MONDAY, OCTOBER 22, 2018
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Implementation Case Studies Six Sigma Case Study: Converting Paper to Electronic Documents

Six Sigma Case Study: Converting Paper to Electronic Documents

This work described below was carried out in a large company based in the U.S. and India. The project dealt with converting printed paper from U.S. customers into electronic copies. The material was quite heterogeneous in nature – consisting of assorted magazines and legal papers. It is part of an ongoing operation that services several customers. The results obtained have wide applicability in the back rooms of industries processing large amounts of data – IT enabled services, banks, insurance companies, hospitals, etc. – and computer based office processes.

This project was taken up as a demonstration example within the framework of building a Six Sigma mind-set in the organization, while training a core group in the use of the techniques and the teamwork required. The problem solving methodology consisted of seven steps, combined with quality tools to create a dramatic improvement in the quality of the output far beyond the expectations of anyone in the organization.

The narrative unfolds in the same sequence as the project followed – through each of the seven steps of problem solving accompanied by education in and application of the six sigma techniques relevant to the problem.

1. Selection of the Problem

1.1) A meeting of the senior management of the company was held and a brainstorming session produced a list of over 30 problems. These were affinitized into two categories:

  • “End result” problems faced by the external customers
  • Internal problems that were causes of customer problems rather than basic problems themselves.

The realization that the first category of problems was the one to be attacked (customer focus) came spontaneously.

Then prioritization was done to select the most important problem using the weighted voting system followed by a quick discussion to produce a consensus. The theme (CTQ [critical to quality]) selected was: consistency of quality and timeliness.

1.2) The problem area: Within the thee, intuitively the management recommended a particular customer line. When asked to collect data for different customer lines and present it, to their surprise they found that another major line had a bigger problem. This was the line selected. The realization of the importance of data based had begun!

1.3) Definition of the problem: Data (including errors) was collected for 30 days. During this exercise it was realized that different auditors were classifying the same error in two different ways, leading to measurement system discrepancies. This led to a reclassification of the errors, and training of the auditors.

From the data then collected and analysed the problem was defined as follows:
Customer requirement: Current process average errors: 510 ppm
Variability (sigma): 710 ppm
(Average + 3 sigma): 2640 ppm
Note: Errors were collected before rework to ensure that the root causes would be exposed.

Problem definition: Reduce error density to assure 3-sigma quality under 50 ppm from the current 2640 ppm (i.e. 98%).

2. Finding the Vital Few to Attack

The errors collected were categorized using a Pareto diagram. Prioritization was required at three levels:

Level 1: Four categories, C1 to C4 – one category (C1) constituted 85 percent of the errors
Level 2: C1 into 4 categories, C11 to C14 – one (C11) category constitutes 98 percent of the errors
Level 3: C11 into 4 categories, C111 to C114 – one (C111) constituted 85 percent of the errors

Category C111 was attacked as it constituted approximately 65 percent of the total problem.

3. Idea Formulation for Countermeasures

Seven error types were found in C111 in two broad categories. They were examined to determine why each one could have occurred, and a brainstorm for possible countermeasures was done. The most likely measures to “kill” the problems were selected for trial implementation.

4. Idea Testing and Modification

The selected countermeasures were analyzed and tested for each error type and the successful countermeasure was short-listed for implementation.

5. Implementation of Countermeasures

Training instructions were prepared for the new procedures and all the operators were trained. Implementation of all the countermeasures was done across the system from a particular date.

6. Confirming the Results

The team was trained in control charts and the X bar-sigma charts were introduced to monitor the results. A dramatic reduction occurred from the day of implementation and the first three weeks confirmed that a drop of 90 percent in error density had been achieved from 2640 ppm to around 300 ppm.

Tremendous enthusiasm was generated in the team as the result of this project far exceeded their expectation.

7. Maintenance of Improvement – Continuous Small Improvements

Standard operating procedures (SOP) were drawn up for the process changes. A special session with the operating personnel emphasizing regular review, and killing any abnormal peaks that may have occurred in the control chart was explained. An SOP covered the frequency of review meetings for each level of supervision and management and a review format was introduced. The line supervisor who was part of the team became the enthusiastic owner of quality and the control chart, as well as the leader of the team charged with maintaining quality and continuously improving it. The slogan “If you do not improve, you deteriorate” was introduced.

This effort gradually brought down the (average + 3 sigma) error density further from 300 ppm to <50ppm.

The Quality Improvement (QI) Story

A QI story was prepared for presentation to senior management detailing the improvements that occurred:

Tangible

  • Customer delight: Customer reported 100 percent quality in his sampling consistently over six months. He could not find errors at such a low density.
  • Productivity and cost: Inspection and rework reduced to almost zero. First pass efficiency was at 99.7 percent. Sampling sizes were reduced. These resulted in savings of $50,000 per annum at Indian wage levels (U.S. equivalent $300,000 per annum).
  • Volume increase: Approximately 50 percent by the customer. The production went through without increased manpower.
  • Turnaround of the documents was improved dramatically due to no rework and started meeting customer requirements.

Intangible

  • Senior management time saved
  • Motivation of the operations personnel very high
  • Team work between operations, instruction and tool development and QA personnel
  • Mind-set changes
  • Producing quality saves money
  • The importance of data and Six Sigma techniques
  • If you do not improve, you deteriorate

Future plans for improving the turnaround by 50 percent using just in time methods are being implemented now.

Conclusion: Six Sigma – Techniques and Mind-set

The case here emphasizes the importance of Six Sigma techniques implementation being accompanied by building a culture and mind-set of continuous improvement and change in all employees. In the author’s view and experience it is the creation of synergy between people and techniques that ensures maximum and continuing benefits from a Six Sigma initiative.

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