Current State VSM Essay

1065 Words Dec 3rd, 2014 5 Pages
MEMORANDUM
November 15, 2013

TO: Sarah McDougal, Manager of Disbursements at Ramsville
FROM: Team 5
SUBJECT: Process Improvements for Ramsville
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Team 5 will be analyzing and providing recommendations on how to improve the issue of overdue payments to suppliers at Ramsville. After walking the process, creating a current value stream analyzing data, Team 5 has suggestions on how to increase efficiency by eliminating muda that will improve customer satisfaction and supplier relationships.

ANALYSIS
Team 5 identified the key issues by creating a Current Value Stream Mapping (Table 1, Page 3). Ramsville’s pay now invoices have a total lead time of 196,200
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The next recommendation Team 5 has is to increase the processing time at the PFR Check to 600 seconds. Team 5 believes this will increase the accuracy of invoice checking because an additional four minutes will be dedicated to the task and employees will have more time allotted to double check the accuracy of the invoices being passed to the next activity. This will assure the practice of quality at the source is being used so that incorrect information is not being passed onto subsequent processes.
Another recommendation is to eliminate the batch process so that payments can get to the suppliers at a faster rate and decrease the number of supplier complaints, summarized on Table 7 (Page 7). This will eliminate the muda of the extra time needed to un-batch the invoices so that information can be relayed to suppliers quicker.
Team 5 also recommends implementing an automated process system that automatically scans and enters invoices into the payment processing software. With the implementation of this software, Pay Later Invoices and Pay Now Invoices can be eliminated from the process. Additionally, Team 5 suggests moving the two employees from Pay Now and Pay Later Invoices to the Final Check activity. This will eliminate the bottleneck of over utilization at the Final Check because the number of employees increases to three. Although the utilization decreases by over 30%, it leaves room for variability and decreases the stress put