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Achieving Customer Specifications Through Process Improvement

Using Six Sigma: Case Study of NutriSoil – Portugal

AMÂNDIO PEREIRA BAÍA, POLYTECHNIC OF GUARDA – PORTUGAL AND UDI – RESEARCH UNIT FOR INLAND DEVELOPMENT OF GUARDA

Tolerance limits are essential in production process management, as they determine consumer satis- faction. The use of statistical quality control tools allows for process improvement and the cpk index enables its measurement. Above all, the adoption by businesses of lean tools has been crucial in reducing the variation of a process or a product, satisfying the consumer’s specifications, eliminat- ing defects, reducing operating costs, and, in short, increasing profitability.

The NutriSoil Company in Portugal, a small and medium-sized enterprise (SME), sells fertilizer in bags. The company has had problems with its filling process due to excess weight of the bags. Results show that by implementing Six Sigma combined with the 5S program, NutriSoil achieved an improvement in its cpk index for this process, which increased consumer satisfaction and a highly significant cost savings. This resulted in increased competitiveness.

Key words: cp and cpk capability index, process capability, process improvement, Six Sigma, SME, statistical quality control

INTRODUCTION The basic objective of this study is to explore, using a case study, the benefits of implementing the strat- egy of Six Sigma combined with the 5S program in NutriSoil, a Portuguese small and medium-sized enter- prise (SME) struggling to retain profitability. NutriSoil had high production costs, a situation that is common to many SMEs.

The specifications or tolerance limits define the dif- ference between acceptable and unacceptable products, and producing within these limits is critical to con- sumer satisfaction. The ability to consistently distribute products within specifications determines whether the supplier will continue to do business with the con- sumer. A company can improve a production process by efficiently coordinating the specifications and the design process. Process capability measures how the process meets specifications.

True process capability cannot be determined until x-bar and R control charts have reached opti- mum quality improvement without significant investment in new equipment. A key aspect of process improvement is to recognize that regardless of the depth of this monitoring, there is always variation. This variation is well defined when a process is sta- tistically controlled. A modern definition of quality

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dispersion permitted, that is, with specification limits. It does, however, have a flaw; it assumes that the process average is centered in the range of specifications. In fact, it is not always so.

On the other hand, the cpk index takes into account the level of acceptable risk, the product variation, and gives a quick overview of the actual process per- formance. It measures the capability of the current process. This measure is in line with the positioning of the average case.

Sigma describes the variability of a process that produces similar products or services (Dedhia 2005). A quality level sigma provides an indicator of the occur- rence frequency of defective items, whereby a higher quality level indicates a process with less possibility of creating defective items. Consequently, with the increased level of sigma quality, the product reliability improves the need for testing and inspection declines, product cycle time decreases, costs are lower, and con- sumer satisfaction is increased.

Six Sigma is a process capability condition defined as the ability of a process to produce a good product. It establishes a relationship between product specifi- cations and process variability, measured in terms of process capability indices: cp and cpk. A process that operates the Six Sigma has a cp = 2 and a cpk = 1.5 (Kumar 2002). Six Sigma is an initiative that aims to eliminate the defective items in any product, process, or transaction.

Motorola was the first organization to use the term “Six Sigma.” In 1992, it reduced defective item levels by a factor of 150 (The History of Six Sigma 2007). Honeywell began this program in the early 1990s and is said to have saved more than 600 million euros in 1999 (Pande, Neuman, and Cavanagh 2003). A study from Lucier and Sheshadri (2001) shows that General Electric was able to save $2 billion in three years, after implementing Six Sigma in 1996 (Antony and Banuelas 2002). Reports of Buss and Ivey (2001), Feo and Bar-El (2002), McClusky (2000), and Weiner (2004) also show the benefits gained by companies such as Raytheon, Dow Chemical, DuPont, Texas Instruments, Johnson and Johnson, Toshiba, Boeing, and others.

states that “quality is inversely proportional to vari- ability” (Montgomery 2009). It is recognized that variability reduction directly results in lower costs. Variability reduction means fewer repairs, fewer con- sumer complaints, less rework, and reduced time waste, all of which imply less effort and money spent during the process.

