Six Sigma Case Study: Converting Paper to Electronic Documents

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New from iSixSigma Joint Design for Electronics Cooling Heat Exchangers Project Example FMEA - Data Center Rework Cost Analysis Requirements Document Project Example

iraj Goyal

This work described below was carried out in a large company based in the US and India. The project dealt with converting printed paper from US 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 (CTQs) selected was "Consistency of Quality and Timeliness".

1.2) The problem area: Within the theme, 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: <50 ppm errors
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% of the errors
Level 2: C1 into 4 categories, C11 to C14 - one (C11) category constitutes 98% of the errors
Level 3: C11 into 4 categories, C111 to C114 - one (C111) constituted 85% of the errors
Category C111 was attacked as it constituted approximately 65% 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% 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% 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. 99.7% first pass efficiency. Sampling sizes were reduced. These resulted in savings of US $ 50000 per annum at Indian wage levels (in US equivalent US $ 300,000 per annum).
• Volume Increase: Approximately 50% 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 don't improve, you deteriorate

Future plans for improving the turnaround by 50% 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/TQM initiative.

About The Author
Niraj Goyal has 25 years of rich and varied working experience in multinationals in various operating roles, among them Operations Director, Cadbury India Limited, where he was exposed to and was among the leading implementers of the TQM movement. A few years back he set up his own consultancy, Cynergy Creators Private Limited. Mr. Goyal consults in India and US with a diversity of industries - training them and facilitating the implementation of the techniques of TQM and Six Sigma until the culture of continuous change is internalized. Further details about this article and assistance for similar change initiation and implementation through training and facilitation can be obtained from Mr. Goyal at nirajgoyal@vsnl.in.