This is a Six Sigma Yellow Belt project I did five years ago. I learned a lot from this project. I hope I could get a Green Belt in the near future.

1. Reduction of each transaction cycle time
• Opportunity Statement: SFS Plant currently has problem with entering
paper work to the system on the timely manner. Some of the “Good
Receipts” were entered to the system late or some of them did not even
enter to the system. If the “GR” has not been done properly, it will affect
other departments such as the production line, shipping department,
customers, inventory and the plant’s budget.
• Project Goal: The current inventory accuracy of SFS Plant is in between
85% and 88% which is still far away from reaching the target goal of 98%.
The project will improve our inventory accuracy 93% by the end of the
March 2008.
• Sponsor: Plant Manager
• Project Manager: Yoke-Yin Purcaro
• Process Owner: Yoke-Yin Purcaro
• Team Members: A, B, C, D, E, F
• Location: California.

2. Reduction of each transaction cycle time
• Financial Savings: This project will not have actual amount of the
financial savings, but it will provide the improvement of the
inventory accuracy.
• Primary Metric: Improving inventory accuracy by reaching 93% by
the end of March. Currently: Between 85% and 89% hit accuracy.
• Secondary Metrics: To help the plant stays within the budget.
• Currently: Some invoices that supposed to be paid last month but
paid in this month.
• Goal: Try to pay all of the bills within the same month.
• Other Benefits: To better manage the inventory and to better
manage the plant budget.

3. Project Summary
Customers: Internal customers: Production
department, shipping department and production
planner.
External customer: customer, CSR, sales, logistics
Product or Service: We have improved the
wait time for a PO that needs to be received.
PO or materials receive in timely manner.
Defect/Error:
Key Dates
Kick-off:
Define:
Measure:
Analyze:
Improve
Control
Target
1/28/08
1/28/08
2/28/08
3/15/08
4/1/08
5/1/08
Completed
Scope:
To enter all the paper work such as purchase
orders and receivers to the system within a
short period. To improve inventory by
reaching target of 98%.
Out of Scope: Paper work did not enter to
system on time which created a conflict
between production, shipping and customer.
Project costs: This project cost us about
$1000. We bought three time stamp clock to
keep track the time from receiving to
entering the system.

4. Validation of the Solution – Time entered
into SAP
100%
April
90%
May
80%
June
70%
July
August
% of orders
60%
Reduced >3 hrs
& within 3 hrs
to 0
50%
40%
30%
20%
10%
0%
Within 30 min
Within 1 hr
Within 2 hrs.
Within 3 hrs.
3 hrs >

5. Validating the new process
Improvement in transaction
cycle time does not mean an
improvement in Inventory accuracy

6. Project Highlights
Define
Who are the
Measure
•
customer?
Plant Manager
•
Production
Customer Service
End use Customer
1.
Shortages –
complaint from
customer.
2.
When information
was not entered in
timely manner,
production won’t be
able to process the
process order.
3.
Inventory issue –
spend hours on
finding the if the
receivers were
entered properly.
•
•
Analyze
Measured by
purchasing a time
stamp
•Short handed
A “Receiving
Analysis” has been
done for this project.
•Lack of organization
20 days sample were
taken randomly from
April to July.
These samples were
separated into five
categories
information entered
within 30 min, within
1 hr, within 2 hrs,
within 3 hrs &
greater than 3 hrs .
Within 30 minutes:
April 26%
May 58%
June 76%
July 48%
•Lack of training
(who is the backup?)
Improve
1. Implemented
three time stamps.
2. We are still using
the time stamp for
keeping track the
time.
3. Have more
employees involve
in entering the
paper work.
4. Train more
employees to do
the transaction to
eliminate the
“Short handed”
problem.
5. Quality assurance
and the supervisor
will help entering
the data to SAP
Control
25 bill of ladings
will be randomly
audited
Email team
leaders if the
document was
not stamped
“forget to enter”
or “overlooked
the document”
will be
documented for
improvement
purposes.

7. The Define Stage deliverables
 Santa Fe Springs Plant has realized that the delay on receiving raw materials to the
system caused a major problems
 Problems: Unable to proceed the process order in the production department,
inaccurate inventory and shortages
 Production department: When the raw material was not entered to the system on
time, the process order can’t not be done. The production line has to stop.
 Inventory: When the materials that supposed to be entered before the cycle count but
didn’t enter to the system until the cycle count has been performed, the inaccurate
inventory shows.
 Shortages: When the materials didn’t receive at the right time, shortages on the order
will be occurred.
 The timing of entering information to the system is important as it will create all the
problems as above; and all these problems waste employees energy and time on the
investigation.