Six Sigma is a powerful business strategy that employs a disciplined approach to tackle process vari- ability using a rigorous application of statistical and nonstatistical tools and techniques (Hamon 2010; Evans and Lindsay 2005). Six Sigma is an initiative that aims to eliminate the defective items in any prod- uct, process, or transaction.

Even though Six Sigma has proved to be effective in many situations, other lean tools such as the 5S frame- work also offer the ability for organizations to improve rapidly. Lean thinking emphasizes maximizing value through reduction of waste, variation, and overburden within processes (Womack 2011). Lean promotes the attitude of make it better now, make it perfect later (Toussaint and Gerard 2010).

LITERATURE REVIEW The cp and cpk process capability indices represent the ability to combine people, machines, methods, materials, and measurements to produce a product that consistently meets the requirements or expecta- tions of the consumer. The process capability indices continue to be used as process tools, even though there is “a growing recognition that these tools are limited and, in particular, the capability standard indices are appropriate only with measurements that are independent and distributed in a reasonably nor- mal manner” (Rodriguez 1992, 176). The popularity of process capability indices, although in many cases these indices are flawed tools, has led to ongoing research in this area, which has recently been evalu- ated by Wu, Pearn, and Kotz (2009).

However, a high cp value does not guarantee that a production process is within the limits of the speci- fications because the cp value does not imply that the current state of the process coincides with the

Achieving Customer Specifications Through Process Improvement Using Six Sigma: Case Study of NutriSoil – Portugal

systems. As far as metrics are concerned, when a pro- cess is operating at a Six Sigma level, it produces noncompliance (defective items or errors) at a rate of not more than 3.4 defective items per million oppor- tunities. As a methodology, Six Sigma leads to an improvement of the business process focusing on the understanding and management of customer expecta- tions (Brewer and Eighme 2005; Rudisill and Clary 2004). As a management system, Six Sigma is used to ensure that critical efforts for improvement developed through the methodology and metrics are aligned with the company’s business strategies. In the late 1990s, about two-thirds of Fortune 500 organizations had undertaken Six Sigma initiatives with the aim of reduc- ing costs and achieving improvements.

Although Six Sigma proved to be efficient when applied to big companies, few reports provide success factors, guidelines, tools, and techniques for imple- menting Six Sigma in the context of SMCs (Antony 2011; Antony, Kumar, and Madu 2005; Wessel and Burcher 2004).

METHODOLOGY cp and cpk Capability Index and Six Sigma In their study the authors used cp and the cpk as the main metrics in this cycle of the improvement pro- cess. If they compare the cp process metric with the cpk metric, they are able to detect which is the opportunity improvement that exists in the process. By reducing process variation, the supplier increases the ability to meet the specifications and also reduces the number of products that do not meet the specifications. A cpk = 2 represents a Six Sigma level, with 3.4 defective items per million opportunities, with quality costs less than 10 percent of sales and configures a benchmark of “world class” (Mike 1998).

It should be noted that although a process pro- duces a quality feature with a capability index higher than 2.5, the needless precision makes it very expensive. The process capability must be

Many of the success stories on the implementation of Six Sigma belong to large organizations, particu- larly multinationals. Very few publications refer to the implementation of Six Sigma in SMEs. Six Sigma has been criticized by people saying that it requires a large investment and resource-intensive programs that only large companies can provide (Calcutti 2001). However, an SME may have fewer complica- tions than a large company in terms of company size, the nature of its projects, effort for building teams, and training employees, so it can be argued that the implementation of Six Sigma in SMEs is easier, except for the cost of investment.

