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Case Study - Six Sigma Implementation

Bluvas T-shirt Company


Sanjeev Bhawsinka, Project Engineer
Tamko Roofing Products
4500 Tamko Drive, Frederick, MD 21703
email: sanjeev_bhawsinka@tamko.com
Tel. +1 301 694 7611 Fax. +1 301 874 5563

Ranga Magadi, Software Consultant


First Data Merchant Services
11311 McCormick Rd, Huntvalley, MD 21031 USA
e-mail: garg@rdacorp.com
Tel. +1 410 527 2940 Fax. +1 410 527 2910

Harsh Marwaha, Consultant


Oracle Corporation
1910 Oracle way, Reston, VA 20190 USA
e-mail: harsh.marwaha@oracle.com
Tel. +1 301 4516393 Fax. +1 240 386 5509

John Strohm, Software Engineer


OPNET Technologies
7255 Woodmont Ave, Bethesda, MD 20814
e-mail: jstrohm@opnet.com
Tel. +1 240 497 3000 x2721 Fax. +1 240 497 3001

Munish Garg, Consultant


RDA Corporation
1954 Greenspring Drive, 7th Floor, Timonium, MD 21093 USA
e-mail: garg@rdacorp.com
Tel. +1 301 51803571 Fax. +1 240 386 5509

Abstract
Bluvas T-shirt Company has been manufacturing custom printed t-shirts since 1953. Competition and reduced
profitability has forced the management to take a second look at their processes in an effort to improve their
revenues. The management considers customer satisfaction paramount and has decided to use customers as a driving
force for their process improvement project. Using the Six Sigma methodology, the current processes were
benchmarked and improvements made based on customer driven critical to quality characteristics.

Key Words & Phrases: Six Sigma; Process Improvement VOC, CTQ.

Introduction six-sigma methodologies to improve and control the


production of t-shirts. This translated to a goal of
This is a case study of how Six Sigma, using the performing at the Six Sigma level by the end of
DMAIC improvement methodology, can be applied August 2002. The team was tasked with improving
in a commercial environment. It is based on a project market share using the Six Sigma process.
done by a 5-person office in Washington, MD that
sells printed t-shirts. This case study shows how the mission to become a
Six Sigma office would drive improvement projects
In January 2002, in light of reducing market share for two key customer CTQs, mapped here step-by-
due to increased competition in Washington DC area, step to the DMAIC methodology. The sequence
General Manager Harsh Marwaha decided to employ and/or details of some of the actual events have been
modified for the sake of simplicity or to better satisfaction. They were pleased to be asked for their
illustrate a point. input and enthusiastic about providing feedback.

The Bluvas T-shirt Company manufactures custom- 1.2 Contain Problem if Necessary
printed t-shirts. Clients pick shirt sizes, fabric color
(white, gray, or navy), image to put on each shirt, and After reviewing the results of the customer surveys,
quantity. Bluvas, Inc. would like to increase sales by the team felt they did a good job of forecasting
improving quality and order delivery for customers. customer concerns during their brainstorming
meeting. Because the customers’ key concerns were
Project Leadership addressed by the CTQs, no containment actions were
needed.
Harsh Marwaha, General Manager
Sanjeev Bhawsinka, Black Belt 1.3 Translate VOC into CTQs
John Strohm, Green Belt
Ranga Magadi, Green Belt Because of the way the team had gathered the Voice
Munish Garg, Systems Engineer of the Customer data—by helping customers identify
CTQs and asking customers for specific, measurable
Define 1: Project CTQs performance requirements—the task of translating
customer feedback into CTQs had taken care of itself.
In addition, the nature of the customer interviews
1.1 Evaluate VOC allowed the team to validate the identified CTQs with
the customer on the spot.
On February 15, 2002, the project management held
a full-team brainstorming meeting. Since the
customers typically ordered by phone, the team 1.4 Prioritize CTQs
agreed that the best way to get the VOC was random
surveys for the customers over the phone after they The next task for the team was to prioritize CTQs
had placed their orders. To elicit responses from the based on the results of the customer survey. The
customers, Harsh Marwaha agreed to give all those prioritization process was facilitated by the survey's
who responded to the survey 2% off their bill. The design, since it required customers to force rank
team believed that a financial incentive would prompt CTQs.
more and more people to respond over the phone and
was an economical way to reach the customer in a A Pareto chart was created for each of the two
short timeframe. categories of the survey to visually display the
customers' prioritization of the CTQs.
A total of 15 customers were randomly asked to
participate in the survey. Even with the financial Voice of Customer
incentive 3 of them declined the opportunity. The
other 12 responses are summarized in the table
Customer Preference

below:

Category Sample points for further


discussion
Customer Service • On-time delivery
• Shirt options C ustomer Service Product Quality P roduct price

