GMP Manufacturing Kaizen Event

1. Enterprise Excellence
Reduce Temp Management Equipment
Repair and Scrap Expense
Measure/Analyze Tollgate
Karla Mack
Project Manager
February 19, 2015

2. DMAIC Road Map
=Tollgate
Approval
2
Kaizen

3. Agenda
 Project Charter
 Kaizen Team
 Measure
 Analyze
 Improve
 Lessons Learned
 Next Steps
 Sign-Off Decision
3

4. Project Charter
4
Problem/Goal Statement
Core Team Tollgate Review Schedule
Business Impact
 Belinda Cordina Project Sponsor
 Catherine Stemper Deployment Leader
 Karla Mack Green Belt
 Bob Pahl Black Belt
 TBD Process Owner
 Team members, role, % contribution, LSS training
 Jim Fisher, MFG One, 10 %, CIIP Trained
 Ashley Lucci-Vaughn, MFG One, 10%, CIIP Trained
 Dave Rawlings, Marketing, 10%, CIIP Trained
 Jason Price, Finance, 5%, CIIP Trained
 Laticia Wilson, Finance, 5%, CIIP Trained
 Debbie Nicolas, GSC HC Finance, 5%, CIIP Trained
 Becky Hudgins, GSC HC Finance, 5%, CIIP Trained
 Erion Lanier, Quality, 10%, CIIP Trained
 Problem: The total spend of repairing and scraping Temp
Management equipment has increased 19% over the past 12 mos.
with no clear reason as to why and no increase in number of units
serviced.
 In Scope: North America Scrap & Repair Expense for Loaned
Equipment & Purchased Equipment; All cost related to repair and
scrap process; Approval process and criteria for scrapping and
repairing equipment
Out of Scope: All other Ecolab Temp Management equipment
processes upstream or downstream from the repair & scrap process
as defined in this project; Chillbuster Equipment; Changes to our
existing contract with MFG One beyond scrap and repair criteria
 Goals:
 Reduce total spend of repair and scrap expense
 Review/Revise criteria for scrap and repair
 All invoices paid upon completion of approval process/criteria
Tollgate Scheduled Completed
 Define 12/02/14 12/02/14
 Measure 02/13/15 02/19/15
 Analyze 02/13/15 02/19/15
 Improve 03/23/15
 Control 04/20/15
Review high-level schedule milestones
 Define Gate Complete
 Measure Analyze Kaizen Complete
 Potential Savings
 Estimated Type 1 OI Benefits:
 10%-20% ($50-$100K ) reduction in total
spend on repairs and scrap from 2014 to 2015
(Oct 2013 – Sept 2014 total spend: $500K)
 Estimated Type 2 OI Benefits:
 % reduction in FTE time due to increase in
consistency and quality of information received
(Providing opportunities to work on value-add
activities)

5. HUGE Thanks to the TEAM!!!
5
Kaizen Team Members (Left to Right)  Ashley Lucci-Vaughn, Jim Fisher, Laticia Wilson,
Debbie Nicholas, Becky Hudgins, Erion Lanier, Jason Price, Karla Mack

6. DMAIC Road Map
=Tollgate
Approval
6

7. Current State Process Map
7

8. 8
Current State Data
2012 2013 2014 Comments
Total Spend $ 270,085.51 $ 460,415.40 $ 422,685.05
Significant increase
from 2012-2013 due
to increase in repaired
units over 6+ years old
Customer Request
Expense
$ 34,478.09 $ 26,703.13 $ 15,189.12
IntraTemp: 15K –
2014 & 4.6K – 2013
Average Cost: $120
($375 for IntraTemp)
Repair Expense $ 215,239.05 $ 407,595.01 $ 392,081.37 Average Cost: $360
Scrap Expense $ 20,368.37 $ 26,117.27 $ 15,414.56 Average Cost: $40
Note: All figures exclude the IntraTemp business that was transferred to MFG One in late 2013
Analysis Conclusions:
 % Scrap has decrease year over year (-4%: 2012-2013; -10%: 2013-2014) w/
75% criteria
 Average book value at time of scrap is $38.68
 Units driving repair cost are Warmers (ORS-2038, ORS-2057, ORS-2066)