The Six Sigma philosophy consists of manage- ment by facts and not by opinions (Nanda and Robinson 2011). Antony, Kumar, and Madu (2005) found that Six Sigma provides executives and manag- ers with the strategies, methods, tools, and techniques to change their organizations. Many organizations recognized that the Six Sigma methodology provides a set of practices designed to improve the produc- tion process, and the methodology quickly spreads to different functional areas such as marketing, engi- neering, purchasing, distribution, and administrative support (Ray and Das 2009; 2010).

Magnusson, Kroslid, and Bergman (2003) found that Six Sigma is a business process that allows com- panies to dramatically change and improve their basic organization through the design and monitoring of daily business activities so as to minimize waste and resources while consumer satisfaction is increased in some of its components. Franken (2007) emphasizes that when the internal operations of a company are not well structured, this company will find it difficult to create value and be highly competitive. Six Sigma begins as a focus for improving internal operations, but Zucker (2007) notes that the work of Six Sigma is usually done through cross-functional teams to man- age the project. The benefits are well documented for manufacturing industries and growing service indus- tries (Wright and Basu 2008).

In the last two decades Six Sigma has evolved from a focus on metrics to a level of methodology and finally to the design and development of management

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500 and 1,000 kilograms (big bags) and plastic bags of 20 kilograms. All bags have a label containing formula, lot, date, and other infor- mation from the manufacturer.

This SME was established in 2005, employs 32 workers, and is committed to developing and producing fertilizer. The main customers of NutriSoil are super- markets and other stores geared for farming and gardening. The company annual ly produces 40 million tons of fertilizer. Socio- environmental issues are extremely important for NutriSoil; therefore, the company’s involvement with the environment is a constant con-

cern. The NutriSoil production process is presented in summary form in Figure 1. All raw materials come from domestic suppliers and arrive in bulk to NutriSoil by road. The material is crushed by a shredding machine and is sent for composting. Then the nutri- ents and other supplies are blended and the fertilizer goes to the silo where it is stored. Later the weighing is done and the formulation is forwarded to the bagging machines where it is packed.

NutriSoil operates in a highly competitive market, where the cost-price factor is crucial. To improve profitability, NutriSoil adopted a simplified version of the Six Sigma process (see Figure 2) in an attempt to reduce production costs. This sketch was developed after meetings with the company owner and with top and middle-level managers. Also, the operators’ concerns were fully considered in the definition of all procedures.

Define A team was created consisting of operators, pro- duction and quality engineers, the marketing department, and the company owner. This team spent many hours in the production area to collect data and understand the production and packing mode

re-evaluated periodically to ensure that the process average has not changed and that process variation has not increased. The minimum recommendation for re-evaluation is six months.

The NutriSoil Company implemented a Six Sigma strategy to pursue its goal of reducing costs, which is vital to its survival. The company sought to:

• Exert a continuous effort to achieve stable and pre- dictable results of a process (reduction of process variation), which is of vital importance to the suc- cess of a business

• Recognize that production and business processes have characteristics that can be measured, analyzed, improved, and controlled

• Obtain commitment to improvement from the entire organization, particularly from top management

Case Study – NutriSoil Company The name of the NutriSoil Company is fictional to preserve confidential information in an industrial context, but the case is real. NutriSoil is a company that produces and sells organic fertilizer in bulk bags of

Figure 1 NutriSoil production process diagram

Green Waste

Destroying

Composting

Mixing

Silage

DispatchPacking

Big bags 30%

20 kg 50%

Bulk 20%

• Visual inspection • Manual sorting

• Piles formation • Temperature and humidity control • Revolving

NutriSoil

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Achieving Customer Specifications Through Process Improvement Using Six Sigma: Case Study of NutriSoil – Portugal

the Pareto diagram to determine the importance of the causes and the cause and effect diagram to detect the causes of variation. Control charts for average (x-bar) and the amplitude (R) were used to determine the assignable causes of variation.

Improve A program of organization and standardization, 5S (see Figure 3), was gradually and systematically implemented with a view to increasing the safety and efficiency of labor and productivity.

