O). Work environment can be Stand Alone (S) or Networked (N). The NSC-generated Quality Management System, which brought the company to ISO 9002:1994 certifications prior to its liquidation, was totally abandoned by GSPI. At present, with the deployment of Total Productive Management [TPM], some of the standard operating procedures [SOP] and standard practices and instructions [SPI] inconsistent with TPM were excised from operational practice and supplanted with new SOPs and SPIs borrowed and transferred from IIL’s manufacturing plants. The latter were oftentimes not practically applicable to GSPI’s existing facilities and configurations.

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There are plans to pursue ISO9002:2004 certification integrated to Six Sigma. 36 No indication that TPM also would integrate ISO9002 to its deployment. 7.4. Operational Strategic Information Systems Strategic information systems are client-driven systems that support missioncritical operations and provide direct public access to government services. There is no direct employee access to government services: Social Security System, PhilHealth/Medicare, Individual Taxpayer’s Withholding or Corporate Taxes. All these are using the more traditional form of links: paper forms. 7.5. Databases Table 7.5.1. shows an analysis of the existing and proposed systems. Table 7.5.1. Databases (Existing and Proposed) GENERAL CONTENTS OR BRIEF DESCRIPTION DATABASES

DATABASE MANAGEMENT SOFTWARE USED

Employee

Employees’ Personal Data and Information

MS Excel

Suppliers

Supplier Information

MS Excel

Customers

Customer Information

Cobol / Oracle

Payroll

Employees Salaries and Wages

DataBase 2.0

Production

Production Tonnages, Yield, QA Inspection

Cobol / Oracle / MS Excel

Delays

Operational, Equipment, Miscellaneous

Cobol / MS Excel

Facility / Equipment

Facilities, Equipment, Assembly, Component

Oracle MS Excel

Maintenance Practices (SOPs/ SPIs)

Standard Instructions, and Procedures

Oracle MS Excel

Materials and Spares

Specifications, Unit of Measures, etc

FoxPro Oracle / MS Excel

One-Point Lessons Easy Kaizen Lists

TPM Kaizen OPLs

MS Excel

Database Management Software includes MS Excel, MS Access, MS SQL Server, MySQL, IBM’s DB2, Oracle SQL, SQL, Informix, FoxPro. All bold-typeface databases are existing databases; while normal fonts are proposed ones. 36

SixSigma (2005). Six Sigma Deployment Strategy and Status at GSPI, Philippines. PowerPoint presentation. 20 September

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7.6. Security Except for a few paragraphs on information security found on the Corporate Policy, there exists no codified Information Security Policy or Guidelines. An email from a user to ISSD this year triggered the designation of an Information Security Officer, responsible for the Corporate Antivirus Server and advisory on emerging computer threats. Unfortunately, the newly designated Information Security Officer is nowhere the level of a knowledgeable Corporate Information Security Officer with appropriate license to practice as such. Even the advisory alerts sent to GSPI Lotus subscribers is an elementary effort to alert users of these threats using only one web resource. The anti-virus subscription is also on hold, awaiting the resolution of the status of the Corporate Antivirus server. For now, antivirus protection pattern database Live Updates are downloaded and then deployed singularly to Corporate Symantec AntiVirus [SAV] clients. It is therefore in the hands of various computer users to update their virus patterns, instead of ISSD-centrally controlling this feature. There are no corporate subscriptions for the other computer threats such as worms, spywares, or Trojan horses. ISSD claims that these should be addressed by the corporate SAV, which unfortunately is not the case. Even the SAV website alerts its users when threats are not addressed by the SAV software and additional supporting stand-alone scanners are issued from time to time. A firewall between the Internet and GSPI’s LAN is employed using a proxy server. Firewall is hardware, software or a combination protecting a computer network from unauthorized access. The GSPI’s firewall is configured to bare and basic necessities, such as all protocols are assigned the same protocol numbers. With same protocol numbers for all available protocols, hence, the access to web services is subject to the crest and through inherent to this configuration. The effect of this type of configuration is that users are coursed through the same routes to communicate with the proxy to the internet and vice versa. The file transfer protocol [FTP] uses the same configuration and ports as hypertext transfer protocol [HTTP]. Thus, downloading files are redirected to using HTTP rather than the faster FTP route. Also, the resume function of downloading large files is not configured; in effect one has to start from the beginning byte of a large file to be downloaded when the LAN connection fails even for just a few minutes. The security protocol is also assigned with the same port number as HTTP; thus there is no assurance that accessing a secure website is truly a secured access. Interestingly, while most are using Windows XP Professional or Corporate versions, most Microsoft Internet Firewall, bundled to the Windows XP operating system especially with the release of Service Pack 2 [SP2] which is enabled by default, have been turned off because of the lack of understanding of this security feature. ISSD technicians claimed that the Microsoft firewall is restricting usage to communication software applications, thus it was easier to turn it off rather than tweaking each