• Friendly support C ategories

Product Quality • Off center image


• Image not bright
• Torn
• Stained Customer service includes factors like on time
delivery, and after sales service. A high percentage
In addition to the feedback solicited from the survey, of Bluvas Inc. customers are repeat customers. Better
the team recorded any additional input offered by the customer service can help increase customer loyalty,
customers and found that customers were and, therefore, possibly increase sales. On-time
appreciative of the effort being made to improve their delivery involves giving customer a feasible delivery
time during the order/pre-order process. Once the customers had agreed that improvement in the top-
customer agrees to the delivery time, it is entered into ranked CTQs could enhance current order rates.
the database and production is scheduled. On a
particular day, a number of jobs can be scheduled to The team concluded that their targeted CTQs did
run. After sales service for t-shirts is minimal except support their business strategy of growth. They had
when customers have complaints about product already received positive customer reaction from the
quality. customer surveys. In addition, the improvement
effort as a whole differentiated their office from
Product quality is equally important for customer competitors since no competitors were using Six
retention. Product quality involves delivering the Sigma strategies and tools.
right quality products to the customers. Customers
have a choice of fabric, sizes and images. Margins Define 2: Define Charter
are similar across t-shirts of different fabrics. The
factor that affects the product quality most is the off-
centered image. Customers are quite satisfied with 2.1 Develop charter
the other aspects like paint quality, fit, etc. T-shirts
once produced are inspected for image quality and From the VOC data and the initial brainstorming
verified against customer orders before shipping to session, the team had enough information to create a
the customers. Random samples from the production project charter, a document that establishes the
lot are examined and inspected. purpose and plan for the project.

Product price depends on factors such as price of First, the team agreed on a statement of the problem,
materials such as fabric, paint, etc., labor costs, or the unmet customer need targeted for
packaging costs, and shipping costs. While there is a improvement.
possibility of increasing sales by lowering the price,
the company already operates on thin margins. Thus, Problem statement:
reducing the price is not an option without reducing
costs. Certain costs such as shipping costs are not in "Voice of the Customer data indicates that in
the control of Bluvas Inc. While lower cost materials order to promote growth with our customers, we
are available in the market, using such materials is need to improve our process capability in the
not in harmony with the company’s business strategy areas of on-time shipping and product quality."
of increasing sales with increasing quality. Therefore,
the team decided not to focus on product price as a On Time Shipping: Customers want shipping on
strategy. the shipping date notified during ordering.
Previous delays in shipping have caused
VOC shows that on-time delivery and product quality customer attrition.
are the most important factors to customers.
However, since delivery is beyond the control of the Product Quality: Customers want products to be
company, it was decided to use on-time shipping as zero defects. Bluvas is currently operating at
the CTQ about 130,000 defects per million opportunities,
which is less than 3-sigma level. The rework for
Given these considerations, the team identified the defects is costly for Bluvas and customers are
following two CTQs, which are most important usually refunded for any defects.
factors to customers, to target for their improvement
project: Next, the team created a goal statement that described
• On-time shipping the success of their project, as they saw it.
• Image Centering
Goal statement:

1.5 Integrate CTQs with Business "By the end of August 2002, both of these
Strategy processes will be operating at a Six Sigma level."

The goal of the company was simple: to drive its After considering the problem and goal statement, the
growth by 15% above their targeted growth for the team created a project scope, which detailed the
year. During the Voice of the Customer surveys, the process boundaries and project focus.
Project Scope Define 3: High Level Process
The project will focus on the two CTQ’s selected. Map
Within the CTQ’s project will focus on those aspects
that are in direct control of Bluvas, Inc. For example, 3.1 Construct Process Map
Bluvas does not have any control on shipping time.
Therefore, we will not focus on it. Similarly, as the On-time shipping CTQ:
customer selects the t-shirt fabric we will not focus
on fabric quality. The team created a SIPOC map of their process,
which depicted the following steps:
The team then identified the resources required to
complete the project. 1. A client submits an order. Some time later,
the order is received and processed. The
Resources/team members: processing time is incidental, but an order may
sit idle for some amount of time.
A separate team, lead by a Green Belt, was 2. The order sits in the job queue until the
established for each targeted CTQ. manufacturing system is ready to process it.
This delay can be small, or up to a matter of
John Strohm was the team leader for the on-time days.
shipping CTQ. Ranga Magadi led the team targeting 3. Raw materials (plain shirts) need to be
image centering. Sanjeev Bhawsinka (Black Belt) pulled from stock. An request for materials is
would serve in a mentoring role and Harsh Marwaha put into this part of the factory, and some time
(General Manager) would provide overall direction. later the shirts appear on the line for printing.
4. An employee needs to set up the die for
Finally, the team determined the benefits expected printing the run of shirts.
from their improvement project. 5. The employee then prints the run of shirts.
Run times scale with the number of shirts, but
Expected Benefits: run time can be increased by having to change
• Revenue growth by increasing product paint, correct defects, or shut down for
quality. break/the day (if a run is exceptionally long).
• Better customer relations. 6. The shirts need to dry before they can be
• Increase in revenues due to customer packaged. This is often pipelined with the
retention and customer collateral. printing process, but if the drying time is long,
• Identification of other factors affecting extra delay may be incurred.
product quality. 7. After the printing is complete, the shirts
need to be folded and safely packaged for their
2.2 Obtain Key Business journey to the customer.
Stakeholder Signoff 8. An inspector then needs to inspect the shirts.
Based on how busy the plant is, an inspector
The team identified the project's key stakeholders as may be available right away or the shirts may
follows: queue for a while. If the inspection fails, the
shirts need rework, which drastically increases
• Heeralal Pande, Vice President, customer the production time.
service, champion at high level and one who 9. The boxes are then put on the loading dock
could support translation. for the delivery company. When the delivery
• The Inspectors, who inspect the product quality company arrives and picks them up, the
and whose roles could be most significantly delivery is considered “shipped.”
impacted by the projects, and who could help 10.“Delivery” takes place when the consumer
ensure the process stays in place once the project signs for the packages and takes ownership of
is completed. them.

