Assignment 2
Allen Chandy – 8770402
Dhaval Surti – 8746403
Patel Aashutosh – 8758705
QUAL8200 - Principles of Lean Six Sigma
Phil Wolfe
2022, June 24
Table of Contents
Introduction ..................................................................................................................................... 3
Project Definition and Goal Statement ........................................................................................... 4
SIPOC ............................................................................................................................................. 5
Process Map .................................................................................................................................... 6
Equipment Assembly & Installation Process Map .................................................................... 6
Equipment Return & Repair / Replacement Process Map ......................................................... 7
Financial Statement ......................................................................................................................... 8
Cause-And-Effect Diagram ............................................................................................................ 9
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List of Figures
Figure 1 SIPOC ............................................................................................................................... 5
Figure 2 Equipment Assembly & Installation Process Map ........................................................... 6
Figure 3 Equipment Return & Repair / Replacement Process Map ............................................... 7
Figure 4 Financial Statement .......................................................................................................... 8
Figure 5 Cause-And-Effect Diagram .............................................................................................. 9
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Introduction
Titan Laser Ltd produces a Time-Of-Laser inspection system. It is used to carry out
three-dimensional scanning utilizing the laser light reflection rule to determine precise distance
with the aid of sensors. One thousand units were formerly sold annually by the company. To
assemble major components like galvanometers and lasers and test the result, contractors and
businesses create core subassemblies. The selling rate has reduced to 950 units per year, or
almost 5% of sales, due to the company getting several apparent complaints about the gadgets.
The first complaint was filed 12 to 18 months ago, which affected the company's
revenues by 1%, but the company initially disregarded it. The selling price of the entire system is
$24,500. Thus, the company is losing $1,225,000 annually due to a 5% decline in yearly sales
rate. Now that returns and repairs take up to seven hours each day, the company decided to open
a second repair facility to serve its clients better.
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Project Definition and Goal Statement
Purpose
The company intends to discover the potential issues with the equipment and implement changes
in the process for improving customer service.
Objectives

Discover the many problems that might cause the device to malfunction.

Examine the procedure for creating an improvisational strategy.

Reveal the process parameters for implementing changes to improve the quality.
Deliverables

Factors affecting the troubleshooting process and their potential impact on them.

Analyzing the company's financial report to determine its condition.

Visualizing and process mapping tools to illustrate the process.

Cause-and-effect diagram indicating the various factors affecting the process.
Scope
To determine the potential cause and factors that lead to equipment failure and the ways to
implement more efficient and reliable strategies for improving customer service and increasing
the organization's annual sales with lesser equipment returns.
Acceptance Criteria
Once the scope and objectives are achieved, deliverables are deemed acceptable.
Goal Statement
Improve the efficiency and effectiveness of product repairs and replacement process from 7
days to 4 days by the upcoming 6 months.
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SIPOC
The SIPOC diagram that visualizes the product replacement & repair or replacement
process is pictured in a table form as below. The whole representation illustrates the various inputs
and outputs related to the process from its initialization to completion. The help of the SIPOC
diagram will assist the entire project team to understand the core process that needs to be
emphasized. This model allows the team to determine whether suppliers, inputs and processes are
impacting the outputs & customer needs. Significant improvement possibilities are created by
actionable insights into the variables affecting customers.
Figure 1 SIPOC
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Process Map
Equipment Assembly & Installation Process Map
Figure 2 Equipment Assembly & Installation Process Map
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Equipment Return & Repair / Replacement Process Map
Figure 3 Equipment Return & Repair / Replacement Process Map
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Financial Statement
Figure 4 Financial Statement
Without product failures or returns, the business sold 1000 pieces of equipment last year,
resulting in revenues of $24,500,000 and a net profit of $11,250,000. The company's revenues
decreased this year by just $23,275,000. 13 equipment failure occurrences occurred over this
period, costing the company an extra $49,200. In addition to these costs, the manufacturer paid
$397,500 for indirect costs related to the equipment in the replacement pool. Thus, a total of
$446,700 was contributed to the company, bringing the current-period net profit down to just
$10,240,800.
A direct loss of $1,225,000 to the company's yearly revenues results from the sale falling
by 5% due to the device's escalating problems. The business loses $1,671,700 yearly and more
than 360 hours (60 days) a year due to the cost of fixing defective products.
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Cause-And-Effect Diagram
One of the most well-liked and effective methods for identifying the reasons for issues and
offering remedies is cause and effect analysis. A cause-effect diagram is a visual tool used to
graphically illustrate potential causes of a particular problem or effect in increasing detail levels,
indicating causal links across ideas. Using the approach of cause-and-effect analysis, you can find
all the potential causes of an issue. It implies the trial won't go on indefinitely because you can
identify and address the primary reason the first time.
Figure 5 Cause-And-Effect Diagram
The figure above illustrates a cause-and-effect diagram for the equipment failure issues. It
indicates the various factors and reasons which can lead to this problem. By analyzing this
diagram, the team can make strategies to implement corrective actions.
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