Cape Cod Child Development is a trailblazer in applying Lean Six Sigma to the nonprofit world. View this 30 minute success story webinar to learn how Angie Grabiec provided budget relief by improving the supply purchasing process.

1. Improving the Purchasing
Process for Supplies
Presented by Angie Grabiec
Executive Administration Manager
Cape Cod Child Development

2. About Our Presenter
• Executive Administration
Manager
• Cape Cod Child
Development
Angie Grabiec

3. WAYS TO CONTROL SPENDING IN
A NON-PROFIT ORGANIZATION

4. EXECUTIVE SUMMARY
The ordering process for CCCD was
disorganized and an order as you wish
system. There was much hoarding at
every site. Due to this there has been a
large loss of dollar amounts for the
organization.
Steam line to one person
ordering products.
Compare costs of products
with each vendor.
Significant cost savings.
Solutions
Implemented
1. Create order form
2. Managers send a
request one time per
week for products
3. Create Kanbans
4. Review invoice
5. Switched to GMED
6. Switched from paper to
using dishwashers
Root Cause
1.WB Mason cost was
significantly higher that
Geriatric Medical. Staff was
able to order what and
whenever they wanted
without approval.
Project
Result

5. CURRENT VENDORS
Verizon WB
Mason
Geriatric
Medical

6. DEFINE PHASE

7. PROJECT CHARTER
Problem
Statement
Business
Case
Goal
Statement
Spending and
average of
$2500/month on
supplies that are not
necessarily needed
and are the best
price.
Provide outstanding
products for less cost
which will improve
revenue., ability for
raises and the
bettering of facilities.
Reduce the amount
of the average
monthly cost by 20%
from $2,500 a
month to
$2,000/month
Phase Planned
Actual
Define: May 15 June 1
Measure: May 1 June 15
Analyze: July 1 Aug 30
Improve: Sep 15 Dec 1
Control: Sep 30 Dec 30
Process Start:
Receive order via
email
Process End:
Receive packing
slips
Angie Grabiec
Green Belt
&
Anne Colwell
Sponsor
Time
Line
Scope
In/Out
Team
Members

8. Voice of the Customer Translation Matrix
Customer
Comment
Gathering
More
Understandin
g
Customer
Requirement
Why can’t I
order myself?
Why are you
ordering non-
name brand?
Why do you
get to decide if
I have to many
supplies
The new
chemicals are
making me sick
Customer does
not want to lose
control
Never
questioned
about brands
before
Hoarding is
comforting
Nothing wrong
with what they
had and it
smelled good
Ability to
order products
without
supervision
Ability to
order
preferred
product
“Just in case
supplies”
Stop trying to
fix what they
think is not
broken
Take Away: Employees do not want to be controlled for
purchasing, they feel as though they are responsible enough.

9. SIPOC – Ordering Supplies Thru Delivery
S
Suppliers
I
Inputs
P
Process
O
Outputs
C
Customers
1.Lead
Teachers
2.Site
Managers
3.Finance
4.Human
Resources
5. Enrollment
6. Facilities
7. Early
Intervention
1.Lead teachers
email site
managers their
order request
2. Site
Managers email
Angie the
requests for
each site
3. Managers
through out
the
organization
email me their
supply
requests.
Input orders
with vendors
Receive
order
Distribute
order
Receive and
file packing
slips
Supplies and
Packing Slips
Angie
Grabiec
Customer Requirement
All orders be delivered
no later than Monday
afternoon.

10. “As Is” Swim Lane Map
Rec
Order
Ship to
EE
Rec
Order
Fin
Receives
*Monthly visits to Finance
to see if they have any self
purchasers
Take Away: Some employees ordering
items on their own and there is no
way of tracking for cost savings

11. MEASURE PHASE

12. Data
Collection
Plan
Measure Data Type Operational Definition Stratification Factors Sampling Notes Who and How
The % of
savings
for a 3
month
period
None
To measure the
savings of orders per
month.
Measure the cost of
each product from
WB Mason, Geriatric
Medical and Verizon
June 2016
to
June 2017
Angie
Grabiec by
reviewing
monthly
invoices
Supply
Cost
Continuous
The total dollars
spent on supplies per
month.
By Item
2016 &
2017 to
date
Angie
reviewing the
monthly
invoice

13. 0
5000
10000
15000
20000
25000
30000
Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16
Cost of Supplies from Jan 2016 - May 2017
Outfitting
New admin
Furniture &
Remodel
$2,500
average per
month
Base Line Run
Chart
Take Away: There is variation of cost
due to new sites opening and
renovations to current buildings.

