Cssgb presentation
- 1. PROCESS IMPROVEMENT PROJECT Improving reporting of defects Presented by – Christine Lorn
- 2. ABOUT PANGEA SILKSCREEN, INC. Silkscreening and Embroidery Company All Orders are 12 Employees Custom Decorates and Buys Blank resells Garments
- 3. Define Measure Analyze Improve Control DEFINE – PROJECT CHARTER PROBLEM STATEMENT Project Name: Reduction of Fabric The issue: Handling of defective goods Project Flaws/Rejects Michele LeSage received and goods rejected after Sponsor: Department: Production and decorating processes. Accounting Process: Screen printing and Embroidery Goods received damaged are occasionally not processed for a credit. In TEAM MEMBERS NAME DEPARTMENT some cases, goods received incorrect are Christine Lorn Independent Consultant even processed through production. Lance Gibson Accounting/Admin Support Laura Traverse Production Manager Excessive time spent on researching inventory discrepancies due to unreported rejects or improperly invoiced orders.
- 4. Define Measure Analyze Improve Control DEFINE – PROJECT CHARTER GOALS AND OBJECTIVES • Improve the process of handling defective goods received as well as defectives produced during printing or embroidery process. • Reduce number of defectives inaccurately reported or not reported at all. Objectives 1. Create accounting and production processes for tracking and differentiating between types of rejects/flaws. Begin tracking and differentiating of types of rejects Reduce errors in invoicing 2. Develop flow charts for handling rejects. Reduce number of defects processed incorrectly. Reduce number of defects not processed for credit 3. Begin regular reporting of rejects. Awareness of cost of rejects and intent to reduce this cost
- 5. Define Measure Analyze Improve Control DEFINE – FISHBONE DIAGRAM Man Production Software Lack of Interdepartmental Fail to properly fill out Sales Limited capabilities due to Communication. Order paperwork Lack of industry specific options Insufficient Training on reporting Fail to return defective goods Limited reporting options Procedures After RA request Insufficient Training on use of Fail to recognize incorrect Accounting software Goods during inspection Complacency due to Tenure Fail to report defectives To Purchasing Department Defect Reporting Errors Fail to use correct GL account Poor lighting in sorting areas Fail to process return request Improper procedure for Lack of organization in Use incorrect GL account for invoicing rejects sorting areas Inventory adjustments Recording shortages as rejects Insufficient documentation of Improperly record return/ When they were received defective Reporting procedures Replacements In Peachtree Fail to include rejects during Lack of organization in Fail to record return/ invoicing Production facilities Replacements in Peachtree Accounting Facilities Purchasing
- 7. Define Measure Analyze Improve Control MEASURE – PARETO CHART Pareto Chart 80 100% 90% 70 80% Contribution 60 70% 50 60% 40 50% 40% 30 30% 20 20% 10 10% 0 0% Inventory Items not Invoiced Fabric Flaws Adjustments Returned Value 73 37 18 9 Cumulative Percentage 53% 80% 93% 100%
- 8. Define Measure Analyze Improve Control FLOW CHART – REPORTING FABRIC FLAWS AND REJECTS Receive and Inspect Blank Process order through Goods proper decorating process. Inspect Finished No Goods. Visible Flaws? Receive and Inspect Replacement Goods. Yes Visible Defects? Time to replace goods before Order Yes Request replacement Due? goods from Purchasing Yes No Department. Fill out Paperwork Fill out SO and and send to No corresponding Defect Invoicing. Report, Send to Office. Notify Purchasing Request Credit Department of from Vendor for defective goods. defective goods.
- 9. Define Measure Analyze Improve Control IMPROVEMENT – CORRECTIVE ACTIONS • Develop process instruction document to formally train production staff on proper reporting procedures for defective goods and rejects. • Create forms for formally reporting defective goods received. • Added 2 new GL accounts for tracking rejects and defective goods in order to monitor lost sales. • Develop written procedures for invoicing with rejects specific to Peachtree Accounting software. • Develop written procedures for processing returns of defective goods. • Train office staff to follow new procedures.