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computer to communicate with the GSPI proxy server or other shared computers in the LAN. This stop-gap measure only compromises the respective computer unit as well as the entire GSPI’s LAN. Digital signatures and encryption services are also available on the corporate Lotus email system. Digital signature is an authentication code created with a sender's secret key and can be verified by a recipient using the sender's public key. 37 Both these features are not popularly used, or simply ignored, by end-users. The problem may also that users are unaware that these features exist. There is a draft Disaster Recovery Plan for GSPI 38 , only top managers are privy to these plans. This whitepaper is assuming that information security threats were also addressed in the abovementioned plan. Last but not the least, there are no regular Information and Communications Technology (ICT) security trainings undertaken by employees, especially those on sensitive positions or personnel handling the various information systems at GSPI.

37 http://linux.about.com/cs/linux101/g/digital_signatu.htm?terms=Digital+signature 38

Internal Audit (2005). Global Audit Solutions & Concepts. PowerPoint presentation

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88.. SSuum mm maarryy // R mm meennddaattiioonnss Reeccoom Owing to the fact that GSPI is essentially financially independent of the mother company, GSHL, except of course during the initial phase of rehabilitation for US$50M, any expense for the upgrade of information systems at GSPI should come from its local coffers. Before any system gains user applicability, user-friendliness, and continuous improvement; an upgrade of antiquated hardware should be the first and foremost concern. Computerization does not come cheap, thus initial investments should be programmed to ensure deployment without sacrificing the operational capability of the basic business: steel manufacturing. As prices for computer and related facilities tend to go down each quarter, this whitepaper limited itself to a shopping list, plus a number of recommendations: 8.1. Hardware: 1. Upgrade all Windows X86 to Windows XP desktops and workstations. At least one (1) Windows XP desktop should be available on each section. 2. Purchase of Corporate Volume License for Windows XP Professional or Corporate Editions. Negotiate corporate discounts for the eventual commercial release of Microsoft® Windows Vista™ operating system. 3. Upgrade all Windows NT servers to Windows 2003 servers; including the purchase of a corporate license for its operating system. 4. Upgrade all Epson dot-matrix printers to HP deskjet/laser jet printers. At least one (1) HP deskjet/laserjet printer should be available on each section 5. Negotiate for a corporate-wide Computer Maintenance/Repair/Replacement contract with outsourced local computer supplier. 6. Facilitate revival of the Corporate Antivirus server. 7. Procure additional servers for dedicated Intranet, Knowledge Management and Corporate web server hosting. 8. Complete the LAN interconnection of various plant sites to the central node. 9. Complete the purchase of the Integrated Services Digital Network (ISDN) Line for Video Conferencing. 10. Purchase additional leased line for Iligan-to-Makati interconnection. 8.2. Software 1. Upgrade all Microsoft Office 95/97 to Microsoft Office 2003 Professional or Corporate versions, to include the following software packages: Word, Excel, PowerPoint, Access, Outlook, and Internet Explorer. Negotiate discounts for the eventual upgrades, say Office 2007. 2. Purchase new licensed versions of Microsoft Visio, Microsoft Project, Autodesk AutoCAD, Adobe Acrobat Professional, and Minitab or Six-Sigma software packages.