14. ANALYZE PHASE

15. Systems
staff dislikes
change
Products
multiple
vendors for
better price
Vendors
More than one
vendor to get
best price
Staff is not
happy with
some new
products
Staff dislikes
change
There is not
set policy in
place for
ordering
sending order
request to
supervisor
Staff tries to
order on own
staff shops with
credit card
asks for
reimbursement
People Policies Process
Cost of
products
FISHBONE DIAGRAM
Ghost cell
phones
Take Away: The biggest issues were staff ordering and shopping on their own
and no policy set in place for purchasing.
Biggest issues

16. 5 Whys
Why 1 Why 2 Why 3 Why 4 Why 5
Why? Because
Why
does
staff
order
supplies
on their
own?
Because
they do
not think
they will
get their
supplies
on time..
Why? Because
Why
don’t the
staff
think
they will
get their
supplies
on time?
Because
they are
ordering
last
minute.
Why? Because
Why is
the staff
ordering
last
minute?
Because it
is a habit..
Why? Because Why? Because
Why is
ordering
last
minute a
habit?
Because
there has
never been
any guidance
or
repercussions
Why are there
no
repercussions
?
Because
we’ve
always
done it
that
way.
Take Away: Employees preference is to be able to
order inventory themselves with no questions asked.

17. Root Cause Hypotheses
Hypotheses
#
Possible root
cause
Root Cause Hypotheses Result
1
2
Staff
Staff
Staff orders products
themselves at a much higher
cost then necessary
Staff finds items at stores during free
time and purchases without tax ID
number and request reimbursement
3 Staff Ordering more products than
needed
with no place to store them.
True
(receive invoices)
True
(Reimbursement
papers rec’d from
Finance)
True
(Observations of
Storage Cabinets at
different sites
You can not count on the price of a vendor
for an extended period of time, the price
changes frequently.
4 Vendor Existing vendor was more
expensive than other potential
vendor
True
(Price Comparison
see chart)

18. 0
100
200
300
400
500
600
700
WB Mason Cost Geriatric Medical Cost Price Difference Feb - Apr Avg Qty Est. Monthly Savings
Price Comparison Chart
Take Away: There is a significant price
difference between GM and WB Mason

19. 0
50
100
150
200
250
300
350
400
WB Mason Cost Geriatric Medical Cost
Price Comparison of WB Mason and Geriatric Medical Chart

20. IMPROVE PHASE

21. 2)Data showed phones that were no longer
in use as well as WIFI sticks were still being
paid for. I evaluated the invoice from Verizon
and if no data was used in a 3 month period I
asked for the WIFI stick to be returned and
cancelled the usage.
3)Cost savings, Verizon
= approximately $15,000 a year
4)Termination notice from
HR lets me know to shut off
the now termed employees
phone and collect it from
them.
1)Currently the cell phone is $1,900 a
month. Prior to taking over the invoices
we were at approximately $2,700.00 a
month
QUICK WIN

22. Median: 2904.21
1677.89
1877.89
2077.89
2277.89
2477.89
2677.89
2877.89
3077.89
3277.89
Before
Run Chart: Verizon Cell Phones
After
QUICK WIN
Take Away: If you average the cost savings per month with
VerizonWireless, it comes out to be the amount of the
average mortgage payment.

23. Impact Effort Matrix
Solution Options
1) Change Vendors
2) Purchase
products once a
week
3) Review every
invoice for every
vendor myself
4) Return to using
dishwasher instead
of paper products
IMPACT
High
Medium
Low
Potential
Investments &
Infrastructure
Best Options
Low Priority
Options
Potential
Quick Hits
EFFORT
1
4
2 3
5) Restrict Prime
Accounts
6) Discontinue all
PO Boxes
5
6
Take Away: Controlling the
spending saves $ and saves time
for staff.
7) Discontinue
Paper Products
7

