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OPERATION MANAGEMENT(Final Test: Take Home Test)SIX SIGMALecturer: PROF. DERMAWAN WIBISONO

SIX SIGMA IN PISANG SALE SONIA (CAU)

BY

MEGA MUSTIKA29114929COMPANYPisang sale Sonia is founded in 2011. It has 4 employee who help the production of Pisang Sale Sonia.It is located in Kecamatan Cihideung, Tasikmalaya

PRODUCTPisang Sale Sonia is made from pisang ambon. It has four different flavour: original, cinnamon, ngiger, and sambal goang. The added flavour is advantage or Pisang Sale Sonia.It is packed into 250g for each. Each pisang sale has 1-2cm x 15-17cm.Price from owner is Rp.10.000 and from reseller is Rp 12.000-15.000It has approved by National Health Ministry with Dinkes P-IRT No. 2143278010657-18. It also has certification from MUI West Jawa with No. LPPOM MUI Jawa Barat: 0112109357113.

STRUCTURE ORGANIZATIONJob Desk:

Chief : Organizing and Controling the supply chain process

Supervisor : Helping the chief in controling the process of production

Worker 1 : peeling, cutting, and draining banana

Worker 2 : preparing the batter, frying, remove its oil, and packaging

Helper : helping the workers and delivering the productSIX SIGMASix sigma programs seek to reduce the variation in provess that lead to defects. Defect is simply defined as component that does not fall within the customers spesification limits.The central idea behind Six Sigma is that if you can measure how many "defects" you have in a process, you can systematically figure out how to eliminate them and get as close to "zero defects" as possible. Six sigmas method employed in a systematic project-oriented fashion through the define, measure, analyze, improve, and control (DMAIC) cycle.

SIX SIGMA

To achieve Six Sigma Quality, a process must produce no more than 3.4 defects per million opportunities. An "opportunity" is defined as a chance for nonconformance, or not meeting the required specifications. This means we need to be nearly flawless in executing our key processes.

Key Concepts of Six Sigma based on General Electric Philosophy: DMAIC METODOLOGY SIX SIGMA STEPS PROCESSESDEFINEIdentify customers and their prioritiesIdentify a project suitable for Six Sigma efforts based on business objective as well as customer needs and feedback Identify CTQs (critical-to-quality characteristics)MEASUREDetermine how to measure the process and how it is performingIdentify the key internal processes that influence CTQ and measure the defects curently generated relative to those processesANALYZEDetermine the most likely causes of defectsUnderstand why defects are generated by identifying the key variablesIMPROVEIdentify means to remove the causes of defectsConfirm the key variables and quantify their effects on the CTQsIdentify the maximum acceptance ranges of the key variables and a system for measuring the deviations of the variablesModify the process to stay within an acceptable rangeCONTROLDetermine how to maintain the improvementsPut tools in place to ensure that the key variables remain within the maximum acceptance ranges under the modified processPROBLEMSPRODUCT:The fluctuation of priceProblems occur when there is raising in price of materials. Sonia wouldnt easily increase the price because the fluctuation but it obviously reduce the profit of owner. The dried banana is break when frying.There is no burnt from the frying process. The employee is really careful when frying the banana although sometimes its break in the process. But the break sale pisang is still eligible for sale. Sonia sells the break sale pisang with smaller package to the kiosk or warung around her home.

MACHINE :Problem also occurs because of machine failure, temperature setting not optimal, lack of maintenance, etc.

HUMAN :Problems also occurred from the human error such as less experienced, exhausted or less control. The last factor is from the machine such as

METHODS:The main problem in producing sale pisang is drying process, such as :The Banana is easily rotten if drying inapropiately especially in rainy season.It is really difficult to control the drying process because the technic and machine are still using the traditional methods.

