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Six Sigma in Action:
                 Demonstrating Customer Value




Master Black Belt: Steven Bonacorsi
Six Sigma in Action:
                                                               Shipping Cost Reduction
Customer Profile  GE Aircraft Engines, Lynn MA
Business Problem & Impact
Customer needed a reduction in shipping costs and improved
order delivery performance for short cycle PC orders
Measure & Analyze                                                       Defect Reduction in Shipping Orders
Data Collection: Defects with respect to on-time deliveries
were over 30%. Over one year, the customer was spending          0.35

approximately $33,000 on rush orders.                            0.30

Root Causes: Statistical analysis proved multiple variation      0.25
sources, including variation in OEM shipping time, client
                                                                 0.20
staffing to receive PCs and end user availability for set up
                                                                 0.15
Improve & Control
                                                                 0.10
Improvements included a modification in the inventory levels
to accommodate variation in OEM ship time, a staffing change     0.05

that led to more consistent receiving practices, and a change    0.00
                                                                          Measure   Analyze   Improve   Control
in the process for scheduling with end users that
accommodated their availability
Results/Benefits
Defects in short cycle PC deliveries was reduced to less than
5% (from 30.1% to 3.2%), which resulted in a savings to the
client of approximately $30K annually in shipping costs.

     Reduced clients staffing cost by $30K while improving performance!

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Pc Shipping Improvement Six Sigma Case Study

  • 1. Six Sigma in Action: Demonstrating Customer Value Master Black Belt: Steven Bonacorsi
  • 2. Six Sigma in Action: Shipping Cost Reduction Customer Profile GE Aircraft Engines, Lynn MA Business Problem & Impact Customer needed a reduction in shipping costs and improved order delivery performance for short cycle PC orders Measure & Analyze Defect Reduction in Shipping Orders Data Collection: Defects with respect to on-time deliveries were over 30%. Over one year, the customer was spending 0.35 approximately $33,000 on rush orders. 0.30 Root Causes: Statistical analysis proved multiple variation 0.25 sources, including variation in OEM shipping time, client 0.20 staffing to receive PCs and end user availability for set up 0.15 Improve & Control 0.10 Improvements included a modification in the inventory levels to accommodate variation in OEM ship time, a staffing change 0.05 that led to more consistent receiving practices, and a change 0.00 Measure Analyze Improve Control in the process for scheduling with end users that accommodated their availability Results/Benefits Defects in short cycle PC deliveries was reduced to less than 5% (from 30.1% to 3.2%), which resulted in a savings to the client of approximately $30K annually in shipping costs. Reduced clients staffing cost by $30K while improving performance!