24. Process/Product
Name:Purchasing Supplies
Responsible:Angie ):
Process
Step/Input
Potential
Failure
Mode
Potential
Failure
Effects
SEVERITY(1-10)
Potential
Causes
OCCURRENCE(1-10)
Current
Controls
DETECTION(1-10)
RPN
Action
Recommended
Resp.
Actions
Taken
SEVERITY(1-10)
OCCURRENCE(1-10)
DETECTION(1-10)
RPN
What is the
process step
or feature
under
investigation
?
In what
ways could
the step or
feature go
wrong?
What is the
impact on
the customer
if this failure
is not
prevented or
corrected?
What causes
the step or
feature to go
wrong? (how
could it
occur?)
What controls
exist that
either prevent
or detect the
failure?
What are the
recommended
actions for
reducing the
occurrence of the
cause or improving
detection?
Who is
responsible
for making
sure the
actions are
completed?
What actions
were
completed
(and when)
with respect
to the RPN?
All other
Amazon
accounts
blocked
Angie may
be gone
with need
items
Would not
have what
they need in
time
10
Angie being
gone
6
Angie sends
emails and
texts
2 120
Have Paula be
backup person
Angie by end of
August
2 6 2 24
10
Not planning
ahead 8
no warning
8 640 0
0 0
0 0
0
FMEA Form
Take Away: To ensure no
one is left without supplies
there is a back up plan for
coverage if I am out.

25. To Be Map
Supervisor
send Angie
email with
supply
request
Receive
email from
Site
Manager
Email
vendor
supply
needs
Vendor
receives
order
request
Site
Managers
receive
supplies
Angie
receives
packing slip
Finance
receives
packing
slips once a
month
EmployeesAngieVendorFinance
Take Away: The most important changes for this
process were to eliminate excessive paper flow
and people “touching” the orders.

26. Implementation Plan
Action Item Responsible Due Date
Follow up with site
managers about
hoarding supplies
Follow up with
vendors for price
comparisons
Continue
education of
employees about
savings
Monitor expenses
and review
monthly
statements
Angie Monthly
Angie
Angie
Angie
Every 6 months
Every 6 – 10
months
Monthly
Take Away: Savings is apparent now that the process for
ordering supplies has been streamlined.

27. 0
5000
10000
15000
20000
25000
30000
Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16Dec-16 Jan-17 Feb-17Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17
Began
Ordering
from both GM
and WB
After
Policy
Change
Run Chart
January 2016 - September 2017
Take Away: Since we are still ordering paper products the cost has stayed steady. We have
ordered real dishes for the sites so there will be a huge cost difference soon. If we stayed with
WB, the paper cost would be double what it is now.

28. Total
Supply
Expenses
Before
Total
Supply
Expenses
After
0
5000
10000
15000
20000
25000
Take Away: As you can see the variation of cost after
implementing the purchasing policy. To have one person handle
centralized purchasing is key!
BOX PLOT

29. CONTROL PHASE

30. Monitoring Plan
Response
Plan
Name of
the
measure
Input,
Process,
Output?
What is
the
target?
Method
of data
capture
Checking
frequency
Person
responsible
Upper
Lower
trigger
measure
Who will
respond?
Reaction
Plan
Number
of sites
Order
lead
time
Order
defects
Angie to
order
only
Least
exp
product
I N/A
Record
number
of sites
Yearly Angie
P
O
P
P
To Angie
by Wed ,
PM
100%
Accuracy
100% of
the time
View all
options
Email
time
stamped
on order
Email
from
Staff
Stream
line
process
View all
vendor
sites
Weekly Angie
Weekly Angie
Weekly Angie
Daily Angie
Less than
8 sites
order
Send
request
after
Thurs PM
Return
product
Employee
order own
supply
Invoice
higher
than
normal
Angie
Angie
Email
asking for
order
Email
asking for
order
Angie
Contact
vendor
Cust Serv
Angie
Inquire
reason
with
manager
Angie
Decline to
purchase
with this
vendor

31. Lessons Learned
Communication is key with employees…
Explanation of why: At a managers meeting I informed staff that the main reason for
changing supplies is for the cost savings for the organization. I also explained to them
when they thought the new cleaning agent was to toxic how I pored the product on
a table. Timed how long it would take to dissipate. Within 30 seconds it was gone, no
residue. I rubbed the chemical on my face by my nose and then on my hands to check
for any eye or skin irritation and there was none. I also informed them that this
product is used in a NICU unit. This is an intensive care unit for the sickest babies, if it
is safe enough for this unit then it is what we need for our sites.
EXAMPLE OF WHAT COST SAVINGS CAN DO: This past holiday season was the first
season gift cards were ever given. In January it was the first time raises were given.
Most of all the savings by switching to a new vendor and making changes with
Verizon has a monthly savings of a mortgage payment. A payment for a new facility
for the children in need.
End Result: Explaining the information regarding the safety of the cleaning product
and the usage of the savings earned to the staff made an enormous impact. The staff
could make the connection by having me take the time to explain to them the use of
the savings and that I stopped and took time to investigate the cleaning agent. Most
importantly, the staff knowing that their concerns were heard and will continue to be
heard. Vendor choice reduces spending!
Take time… Explain

32. Questions?

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