All key stakeholders agreed to the project's purpose Product Quality CTQ:
and other provisions as outlined in the charter.
The team mapped the process when a customer
returns a t-shirt. The most common reason for return
is off-centered image.
The next step for each team was to select the best
3.2 Validate Process Map Against possible Y and establish the metric by which it would
Charter be measured.

On time shipping CTQ: On-Time shipping: Y2 is an indirect measure of on-


time deliveries because it does not measure when the
The team agreed that the identified steps 1-9 in their customer take ownership of the product. Bluvas Inc.
process were within the scope of the project, and that gets around that problem the way many e-tailers
the boundaries of the project were neither too narrow have. Amazon.com, for example, guarantees that an
nor beyond the control of their office. It was agreed order can be shipped in 24 hours, but makes no
that the duration between shipping and actual promises as to when the order can arrive. One group
delivery was beyond the control of Bluvas’s office. member points out that if the company doubles the
number of orders it ships out, and cuts the percent of
Product quality CTQ: orders shipped late by 30%, then the number of
orders shipped late will appear worse, while the
The team agreed that correcting the off-centered average customer’s order will be more likely to be
image was within the scope of the project. Since their on-time.
CTQ involved accepting customer returns, due to the
image being off centered, the team agreed that these The team agreed that whether the shipment was made
returns were something that could be handled within on or before the target, shipment date would be the
the office. best output measure, or Y. However, instead on
using the contract date, the team decided to use the
target date as that was the focus of the shipping
Measure 4: Project Y department anyway.

4.1 Identify all possible Ys for CTQs


CTQ Metric (Y)
On-Time shipping: The following Ys were On-time Difference (in days) between
considered for measuring on-time shipping: shipping the target ship date and the
• Y1: Number of orders that are received actual ship date.
by customers later than the promised date.
• Y2: Number of orders which are Product Quality: We could not select Y1, as this
shipped later than the promised date of measure does not give a clear picture of the number
shipping of defects. For example, customers may not return t-
• Y3: Number of orders that are shipped shirts even if they are off centered. On the other
later than the targeted date of shipping. hand, Y2 provides a more accurate statistics of the
(Targeted date for the company was three days image quality.
before the contract date)
• Y4: Proportion of orders which are CTQ Metric (Y)
shipped later than the promised shipping date Product Quality The distance between the
• Y5: Proportion of orders that are image center and the t-shirt
shipped by the date specified to achieve on- center for a sample number of
time shipping. t-shirts.

Product Quality: The following Ys were considered 4.3 Ensure Project Scope is Manageable
for measuring product quality:
The team discussed the project with the management
• Y1: Number of t-shits returned by the an concluded that the project scope was manageable.
customers due to the image being off centered.
• Y2: The distance between the image center Measure 5: Performance
and the t-shirt center.
Standards for Y

