Problem Background:

Philips Respironics is a global leader in Healthcare products. Their Integrated Warehousing & Distribution Center (IWDC) receives orders from global Customer Service teams that support a variety of international Healthcare markets. Deliveries for fulfillment are automatically generated from Philips’ SAP Enterprise Resource Planning (ERP) system, but the communication and delivery date prioritization are manual processes, which result in delays in the release and posting of customer orders. Due to the mix of automated and manual processes, it has challenging to determine accurate metrics for shipping (pick, pack, post goods issue). Accordingly, the primary purpose of this Six Sigma field project was to define, measure and analyze the IWDC International Freight Order Fulfillment processes, and then recommend process changes to improve, and control, the processes in a manner that reduces the time required to ship customer orders while maintaining current levels of accuracy and efficiency.

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Solution:

Define Phase: By interviewing current employees and analyzing preliminary data, the team created a problem and goal statement revolving around the main goal of decreasing the time it takes freight forwarders to retrieve packages at the warehouse, Process maps were also created to breakdown each step in the process.

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Measurement Phase: Key inputs and outputs were defined using the process maps and a data collection plan was devised. Through the use of multiple site visits, internal SAP data, and a custom written MATLAB program to do data extraction/analysis on the data sets the true problem could be easier to identify. Process capability maps were created to assist in the analysis of the large amounts of data.

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Analyze Phase: After breaking down hundreds of thousands of data points into around 300 statistical points, it was determined that the biggest root cause was not the freight forwarders themselves, but the customers taking their time giving all the order information. 

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Improve/Control Phase: Recommendations were given to the distribution staff with protocols to follow for future implementation and data collection. Philips Respironics is currently in the process of applying these changes. 

 

The project was presented to the VP of distribution and upper management so internal processes could begin to be modified. 

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Project Tools: Business Canvas, SIPOC map, Voice of Customer/Business, Swimlane Process Map, Ishikawa (Fishbone) Diagram, Pilot Run Organizing, MATLAB Data Extraction Algorithms, Process Capability Plot,