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Lean Six Sigma Process Improvement Results:
Reducing Mail Packaging Time From 415 to 96 Minutes

Tune in to find out how Jared Church & Franklin Garrett from UC San Diego used Lean Six Sigma to significantly reduce mail packaging time from 415 to 96 minutes!


Project Summary

Reduce the lead time in final letter production process to ensure that customers receive their notice at least 10 days before their account is sent to collections.

Problem Statement:

Based on analysis of run time for the production of final notice letters, customers are not receiving final notices in a timely fashion.

Business Case & Benefits:

On average, the University pays an 18.5% premium for collection services. During the 2017 calendar year, accounts were assigned to collections at an average of 13 days from the time the letters were sent. The opportunity is to reduce packaging time to allow more time for customers to receive their letters and respond.

Check out their Executive Summary here.

We were able to show that our final letters were being mailed in time to guarantee delivery no later than the first of the next month. And we estimated our savings to just over $12,000 which we are recognizing through reduced collection fees, supply and mailing expenses, reductions in transportation motion and over production as well as our waiting and the use of talent that we didn’t need to be using.


Define Phase: Identify the Problem

The Define Phase is the first phase of the Lean Six Sigma improvement process. In this phase the project team creates a Project Charter, a high-level map of the process and begins to understand the needs of the customers of the process.

This is a critical phase in which the team outlines the project focus for themselves and the leadership of the organization.

Now, our project, it’s focused on key element on what we do in accounts receivable which is to create and distribute what we call final collection notice letters. Now, this is a critical part of our due diligence process at the university. It’s our formal notification to our customers that their accounts are being reassigned to a collection agency.

Check out their completed Lean Six Sigma Tools: SIPOC, Voice of the Customer, Spaghetti Map, Swimlane Map, Project Charter


Measure Phase: Quantify the Problem

How does the process currently perform? Or in other words, what is the magnitude of the problem? Measurement is critical throughout the life of the project. As the team starts collecting data they focus on both the process as well as measuring what customers care about.

That means initially there are two focuses: reducing lead time or improving quality. In the Measure Phase, the team refines the measurement definitions and determines the current performance or the baseline of the process.

So our business systems analyst – actually, all people involved in this step, it was very easy for them simply to start the clock when they started their process and end the clock when it ended. And so, we tapped each of them with oversight to take those measurements and show us the data after the fact which in turn, ended up validating what we believed that they were just significant delays.

Check out their completed Lean Six Sigma Tools: Run Chart, Data Collection Plan


Analyze Phase: Identify the Cause of the Problem

The Analyze Phase is often not given enough attention and, without analysis, teams jump to solutions before knowing the true root causes of the issues. The result is teams who implement solutions but don’t resolve the problem! These efforts waste time, consume resources, create more variation and, often, cause new problems.

The ideal is for teams to brainstorm potential root causes (not solutions), develop hypotheses as to why problems exist and then work to prove or disprove their hypotheses.

Verification includes both process analysis and data analysis and has to be completed before implementing solutions. This is the crux of the Analyze Phase!

As we started looking for causes, we really focused on the areas of people production, whether or not the process is defined, physical machineries, process defects, and then others. What we really decided to focus on in our people area was the fact that because so many people were involved, there were a lot of shifting priorities, going from the data collection, letter production, physical stuffing. I mean there was just too much happening and everybody was doing things on their own timeline.

Check out their completed Lean Six Sigma Tools: Root Cause Hypothesis, Fishbone Diagram,


Improve Phase: Implement and Verify the Solution

How will the team mitigate the root causes of the problem? Once the project teams have determined the root causes it’s time to develop solutions.

The Improve Phase is where the team brainstorms solutions, pilots process changes, implements solutions and lastly, collects data to confirm there is measurable improvement.

A structured improvement effort can lead to innovative and elegant solutions that improve the baseline measure and, ultimately, the customer experience.

The key takeaway here is that we showed positive improvement. We were able to reduce our median time significantly, 415 minutes down to 96.

Check out their completed Lean Six Sigma Tools: Improved Spaghetti Map, Improved Swimlane Map, FMEA


The training was amazing and that it gave us the tools and the communication skills necessary to really articulate the benefits of this process and help them see.

