Business associates reviewing notes together in a meeting.

Using Six Sigma to Improve Supplier to a Customer

November 30, 2018

Two companies were mature practitioners of Six Sigma.  One was a supplier to the other.  It was written into the suppliers contract that the supplier was expected to work on Six Sigma projects with the customer.  The customer’s expectation was that doing projects together was a reliable way to keep supplier costs down and, therefore, prices stable.

After several successful projects over a few years, the processes and behaviors were fairly well established.  During the joint meetings discussions of a commercial nature were prohibited, there were other joint forums for those discussions.  Argument and blame were discouraged.  This was a time to focus on the facts and the data to solve problems that were having a negative impact on the customer and its customers.  Some other conditions of the meetings included:

  • DMAIC was the process followed to pursue the improvements.
  • Projects would be focused on improvements that neither side could solve alone.
  • A leader from both companies would attend the meeting.
  • Notes and assignments were recorded and tracked.
  • An agenda was sent out prior to the meeting with a schedule of project reviews.
  • Project Belts, a quality leader and a MBB from both companies would attend the meeting

During one meeting the supplier quality leader presented some data that showed a problem caused by neither the supplier nor the customer.  The data clearly showed that the problem was coming from a different supplier to the customer.  It was agreed that the issue required further investigation.

Following the investigation, it was clear that a different supplier to the customer was the cause of the observed problem.  The project commenced.  At the conclusion of the project, the customer had rewritten its contractual requirements for the 2d supplier.  The customer had further adopted the Six Sigma partner’s process for measuring for the problem that the project was intended to fix.  Further, the 2d supplier dramatically changed its assembly process to ensure that the problem did not recur.

The outcome of this project was tens of thousands of dollars in warranty avoided.  Overall, the entire supply chain experienced a focused improvement.  Finally, the relationship between the supplier and the customer was enhanced because the supplier proved that it cared enough about the success of its customer to go the extra mile to work on a problem that neither party directly owned.  This was a major victory for all parties involved.

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