4.2 Prioritize and Select Project Y


5.1 Gather Required Information to 2. Date Taken
Establish a Performance Standard 3. Distance (in cm) between center of the t-
shirt and the Image center
Along with identifying CTQs and the metrics to
measure them, during their initial customer When will the data be collected?
interviews the team also elicited boundaries, or The shipment supervisor will collect the data as per
specifications, for acceptable performance for each the following timeline:
project Y. • Baseline data - March, 2002
• Project pilot – June, 2002
Here are the customer-defined performance standards • Control data - July, 2002 onwards
for each Y:
Who will collect the data?
Y Performance standard The product inspector will be responsible for the
On-time The image should be shipped image quality data while the shipment supervisor was
Shipment before the target shipping date. responsible for collecting the shipment date.
Image The image should be centered less
centering than 3cm from the center of the t- How will sampling be done?
shirt. All the shipment data for the month is recorded since
the whole month was a sample for the yearly
shipments. To collect the image quality data a
5.2 Set and confirm performance random 600 t-shirts will be selected for the baseline
standards for the project and control data and 100 samples for the pilot data.
The team agreed that the customer performance What will the data collection form look like?
standards are valid. The sales engineer devised a form on the computer
using Microsoft Excel spreadsheet software. The
Measure 6: Project Data entire team reviewed and refined the data collection
Collection Plan form.

Who will analyze the data?


6.1 Draft Project Data Collection Plan On a monthly basis, Black belt, Sanjeev Bhawsinka,
would work with Harsh Marwaha to analyze the data
What data needed to be collected? using applicable statistical tools. They would then
share the results with the rest of the team.
Y: On-target shipment
The following data will be collection for each order: What data will be excluded from analysis?
1. Order # The data would exclude orders that were changed
2. Customer # later by the customer.
3. Order Date
4. Expected Shipping date 6.2 Complete Measurement System
5. Planned production date
6. Production time taken
Analysis (MSA)
7. Actual Shipping date
1. Reason of Late Shipping (May be null) With the data recording being shipment date and off-
– This is filled by internal staff. center image measurement, no elaborate analysis was
♦ Delay (in days) due to Inventory done.
Issues
♦ Delay (in days) due to Setup Issues Measure 7: Data for project Y
♦ Delay (in days) due to Job
scheduling issues 7.1 Collect Data for Y and Potential Xs
Y: Image centering As outlined in their respective data collection plans,
The following data will be collection for each each team collected baseline data on their respective
sample: process. There were no problems with the data
1. Sample number collection process. Data on a total of 600 samples
were collected for the product quality. 80 orders were
collected for on-time shipment. Y: Image centering
The team would look into the various factors in the
production process that could cause the image center
Measure 8: Process Capability to deviate and suggest remedial actions.

8.1 Analyze Data


Analyze 10: Prioritized List of All
Y: On-target shipment
To determine whether the data in their sample was
Xs
normally distributed, the team performed a normality
test. The Anderson-Darling normality test resulted in 10.1 Capture all possible Xs.
a p-value of 0.188. Since the p-value is greater than
0.05, the team concluded that their data was normally The team looked at all the potential sources for
distributed. variation of Xs and drafted the following prioritized
list of Xs
Y: Image centering
To determine whether the data in their sample was Y: On-target shipment (delay in days)
normally distributed, the team performed a normality The team held a brainstorming session to list all the
test. The Anderson-Darling normality test resulted in possible cause of variations in shipment. The
a p-value of 0.446. Since the p-value is greater than following were the list of reasons.
0.05, the team concluded that their data was normally
distributed. 1. Inventory issues: Delays due to shortage of
Shirts, color, images.
8.2 Focus Project Y as needed 2. Set up issues: Delays due to changes in the setup
of the machine
3. Job scheduling issues: Delays due to
After analyzing their data team concluded that the Inefficiencies in scheduling jobs.
project Ys were correctly identified and decided to
move forward. Y: Image centering
The team held a brainstorming session to list all the
Measure 9 Improvement Goals for possible cause of variations in image centering. The
following were the list of reasons.
Project Y
1. Operator experience: The number of years of
experience of the operator.
9.1 Identify project goal 2. Days past service: Number of days since the
printing machine was last serviced.
The following table illustrates the improvement goals 3. Die complexity: The complexity of the image.
of the project

Y Performance standard
On-time The mean should be less than 0 Analyze 11: List Vital Few Xs
Shipment and standard deviation less than 1.
Image The standard deviation of the 11.1 Verify Xs with Data
centering image difference should be less
than 1. Mean should be between – The team used statistical methods to determine
0.3 to +0.3. which of the possible causes led to variations.