Jared Church
Associate Director, Student Business Services, UC San Diego

Control Phase: Maintain the Solution

Now that the process problem is fixed and improvements are in place, the team must ensure that the process maintains the gains.

In the Control Phase the team is focused on creating a Monitoring Plan to continue measuring the success of the updated process and developing a Response Plan in case there is a dip in performance.

Once in place, the team hands these plans off to the Process Owner for ongoing maintenance.

Our control plan in our process measurements, we’re going to – we can measure when the letters are created. We can measure how long it takes these letters to be printed, folded, stuffed, and bound. And the output is when these letters – are the pickup happens with our mail services?

Check out their completed Lean Six Sigma Tools: Monitor & Response Plan, Control Plan, Visual Management Checklist,


A Sneak Peak Into the Full Success Story Webinar:

Tracy O’Rourke: Yes. So, really great project. I loved hearing about your project. I love the tools you used. I love the spaghetti chart and the FMEA and your SIPOC. So one of my favorite things about this is really just honing in on waste and removing it, identifying where it’s occurring and then just getting – finding the root causes and getting rid of it. And you guys got some really good savings too in terms of projected savings. So great job on the project.

Franklin Garrett: Thank you.

Jared Church: Thank you.

Tracy O’Rourke: So, I do have a couple of questions. What is the most challenging part of your project?

Franklin Garrett: For me, the most challenging part is – so we took the Lean Six Sigma training, right? So one of the main things I learned in this training was voice of the department versus voice of the customer. So when we came back to our department and we have this project, the thought process of staff which is like the voice of the department.

So the challenging part for me was trying to get them to see that it’s all about the customer experience and trying to get out of thinking the impact to the actual department and think the steps for the actual customers.

Jared Church: Yeah. I think we work in an environment that has a really strong and ingrained culture. Employees who have been here for many, many years, great employees who were experts at what they do, but really trying to dig in and analyze these processes felt a little bit uncomfortable, right? There is a little bit of fear I think. And I would say that that was certainly a challenge to overcome.

The training was amazing and that it gave us the tools and the communication skills necessary to really articulate the benefits of this process and help them see. And it was interesting as we were going through and interviewing people, running through these tools, creating these visual aids and sharing that with our team, it was really cool to see the light bulbs come on. And wow! I can’t believe that we’re paying that much and why did it take this long versus this long. It was a really fun element while challenging at the same time.

Tracy O’Rourke: Yes, definitely. So you guys were both graduates of UC San Diego’s On-Site Lean Six Sigma Green Belt. Congratulations! And this was your project. So how has completion of this project impact how you both look at things?

Franklin Garrett: Well first off, it really trickle down to our staff. We have a staff of 13 staff members and all of them by the end of December will have Yellow Belt training. So just us going through it and like leading the charge really trickle down. And also, we’re looking to have weekend expense. So Jared and I looking into Black Belt and see – really to answer your question, what really motivated us in as far as the – to learn even more and bring that back to our department.

Jared Church: I think it just opened our eyes to the fact that it’s OK to look at current processes and ignore the fact that things have been done the way they’ve always been done and come in with fresh ideas, new tools, different ways of looking at how we manage our business, and using those tools to just identify opportunities for improvement and streamlining.

Money saved is money earned, right? And the less time that we’re spending on processes that we can streamline means we have more time to focus on those real value-add projects, the ones that are really going to catapult us to the next level.

The fact that we focused on mailing, it seems like such an insignificant part of what we do. But we were able to show the impact just across the organization as a whole. Forget about the $12,000. When you look at the customer and the impact that a delayed letter could have on someone’s life, I mean it was really significant. It has really opened our eyes to start looking at everything that we do differently. Try to identify everything that we can do quickly and turn it around and show some real improvement. So, we’re really excited.

Tracy O’Rourke: Well, that’s awesome. OK. So I had – I just have one last question. And that is, if you were going to give someone advice on a Lean Six Sigma – a person who is just starting to get educated and applying process improvement in an industry like yours, what would you tell them? What would be some advice you would have?

Franklin Garrett: I think similar to what Jared was talking about. It’s just that any process can be improved. I think like when I first went into it, I was thinking, I kind of got to the point where I was like overwhelmed with everything that’s going on as far as I know this is a big project in our office that I can tackle. I have no idea how to tackle it. Am I going to have the support from my peers and from the technical side?

