project charter for a company on sales and quality using xl sheet

ABC Manufacturing ltd. has been one of the leading manufacturers of spindle shafts for aerospace industry. The company produces different line of spindle shafts for various customers. The company scorecard shows that ABC has been on “AB” ranking from Jan 2016 till June and B ranking on July and August 2016. (The rankings are as follows: A, AB, B, C, and D which A is the highest ranking). The company is allowed internally to have 5% defective which communicated with customers upon signing the contracts. In the last management review meeting, it was brought up that the 5% defective rate could be a negative point for the company and could be one of the reasons that sales department has not been able to sign any new contract with customers in the past 5 months which costs the company $150,000 annual revenue loss per each customer (Average new customer per month is 4). On the other hand, quality department believes that the company has been recently producing more defective parts greater than allowable 5% and refers to recent quality issues that have occurred at customer location to prove its theory. Quality Manager insists that this is a serious problem and company has to target to get back to below 5% defective rate but 5% defective rate is very good and should not be changed. Further to this, to prove his point, he collected 200 samples and inspected them and 9 defective parts were identified. A quick benchmark on some competitors, show that the proportion defective allowed for them is significantly lower than ABC but also they have lower production rate and capacity. Top management requires to establish a team to investigate this and report to him in 2 months.

You have been assigned to initiate a Six Sigma project to resolve the issue and improve the situation;

1. Create a business case that explains the issue

2. Develop a project charter to clearly identify the primary and secondary metrics

Business Charter

Quality

Six Sigma Project Charter Belt Name: Project Name: Division:

Quality

Champion (PO): Start Date: Master Black Belt: End Date: Team Members: Problem Statement: Objective & Scope During the January 2016 to July 2016, the company ABC has been gradually lowering its ranking from AB to B. Which has impacted the organization in a loss of 20 contracts and worth $62,500 per customer during this period of 5 months according to sales department. The project will focus on identifying the problems and its impact on the organization ABC by reducing the defective rate of products below 5%

Primary Metric

:

% of defective products

Secondary Metric

s:

Rework Rate Material Usage Rejection Rate Primary Metric Chart: Secondary Metric Chart(s): INSERT HERE

INSERT HERE

Secondary Metric
Target

38723 38754 38782 38813 38843 38874 40

34 28 22 16 10 Actual

38723 38754 38782 38813 38843 38874 40

Financial Description COPQ

Primary Metric
Target

38723 38754 38782 38813 38843 38874 1000000

850000 700000 550000 400000 250000 Actual

38723 38754 38782 38813 38843 38874 1000000

Defect Description, DPU, Cycle Time or Other

Sales

Six Sigma Project Charter

Belt Name: Project Name:

Division: Sales Champion (PO):

Start Date: Master Black Belt:
End Date: Team Members:

Problem Statement: Objective & Scope

During the January 2016 to July 2016, the company ABC has been gradually lowering its ranking from AB to B. Which has impacted the organization in a loss of 20 contracts and worth $62,500 per customer during this period of 5 months according to sales department.

Primary Metric Chart: Secondary Metric Chart(s):
INSERT HERE INSERT HERE

The project will focus on identifying the problems and its impact on the organization ABC by reducing the annual sales loss with signing new contracts.
	Primary Metric:	Annual Sales		Secondary Metrics:	Time to Process customer order
New customer rate
Customer retention rate

Secondary Metric
Target

38723 38754 38782 38813 38843 38874 40 34 28 22 16 10 Actual

38723 38754 38782 38813 38843 38874 40
Financial Description COPQ

Primary Metric
Target

38723 38754 38782 38813 38843 38874 1000000 850000 700000 550000 400000 250000 Actual

38723 38754 38782 38813 38843 38874 1000000
Defect Description, DPU, Cycle Time or Other