The purpose of the 5S methodology is to improve efficiency through proper disposal of materials (separate what is necessary from the unnecessary), organizing, cleaning and identification of materials and spaces, and maintenance and improvement of the 5S.

This methodology develops a systematic plan for sorting, cleaning, and ordering, enabling as a result greater productivity, security, organizational climate, and motivation of employees, with the consequent improvement of organizational profitability.

A program of buildings and equipment main- tenance, total productive maintenance (TPM), was

of fertilizer bags. Team members were encouraged to identify the vital characteristics of the production process based on the “consumer voice.”

Measure To determine the defective items that occurred in each production phase, the team was divided into small groups in order to identify the vital procedures of each phase of the production process. A brainstorming ses- sion was conducted to develop the data collection plan. The data for defective products were collected and analyzed in order to measure the current performance in each of the workstations. Before the data collection it was decided to validate the measurement system, namely studying the measurement system’s contribu- tion to the variation in the form of repetition (the same product measured repeatedly by the same instrument) and reproducibility in the process (the same product measured by different operators).

Analyze In the analysis of causes for defective items, a classifi- cation of defective items and the respective contribution to the total defective items was made: the authors used

Figure 2 Six Sigma process adopted by NutriSoil

De�ne

Measure

AnalyzeImprove

Control

Develop and execute appropriate data collection method

Find the root causes of the

problem

Generate and improve

solutions

Ensuring the results

Understand the problem and its �nancial impact

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Equation 1

% Defective bags = Number of defective bags

× 100 Number of processed bags

An additional measure used to assess the evolution of the production process in general was the defective items per unit rate (DIUR) (see Equation 2):

Equation 2

DIUR = Total number of defective items found in 20-kg bags

Number of processed bags

In this introductory phase of the Six Sigma strat- egy, the packaging process of 20-kilogram fertilizer bags deserved special attention, especially those sold in malls with high-quality requirements. It was confirmed that, to avoid noncompliance with the specification 20 kilograms with a tolerable mini- mum variation of 2 percent, there was a need to add additional fertilizer to bags, to respect the weight of the minimum specification, which constituted a significant cost.

An ABC analysis revealed that the packing process of 20 kilogram fertilizer bags, given that they repre- sent 50 percent of sales and moreover intended for a market extremely demanding in terms of quality con- trol, deserves priority, since there lies an opportunity for improvement that could significantly contrib- ute to an increase of the competitive advantage of NutriSoil and its profitability.

also implemented. The objective of this program is to increase both production and morale and employee satisfaction (Ismail 2013; Jain, Bhatti, and Singh 2014). Maintenance is no longer seen as a nonprofit activity, and downtime to perform maintenance began to be scheduled as part of the daily production. The goal is to keep emergency and unplanned maintenance to a minimum.

Control Teams were formed to discuss production problems that may cause errors, failures, and defective items. The customer complaints analysis was also used to identify potential problems. The creation of produc- tion process control charts was implemented in order to keep employees aware of their process performance in real time:

• p chart : to control the evolution of the fraction of defective 20-kilogram bags

• c chart: to measure the evolution of the number of defective items produced per 20-kilogram bag

A training program was implemented in each of the production stages with the purpose of bridging the gaps found. To compare the performance of the production process before and after the introduction of the Six Sigma strategy, defective products reported by the entire production process made use of the following bench- mark (see Equation 1):

Figure 3 5S methodology

Source: Adapted from Coutinho (2006)

Seiri

Clearout and classify

Store

Sort

Seiton

Con�gure

Shine

Seiso

Clean and check

Standardize

Seiketsu

Conformity

Sustain

Shitsuke

Custom and practice

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Achieving Customer Specifications Through Process Improvement Using Six Sigma: Case Study of NutriSoil – Portugal

29,071.72 bags, were packed with a weight below the minimum specification, which corresponded to a cost of reprocessing of 58,143.44 euros.