But what I learned is that you can pick any process and streamline it. So any process that you have, you can pick a component of that and make it more streamlined so you don’t have to go in and try to pick up the biggest pain point. You can pick something up that’s more reasonable, that you have complete control over. And like Jared said, you take one small process in our office and improve it can have a big impact.

Jared Church: Yeah. Some advice I would give is not to let the material overwhelm you. I remember the first couple of weeks in class looking at the website and all of the templates that are there, my head was swimming a little bit, right? How much am I supposed to use? What am I supposed to use and when?

And the advice I would pass on is one or two pieces from each step, it may be enough. It just really depends on what the process is. So take it slow. Absorb what you can. And put it into practice. Come back after every one of your classroom sessions and try to apply it to what you’re doing. Think about how it could fit in and the tools that you could use. And I mean the Go Lean Six Sigma website and the templates there, those are a favorite now on my webpage because I want to be able to access them quickly.

So again, my advice is use what’s available but take your time and don’t let it overwhelm you.


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Success Story Transcript

Tracy O’Rourke: Hello and welcome to our Success Stories Webinar hosted by GoLeanSixSigma.com. My name is Tracy O’Rourke and I’m a Managing Partner and Executive Advisor at GoLeanSixSigma.com.

We are very excited to have this offering for our learners because this is where the rubber meets the road. This is when we talk about real projects that have been implemented within an organization and we get to share these stories with you.

So today, we are highlighting a great success story from UC San Diego presented by Franklin Garrett and Jared Church. It’s called Reducing Mail Packaging Time From 415 to 96 Minutes. That sounds like an awesome project, doesn’t it? I thought we’d go to the next slide so I can tell you a little bit about our presenters today.

About Our Presenters

So Franklin Garrett is an Assistant Director at the Student Business Services Department at UC San Diego. He oversees the Student Account Services Unit including Customer Service and Student Accounts Receivable. He has ten years of higher education experience in the areas of counseling, advising, student services coordination, and student account services. Franklin has a Master’s Degree in Education with an emphasis in multicultural counseling from San Diego State University.

Jared Church is an Associate Director from Student Business Services. He has been serving as an Associate Director for the past three years at UC San Diego. He enjoys spending time with his family as I do and talking about movies. He earned his MBA from the University of Phoenix and has been working in higher education since 2002.

Welcome Franklin and Jared!

Jared Church: Thank you.

Tracy O’Rourke: So, let’s – I’m going to turn it over to you guys so you guys can share your projects.

Mail Express

Jared Church: All right. Well, we’re excited to be here talking to you today about our project, we lovingly titled Mail Express.

About Us

Franklin and I work for an organization called Student Financial Solutions and we are made up of four separate units. We have our Central Cashier’s Office which handles really everything cashiering related, some of the highlights or current exchanges, petty cash reimbursements, physically processing cash and check payments to the university.

Our University Billing Services Unit is primarily responsible for managing our tuition installment plan, dealing with entity billing as well as student billing, delinquent account management, and departmental invoice processing.

Our Loan Administration Office manages our cohort default management. They also handle all of the financial advising and counseling that’s related to institutional loans in addition to the collection on those institutional sources of funding.

Our Student Accounts and Campus Cards Unit, they also deal with student account billing and collections as well as all of the customer service related to those functions. They manage the issuance of refunds from student accounts and they provide all of the campus ID cards for both students and staff here at UCSD.

Executive Summary

Now, our project, it’s focused on key element on what we do in accounts receivable which is to create and distribute what we call final collection notice letters. Now, this is a critical part of our due diligence process at the university. It’s our formal notification to our customers that their accounts are being reassigned to a collection agency.

Our business case was founded on the premise that our mail time or our mail lead time is just too long. It’s taking us too long to get these letters produced. And in turn, it’s delaying our student’s receipt of those letters and allowing them enough time to properly take action.

Our root cause analysis showed that we have opportunities to reduce production, decrease motion, remove variation, as well as decrease our lead time. We found that we have unnecessary personal involvement, inconsistent process steps, and a lack of process coordination.

In addition, we also identified that we were paying unnecessary cost just to have these letters mailed and service.

