Problem & Mission Statements from Previous Six Sigma Projects & Their Progression

Project #1: First Pass Yield Improvements on routers 760B.

Company Description (from project charter): Foxconn is a Contract Manufacturing for HAWK Systems and its operations at the Houston facility employees approximately 350 employees. The operation is divided into different business units (BUs) with a dedicated Customer Focus Team (CFT) for each BU.

The router 760B belongs to the Router BU. This router is manufactured along an assembly line process consisting ofseven to eight stations connected by a conveyor. Each station has a specific task/procedure to install up to 4 different components on each unit and then pass the unit to the next station.

After the final check (last station) every unit is tested on a station (Final System Test - FST) which checksthe unit’s configuration. Then the software is then loaded into the router’s system.

1st Draft:

Problem statement:The router 7600 series (760A and 760B) has the lowest average FPY (9X.56%) among all platforms (overall the router business unit hits average FPY in 9X.53%) resulting in loss of revenue – based on observations from February/09 and September/09.

Mission Statement:Reduce the percentage of rework (assembly/operator induced failures, hardware defects or network related failures) to less than 1.X0% (FPY tentative goal 9X.5%) in the next 4 months resulting in $XXXXXX/month in new revenue.

Revisions suggested by Dr. Kovach:

Problem statement:On average, rework on router 7600 series (760A and 760B) has been 2.X% (i.e., the highest among all platforms in the router business unit) in the past 8 months (2/09-9/09), resulting in a loss in revenue.

Mission Statement:Reduce the percentage of rework to less than 1.X0% in the next 4 months (by 1/10) resulting in $XXXXXX/month in new revenue.

Final Draft:

Problem statement:The 760B routers have averaged only 97.77% first pass yield (FPY) (i.e., the lowest among all platforms in the router business unit) i.e., the lowest among all platforms in the router business unit in the past 8 months (2/09-9/09), resulting in a loss in revenue.

Mission Statement:Increase the FPY for the router 760B to 98.5% or better in the next 4 months (by 1/10) resulting in $41,136.00/month in new revenue.

Project #2:Reduce the Average Number of Invoices in the AP Invoice Request Exception Queue.

Company Description (from project charter):The Supply Chain Management department provides implementation and oversight of policies and procedures related to procurement, including implementation and oversight of the systems and processes involved in the procure-to-pay lifecycle. During the past two years SCM has been the lead in a company-wide systems redesign project; a portion of which has been the implementation a new EIP (Electronic Invoice Presentment) system and outsourcing of the data entry and imaging portion of our Accounts payable process. The purpose of this portion of the redesign project was to upgrade our systems for better compatibility and integration with other system and also to improve the overall performance or our Accounts payable process. Specifically resulting in more timely and accurate entry of invoices and greater accuracy and availability of payables information to our internal users. We’ve seen the initial results that we expected with this implementation, but also see that there is still a significant delay in the processing and payment of PO related invoices which results in late payment of invoices.

1st Draft:

Problem statement:Invoices in the ‘AP Invoices Request Exception Queue’ sit too long before being resolved, often resulting in late payment of invoices, late payment fees/service charges, and missed discount opportunities.

Mission Statement:Reduce the average number of days that invoices sit without resolution in the ‘AP Invoices Request Exception Queue’ from 1X.5 days to XX days over the next XX months, resulting in an increased number of on-time payments and reducing the number of late fees/service charges and missed discount opportunities.

Revisions suggested by Dr. Kovach:

Problem statement:On average, invoices in the “AP Invoices Request Exception Queue” waited for 1X.5 days to be resolved in the last X months (?/09-?/09), resulting in late payment of invoices.

Mission Statement:Reduce the average number of days that invoices sit unresolved in the ‘AP Invoices Request Exception Queue’ to less than XX days over the next XX months (by ?/10), resulting in an increased number of on-time payments and a reduced number of late fees/service charges and missed discount opportunities (for you or for your customer? – if customer, don’t list here).

Final Draft:

Problem statement:The number of invoices routed to the “AP Invoices Request Exception Queue” has averaged 1380 over a period of 18 weeks (5/2009-9/2009), resulting in rework.

Mission Statement:Reduce the number of invoices in the “AP Invoices Request Exception Queue” to not more than750 over the next 4 months (1/31/2010), resulting in decreased rework savings approx 1.3 million dollars per year.

Project #3: Improving Availability of Totes to Increase On Time In Full(OTIF) Performance

Company Description (from project charter):Shell is one of America’s leading oil and gas producers and a recognized pioneer in oil and gas exploration and production technology. This project focuses on improving the availability of totes between the California Regional Distribution Center (CRDC) and the distributors on the West Coast, which in turn improves the OTIF performance. OTIF is the measure of the product delivered to the customer on time and in the requested quantity. Improved OTIF performance reflects an increase in the customer satisfaction. There are 2 types of totes: 1 way totes and 2 way totes. For 1 way totes, the distributor pays for the totes and the totes are not returned after use. For 2 way totes, once empty, the distributors return the totes to the distribution center. The 2 way tote distribution between the CRDCand the distributors on the West Coast has resulted in reduced OTIF performance. Shell Lubricants wants to improve theavailability of totes on the West Coast to avoid disruption.

1st Draft:

Problem statement: On an average, the supply availability of lubricants in the west coast has decreased to 60% over the last 10 months(12/09- 09/09) resulting in a reduced OTIF ( On Time In Full Performance).

Mission Statement: To increase the supply availability of lubricants in the west coast to 97% in the next 4 months resulting in an increase in OTIF by XX%.

Revisions suggested by Dr. Kovach:

Problem statement: The number of totes available to transport lubricants from distribution centers to customers averaged only X over the last 10 months (12/08-9/09), resulting in reduced on-time in full (OTIF) performance.

Mission Statement: Change “To increase” to “Increase”

Final Draft:

Problem statement:The percentage failure due to the unavailability of totes at the CRDC has averaged 67% over the last 10 months (11/08- 09/09) resulting in reduced OTIF performance of 83%.

Mission Statement:Reduce the percentage failure due to unavailability of totes at the CRDC to less than 15% in the next 6 months (09/09- 03/10) resulting in an increase in the OTIF performance to 97%.

Project #4: Reduce resolution time of computer’s virus infection.

Company Description (from project charter): The UH Department of Biology and Biochemistry consists of approximately 200 researchers and staff. The services provided by the Information Technology (IT) staff includes solutions to common IT issues such as network connectivity, hardware support, software support, procurement of technology, web design, and application development.

1st Draft:

Problem statement: The resolution time of common IT issues remains higher than expected by IT team and customers, resulting in downtime of customers production and overtime work required to satisfy customer needs.

Mission Statement: Diminishing resolution time of common IT issues by 30% in the next five months, from October 2009 to March 2010, resulting in less downtime of IT resources, which translates in more customer’s production.

Revisions suggested by Dr. Kovach:

Problem statement: The time to resolve common IT issues has averaged X days over the last Y months (?/??-?/??), resulting in downtime for system users and overtime for IT staff to resolve the issue.

Mission Statement: Reduce resolution time for common IT issues to less than Z days in the next five months (by March 2010), resulting in…

Final Draft:

Problem statement: The time to resolve virus infection on user’s computers has averaged 9.6 working hours over the last 2 months (07/09-09/09), resulting in downtime of user’s computers and reducing IT staff’s capacity.

Mission Statement: Reduce resolution time for computer’s virus infection to 8 working hours in the next four months (by 03/10), resulting in 17% less downtime for user’s computers and to increase IT staff’s capacity to resolve issues.