9. Data Supporting Problem Statement
 Critical 1: Significant Increase in Repair Expense over
Past 36 months
 Detail: Repair expense has increased 57% from 2012 – 2014.
 This excludes the IntraTemp business that was transferred to MFG One in late 2013
 70% increase in repair cost from 2012 to 2013 due increase repairs of units 6+ yrs old
 Critical 2: Weak Criteria Around Scrap / Repair Decision
Detail: Current Criteria: If estimated repair costs > 75% of cost of
new unit, the unit is scrapped
 Critical 3: Lack of Visibility To Data / No Reporting Metrics
Surrounding Repair Expense
Detail: No current standardized process metrics
9

10. DMAIC Road Map
=Tollgate
Approval
10

11. Team used fishbone diagram to identify greatest pain
points
11
 Lack of Consistent & Clear Policies (Scrap & Repair)
 Lack of Billing Policies & Training on Customer Driven Cost
 Misuse
 Invalid Returns
 Special Request
 Working Units Shipped Back to MFG One Due to Rep Turnover

12. What We Found
 Units of 6 years old = 15K first year; 70K each additional
 45% = 185K
 # of times repaired = 25K
12

13. DMAIC Road Map
=Tollgate
Approval
13

14. Solution Generation & Results
14
Process Scrap Customer Request Repair
Assign process owner to own
metrics, reporting, master data
Scrap if 6+ years old Begin tracking these request
through MFG One reporting
Standardized questionnaire for CS
and Sales to use to troubleshoot
units
Redesign the monthly reporting
from MFG One to ensure process
control
Scrap if previously serviced twice
Scrap if Basin needs replaced
Scrap if repairs exceed 45% of the
value of a new unit

15. Future State Process Map
15

16. Business Impact
 This is a Type 1 savings project
 Cost savings for scrap 6+ years
 Year 1 savings $15k
 Subsequent year savings $70k
 The project determines clear criteria for scrap / repair decision making
 Scrap units > 6 years of age
 Scrap returned units that have been previously repaired twice
 Scrap units with basin damage
 Scrap units whose cost to repair > 45% of new unit cost
 Defined metrics enable process owners to have the data they need to
approve invoices and provides quality control.
 Metrics provide data to support marketing business decisions around
customer management.
 Customer Service and Sales Reps troubleshoot using a standardize
questionnaire
Financial
Process

17. Pilot Plan
Pilot Test Description Success Criteria Test Team Schedule
Redesign the daily
reporting from Ecolab
Add # of times
repaired and mfg
date
Test 5 units to verify
data corresponds to
the correct unit Erion, Karla, Becky 2/23-2/27
Reps/CS
troubleshooting w/
customer using
questionnaire
Test question are for
flow and make sure it
is a appropriate line
of questioning
Rep focus group (3-5
reps of sales mgt) Dave Rawlings 2/23-3/11
Metrics & Reporting
How are metrics
measured and
reported monthly?
What will they look
like? How will they be
calculated?
Validate calculations
of agreed upon
control metrics Luke, Erion 3/2 - 3/18
Redesign the monthly
reporting from MFG1
Finance and service
detail: addition of age
of unit, # of times
repaired, type of
service
(repair/customer
request/scrap)
equipment class,
unconfirmed/confirm
ed; nature of service
Test 25 units to verify
data corresponds to
the correct unit Erion, Karla, Becky 3/11-3/18
17
Pilot status will be communicated to team and stakeholders weekly – Owner: Karla Mack

18. Action Plan
Action Who Complete Status
For MFG1 provided data, we will need Kathy T. to modify
her monthly repair report Ashley/Jim 18-Feb
Dave, Erion, Karla to develop questionnaire for marketing Karla 19-Feb
Verify R&D about the need for component trending Karla 19-Feb
Review financial numbers with Ross Laticia 19-Feb
Find out the process and timeline for updating agreement
btw Ecolab and MFG1 – Follow-up w/ Legal Karla 23-Feb
Hold meeting w/ stakeholders to establish process owner Karla 25-Feb
Verify Invoice Approver (Process Owner?) Karla 25-Feb
Have Liesel write script to get # of times unit is repaired and
manufacturing date on daily report to MFG One Dave 27-Feb
Hold meeting to establish metrics calculations Karla 27-Feb
Create part drop down list for MFG One reporting Becky/Jason 27-Feb
Create nature of service drop down list for MFG One
reporting
Erion/Process
Owner 27-Feb
18
LEGEND
Green = On Track
Yellow = At Risk
Red = Behind Schedule
White = Not Started
Blue = Complete