9.2 Define improvement methodology Y: On-target shipment


To determine the causes for the delays in shipping,
Y: On-time shipment the entire process from order entry to the order
The team would track the production processes that shipment was tracked for the month of March. The
are causing delays in shipment and suggest delays in each of the Xs were noted for each order.
improvement to the processes. Regression analysis was done to find out the extent of
impact of listed Xs on the On-target shipment.
The regression analysis of the results yielded the
The regression analysis yielded the following result. following result.
Imagediff = 0.603 - 0.447 ExpMonths + 0.933
The regression equation is DaysPastService + 0.025 DieComplexity

ShipVar = - 0.486 + 2.71 Inventory + 3.18 Predictor Coef StDev T P


Setup + 2.78 Job Constant 0.6027 0.2209 2.73 0.053
ExpMonth -0.4471 0.2209 -2.02 0.113
Predictor Coef SE Coef T P DaysPast 0.9334 0.2209 4.23 0.013
Constant -0.4859 0.2905 -1.67 0.099 DieCompl 0.0254 0.2209 0.12 0.914
Inventory 2.7092 0.6844 3.96 0.000
Setup 3.1815 0.7201 4.42 0.000 S = 0.6248 R-Sq = 84.6% R-Sq(adj) = 73.0%
Job 2.777 1.5490 1.79 0.077
Analysis of Variance
S = 2.406 R-Sq = 78.7% R-Sq(adj) = 66.3% Source DF SS MS F P
Regression 3 8.5744 2.8581 7.32 0.042
Analysis of Variance Residual Error 4 1.5616 0.3904
Source DF SS MS F P Total 7 10.1359
Regression 3 278.088 92.696 16.02 0.000
Res. Error 6 439.862 5.788 The following can be inferred from the results:
Total 79 717.950
1. Die complexity has very little impact on the
image quality.
The following can be inferred from the results.
2. Image quality is mainly dependent on the
1. Delays in any of the three listed processes can
number of days since the last service. Therefore
lead to delay in shipment.
suggesting more frequent machine maintenance.
2. Delays due to setup and inventory issues have
more impact in shipment delays than Job
scheduling issues. 11.2 Finalize List of Vital Few Xs
Based on the statistical significance, the team
Y: Image centering identified and prioritized the vital few Xs that
Image centering was measured using the image have direct effect on the project Ys.
distance (distance of the image center from the center
of the t-shirt). The image distance was found to be Y: On-target shipment
normally distributed with a mean of –0.121 and a 1. Setup delays
standard deviation of 2.10. The following Factorial 2. Inventory delays
design experiment was set up to find out the extent of 3. Job delays
impact of listed Xs on image centering.
Y: Image centering
Response Variable: Y = Image Difference (cm) 1. Days past service.
2. Operator experience
Driver Variables: High = +1 Low = -1
Operator Experience 24 Months 2 Months
Days Past Service 100 Days 30 Days
Analyze 12: Quantified Financial
Die Complexity 7 2 Opportunity
The resulting means from image differences are listed 12.1 Refine financial benefits
in the following table.
Next, the team estimated the financial benefits
ExpMonths DaysPast Die Imagediff
Service Complexity of implementing the project.
-1 1 -1 1.734367
-1 1 1 2.296733
-1 -1 -1 0.799467 Y: On-target shipment
-1 -1 1 -0.63113 Analyzing the past monthly orders from the
1 1 -1 0.638933
customers, the team estimated that each delay cost
1 1 1 1.474433
1 -1 -1 -0.86367
$1000 in future revenue due to customer
1 -1 1 -0.62733 dissatisfaction. Based on the data analysis, the
percentage of t-shirts that were shipped late was
14.64%. Percentage of t-shirts expected to be delayed 12.3 Identify intangible benefits.
after Six Sigma implementation data was 0.10%
Y: Image centering
Total benefit = 1,000*(.1464-0.0010) Better image centering increases the customer
= $14,530 satisfaction, which leads to higher revenues.