To monitor the process progress and calculate the cp and cpk capability index for the weight of 20-kilogram bags, control charts for average (x-bar) and amplitude (R) were implemented and put next to the bagging machines. Every hour, four bags are randomly packed and inspected and the respective weight is recorded. If more than two bags display underweight according to the minimum specification limit, all bags produced since the last acceptance are retained and corrective actions are taken if necessary.

In addition, a laborer carefully monitors the pas- sage of the bags on the conveyor belt, and from time to time, removes a bag that weighs less, is torn, or is badly sealed, and puts it in a pile to be reprocessed. In the initial stage of the study the process was consid- ered to be stabilized, but its variability was unable to meet the specifications.

The customer may receive more fertilizer but never less than nominal. This excess weight is unnec- essarily expensive. The problem was identified and a versatile team was formed consisting of technical services, plant operators, and quality personnel. The investigation revealed that the filling machine needed improvements and that it was appropriate to develop a training program for employees. The team worked closely with operators to achieve a reduction in pro- cess variation with a consequent improvement.

In order to find the causes associated with the high variation of the bag weight, the authors used a cause and effect diagram (see Figure 5).

RESULTS Table 1 summarizes the results of the indicators used to assess the impact of the actions taken when imple- menting the Six Sigma strategy.

Control charts for 20 kilogram bag weight average (x-bar) and amplitude (R) are presented in Figure 6, before the Six Sigma strategy. Control charts for 20- kilogram bags weight average (x-bar) and ampli- tude (R) after the Six Sigma strategy are presented in

Packaging Process: Before the Introduction of the Six Sigma Process The packaging process (see Figure 4) consists of two bagging machines and bags 1,008,000 fertil- izer bags annually (a daily average of 3,360 bags) in 20- kilogram plastic bags, which are sold on the market for 15 euros. The problem detected, and the urgent need to act immediately, is that to comply with the minimum specification NutriSoil is filling the bags with an average of 20.93 kilograms, which equates to an annual waste of 699,693.67 euros; that is, 46,646 bags are held back, and 90.74 percent of all bags produced are overweight. However, it is generally recognized that for the company to remain competitive and profitable the overfilling should be minimized.

The specifications are imposed by legal rules, so the bags must contain at least more than 19.6 kilograms of fertilizer. Bags that do not meet the minimum speci- fications are again inserted for reprocessing into the production process, resulting in average unit cost of 2 euros. In addition, bags found on the market weigh- ing less than the minimum specification are subject to heavy fines, and 2.88 percent of the bags, that is,

Scale

Silo

Filling Machine

Figure 4 Weighing and packaging process of 20-kilogram bags

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DISCUSSION The introduction of the Six Sigma strategy in NutriSoil resulted in considerable savings, which allowed the company to improve its competitive advantage. The increased cpk index (from a low value

Figure 7. Figure 8 shows the p control chart, for fraction of defective produced 20-kilogram bags, for a period of one year of the Six Sigma strategy. Figure 9 shows the c control chart, used to monitor the evolution of the total number of defective items per 20-kilogram bag for the one-year period of the Six Sigma strategy.

Table 1 Metrics employed

Key metrics employed Before the introduction of Six Sigma After the introduction

of Six Sigma Improvement (%)

Percent of defective bags produced 4.50 2.17 51.77 Defective items per unit rate (DIUR) 4.24 2.12 50.00 cpk – Process capability 0.63 1.02 61.90 Process average (kg) 20.93 20.05 4.20 Process standard deviation (kg) 0.70 0.15 78.90 Percent of bags weighing more than 20 kg 0.907 0.6337 30.20 Percent of bags weighing below the minimum specification – 19.60 kg 0.0288 0.0011 96.10

Bags lost per year – overweight 46,646.24 2,542.88 94.50 Cost (€) of extra weight – 20 kg bags 699,693.67 38,143.16 94.50 Bags under weight – year 29,071.72 1,142.82 96.10 Cost (€) of underweight – 19.60 kg bags 58,143.44 2,285.65 96.10 Percent of machine downtime 5% 3% 40.00 Percent of work-related accidents 1% 0.2% 80.00

