Murphy Trucking, Inc.
Murphy Trucking, Inc. (MTI), supplies contract transportation services to many different manufacturing firms. One of its principal customers, Crawford Consumer roducts (CC), is actively improving !uality "y using the Malcolm #aldrige $ational %uality &ward &ward criteria. In an effort to improve supplier !uality. Crawford Crawford Consumer roducts mandated, last year, that all suppliers provide factual evidence of !uality improvement efforts that lead to highly capa"le processes. &s part of its supplier development program, CC held a seminar seminar for all its suppliers to outline this initiative and provide initial assistance. The e'ecutive officers of MTI participated in the seminar and recognied that MTI was seriously lacking in its !uality improvement efforts. More importantly, eff eff #laine, who was the purchasing manager at CC, told them privately that many errors had "een found in MTI*s shipping documents. CC would not continue to tolerate this high num"er of errors+ and if no improvements were made, it would seek transportation services elsewhere. ick Murphy, president and C-O of MTI, was concerned. uring an off/site meeting, Murphy and other MTI e'ecutives developed a comprehensive "lueprint to help MTI develop a total !uality focus. One of the key o"0ectives was to esta"lish an 1C effort to gain control of key customer/focused processes and esta"lish priorities for improvement. The Billing Study After Process Improvement
In a good/faith attempt to respond to CC*s feed"ack, MTI turned its attention to its "illing input errors and worked on them over the following si' months. To To gain some understanding of the situation, MTI conducted an initial ("ase case) study "y sampling 23 "ills of lading, each day, over a 23/day period. Initial results were dismal, with defective "ills averaging a horri"le 43 percent5 &fter process improvement and an intensive intensive effort to train train shipping clerks not to make errors, the company was a"le to make another study to determine what progress had "een made. MTI #ase Case ata shows the results of the initial and after improvement studies. #oth studies revealed that field employees were correcting errors as they found them. In "oth cases, rework was costing the company almost 62 per error, "ut the num"er of errors had "een su"stantially reduced "etween the two studies. 7owever, field employees still were not always catching the errors, which led to field service and other pro"lems. Discussion Questions
8. &t this point, point, MTI MTI is unsure unsure of how to interpre interprett these results results.. 9ou 9ou have have "een hired hired as a consultant "y the e'ecutive committee to analye these data and provide additional recommendations for integrating 1C concepts into MTI*s !uality system. :sing the initial results from the "ase case data, determine the performance, that is, the process capa"ility, in a !ualitative and !uantitative senses, of the "illing input. ;hat is the average rate of defective "ills< Is the process in control< ;hat error rates might the company e'pect in the future< ;hat general conclusions do you reach< 2. erform erform the same statis statistical tical analysi analysis s with the second second set set of data. 7ow 7ow do the results results differ< ;hat is the average rate of defective "ills< Is the process in control< ;hat ; hat error rates might the company e'pect in the future< ;hat general conclusions do you reach<
MTI Bse !se Dt
MTI Defective Billing Dt Dy Initil Study #esults
8 2 > @ A 4 ? B = 83 88 82 8> 8@ 8A 84 8? 8B 8= 23
83 = 8> 83 8A 83 8@ 8> 8@ 8@ 82 8> 8@ 8> 82 82 8@ 84 8@ 83
"o. of Defective Bills After Process Improvement Study #esults
4 4 ? ? @ 4 ? B ? A A @ ? A ? A ? A ? ?
The Billing Study, Prt II The revelations from the initial study had "een startling. The results
from the second study were encouraging, "ut not yet where the company wanted to "e. ick Murphy personally led a group pro"lem/solving session to address the root causes of the current error rate. uring this session, the group mem"ers constructed a cause/and/effect diagram to help determine the causes of incorrect "ills of lading. -ight categories of causes were identified 8. Incomplete shipper name or address 2. Incomplete consignee name or address >. Missing container type @. Incomplete description of freight A. ;eight not shown on "ill of lading 4. Improper destination code ?. Incomplete driver*s signature information B. Inaccurate piece count :sing eming*s plan/do/study/act process, the group of Murphy designed a plan to e'amine all "ills of lading over a 2A/day period and count the num"er of errors in each of these categories. They repeated the si' months later to determine what progress, if any, had "een made in error reduction. The ta"les in the MTI #ase Case ata 8 worksheet shows the data for these studies. ick Murphy thought that the p/chart developed in the first study and reapplied to the second study provided significant information a"out the process+ however, he was curious to find out whether another method could tell them more a"out the nature of the defects they wer encountering.
Discussion Questions $cont.%
>. &fter developing p/chart for the first and second studies, you decide to analye the data to determine whether the system is in control "y constructing another appropriate control chart (other than a p/chart) that could "etter tell you a"out the nature of the defects. 9ou also decide that it would "e wise to construct a areto diagram to gain additional insight into the pro"lem, and suggest recommendations to reduce "illing errors. @. Complete your analysis "y using the three charts from each of the two studies to advise ick and his managers at Murphy on the ne't steps. 7ow do the results differ from the first to the second study< Is the process in control< ;hat error categories have improved< ;hich ones might the company need to work on immediately in order to "ring a"out further improvements< ;hat general conclusions do your reach<