Therefore the with the project implementation, the Y: On-target shipment


Revenue is expected to increase by $14,530 per Reduced delays reduce the burden on customer
month. service, which leads to decreased needs and a
reduction in customer service costs.
Y: Image centering
Analyzing the returns from the customers, the team
concluded that all t-shirts that were off-center by 3cm
or more were returned. Based on the data analysis,
Improve 13: Proposed Solution
the percentage of t-shirts with this defect is 15.37%.
On an average, the company produces 10,000 t-shirts 13.1 Identify Improvement Strategy
with an average price of $15. On project
implementation, the return rate is expected to drop to Y: Image Centering
0.27%. After having discussions on ways of improving
image centering the team decided on the following
Total benefit = 10,000*15*(.1537-0.0027) improvement strategy
= $22,650
X: Days past Service
Therefore the with the project implementation, the The team concluded that they should not wait for
Revenue is expected to increase by $22,650 per production slack period for machinery service
month. (service takes about 4 hours). The service has to be
done as required (every biweekly). They decided to
In summary, the project would lead to a per month plan ahead for the machinery service and give a
revenue increase of $37,180. yearly service plan with service dates to the
mechanical contractors. (History showed that if the
service dates were delayed they had average
12.2 Estimate costs associated with the downtime of about 10-hours/every week due to
project machinery parts failure along with poor quality
product).
Y: On-target shipment
Tracking the delays in various departments was X: Operator Experience
estimated to cost the company, $20 per order. The team decided and came to a conclusion that the
Since approximately 175 (80-baseline, 15-pilot, company would add one-week mandatory training
80-final) orders need to be tracked, it was session for all new employees before they enter the
estimated that this would cost the company production field. After the training session, the new
$8,750. employee will work for 2 months under the guidance
of an experienced (with a minimum of 2 years
Therefore, the total estimated cost for the experience) worker at the same job location. The
project is $15,250. team believed that after the training and guidance
from an experienced employee the new employee
Y: Image centering would possess good skills to perform the desired job
The team analyzed the costs associated with the and would be held responsible for his job. Currently,
effort involved in sampling the image. It was all the employees with less than 12 months
estimated that sampling of each shirt cost the experience would be given 2 day in-class training
company $5. Since during the course of data a total which would help them to improve their work
of 1300 samples (600 – baseline, 100-pilot, 600 – quality.
final) are to be taken, it was estimated that the total
sampling cost was $6,500. Y: On-target Shipment
In order to meet the shipment date target following
In summary, the total project cost would be $15,250. improvement strategy was proposed.
X: Set up Delays The team also decided that the resource requirements
The team decided to work on adding Standard and procedure to collect the data would be identical
Operating Procedures (SOP) for all the set up to the baseline data process. The period set for the
processes. This is going to help in reducing the pilot was 2 months.
tampering of the process and, thus, the delays that are
caused due to changes in the setup. 14.2 Run the pilot and collect Data

X: Inventory Delays Y: Image Centering


The team came up with a process of documenting the The pilot was run for 10 days starting June 1, 2002
inventory once a week and a person is going to be and 10 samples were collected every day to make a
assigned and responsible to do the specific job. Since total of 100 samples.
the inventory check is only once a week and can take
about 4 hours to do the job it was decided that the Y: On-target Shipment
documentation would be carried out by the line The pilot was run from June 1, 2002 and the first 15
supervisor. The team talked to the line supervisor and orders were taken for pilot testing.
they commonly agreed upon the documentation
project. 14.3 Analyze the results of the pilot

X: Job scheduling issues Y: Image Centering


The team found that the computer system uses MP2 After collecting 100 samples, the team analyzed the
software for job scheduling and this software has results of the data collection in Minitab using a 2-
been outdated for years. This software does not give sample t-test and F-test.
flexibility in operation to the sales force and needs to
be changed. After doing some research, we found For the 2-sample t-test (to test the mean) the null
that the cost of the software is negligible and can be hypothesis stated, “The mean of the pilot response is
changed immediately without any major effect on the equal to the mean of the baseline response”. The
production and sales department. alternative hypothesis stated, “ The mean of the pilot
response is not equal to the mean of the baseline
response”. As shown below in the t-test analysis,
13.2 Experiment to determine Solution since P-value is > 0.05 we accept the null hypothesis
i.e. the mean has not moved.
The team decided that the most effective way to test
their improvement strategy was to conduct a pilot for Two sample T test for BaselineImageDiff vs
PilotImageDiff
both the image centering and on-target shipment
project. The aim was to determine whether the Xs N Mean StDev SE Mean
indeed had an effect on the Ys. Baseline 600 -0.12 2.10 0.086
PilotIma 100 -0.09 1.02 0.10

Improve 14: Piloted Solution 95% CI for mu Baseline - mu PilotIma: (


-0.293, 0.23)
T-Test mu Baseline = mu PilotIma (vs not =):
14.1 Plan the Pilot T = -0.23 P = 0.81 DF = 267

Y: Image Centering Since P-value is > 0.05, FTR the Null


Hypothesis
The team agreed that they would not have to change
the data collection plan or the form they used to
collect their baseline. They also agreed that the We also wanted to know if we had reduced the
changes carried out to improve the image centering variation in the process and, thus, the standard
would be documented and recorded. For example, deviation. To check this we carried our F-test. The
when was the last machine service done and when it null hypothesis stated, “The variance of the pilot
is next due; response is greater than or the same as the variance of
how many hours did it take for the service; what was the baseline response”. The alternative hypothesis
the effect of in class training on the employee in stated, “ The variance of the pilot response is less
terms of work quality. than the variance of the baseline response”. As shown
below, since the F-calc > F–crit, we reject the null
Y: On-target Shipment hypothesis and accept the alternative hypothesis that
the variance has decreased.
BaselineImageDiff PilotImageDiff F-Crit (=FINV(0.05,79,14) 2.2014
Count 600 100
St. dev. 2.10 1.017 Since F-Stat is > F-Crit, Reject the Null
Variance 4.423 1.035 Hypothesis

Calculations
F-Stat (=sBaseline2/sPilot2) 4.273
F-Crit (=FINV(0.05,599,99) 1.306 15. Control
Since F-Stat is > F-Crit, Reject the Null
Hypothesis 15.1 Develop Control Plan
After the pilot test run which revealed positive results
The above 2 tests revealed that the improvement the team met to develop a control plan to ensure that
strategy used to reduce variance and thus the standard the benefits from the solution continued to be
deviation was driving positive results. realized. The team created a control plan as outlined.