So the solutions that we implemented in our project were establishing a firm monthly date for letter production. We completely removed one of our analyst level employees from the printing process. We stopped producing unnecessary letters and we eliminated unnecessary letter sorting.

The overall results of our project, we were able to reduce our median cycle time for packaging from 415 minutes to 96 minutes. And that’s all counted in business time, business minutes.

We were able to show that our final letters were being mailed in time to guarantee delivery no later than the first of the next month. And we estimated our savings to just over $12,000 which we are recognizing through reduced collection fees, supply and mailing expenses, reductions in transportation motion and over production as well as our waiting and the use of talent that we didn’t need to be using.

So the key takeaway from this is that our project was a success. We were able to ensure customers receive their final notice letters in time to respond before they are actually sent to Collections. And we also improve our cycle time by removing those unnecessary wastes.

Waste Removed

Franklin Garrett: Here’s the list of the wastes that we removed. Going into the project, the first thing that jumped out of our mind is that it was going to be cost saver, which it ended up being a cost saver but we didn’t realize how much waste that we were going to be able to identify and to remove.

Some of the wastes that are listed here is transportation. We had excessive letter transportation during delivery to stations. We had people taking letters to multiple stations.

We had unnecessarily person motion. We had a staff member going through different stations to deliver letters.

Overproduction. We had a whole section of third party letters that were being produced only to be turned around and shredded by staff member. There was no need to even produce these letters.

Waiting. We had unnecessary lead wait times between letters being printed and assigned to a staff member. A lot of times, the letters were printed and sit on somebody’s desk until they noticed it and then hence, started the process.

We also have waiting between a letter completion time and then letter picked up by mail. So what we started to do is to make sure that we had that planned out the day before so we can coordinate our mail services.

Underutilized talent which is what Jared spoke to. Yeah, multiple FTEs that were involved from the production process that’s better suited for student employees or other lower level staff members.

SIPOC

Here is our SIPOC showing our suppliers, inputs, process, outputs, and customers. As you can see, the customers or the suppliers are our customer processing team, production team, and mail services.

The actual input is the PDF letter that was produced.

So our process, the start is to pull and correlate the data that’s required to produce the letters. Once the letters are produced, they are printed and then we have them sorted by removing third party letters. And then from there, it gets sorted, folded, stuffed, and bound. Then we schedule pickup from the mail services to pick up the letters and then the letters are mailed to our customers.

Our final output is the final notice letter if our customer or the student that we are sending the letters to.

Voice of the Customer

Voice of the customer. So voice of the customer is interesting for us because these are customers that are typically hard to get a hold of because these are customers we already been communicating about a past due debt, two monthly letters and emails that go out. So we really – to get the voice of the customer, we have to get real creative.

So what we did is we have about 15 student employees that work in our office. So we surveyed them to get the voice of the customer. Some of our other campus partners utilize students so we explain what our project is and what the past two letters and the final notice letter was and then we got feedback from them.

Some of the feedback that we got was that of course, as we talked about earlier, the final notice letter would be received too close to the collection date. Imagine getting – you’re having your account go to Collections and you get a letter after your account is already in Collections. That can be a really frustrating thing.

The letter doesn’t mention the temporary payment option. So actually, there’s – we have an option in our office where they can sign up for a temporary payment plan which will also avoid account going into Collections.

The letter doesn’t have my collection due date. It list first of the month of the next month. The letter doesn’t list a specific contact person. We have a generic – just our general number and our general email box, our email box on the actual letter. So what we talked about for the voice of the customer is to make it more personalize and give them a specific person to contact.

Current Spaghetti Map

So this spaghetti map, this is actually like one of my favorite activities that I did in this project was really mapping out the motion and the transportation. So I guess you can see purple or blue. I start out at one staff member’s office. The letters are – from her computer, she generates and starts the print job. After those letters are printed, she walks over to the printer. At the printer, she is picking up the letters and also she is sorting out the third party letters.

Our #2 is where she is actually dropping the letters off that don’t need to be – the third party letters that don’t need to be part of our process.

The person that sits in area #3, all she does is shrink those letters. She doesn’t even do anything with them.

From there, the letters that we actually do need to mail get taken to our pit, our customer service center where we have the production start. So we have from #4, as you can see, that’s where all the letters get dropped off. From there, those letters are taken into another room to be sorted.