DEFECTS FROM DRYINGDAYPRODUCTION (g)DEFECT (g)OUTCOMES (g)1100.0001.2003602100.0001.0003003100.0001.1003304100.0001.3003905100.0001.4004206100.0001.2003607100.0001.1003308100.0001.2003609100.0001.00030010100.00090027011100.00080024012100.0001.00030013100.00070021014100.00060018015100.0001.30039016100.0001.20036017100.0001.10033018100.0001.00030019100.0001.20036020100.0001.10033021100.0001.00030022100.00090027023100.00080024024100.00090027025100.0001.00030026100.00070021027100.0001.20036028100.0001.30039029100.0001.50045030100.000700210TOTAL31.4009.420Defects from drying means:The banana isnt dried properly or rotten in process. So it has to be disposed.

The outcomes from defects of drying can be calculated:Loss = (Total possible outcomes / weight per pack) x selling price

Loss = (9420g : 250g)*Rp.10.000,00

Loss = Rp 380.000

Sonia has lost arounD Rp Rp 380.000/ month

DEFINE (1)SUPPLIESINPUTSPROCESSESOUTPUTSCOSTUMERSBananaSellersAmbonBananaCooking the BananaSale PisangTraditional and Super Market in TasikmalayaSoniaBatter (tapioka flour, rice flour, butter, sugar, coconut water, oil, cinnamon, ginger, and sambal goang) Traditional Market in BandungSmooking MachingSoniaSpoonOthersStoveKnifeBamboo TrayPlastic for wrappingFried PanWoods or Coconut ShellSIPOC DiagramThe first step is to define goals to improve the overall process . We create SIPOC diagram that used to improve an operation process. This diagram also shows the work flow of 5 elements : Supplier, Input, Process, Output and Customer.

DEFINE (2): SALE PISANG COOKING PROCESS

We also create the operation process chart (OPC) in define. This OPC show a more detail of the step of the process conducted of the product.1. The process of draining uses two methods: spread out the banana on the bamboo tray then dry it directly by under the sun and by smooking machine. The drying process takes two-three days depending on weather.

2. The ingredients of batter are: tapioka flour, rice flour, butter, sugar, coconut water, oil. The batter then pour into three separate large bowl and be added several flavor such as cinnamon, ginger, and sambal goang.

3. Sonia use spinner machine to remove the oil from sale pisang

4. Each package contains 250 g.MEASURE (1)DAYPRODUCTIONDEFECTOUTCOMEDRIED BANANAPOSSIBLE PACKPERCENT OF DEFECTS1100.0001.20036039640158,560,9081735622100.0001.00030039700158,80,7556675063100.0001.10033039670158,680,8318628694100.0001.30039039610158,440,9845998495100.0001.40042039580158,321,0611419916100.0001.20036039640158,560,9081735627100.0001.10033039670158,680,8318628698100.0001.20036039640158,560,9081735629100.0001.00030039700158,80,75566750610100.00090027039730158,920,67958721411100.00080024039760159,040,6036217312100.0001.00030039700158,80,75566750613100.00070021039790159,160,52777079714100.00060018039820159,280,45203415415100.0001.30039039610158,440,98459984916100.0001.20036039640158,560,90817356217100.0001.10033039670158,680,83186286918100.0001.00030039700158,80,75566750619100.0001.20036039640158,560,90817356220100.0001.10033039670158,680,83186286921100.0001.00030039700158,80,75566750622100.00090027039730158,920,67958721423100.00080024039760159,040,6036217324100.00090027039730158,920,67958721425100.0001.00030039700158,80,75566750626100.00070021039790159,160,52777079727100.0001.20036039640158,560,90817356228100.0001.30039039610158,440,98459984929100.0001.50045039550158,21,13780025330100.00070021039790159,160,527770797TOTAL31.4009.42011905804762,320,791486377In this step, we tried to measure the process and how its performing.

The next table shows :The total production in month is 3.000.000 (gr)

Its total production of dried banana is 1.190.580 (gr)

The posibble pack is 4762

The percent of defect is 0,79%MEASURE (2)

One of benefit of Six Sigma thinking is described the performance of a process in terms of its variablitiy and to compare different processes using a common metric. This metric is defects per million opportunities (DPMO). The calculation of Pisang Sale Sonia shows below:ANALYZE: FISH BONE DIAGRAM

We are using the fish bone diagram to elaborate the factors that caused defects. The analysis conducted only in the drying process of banana.

