Lean Six Sigma Packaging Project Saves $300K

Posted by on Mar 16, 2012 in Lean Six Sigma | 0 comments

A project was conducted by a Purchasing department to determine the feasibility and benefit of using returnable containers for a certain product.  As usual, a team was formed and a contract was developed.  The problem statement was defined as the scrapping of the current containers at a cost of $575K per year.

The team developed a process map of the procurement, logistics, and use of the scrapped containers and compared it to the proposed procurement, logistics, and use of the returnable containers.  Next they did a cost analysis comparing the two and a force field analysis comparing the advantages and disadvantages of each.

The cost analysis and the advantages of going to the returnable containers was a clear winner, saving the company $299,286 per year.

The advantages of using Lean Six Sigma and the DMAIC process is that is made the team go through a step by step approach to defining the problem, collecting data on the current packaging, looking at the effects of the logistics of the returnable container, and weighing the pros and cons of each.

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