- 10. Define Measure Analyze Improve Control WRITTEN PROCEDURES Pangea Silkscreen, Inc. Pangea Silkscreen, Inc. Written by: Christine Lorn Written by: Christine Lorn Approved by: Michele LeSage Approved by: Michele LeSage Date Issued: 10.15.12 Date Issued: 10.15.12 Subject: Handling of Fabric Flaws and Rejects by Purchasing/Accounting Subject: Reporting of Fabric Flaws and Rejects by Production/Shipping 1. Purpose: To describe the actions necessary to correctly deal with fabric flaws and post-production 1. Purpose: To describe the actions necessary to correctly report fabric flaws and post-production rejects. rejects. 2. Scope: Applicable to Purchasing and Accounting departments. 2. Scope: Applicable to Printing and Embroidery departments. 3. Procedure – Irregular Garments and Incorrectly Ordered Goods: 3. Procedure – Preproduction Inspection: 3.1. Upon receipt of Irregular Garment form – Return Only: 3.1. Inspect blank goods received from distributor 3.1.1. Request RA# and Call Tag for garment to be returned. 3.1.1. Check garment color to SO. Use mill color card if unsure of colorway. 3.1.2. Enter return information into Peachtree using RA# as invoice#, making sure to remove 3.1.2. Inspect for visible defects; rips, stains, irregular seams, irregular sizing, etc. items from inventory (negative quantities). 3.2. If irregular garment(s) is found: 3.1.3. Change item GL account # to 3140400 3.2.1. Fill out Irregular Garment form and submit to Purchasing Department. 3.1.4. Mark as ‘waiting on bill’ and save. 3.2.2. Prepare irregular(s) for return to vendor. 3.1.5. Return call tag to Shipping Department, including RA#. 3.2.3. Mark clearly with RA# provided by Purchasing. 3.1.6. Update Sales Order in Peachtree to reflect new quantities. 3.2.4. Place package on back desk and await call tag. 3.2. Upon receipt of Irregular Garment form – Replacement Requested: 3.3. If no replacement is to be requested, proceed with order with current quantities. 3.2.1. Request RA# and Call Tag for garment to be returned. 3.4. If replacement is requested, hold order until replacement garment(s) arrive. 3.2.2. Print out confirmation for replacement goods. 3.5. If items have been ordered incorrectly: 3.2.3. Enter return information into Peachtree using RA# as invoice#, making sure to remove 3.5.1. Place incorrect items in empty box and prepare for shipping. Place on back desk. 3.5.2. Highlight items ordered incorrectly. items from inventory (negative quantities). 3.5.3. Return PO and SO to Purchasing Department. 3.2.4. Enter replacement confirmation PO into Peachtree using default information. 3.5.4. Hold order for replacement goods. 3.2.5. Return Call Tag including RA# and Replacement PO to Shipping Department 4. Procedure – Postproduction Inspection: 3.3. Upon return of Sales Order/PO including items ordered incorrectly: 4.1. Inspect finished goods after print/embroidery process. 3.3.1. Request RA# for garment(s) to be returned. 4.1.1. Check garment for decoration alignment, Ink fastness, burning/shrinkage, thread 3.3.2. Enter return information into Peachtree using RA# as invoice#, making sure to remove coverage, etc. items from inventory (negative quantities). 4.2. If irregular garment(s) found: 3.3.3. Create Shipping Label for goods being returned using UPS Worldship. Be sure to put RA# 4.2.1. Clearly mark item as rejected on SO. in the reference box. 4.2.2. Place rejected item in test fabric box. 3.3.4. Create new PO for replacement goods. Write new PO# in notes section of SO. 4.2.3. Submit SO for invoicing. 3.3.5. Enter replacement confirmation PO into Peachtree using default information. 3.3.6. Return Shipping Label including RA# and Replacement PO to Shipping Department 4. Procedure – Posting Postproduction Rejects: 4.1. Invoice all items on Sales Order. 4.2. Remove items from inventory on ‘Apply to Sales’ tab (negative quantities. 4.3. Change GL Account # to 3140500. 4.4. Proceed with regular invoicing procedure.
- 11. Define Measure Analyze Improve Control NEW FORMS FOR REPORTING REJECTS Irregular Garment Form Please complete and return to Purchasing Department Item # Color Size Description of Irregularity (Type and Location) Replacement Requested? Yes No PO# SO# Due Date: Reported By: For Office Use Only: Date Rcd: RA# Date Shipped: Replacement PO#
- 12. Define Measure Analyze Improve Control CONTROL How will Pangea be able to monitor effectiveness? An additional report will be added to the End of Month reporting schedule which will be monitored for errors. Most errors in this new procedure will be found during month-end inventory analysis. Future Benefits: Pangea will now be able to track the quantities and values of rejects produced as well as profits lost due to defective goods received from vendors. Less time will be spent on Month-end inventory.
- 13. THANK YOU! Please feel free to ask questions now.