IMPROVE (1): TRADITIONAL SMOKING MACHINE

Weve found that the reliable machine is important in reducing the causes of defect in drying process. However, Sonia didnt use properly machine to fasten the process of drying. Sonia has traditional smoking machine which is illustrated beside.

The strenght :Sonia has the machine since years ago so it didnt cost her much at the beginning stage of businessThe fuel is from woods and coconut shell that are cheap in Tasikmalaya.

The weakness:It doesnt support the production if Sonia get many order. It doesnt have termostat or timer so it is difficult to control the machine

IMPROVE (2): MODERN SMOKING MACHINE

One of improvement that Sonia can do is having the modern smoking machine

The strenght :It is highly control and accurate because has thermostat and timer.Its easy to use. It doesnt need training to use this.The fuel uses gases, the roof and wall is made by alluminium so its faster to reach its optimal heat.It will reduce the time of drying because the heat is optimum

The weakness:The price is expensive

IMPROVE (3): THE COST OF CHANGING MACHINEThe machine is costed around Rp.6-7.000.000Based on the calculation before Sonia losses approximately Rp. 380.000 each month.By having this machine, Sonia can reduce defect because of lack of control of machine.Sonia will gain another profit by reducing the defect gradually. Moreover, it only cost sonia around Rp. 300.000 each month in two years. It is from calcution of cost of machine / 24 month. It is equal with the loss that Sonia gain from defect. Rp 7.000.000/24= Rp 291.667CONTROLCurrent10%20%30%40%50%60%70%80%90%99,90%Total Defect9.4209421.8842.8263.7684.7105.6526.5947.5368.4789.411Percentage of Loss0,790,710,630,550,470,400,320,240,160,080,0008Sig Sixma Level4,004,004,004,104,104,204,304,404,504,705,90Total Loss per Pack3834302623191511841Total Loss in Rp.380.000340.000300.000260.000230.000190.000150.000110.00080.00040.00010.000Control means taking action in improvement will gradually reduce the defect of product.It shows calculation in process improvement by including: the total defect, percentage of loss, six sigma level, total loss per pack, and total loss in Rp.Sonia can gradually reduce the defect from 10% to 99%. Reducing the defect means gaining the new profit as equal as with the total loss of its defect. If Sonia eventually succeeded to decrease the number of defect up to 99,9%, She will gain: total current loss-total loss of 99%= Rp.380.000 Rp. 10.000 = Rp. 370.0000CONCLUSIONSix Sigma is one of means to measure total defects in production and the sistematically figure out how to eliminate them as close to "zero-defect (99%)". It then employed in DMAIC system. We (D)efines the process, (M)easure the defect in process, (A)nalyze the causes of defect, identify the means to (I)mprove, then calculate the way to (C)ontroling the maintainance of the improvement.

In Pisang Sale Sonia case, we found that the process is still traditionally. The total production in month is 3.000.000 (gr). Its total production of dried banana is 1.190.580 (gr). The posibble pack is 4.762. The percent of defect is 0,79%.

The total loss of profit apporoximately Rp.380.000/month because of defect.

We've also found that the main problems is drying process and having the reliable machine will surely reduce the cause of defect.

Sonia can improve its process of production by having modern smoking machine that will cost her around Rp.6-7.000.000. It's equal with total loss that Sonia could possibly gain from two years of having defect.

It can gradually reduce its defect and help Sonia to gain Rp. 370.000/month.REFERENCESGupta, Praveen. (2006). Six Sigma Business Scorecard, 2nd ed. McGraw-Hill.Heizer, J and Render, B. (2011). Operations Management, 10th ed, Global Edition, Pearson.Jacobs, F.R. and Chase, R.B. (2011). Operations and Supply Chain Management, 13th ed. Global Edition, McGraw-Hill.http://www.ge.com/en/company/companyinfo/quality/whatis.htmhttp://www.isixsigma.com/new-lean-six-sigma/