Paper Organizers International: A Fictitious Six Sigma Green Belt Case Study
- Background of the Case Study
- Define Phase
- Measure Phase
- Analyze Phase
- Improve Phase
- Control Phase
- References
This chapter is from the book
This chapter is from the book
This chapter is from the book
CHAPTER OUTLINE
16.1 Background of the Case Study
16.2 Define Phase
16.3 Measure Phase
16.4 Analyze Phase
16.5 Improve Phase
16.6 Control Phase
LEARNING OBJECTIVES
After reading this chapter, you will be able to:
-
Conduct a Six Sigma DMAIC project
-
Use the tools and methods of the Define, Measure, Analyze, Improve, and Control Phases
16.1 Background of the Case Study
The Company
Paper Organizers International (POI) offers a full range of filing, organizing, and paper shuffling services. To accomplish these tasks, POI purchases metallic securing devices [*] (MSDs), staplers, hole punchers, folders, three-ring binders, and a full range of related products to serve its customers' paper-handling needs. The employees, or internal customers, of Paper Organizers International use Metallic Securing Devices (MSDs) to organize piles of paper pending placement into folders or binders.
The Purchasing Department of POI has noticed an increase in complaints from employees in the Paper-Shuffling Department (PSD) about MSDs breaking and failing to keep papers together. This creates opportunities for client papers to be mixed together. The Purchasing Department would like to improve the process for purchasing MSDs to eliminate complaints from employees in the Paper Shuffling Department.
Origin of the MSD Six Sigma Project
POI's mission statement is "Put the Right Information in the Right Place," RIP it! To accomplish this mission, POI has established a cascading set of business objectives and business indicators, which ultimately result in potential Six Sigma projects, see Table 16.1 on page 491.
Table 16.1. POI's Business Objectives and Indicators with Potential Six Sigma Projects
|
President |
Director of Paper Shuffling Department (PSD) |
|||
|---|---|---|---|---|
|
Business objectives |
Business indicators |
Area objectives |
Area indicators |
Potential Six Sigma projects |
|
Increase the number of orders |
Number of orders/month (c-chart) |
Increase the number of orders in PSD |
Number of orders in PSD/month (c-chart) |
New customer promotions project |
|
Increase the number of POI services (filing, organizing, etc.) utilized by each customer |
Average/and standard deviation of number of services utilized per customer/quarter ( |
Increase the number of services utilized by each customer in PSD |
Average and standard deviation of number of services utilized per PSD customer/quarter ( |
Existing customer promotions project |
|
Minimize production costs |
Production costs/month (I and MR charts) |
Minimize production costs in PSD |
Production costs in PSD/month (Figure 16.1; I and MR charts) |
MSD quality project |
|
Eliminate employee complaints |
Number of employee complaints/month (c-chart) |
Eliminate employee complaints from PSD |
Number of employee complaints from PSD/month (c-chart) |
Employee morale project |
)
The monthly production costs in the PSD are shown on the Individual and Moving Range chart in Figure 16.1 (see the next to last row in the fourth column in Table 16.1).
)
Figure 16.1 Minitab Individual and Moving Range Chart of Monthly Production Costs in the PSD
Figure 16.1 on page 492 indicates that production costs are stable (no special causes such as points beyond a control limit or too many sequences
up and down, etc.) in the PSD with an average monthly cost of $1,096,880.00 and a standard deviation of $99,000 ()
/d2 = $111,672/1.128).Additionally, production costs are approximately normally distributed (see Figure 16.2 on page 492). Team members discovered that PSD management considers monthly production costs to be very high, given the volume of work being processed by the department.
)
Figure 16.2 Minitab Histogram of Monthly Production Costs in the PSD
The four potential Six Sigma projects shown in the rightmost column of Table 16.1 are prioritized for attention in Table 16.2. Table 16.2 on page 493 is a Cause-and-Effect-type matrix (see Section 4.1) that weights the importance of each potential Six Sigma project to each of POI's business objectives.
Table 16.2. Prioritization of Potential Six Sigma Projects
|
Business objectives |
Potential Six Sigma projects |
|||||
|---|---|---|---|---|---|---|
|
New customer promotions project |
Existing customer promotions project |
MSD quality project |
Employee morale project |
|||
|
Increase the number of orders |
Weights |
.35 |
3 |
3 |
0 |
0 |
|
Increase the number of POI services utilized by each customer |
.10 |
1 |
3 |
0 |
0 |
|
|
Minimize production costs |
.40 |
0 |
0 |
9 |
3 |
|
|
Eliminate employee complaints |
.15 |
0 |
0 |
9 |
9 |
|
|
Weighted average of potential Six Sigma projects |
1.15 |
1.35 |
4.95 [*] |
2.55 |
The cell values are assigned by top management and are defined as follows: 0 = no relationship, 1 = weak relationship, 3 = moderate relationship, and 9 = strong relationship. The Finance Department developed the importance weights for each business objective to maximize the impact of Six Sigma projects on the bottom line of the organization. Consequently, the most critical project with respect to the business objectives is the MSD quality project; see 4.95 in the last row of Table 16.2. The champion and process owner of the MSD process prepared an initial project charter and presented it to the members of the MSD quality project team.