Figure 5 Cause and effect diagram for the weighing and packaging process of 20-kilogram bags

OperatorScale

Packing machines

Work environment

Overweight bags

Work conditionsWholesomeness

conditions

Cleaning

Maintenance

Training

Attitude

Precision

Dust

Vibration

Nozzles

MaintenanceVentilation

Calibration

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Achieving Customer Specifications Through Process Improvement Using Six Sigma: Case Study of NutriSoil – Portugal

Figure 6 Chart for 20-kilogram bag weight average and amplitude before the Six Sigma strategy

22.50

UCL = 21.97

LCL = 19.99

X = 20.93

22.00 21.50 21.00 20.50 20.00 19.50 19.00

1 3 5 7 9 11 13 15 17 19 21 23 25

Sample

Control chart for average

A ve

ra ge

(k g)

3.50 UCL = 3.28

LCL = 0.00

R = 1.44

3.00 2.50 2.00 1.50 1.00 0.50 0.00

1 3 5 7 9 11 13 15 17 19 21 23 25

—

Sample

Control chart for range

Ra ng

e (k

Figure 7 Chart for average and amplitude after a year of the Six Sigma strategy

20.40

UCL = 20.27

LCL = 19.83

X = 20.05

20.30 20.20 20.10 20.00 19.90 19.80 19.70 19.60

1 3 5 7 9 11 13 15 17 19 21 23 25

Sample

Control chart for average

A ve

ra ge

(k g)

0.80 UCL = 0.69

LCL = 0.00

R = 0.30

0.70 0.60 0.50 0.40 0.30

0.10 0.20

0.00 1 3 5 7 9 11 13 15 17 19 21 23 25

—

Sample

Control chart for range

Ra ng

e (k

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Figure 8 p chart at the beginning and the end of a period of one year of the Six Sigma strategy

0.090 UCL = 0.078

LCL = 0.011

p = 0.045

0.080 0.070 0.060 0.050 0.040 0.030

0.010 0.020

0.000 1 3 5 7 9 11 13 15 17 19 21 23 25

—

Sample

Initial p-chart

Fr ac

tio n

of n

on co

nf or

m iti

es (p

)

0.050 UCL = 0.045

LCL = 0.00

p = 0.0217

0.045 0.040 0.035 0.030 0.025

0.010 0.005

0.015 0.020

0.000 1 3 5 7 9 11 13 15 17 19 21 23 25

—

Sample

Final p-chart

Fr ac

tio n

of n

on co

nf or

m iti

es (p

)

Figure 9 c chart at the beginning and the end of a period of one year of the Six Sigma strategy

UCL = 10.417

LCL = 0.000

c = 4.24

14 12 10

8 6 4 2 0

1 3 5 7 9 11 13 15 17 19 21 23 25

—

20-kg bags

Initial c-chart

N um

be r

of n

on co

nf or

m iti

es p

er b

UCL = 6.488

LCL = 0.000

c = 2.120

8 7 6 5 4

1 2 3

0 1 3 5 7 9 11 13 15 17 19 21 23 25

—

20-kg bags

Final c-chart

N um

be r

of n

on co

nf or

m iti

es pe

r ba

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Achieving Customer Specifications Through Process Improvement Using Six Sigma: Case Study of NutriSoil – Portugal

weight lower than that mentioned in the specifica- tions against an initial 28.84.

• The inclusion of p control charts for each stage of the production process kept employees aware of the performance of their process in real time and was crucial in improving the defective bags produced fraction of 51.34 percent.

• Using the c control chart helped in reducing the number of defective items per bag from 4.24 defec- tive items to 2.12, which was an improvement of 50 percent.

The 5S program of organization and standardiza- tion tidied up the workplace, storage in particular, resulting in an 80 percent decrease in work-related accidents, which had as a consequence decreased absenteeism and increased worker morale.