And then at #5, it’s taken to another area to be folded then it’s also taken to a second – third area to be stuffed.

So we have three different stations with three different tasks instead of having everything done in one place where we’ll go into a little bit deeper in our presentation. As you can see, there’s a lot of unnecessary motion and a lot of unnecessary movement in the process.

Current Swimlane Map

Here is our current Swimlane map before we make the changes. So as we talked about before, the delegates correlated, produced the PDFs, an email notice goes out saying that the letters are ready to be printed.

The processing team, this is the individual that were later going to move out the process but she prints or the staff member prints the letters, removes the third party, delivers the third party letters, and then delivers the other letters that’s actually going to be folded, stuffed, and bound.

When she drops those letters off down where our customer service team, that’s where the actual action occurs, the stacking, folding, binding happens there. And then from there, it gets – the mailing mail pickup gets scheduled. And then the last stage, mailing services unit on campus comes to pick up the letters.

Root Cause Hypothesis

So our root cause hypothesis. So one of the things that we really thought – we really thought there’s going to be a lot of mistakes in that process that’s causing the delay. So we thought that there are going to be too many defects in the folding and stuffing and binding process. We found that there weren’t many mistakes in that.

Really what it came down to was the overproduction, the motion, and the waiting time that contributed to our lead time. So that was surprising to us. We thought it was actually mistakes being made during the actual production, which it wasn’t.

So the key takeaway here is that we had no methodology on how to process the final notice letter. There’s a significant amount of variation in our process and unnecessary delays in the production.

Fishbone Diagram

Jared Church: So another tool we use through the analyze phase was the fishbone diagram. And so, we started with the presumption that our customers are receiving these letters too close to the first of the month.

As we started looking for causes, we really focused on the areas of people production, whether or not the process is defined, physical machineries, process defects, and then others. What we really decided to focus on in our people area was the fact that because so many people were involved, there were a lot of shifting priorities, going from the data collection, letter production, physical stuffing. I mean there was just too much happening and everybody was doing things on their own timeline.

In the production area, one of the things we wanted to change was timely mail pickups which led us to really focusing and being proactive about scheduling when these letters should be physically picked up.

It was very obvious to us that we had just way too much variation on the process all the way from the day that it’s done every month to who is involved. It was just – it was a lot.

The process defects that we really identified again, there are too many people involved and just too many steps. So this really supported our root cause hypothesis and helped us really focused on the areas that we were going to be able to change.

Project Charter

Our project charter was fairly simple. We completed an analysis of our runtime and based on that analysis, we were able to effectively identify that our customers are just not getting these letters in a timely fashion.

And our goal statement was to reduce the lead time in final letter production. So that our customers were getting these letters with at least 10 days to take action before their account was being to Collections.

When we were looking at the scope, I’ll start with out of scope. We realized that we can’t change the letter creation process. It just wasn’t something we were going to be able to do inside of this process or this project. Our data analyst, he does things very systematically and modifying that would have been a real challenge.

We couldn’t modify the due date on the letter. Unfortunately, the system that we use to generate these letters is a bit archaic and a little inflexible.

And the other thing we realized we couldn’t change was actually changing how our mail department processes mail. So these are all the obstacles.

So what is in scope is how we use our current staff resources at effecting changes to the process and printing, sorting, folding, and stuffing. On average, the university pays about 18 and a half percent for collection services. During the 2017 calendar year, we assigned accounts to Collections at an average of 13 days from the time the letters were actually sent. So that was kind of our window, right? We knew that we had to be well inside of that 13-day mark to achieve our goal.

The opportunity was obvious which is to reduce the packaging time to allow more time for the customers to get those letters and respond. And we also identified that if we sent only 5% less to Collections last year, we would have saved just over $6,900 in revenue, which is $6,990 may not be a whole lot but when we’re talking about something that’s just easy to change as folding and stuffing, that number is big.

Our key takeaway from this is that we simply have the opportunity to reduce the amount of money paid to the agencies through cutting our packaging time and maximizing how much time we have to mail those letters.

Data Collection Plan

So in our measure phase, we created the data collection plan. And we focused on four areas. So how much time it takes to gather the data and prepare the letters, how much time it takes to print and presort the letters, sorting, folding, and stuffing them and then the physical time to move.