Y: On-target Shipment Y: Image Centering


After collecting the data for the first 15 order samples • To maintain a timely and proper
during the pilot testing, the team found that there was machinery service and document the service
a remarkable improvement in on-target shipment dates along with any important information
dates. It was found in the t-test analysis that the mean that would be helpful for future reference.
of the pilot test was negative and moved to the left • To continue training session for all
i.e. the actual shipment date had been lowered. new employees. Also, if needed, give
educational training to existing employees.
Null hypothesis: "The mean of the pilot
response is greater than or the same as the
• Monitor the process data every
mean of the baseline response." month for the first 6 months and if under
Alternative hypothesis: "The mean of the control monitor every quarter.
pilot response is less than the mean of the
baseline response."

Two sample T test for PilotShipVar vs Y: On-target Shipment


BaselineShipVar • To monitor the SOP for all the
N Mean StDev SE Mean processes very closely and document any
PilotShi 15 -0.73 1.03 0.27
Baseline 80 0.28 3.01 0.34
changes in the process in a timely manner.
• To audit the inventory process once
95% CI for mu PilotShi - mu Baseline: ( every month and later proceed with once
-1.87, -0.15)
T-Test mu PilotShi = mu Baseline (vs <): T =
every quarter.
-2.35 P = 0.011 DF = 65 • Continue educating employees with
the use of new software.
Since P-value is < 0.05,Reject the Null
Hypothesis
• Continue to compile and analyze
data using applicable statistical tools.
The F-test results revealed that the variance for the
baseline was higher than the pilot results by order of Beginning in July, Bluvas t-shirt company
magnitude of 9. The standard deviation of the pilot implemented the control plan with the solution in
decreased from 3 to 1. The results of F-test are shown place. This included proper machinery maintenance,
below. SOP and continuous education to its employees with
the main focus being quality and customer
Null hypothesis: "The variance of the pilot satisfaction.
response is greater than or the same as the
variance of the baseline response." 15.2 Confirm Solution
Alternative hypothesis: "The variance of the
pilot response is less than the variance of
the baseline response." Y: Image Centering
After the end of the July, the team analyzed the data
BaselineShipVar PilotShipVar collected for measuring the variability in the image
Count 80 15
St. dev. 3.015 1.033 centering. First, we tested the normality of the data.
Variance 9.088 1.067 Since the p-value of the data was less than 0.05, the
data was considered to be normal. We used the same
Calculations
F-Stat (=sBaseline2/SPilot2) 8.519976266
method to determine the Sigma value of the process
as we had when we first analyzed the baseline data.
We were able to improve the sigma level starting at sigma level, the team calculated the value of the
baseline data from less than 3 (with DPMO = Sigma level. We could statistically prove that we had
134,788) to greater than 4 (with DPMO = 2,623) in improved our sigma level from <3 (DPMO=241,588)
the first month of implement the solution for this Y. to greater than 4 (DPMO=1681) during the starting
stage of the control process.
To confirm that the mean is similar and variation has
reduced for this Y, we repeated the analysis we had The team had a 2 sample t-test run and compared it to
performed during our pilot test data. The results are the baseline data. The test confirmed that the mean of
summarized below: this Y had shifted and moved to the left as shown.

Control Test - Hypothesis Testing - Image Control Test - Hypothesis Testing -


Centering - Two Sample T-Test Shipment Variability - Two Sample T-Test

Null hypothesis: "The mean of the pilot Null hypothesis: "The mean of the pilot
response is equal to the mean of the response is greater than or the same as the
baseline response." mean of the baseline response."
Alternative hypothesis: "The mean of the Alternative hypothesis: "The mean of the
pilot response is not equal to the mean of pilot response is less than the mean of the
the baseline response." baseline response."

