Another thing that is important a lot of the calls we

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Another thing that is important, a lot of the calls we get are because we are somehow short or late with a payment, but I suspect that we may be over-paying some invoices and suppliers may not be calling us about those errors.” Sarah: “Wow, I didn’t realize that we were having so many problems. We certainly want to fix them to encourage good relationships with our suppliers, and we sure don’t want to be over-paying invoices! What kind of data have you been gathering on the incorrectly paid invoices?” Colleen: “I’ve asked the analysts to keep track of the reasons for the invoice errors over the past couple of months using some check sheets that we’ve created. I can get a copy of the data to you right after we finish with the current state VSM.”
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Summary of Ramsville work day Number of clerks: 36 Number of AP analysts: 18 Average annual vacation days: 5 Number of company holidays: 5 Work day: 7:30am to 5:00pm M-F Breaks 2 @ 15 mins each (paid) Lunch 30 mins (unpaid) Daily Meeting 15 mins Housekeeping/5S 15 mins Number of invoices found per week to be PFR by AP analysts Week PFRs found each week 1 30 2 27 3 24 4 23 5 22 6 21 7 19 8 38 9 21 10 22 11 23 12 6 13 25 14 25 15 26 16 25 17 25 18 25 19 20 20 24 21 23 22 26 23 24 24 25 25 23 26 26
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Checklist results of invoices paid with errors per supplier complaint (6 months of data) Check sent without signature 18 Check sent without invoice reference 42 Sent to the right company but wrong address 21 Wrong invoice referenced 29 Paid short 27 Over paid 9 Paid paper invoice twice 7 Paid PFR invoice 8 Paid on a canceled purchase order 12 Payment sent to the wrong company 11 Payment returned for unknown reason 6 Two company’s payments sent in one envelope 9 Paid late 342 Payment never made 35 Payment sent for material that was returned 9 Other 46
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Case Assignment: 1. (20 pts) Draw the current VSM. Be aware that every single invoice may not move in a perfectly linear flow through the system. 2. (5 pts) From your VSM analysis, answer the following questions: a. What is the total lead time for this VSM (‘pay now’ and ‘pay later’)? b. What is the total processing time for an invoice (‘pay now’ and ‘pay later’)? c. What percentage of time does an invoice spend waiting (‘pay now’ and ‘pay later’)? 3. (5 pts) Identify which activities add value and which do not. 4. (10 pts) What recommendations do you have for improving these process? a. What are the possible costs and benefits of the recommended improvements? b. Are there any issues to resolve before implementing the improvements? 5. (25 pts) Draw a future state VSM and re-answer all the questions from #2 above. 6. 12.5 pts) Create and analyze the appropriate SPC chart from the data on the PFR check done by AP analysts. 7. (12.5 pts) Use TQM tools, as discussed in the text and class, to analyze the invoice error data. 8. (10 pts) Generate a formal report of your findings following the strategic and technical guidelines for case write-ups as posted in Carmen.
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  • Spring '13
  • stevelundregan
  • AP, invoice, invoices, Sarah McDougal

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