8. Voice of the Customer
•
Who are the customers of this process?
– Plant Manager
• Complain about the poor inventory control due to the delayed on good receipts
• Stay within the plant budget
– Production
• Can’t create process order. No products will be produced in the production line.
– Customer Services department
• Can’t fulfill the customer’s orders. Complaints come from different directions such as
the sales department and the customers
Measure how long it takes
to enter inventory into SAP
•
End Use Customer wants and needs:
• Customer wants the right product, right quantity and the product in the right place.
The order needs to ship out on time as promised. What the customer needs is to avoid
the shortage and delayed.

9. Voice of the Process
R e c e iv in g P ro c e s s
P r o d u c t s t r an s fe r
fr o m o t h e r p lan t s
Aft e r r e c e iv e r
v e r ifie d t h e m at e r ial
an d q u an t it y , t h e
r e c e iv e r s ig n e d an d
d at e t h e d o c u m e n t .
55 m in u t e s
D o c u m e n t w ill
b e t u r n e d in t o
t h e s h ip p in g
le ad e r
5 m in u t e s
Le ad e r w ill d o t h e
"GR " fo r all t h e
r e c e iv in g fr o m
o t h e r p lan t s
F r o m im m e d iat e ly t o 15 m in u t e s
By the end of the
s h ift , all o f t h e
r e c e iv in g d o c u m e n t s
w ill b e file d .

10. Voice of the Process
Receiving Process for Components
Components such as
bottles, cartons, pails,
drums and etc.
After receiver verified
the material and
quantity, the receiver
signed and date the
document.
Document will be turned in
to the front desk and
20 minutes
Administrative will
enter the
information to SAP
Less than 10 minutes
If material was delivered after
the administrative left, the
supervisor, Tony and the QA, Ari
will help enter the information.
Then, we file all the documents that have
been entered.
Within the same day.
More than 30
minutes.

11. Define Stage and Gate
Voice of the Customer:
Voice of the Process:
All of the P.O. must be entered within the same day as
it is delivered.
All of the deliver P.O. should have two time stamps –
Time in and the Time Entered.
EXCEPTIONAL: Materials such as bottles, cartons, and
the materials transfer from other plants need to be
entered within 30 minutes.
 Materials transfer from other plants enter by the
receiver in the shipping department.
When a P.O. that is delivered by UPS or Fedex should
have a P.O. number as “Reference Number” on the label.
The administrative assistant is responsible for
entering the information.
If all of the P.O. entered to the system on time, the
production department should not have any problems
with the process order.
 Components such as cartons, bottles, caps, pails,
drums, pallets and etc. enter by the administrative
assistant in the office.
The administrative assistant works from 6:30 AM to
3:30 PM. She will make sure all of the materials are
received in the system before she 3:30 PM.
 If the materials were delivered after 3:30 PM, Tony and
Aril perform the Goods Receipt in SAP.
 What we are trying to do here is to make sure all of
the delivered materials received within the same day.

12. The Measure Stage deliverables
The plant bought three time stamps to keep track all the delivered materials and the
time from being received to enter to the system
All of the bill of lading, packing list have two time stamps. The administrative assistant
and the receivers have been trained for performing the “Good Receipts” procedures.
We have been using the time stamp machines since April and we had randomly
picked 20 – 23 bill of ladings for samples.
They are five categories of timing for the receiving: Information enter within 30
minutes, 1 hour, 2 hours, 3 hours and more than 3 hours.
The results we have are on the following slide.

13. Performance- Customer’s point of view
Receiving times entered by Administrative Assistant
100%
April
May
June
July
90%
80%
70%
% of orders
60%
Why does it take
longer than 30 min to enter?
50%
40%
30%
20%
10%
0%
Within 30 min
Within 1 hr
Within 2 hrs.
Within 3 hrs.
3 hrs >

14. Process Performance
Inventory accuracy
and entering data doesn’t correlate?

15. Measure Stage and Gate
Customer’s perspective: Orders to be fulfilled and delivered at the right time and right place. Shortages should
be minimized and quality needs to be consistent.
Process performance: The receivers in shipping department keep forgetting to stamp the time on the paper.
Instruction was sent to the supervisor that the time stamp on paper is necessary. 99% of the papers o
Gap: There is a 30 minutes and more than three hours gap occur on the receiving process.
Validate data is correct, repeatable, and reproducible:
Which measurements/ metrics will help identify the root causes: The timing and the accuracy will be able to
help us to identify the root causes.
“Just do it” opportunities: After we had a meeting about who should enter the paper works after the
administrative assistant left. We decided to have Tony and Ari help us with this task. We are trying to enter all
the paper work on the same day as the materials delivered to our plant.