Now, all four of these elements are all continuous measurements and we measure them in minutes. So our business systems analyst – actually, all people involved in this step, it was very easy for them simply to start the clock when they started their process and end the clock when it ended. And so, we tapped each of them with oversight to take those measurements and show us the data after the fact which in turn, ended up validating what we believed that they were just significant delays.

Total Packaging Time

So this is a representation of our total packaging time before we implemented our solution. We measured this going from March of ’17 all the way through February of ’18 and that green line represents actual time. It represents how long it took each of those months to start to finish get those letters mailed out. And you can see the variation is staggering. It’s significant. Our worst number being just over 1,400 minutes where – and then conversely, we can be as low as just under 200 minutes.

Looking at this data, we were able to identify that our median time should be around 415 minutes based on this data. And so the median is what we are using to project and focus on our solution.

Improved Spaghetti Map

Franklin Garrett: So here is a before and after of our process flow toward the production of the letters. As you can see, before we had a couple of pit stops before we got to the station to actually fold, stuff, and sort the letters.

So in the right-hand side, what we ended up doing is we had the – since we removed one of the analysts out of the process, we started with the person who is actually responsible for managing the folding, stuffing, and sorting. So that person in a new process is the one who prints out the letters and once she prints out the letters, she just walks them over to a station that’s already set up for all the folding, stuffing and sorting. The folding machine in this section, all the letters are already in this section. Everything you need to fold, stuff, and sort is in one area.

So after the folding and stuffing is done, we have a bin there as well. We take that right over to the mailbox. So it went from 8 different pit stops to just 2 which was staggering after I saw it.

And so the key takeaway here is we streamline the workflow with this person’s transportation and material motion.

Improved Swimlane Map

Here is our improved Swimlane. Very similar to the one we had before but instead of three different lines here – I mean instead of four, it’s three because we removed a person from the process. So it’s the same flow but now, the actual printing in the letters is done by customer service team instead of our processing team.

So from that step, just print the letter, deliver the letters, fold, stuff, bind and schedule a mail pickup. All that is done by one person who is responsible for the project – for the process. And then our mail services picks up the letters at the end of the process.

Process Comparison

Jared Church: So this is the box in which it kind just represents the comparison of data. Unfortunately, we weren’t able to get in and measure three full runs before we had to close the project out. But even in those three runs, you can see the difference in time is staggering. The key takeaway here is that we showed positive improvement. We were able to reduce our median time significantly, 415 minutes down to 96.

Over time, we should continue to see reduction in overall median processing time as long as we are effective in this, and which we are very confident that closely monitoring this process every month, we are probably going to be able to get that median time even lower. We had a varying data point, one of the three months, we were over 600 minutes which we identified as just a breakdown in the frontend proactive process. We didn’t have a production meeting that month but the two months where we did, we were on point and we were well below the median of even 96. So again, we’re extremely confident that this improvement, we will be able to – be maintained without a problem.

FMEA

All right. So, the Failure, Mood and Effects Analysis that we did, we really chose to focus on having one person manage the printing to pick-up process, start to finish. An email gets generated. This person recognizes that email and print it. So the failure points here, letters not printed in timely fashion, folding not immediately assigned, no early mail pickup schedule. These are all controllable things. And you can see we were able to reduce the RPN significantly in all three areas.

Focusing closely on pre-assigning the duties to coincide with the production calendar in advanced is really going to be the critical piece at the beginning of the process to ensure ongoing timely processing and mailing of these letters.

Monitor & Response Plan

Here is our monitor and response plan. So, we’re going to have a pre-run discussion. We’re going to schedule the mail pickup in advanced. Focus on the data development, printing, folding, and stuffing. We’ve got three inputs, one process, and one output here.

So really, our reaction plan is we’re going to monitor the pre-run discussion. We’re going to be proactive. Looking at the calendar in advanced. We’ve got a response plan in place for everything. And really, this falls on Franklin and I to manage because the employees responsible for this process reports directly to us. This response plan should be very effective in identifying the actual breakdown point which will make it really quickly and easy for us to respond and get things back on track.

Control Plan

Our control plan in our process measurements, we’re going to – we can measure when the letters are created. We can measure how long it takes these letters to be printed, folded, stuffed, and bound. And the output is when these letters – are the pickup happens with our mail services?