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3. Evaluate the use of off-the-shelf software packages like Capacity Planning, Master Scheduling, Production Planning and Scheduling and their interface to the current Oracle-based legacy application or GMIC. 4. Secure Oracle Corporate User’s License. 5. Secure SAP Corporate User’s License. 6. Purchase reliable Information Security software (anti-virus, network firewall) and similar subscriptions to curb information security threats. 7. Purchase Systems Monitoring Software (SMS) to implement central software deployment instead of deploying software on per station basis. 8.3. Systems Development 1. Hire additional Oracle-certified Database Administrators, System Developers and System Programmers, with experience in a manufacturing scenario and/or steel manufacturing. 2. Employ technical consultants, on full-time basis, for the development of the various subsystems: Marketing Subsystem; Manufacturing and Engineering Subsystem; Finance and Accounting Subsystem; Human Resource Subsystem; Research and Development Subsystem; and Information Services Subsystem. 3. Create teams to help System Developers in creating a user-friendly system application, such as the CMMS, ERP, MIS, or FAS, with features based on actual procedures and practices. 4. Design a regular schedule on trainings and seminars, with invited authorities on systems development, for ISSD personnel and team members of various legacy applications on development. 5. Hire a certified Webmaster to fully implement the e-commerce corporate website, and fully use the vast internet resources for GSPI’s benefit. 8.4. Security Policy 1. Implement a security policy using the following five phase approach: Project Initiation, Policy Development, Consultation and Approval, Awareness and Education and Policy Dissemination. 2. Separate Policies should be developed for Information systems security, System access control, Personnel security, Physical and environmental security, Telecommunications security, Information classification, Business continuity planning, and Management accountability. 3. Establish Formal controls to include the establishment of Codes of conduct; Documentation of expected procedures and practices; and Monitoring and preventing behavior that varies from the established guidelines. 4. Develop several sub-plans that address specific contingencies. Such as: an emergency plan, a backup plan and a vital records plan. 5. Deputize a number of manufacturing operations personnel as assigned workstation’s administrator for each department or section. 6. Hire a certified Information Security Officer with profound knowledge on Corporate Information Security.

Reengineering the

A Appppeennddiixx A A.. N NSSC CP Pllaanntt FFaacciilliittiieess

Information Systems

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A Appppeennddiixx B B.. H Hoott SSttrriipp M Millll P Prroocceessss FFloow w

In hot rolling, slabs are reduced to strips by heating at a reheating furnace [SRF] and rolling at high temperatures in a reversing roughing mill [RM] and then a continuous seven-stand finishing mill [FM]. Water sprays cool the strip and coiled in a downcoiler [DC].

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A Appppeennddiixx C C.. C Coolldd R Roolllliinngg M Miilll P Prroocceessss FFlloow w

The HRCs are de-scaled in a hydrochloric acid bath in pickling line [PKL], reduced in either the four-stand [4-STCM] or five-stand continuous mill [5-STCM], cleaned at alkali cleaning line [ACL] or at high-current density electrolytic cleaning line[HCD-ECL], annealed at controlled temperatures in batch bell-type furnaces [BAF], and skin-passed at either temper mills [TPM].

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A Appppeennddiixx D D.. EElleeccttrroollyyttiicc TTiinnnninngg LLiinnee P Prroocceessss FFloow w

TMBPs are processed in the Coil Preparation Lines and then supplied to Electrolytic Tinning Line which produces either tinplates-ncoils or tinplates-in-sheets.

Reengineering the

A Appppeennddiixx EE.. C Coolldd R Roolllliinngg M Miilll B Buussiinneessss P Prroocceessss

Information Systems

53

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A Appppeennddiixx FF.. SSuurrvveeyy ooff G GSSP PII’’ss Innffoorrm maattiioonn SSyysstteem mss C Coom mppoonneennttss

Legend: NB – Laptops / Notebooks, PC – Desktop PCs and Workstations, CP – Mobile Cellular Phones , PDA –Personal Digital Assistant; AS – Administrative Staff; TS – Technical Staff; P4 – Pentium 4; P3 - Pentium 3; P2/1 – Pentium 2 or 1; X86 – 286, 386, 486 Desktop PCs.

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Survey of GSPI’s Information Systems Components (continued)

Legend: NB – Laptops / Notebooks, PC – Desktop PCs and Workstations, CP – Mobile Cellular Phones , PDA –Personal Digital Assistant; AS – Administrative Staff; TS – Technical Staff; P4 – Pentium 4; P3 - Pentium 3; P2/1 – Pentium 2 or 1; X86 – 286, 386, 486 Desktop PCs.

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Survey of GSPI’s Information Systems Components (continued)

Legend: NB – Laptops / Notebooks, PC – Desktop PCs and Workstations, CP – Mobile Cellular Phones , PDA –Personal Digital Assistant; AS – Administrative Staff; TS – Technical Staff; P4 – Pentium 4; P3 - Pentium 3; P2/1 – Pentium 2 or 1; X86 – 286, 386, 486 Desktop PCs.