19. 19
 Marketing & Sales
 Customer Management Opportunity
 Units being returned that do not need to be returned
 Customer misuse of equipment
 Customer special requests
 Rep Turnover
 R&D
 Opportunity to upgrade frequently failing components
 Quality
 Process for approval of special request
Identified Future Efforts

20. Lessons Learned
 Process performance metrics need to be monitored, tracked
and shared with Leadership, Department Personnel, and
Stakeholders
 Every process NEEDS a process owner to maintain evaluate
if the process is in control
 Kaizens are intensive and require full engagement from all
team members, so having a complete focused team
increases the odds of having success

21. Sign Off
 I concur that the Define phase was successfully completed on 02/19/15
 I concur the project is ready to proceed with pilot implementation and can
officially move to next phase: Improve
Catherine Stemper
Deployment Leader
Ross Michalson
Finance Representative
Bob Pahl
Project Coach
Belinda Cordina
Sponsor

22. Next Steps
 Team will continue to implement action plan
 Pilot plan with start Monday 2/23 with first status update on
3/02
 Karla will schedule a meeting with stakeholders to
establish future process owner

23. Appendix

24. Cause and Effect Diagram
Gaps:
 Standard metrics were not determined
 Lack of Policy to bill for equipment misuse
 Times when units are not returned to MFG One
 Times when units are shipped back and do not need repairs
 Incomplete rep training and procedures
 Unconfirmed complaints
 Rep turnover possibly leading to units being returned

25. FMEA
Process Step /
Input
Potential Failure
Mode
Potential Failure
Effects
Potential Causes Current Controls
Actions
Recommended
Resp.
What is the process step
and Input under
investigation?
In what ways does the
Key Input go wrong?
What is the impact on
the Key Output Variables
(Customer
Requirements)?
What causes the Key
Input to go wrong?
What are the existing
controls and procedures
(inspection and test) that
prevent either the cause
or the Failure Mode?
What are the actions for
reducing the occurrence
of the cause, or
improving detection?
Redesign the
monthly reporting
from MFG1
Inconsistent model
numbers
preventing data to
line up properly
Manual Process None
Identify uniformed
part list and use
that list on each
report
Becky and Jason
to develop list and
provide drop
downs in reporting
Redesign the daily
reporting from
Ecolab
Changes in
queries SF.com
may introduce
error
Invalid data
Human error in
query design
None
Piloting the
creation of the
report
Liesel to write
query, Erion to
test report output,
Karla to help Erion
design test plan
Enforcing Scrap
Criteria
Customer units
sent in that work,
but meet criteria
and is scrapped
Scrap perfectly
good units
Nothing to monitor
customers
sending in units
because they want
new ones
None
Reevaluate scrap
criteria annually
Team to add
reevaluating
criteria annually to
recommendation
Reps/CS
troubleshooting w/
customer using
questionnaire
Condition of unit is
relative and
CS/Rep may not
be able to get out
to the location to
evaluate in person
Working units get
sent back for
repair and don't
need to
Rep/CS are
unable to align
with opinion of
customer
None
Questions are
clear and the
reps/cs are
properly trained on
how to
troubleshoot
Dave, Karla, Erion
to develop
questions; Dave to
develop training
plan for reps and
Erion to develop
training for cs

26. 26
Pilot Communication Plan
Audience Purpose Media Topic of Discussion Owner Freq.
Team Members
Update on progress
on the pilot
Weekly Email on
Progress complete
with red, yellow,
green status
Pilot progress, remaining
action items, barriers and
road blocks if applicable
Karla
Mack
Weekly
Project
Stakeholders
Groups
Update on progress
on the pilot
Weekly Email on
Progress complete
with red, yellow,
green status
Pilot progress, remaining
action items, barriers and
road blocks if applicable
Karla
Mack
Weekly
Belinda Cordina
(Project Sponsor)
Update on progress
on the pilot
Weekly Email on
Progress complete
with red, yellow,
green status
Pilot progress, remaining
action items, barriers and
road blocks if applicable
Karla
Mack
Weekly