Again, real strong oversight of this should be very easy. This control plan as well as our monitor and response plan, we’re going to be able to pinpoint exactly where the process broke down, who is responsible, and quickly take action to make changes and resolve that.

Visual Management Checklist

Franklin Garrett: Here’s what the visual checklist that we implemented to make sure we keep our cycle times down. So what we do is scheduling. So one big piece that we learned from the variation in the process is that there just was not any more thought to the production. So basically, we should have a date every month that is consistent where we know the process is going to run.

And so, for our first part of the checklist is we have, have you assigned a student employee to perform the task? So we have that right off the bat that you have somebody actually scheduled to do the task the day before.

Pre-scheduled mailing services to pick up the letters. So now that we know that everything can be done within a day as long as we have the resources, we learned that we should definitely schedule mailing pickup services the day before we’re confident that we’re going to be able to get the letters produced before mailing comes to pick up the letters.

So another check that we do for our working stations is printer functionality, making sure that the printer has ink, paper, the folding machine is working correctly, making sure there’s enough envelopes, rubber bands.

And then I’d go as far as the work station. The folding machine is actually in the station. Before on the first spaghetti map, the printer was within one area, the folding machine was in another area, the actual letters were in another area. So checking to make sure that all – everything that you need is in the work station so that’s the one area that you’re going to be in when producing the letters.

Projected Saving

So for our hard savings, we reduced mailboxes of 5 to 2. So what we noticed – another thing that came up during this process is that we learned that we have 5 different mail codes and we’re being charged monthly rate for the 5 different mail codes and we’re only actually using 2 actively. So that’s just like a side thing that came up from this project. So we cut the mail delivery down from twice a day to once a day and we also reduced the mailboxes from 5 to 2. That’s a $10,000 savings a year, $5,100 a year of delivery cost is saved, and the mailbox costs resulting to total annual savings of $4,900.

For our collection fees, we pay 18.5 collection fee to agencies. We average about $740,000 to collection agencies annually. By ensuring that our customers are receiving their final notice letters in the timely fashion, they are more likely to pay their balance before their account is being sent to Collections. It’s also a customer service thing because we want to make sure that we are giving all the resources they can to prevent their accounts from going into Collections.

We anticipate that we are going to send 5% less to Collections which translates into that $6,900 a year savings.

Jared Church: Our top savings, again, removing just that one FTE from the process based on a 12-hour a year involvement, we have to make that $374 a year which we’re going to see more value from that FTE, having that person focused on value-add task as opposed to this I guess menial word would be the right one to use, a task that a student employee can do as opposed to this skilled FTE. So we’re very excited to be able to talk about these projected savings and share that with the university.

Any questions?

Questions

Tracy O’Rourke: Yes. So, really great project. I loved hearing about your project. I love the tools you used. I love the spaghetti chart and the FMEA and your SIPOC. So one of my favorite things about this is really just honing in on waste and removing it, identifying where it’s occurring and then just getting – finding the root causes and getting rid of it. And you guys got some really good savings too in terms of projected savings. So great job on the project.

Franklin Garrett: Thank you.

Jared Church: Thank you.

Tracy O’Rourke: So, I do have a couple of questions. What is the most challenging part of your project?

Franklin Garrett: For me, the most challenging part is – so we took the Lean Six Sigma training, right? So one of the main things I learned in this training was voice of the department versus voice of the customer. So when we came back to our department and we have this project, the thought process of staff which is like the voice of the department.

So the challenging part for me was trying to get them to see that it’s all about the customer experience and trying to get out of thinking the impact to the actual department and think the steps for the actual customers.

Jared Church: Yeah. I think we work in an environment that has a really strong and ingrained culture. Employees who have been here for many, many years, great employees who were experts at what they do, but really trying to dig in and analyze these processes felt a little bit uncomfortable, right? There is a little bit of fear I think. And I would say that that was certainly a challenge to overcome.

The training was amazing and that it gave us the tools and the communication skills necessary to really articulate the benefits of this process and help them see. And it was interesting as we were going through and interviewing people, running through these tools, creating these visual aids and sharing that with our team, it was really cool to see the light bulbs come on. And wow! I can’t believe that we’re paying that much and why did it take this long versus this long. It was a really fun element while challenging at the same time.

