APPLICATION CASE STUDY FOR SELECTION OF SIX SIGMA PROJECTCompany XYZ produces machines that are used as a major component of industrial equipment. The company’s annual sales

turnover is RS.250 million. It has a complex product-line and makes customizations for customer segments and Original Equipment Manufacturers (OEMs). One- third of its products are exported and the remaining used in the home country. The company enjoyed a leading position for many years but competition has started showing significant presence now. Company decided to carry out six sigma study. The initial survey was carried out to know the Voice of customer & Voice of Business & these are as follows-

The Voice of the Customer ( VOC)

During customer interactions and surveys, the input that were received are listed here: Customers are generally happy about the product performance and service network. They are concerned about lower availability of products when there is a failure. They have informed OEMs that they prefer XYZs machine as these are cheaper then competitors’ machines. OEMs are finding that the cost of machines as a component of total equipment cost is about 15 percent. OEMs find that it takes a long time to select machines and launch new models. Competitors are introducing new models

constantly.

The Voice of Business ( VOB)

Company spends approximately 3.7 percent of the sales revenue on the warranty of products. Inventory turns of the company for the last fincial year are 3.5. An average delivery performance is 84 percent. Primary reasons for the delivery misses are shortage of parts at the time of assembly; surprises during the assembly of machines of some of the specified parts required for customization do not fit; parts that are shown as available in the information system are physically not available. Sixty – four percent of the suppliers are third party certified to ISO 9000. The company has implemented ERP system two years back and is finding it tough to manage the process using the system.

1. Analyze the VOC & VOB & suggest the improvements strategies that management should chockout.2. Based on the strategies convert VOC & VOB into Critical To Quality(CTQs).3. Prepare the project Charter