Two sample T for BaselineImageDiff vs Two sample T for ControlShipVar vs


ControlImageDiff BaselineShipVar
N Mean StDev SE Mean N Mean StDev SE Mean
Baseline 600 -0.12 2.10 0.086 ControlS 89 -0.47 1.03 0.11
ControlI 600 0.07 1.00 0.041 Baseline 80 0.28 3.01 0.34

95% CI for mu Baseline - mu ControlI: ( 95% CI for mu ControlS - mu Baseline: (


-0.310, -0.060) -1.45, -0.04)
T-Test mu Baseline = mu ControlI (vs not =): T-Test mu ControlS = mu Baseline (vs <): T =
T = -1.33 P = 0.18 DF = 862 -2.11 P = 0.019 DF = 95

Since P-value is > 0.05, FTR the Null Since P-value is < 0.05,Reject the Null
Hypothesis Hypothesis

Control Test - Hypothesis Testing - Image An F-test was also conducted; it revealed that the
Centering - F-Test
standard deviation of this Y has reduced
Null hypothesis: "The variance of the pilot significantly, confirming that the process Y has
response is greater than or the same as the improved and is under control. The F-test results are
variance of the baseline response." shown below:
Alternative hypothesis: "The variance of the
pilot response is less than the variance of
the baseline response." Control Test - Hypothesis Testing -
Shipment Variability - F-Test
BaselineImageDiff ControlImageDiff
Count 600 600 Null hypothesis: "The variance of the pilot
St. dev. 2.10 1.001 response is greater than or the same as the
Variance 4.423 1.003 variance of the baseline response."
Alternative hypothesis: "The variance of the
Calculations pilot response is less than the variance of
F-Stat (=sBaseline2/sPilot2) 4.408 the baseline response."
F-Crit (=FINV(0.05,599,599) 1.144
BaselineShipVar ControlShipVar
Count 80 89
Since F-Stat is > F-Crit, Reject the Null St. dev. 3.015 1.035
Hypothesis Variance 9.088 1.070

Calculations
With the above results, we can conclude with F-Stat (=sBaseline2/SPilot2) 8.3493
statistical certainty that the variation of the image F-Crit (=FINV(0.05,79,88) 1.4341
centering has decreased and the process is very much Since F-Stat is > F-Crit, Reject the Null
under control. Hypothesis

Y: On-target Shipment The impact of the project’s success was evident in the
Near the end of the month, in July, in order to prove following ways:
that we are moving close to our goals of attaining 6-
• Less amount of seconds were produced due to electronic magazine for CIOs of big Fortune 500
proper image centering companies. While currently pursuing an M.B.A. from
• Customers were getting their products before R. H. Smith School of Business at the University of
they expected or the most on the scheduled time. Maryland, Munish holds a B.Tech. in Computer
• Business was starting to pick up with more Sciences from Kakatiya University.
satisfied customers
Sanjeev Bhawsinka is a Project Engineer at Tamko
The projects conducted by the Six-Sigma team were Roofings Products. As a project engineer, he works
truly making a difference in Bluvas total service on designing equipment and developing processes for
levels. Profits were expected to improve this year and manufacturing chemicals and related compounds to
so would employees’ profit sharing. create roofing products. He is currently pursuing his
MBA at R.H. Smith School of Business and holds a
MS and a BS degree in Chemical Engineering from
References University of Illinois, Chicago and University of
Pune respectively.
1. Pyzdek T., (2000), The Six Sigma
Handbook, McGraw-Hill Trade, ISBN: Harsh Marwaha is a consultant with Oracle Corp. He
0071372334. has over 6 years of experience in information
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Decision Making with Microsoft Excel, Duxbury M.B.A. from R. H. Smith School of Business at
Press, ISBN: 0534389325. University of Maryland. He also holds a Masters in
3. Deming, W., (2000), Out of the Crisis, MIT Mathematics and Computers from Indian Institute of
Press, ISBN: 0262541157. Technology Delhi.
4. Pande, P., et al, The Six Sigma Way: How
GE, Motorola, and Other Top Companies are
Honing Their Performance, (2000), McGaw-Hill
Trade, ISBN: 0071358064.
5. Chowdhary, S., (2001), The power of Six
Sigma: An Inspiring Tale of How Six Sigma Is
Transforming the Way We Work, Dearborn
Trade, ISBN: 0793144345.
6. Forrest W. Breyfogle III, et al, (2000),
Managing Six Sigma: A Practical Guide to
Understanding, Assessing, and Implementing the
Strategy That Yields Bottom-Line Succes,
Wiley-Interscience, ISBN: 0471396737.
7. Breakthrough Management Group, Six
Sigma Blackbelt Training Handbook.
8. Tamko Roofing Products, Total Quality
Management Handbook.

Autobiographical Notes
Ranga Magadi is a Technical leader at First Data
Merchant Services, having extensive experience in
credit card transaction processing industry. He is
graduating from the University of Maryland with an
M.B.A in Finance and IT in Summer 2002. Ranga
also holds a Bachelor of Engineering in Electronics
from Bangalore University.

Munish Garg is Consultant in RDA Corporation


Having extensive previous experience with Ernst &
Young, he leads challenging information technology
projects for various companies. He serves on the
editorial board of the CIO Advisor – the weekly