Implementing the Six Sigma strategy provided sev- eral valuable lessons when promoting new projects. First, it was necessary to educate management that investing in quality means increasing the cost of produc- tion. This barrier was overcome by showing the NutriSoil owner the savings achieved. Also, management had to be shown that 5S tidied the factory, which reduced accidents and reduced the idle time of machines and operators. This in turn generated savings. A training plan that included all NutriSoil employees was necessary to overcome active resistance to change. Employee anxi- ety triggered by change was minimized with an effective communication campaign. The communication began with an explanation of the Six Sigma strategy; why the company adopted it; the anticipated benefits of imple- menting Six Sigma; dissipation of fears by explaining the development plan; how the employees would be affected; and what training and support was available:

• Communication of the training plan, training schedule, and reporting of training evaluation, as well as the benefits of implementing the project, proved to be highly motivating.

• The improvements already made were publicly rec- ognized and celebrated in order to maintain and strengthen the commitment to Six Sigma.

Capitalizing on this progress, the NutriSoil Company is launching the certification process based

of 0.63 to 1.02) for the of the 20-kilogram bags was an improvement of 60.8 percent. This demonstrates the value of Six Sigma for SMCs. Using Six Sigma in the process of packing 20-kilogram bags, annual sav- ings in the order of 717,408.31 euros were achieved, corresponding to 4.74 percent of the sales value for this type of product. Managers accepted that the Six Sigma strategy combined with the 5S procedure created, for one year, above all, a change in the orga- nizational culture of NutriSoil.

Today the authors can perceive in NutriSoil a greater sense of participation, commitment, and awareness of the importance of working in order to exceed the requirements of the consumer. The involvement and commitment of all employees, measured by absenteeism and voluntary turnover, facilitated the implementation of the Six Sigma strat- egy both within the production process and in the reduction of defective items that occur in the final product. Specific gains of NutriSoil were:

• Reduced variation in bag weight from 0.70 kilo- grams to 0.15 kilograms, that is, a decrease of 78.9 percent. The control charts for average (x-bar) and amplitude (R) introduced in the packaging process helped to determine and correct the root causes of abnormal variation and improvement on this process. The weighing and bagging machines, in particular, were subjected to significant improve- ments. TPM was determinant in increasing productivity while increasing the morale of employ- ees and their job satisfaction. The time machine downtime due to breakdown decreased from 5 per- cent to 3 percent, in particular because of properly scheduled preventive maintenance.

• The average weight of the bags went from 20.93 to 20.05 kilograms, which equates to an annual sav- ing of 661,550.51 euros. Currently, 2,542.88 bags are wasted due to overfilling, compared to the initial 46,646.44.

• There was a reduction in the number of the bags weighing less than the minimal weight. This resulted in savings of 55,857.79 euros in repro- cessing costs and a decrease in the probability of paying fines. Only 1.13 per thousand bags had a

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on ISO 9001:2008, and living up to its respect for the environment; they would like to obtain environmental certification ISO 14001 – Environmental Certification, in the short to medium term.

CONCLUSIONS The Six Sigma program combined with 5S proved to be an effective, simple way to design and improve a productive process. By following these systematic lean approaches, and applying them to Nutrisoil, the authors achieved not only a substantial reduction in costs and in the work-related accident rate, but also a decrease in turnover and absenteeism in a relatively short period of time.

Further research is needed to evaluate the effec- tiveness of these approaches in other SMEs in various settings. The main difficulty encountered was the owners’ resistance to sharing decision-making power. This was overcome by demonstrating how Six Sigma generated money for the company. The Nutrisoil owner said after implementation that “a change is visible in the organizational culture of NutriSoil, based on the ‘consumer voice’ and the adoption of the best practices, allowing the company to face the future with more optimism.”

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BIOGRAPHY

Amândio Pereira Baía is a professor in the management depart- ment at Guarda Polytechnic. He has a master’s degree in industrial management from Clemson University, and a doctorate in statistics and operational research from Coventry University in England. He can be reached by email at [email protected].

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