Tracy O’Rourke: Yes, definitely. So you guys were both graduates of UC San Diego’s On-Site Lean Six Sigma Green Belt. Congratulations! And this was your project. So how has completion of this project impact how you both look at things?

Franklin Garrett: Well first off, it really trickle down to our staff. We have a staff of 13 staff members and all of them by the end of December will have Yellow Belt training. So just us going through it and like leading the charge really trickle down. And also, we’re looking to have weekend expense. So Jared and I looking into Black Belt and see – really to answer your question, what really motivated us in as far as the – to learn even more and bring that back to our department.

Jared Church: I think it just opened our eyes to the fact that it’s OK to look at current processes and ignore the fact that things have been done the way they’ve always been done and come in with fresh ideas, new tools, different ways of looking at how we manage our business, and using those tools to just identify opportunities for improvement and streamlining.

Money saved is money earned, right? And the less time that we’re spending on processes that we can streamline means we have more time to focus on those real value-add projects, the ones that are really going to catapult us to the next level.

The fact that we focused on mailing, it seems like such an insignificant part of what we do. But we were able to show the impact just across the organization as a whole. Forget about the $12,000. When you look at the customer and the impact that a delayed letter could have on someone’s life, I mean it was really significant. It has really opened our eyes to start looking at everything that we do differently. Try to identify everything that we can do quickly and turn it around and show some real improvement. So, we’re really excited.

Tracy O’Rourke: Well, that’s awesome. OK. So I had – I just have one last question. And that is, if you were going to give someone advice on a Lean Six Sigma – a person who is just starting to get educated and applying process improvement in an industry like yours, what would you tell them? What would be some advice you would have?

Franklin Garrett: I think similar to what Jared was talking about. It’s just that any process can be improved. I think like when I first went into it, I was thinking, I kind of got to the point where I was like overwhelmed with everything that’s going on as far as I know this is a big project in our office that I can tackle. I have no idea how to tackle it. Am I going to have the support from my peers and from the technical side?

But what I learned is that you can pick any process and streamline it. So any process that you have, you can pick a component of that and make it more streamlined so you don’t have to go in and try to pick up the biggest pain point. You can pick something up that’s more reasonable, that you have complete control over. And like Jared said, you take one small process in our office and improve it can have a big impact.

Jared Church: Yeah. Some advice I would give is not to let the material overwhelm you. I remember the first couple of weeks in class looking at the website and all of the templates that are there, my head was swimming a little bit, right? How much am I supposed to use? What am I supposed to use and when?

And the advice I would pass on is one or two pieces from each step, it may be enough. It just really depends on what the process is. So take it slow. Absorb what you can. And put it into practice. Come back after every one of your classroom sessions and try to apply it to what you’re doing. Think about how it could fit in and the tools that you could use. And I mean the Go Lean Six Sigma website and the templates there, those are a favorite now on my webpage because I want to be able to access them quickly.

So again, my advice is use what’s available but take your time and don’t let it overwhelm you.

Tracy O’Rourke: Wonderful. Thank you so much. I’ll just say that I’m Tracy O’Rourke. You’re listening to GoLeanSixSigma.com Success Story Webinar highlighting Franklin Garrett and Jared Church. I want to thank you both for sharing your process improvement project today.

Jared Church: You’re welcome.

Franklin Garrett: Thank you, Tracy.

Tracy O’Rourke: And thank you for all of you listening and joining as well. If you have any questions about this presentation or about how to apply Lean Six Sigma, just contact us and don’t forget to download any free tools and templates on our website. As Jared was saying, it’s one of his favorites now. [Laughter]

Have a great day and thanks for joining us.

Jared Church: Bye-bye.


Get the inside scoop on many other successful Lean Six Sigma projects at our Super Stories of Success page. Do you have a story to tell? We’d love to hear about your own project success! Please contact us.

Tracy O'Rourke

Tracy is a Managing Partner at GoLeanSixSigma.com, the co-author of The Problem-Solver’s Toolkit and co-host of the Just-in-Time Cafe. She is also a Lean Six Sigma Green Belt Instructor at UC San Diego and teaches in San Diego State University’s Lean Enterprise Program. For almost 20 years, she has helped leading organizations like Washington State, Charles Schwab and GE build problem-solving muscles.