16. Identify the Root Causes
Why does a gap of 30 minutes to greater than 3 hours gap occur
in this process?
Short handed
Lack of training
Lack of organization (who is the backup?)

17. Analyze Stage and Gate
Root Causes: When the materials were not received in
timely manner; often, it caused by short handed.
We have noticed that when the employees were
rushing on getting things done, mistakes such as
entering the wrong quantities or overlooked the
paper work happened. Lack of the sense of
urgency is one of the reason why the materials
were received late. Some employees have the
attitude of “Don’t worry, we can do it later.” The
word “later” could be tomorrow or two days later.
Supporting data:
1. In April, we started using the time stamp that
allowed me to keep track the timing from
receiving the product to entering information to
the system. The Good Receipt was performed
within 30 minutes are – April: 26%, May: 58%,
June: 76%, July: 48%.
2. We were short handed most of the time in July.
The production assistant, the production
scheduler, the inventory control were absented.
Key factors that must be addressed in the solution: Being able to receive all of the materials that need to be
received on the same day as they were delivered.
“Just do it” opportunities: In the past, only the receivers and the administrative assistant enter information to
the SAP. Now, we have the lab assistant and the manufacture supervisor to help us entering the data.

18. The Improve Stage - The Solution
•
•
•
•
We are still using the time stamp for keeping track the time.
Have more employees involve in entering the paper work.
Train more employees to do the transaction to eliminate the
“Short handed” problem.
Components will be entered by the administrative assistant.
Quality assurance and the supervisor will help entering the
data to SAP if the administrative assistant left before the
material is delivered.

19. 100%
Validation of the Solution – Time entered into SAP
April
90%
May
80%
June
70%
July
August
% of orders
60%
50%
Reduced >3 hrs
& within 3 hrs
to 0
40%
30%
20%
10%
0%
Within 30 min
Within 1 hr
Within 2 hrs.
Within 3 hrs.
3 hrs >

20. Improve Stage and Gate
Process Change:
Voice of the Process:
Voice of the Customer:
 Make sure all the materials
receive in the system no later
than 30 minutes after they
were delivered.
1. When the materials were
delivered, check the accuracy
on the bill of lading.
1. The production department did
not complained about “Good
Receipt” on our components.
2. Perform “Good Receipt” in
SAP.
2. Production planner will be able
to schedule the production
plan more effectively.
 It is necessary to have to time
stamps (Time in and time
entered) on each bill of lading.
 All of the employees
understood the process and
the concept of keeping track
the timing.
 The last person left the office
makes sure there is no
“undeceived” document.
 People in receiving department
and administrative assistant
were trained for the process.
3. Materials transfer from other
plants will be received in
shipping department and
information will be entered no
later than 15 minutes, usually.
4. Components will be entered by
the administrative assistant.
Quality assurance and the
supervisor will help entering
the data to SAP if the
administrative assistant left
before the material is
delivered.
5. This process is a task NOT an
optional step.
3. They are one less error that
inventory control coordinator
needs to investigate.
4. It save times on investigation.
5. Voice of the customer is unable
to measure but can be heard
physically.

21. How we will maintain the new process
 25 bill of ladings will be randomly audited
 Email team leaders in receiving department and manufacturing
supervisor if the document was not stamped
 “forget to enter” or “overlooked the document” will be documented for
improvement purposes.
 Administrative assistant will be questioned if the document was
entered after three hours.
 The reason will be documented for future improvement.

22. How we know it is working
 The process will be working when 80% of the transactions are entered into
SAP within 30 minutes and 0 orders are greater than 1 hour
 This will be validated with monthly audits using the time stamps

23. Lessons Learned
 Reducing the transaction time might not be the best way to improve our
inventory accuracy, but it definitely helps us to smoothing the process
order for production line and improve the customer service
 Change the goal of the project at an earlier date

24. Sign Off
•
Approval completes the project for the Team. This transfers control of the
project to the process owner.
We agree that this project is complete and the control phase can be completed..
Date:
Team Leader
Date:
Sponsor
Date:
Project Manager