Alex Simmonds Yellow Belt Final Presentation

Reduce and Manage Miscellaneous Receipts In The SL55 Warehouse

Yellow Belt Project

Proprietary & Confidential: Property of Greene, TweedFor Internal Use Only

Alex SimmondsHN Warehouse Coordinator

03/10/2016

Define Problem Statement

Miscellaneous receipt adjustments in the SL55 Warehouse have a negative impact on stock accuracy when performed without proper research and add an average of 6 minutes to cycle completion per instance. Baseline data shows that approximately 4200 miscellaneous receipt adjustments were performed in SL55 during the past twelve months (July/2014 – July/2015). Left unchecked, miscellaneous receipt adjustments will negatively impact OTD as well as costs.


Define Background


Normal Process Flow

Deviation Point

This deviation point is the cause of miscellaneous transactions

Measure


Breakdown of All Misc. Transactions

Misc. Receipts comprise nearly 3/4 of all Misc. Transactions.

The scope is narrowed to these transactions

Measure


Over 4/5 of all Misc. Transactions did not give a clear reason as to why the transaction took place

Breakdown of Misc. Receipts

Why are there so many unknown miscellaneous receipts?

Analyze 5 Why Analysis

Why are Miscellaneous Receipts happening?


Surplus material is found

Why is surplus material present?The same material is being pulled from other locations

Why is material being pulled from other locations?There is no information to determine which location SAP will pick first

Why is there no information to show which location to pick from? The picking screen in SAP is not formatted to show First-In-First-Out (FIFO)

Root Cause:FIFO is not being physically followed, causing ‘surplus' material to be found in locations. These found materials are then erroneously Miscellaneously Received.

Hypothesis Statement:If material to be issued is pulled in FIFO order, or Quant order (SAP), then the amount of Miscellaneous Receipts will decrease by at least 75%.


Analyze Root Cause and Hypothesis Statement

Improve

• SAP screen LS26 has been formatted to show Quant information to determine FIFO

• Standard Work Instruction has been created for issuing material

• If a Miscellaneous transaction is required, a description must be added for why it is happening

ImproveResults

Misc. Receipts per Week

Baseline: 80/week (Avg) 07/01/14 - 07/25/15 Target: 19/week (Avg) Pace: 18/week (Avg)

-average reduction of 62 occurrences per week (77% reduction from baseline)(77% reduction from baseline)

Nov. 2-6

Nov. 9-13

Nov. 16-20

Nov. 23-25

Nov. 30 -

Dec. 4

Dec. 7 - 11

Dec. 14-18

Dec. 28-31

Jan. 4-8

Jan. 11-15

Jan. 18-22

Jan. 25-29

Feb. 1-5

Feb. 8-12

Feb.15-19

Feb. 22-29

Grand Total

0

50

100

150

200

250

300

2% above the established target of 75%

Prior to Improvement After Improvement


Improve Results Continued

Base of 80 Misc. Transactions per Week64 of which were unknown

Improvement to 18 Misc. Transactions per week1 of which is unknown

98% Reduction of Unknown Misc. Receipts

ImproveImpact

• More accurate inventory and associated costing• Reduction in excess material ordering from

Kulpsville and vendors• Reduction in cyclecount adjustments• Fewer discrepancies during inventory audits• Estimated hard savings of at least $8,000 per year!


Control Sustaining Improvements

The SL55 Lead will continue to ensure compliance of the standard work for existing employees and train any new employees.

The SL55 Lead will continue to monitor the misc. transactions on a weekly basis for deviations from the set requirements.


Key Learnings

• Creating and Utilizing Pie Charts to analyze data• Creating and Utilizing Process Flow Maps• Understanding and applying Categorical,

Continuous, and Count data.


Special Thanks

James Mikulski & Yvonne Young – Initial training with the concepts of Lean / Six Sigma

Dustin Carroll & Yvonne Young – Coaching and guidance throughout the process

Matthew Bryan – Working with me to keep moving forward on the project despite heavy work flows

John Williams – Helping with setting the scope and attaining the needed data to bring the project together

The SL55 Warehouse Team – Being open to change and performing their best with integrating the proposed changes


Questions


Documents

Alex Simmonds Yellow Belt Final Presentation