Contract Setup AccuracyProject 0307-10-001

Black Belt: Rob VaughnWeek 2 PresentationDefine and Measure Phase

2

Background – Current Process

e-IKON platform facilitates the auto-creation of a service contract (setup) by the IBS Sales person at time of new equipment sale.

Auto-creation processing referred as OSO.

Non-OSO processing (Order Management) requires Manual creation of Service Contract.

Approximate time for processing Service Contract in OSO model is 20 min.

Currently 44% of contracts set up manually (OM)**, not through OSO processing.

21 personnel in Contract Setup function.

3

Project Definition

Problem Statement:

44% of contracts required to be set up manually, 56% via Oracle Sales Online capability. 21 FTE performing Contract Processing(Cent and SE). On-line processing approx. 20 min. per contract, Manual set-up in excess of 45 min. per contract.

Project Definition:

Reduce number of contracts requiring manual set up from 44% to 20%.

Project Benefits:

Reduction in labor costs of 6 Contract setup personnel - $192k/yr. Current backlog of manual processing, reduced overtime labor.

Improved customer satisfaction with timely billing and application entitlements.

4

Project Definition, Cont’d

Financial Benefits: 44% to 20% manual set up service contracts, reduction of 6 FTE,

$192k plus OT labor. Reduction in credits processed for Time & Material charges

generated during timeframe contract is inactive – not developed yet.

Project Metric “Y”: Strategic Goals: Improved customer satisfaction, reduced costs. Y = # of contracts set up manually, reduce #.

Defect Definition: Manually set up contract.

Leveragability: Project currently applicable to “live e-IKON” regions Cent and SE.

Leveragability to all Regions going forward, cost avoidance.

5

Project Team

Black Belt – Rob Vaughn Champion – Debbie Kok, Jim Morrissey Financial Analyst – Gary Milliren Process Owner – Debbie Kok Team Members: two teams Houston and Duluth

e-IKON Sales – Karl Lamb e-IKON Orders Management – Michelle Craft/Tracy Carter e-IKON Contracts – Sue Knight, Jan Chisholm, Donna Estes, Kyle

Hannah, Angie Adame Sales – Bryant Young, Howard Warteman

Master Black Belt – Bob Conrad, Six Sigma Academy

6

SIPOC

Process Owner:

Inputs Outputs

(Resources required by the process) 6

(Deliverables from the process) 3

Requirements Requirements

Client needs communicated IKON can supply/meet needs

Request to Prepare/Execute a Service Contract

shows up in que (manual or electronic)

Contract Processing Group

Prepare request Online or ManualSpecific Service info available

all price, contact, type, information is available

Contract Processing Group

Review request satisfies cust needs Less people to process

current, minimal backlog, lowest cost

Contract Processing Group (reduce costs = IKON)

Forward/transmit request

Oracle transmit, fax, or ship packet of documents to correct location 2

More timely/efficient processing

measurement tools in place for time/cost or processing requests

Exernal -customers Internal - Sales Groups

Contract Set Up (Reduce Manual Processing Debbie Kok

Process(Top level description of activity) 8

Customers(Anyone w ho receives a deliverable from

the process) 5 4

Need for Service contract

Receive less manual requests to activate a Service Contract 44% reduce to 20%

Submit to Contract Processing

7

Current DPMO

-0.4 -0.2 0.0 0.2 0.4 0.6 0.8 1.0 1.2

USLUSL

Process Capability Analysis for %Def Tot

USL

Target

LSL

Mean

Sample N

StDev (Within)

StDev (Overall)

Cp

CPU

CPL

Cpk

Cpm

Pp

PPU

PPL

Ppk

PPM < LSL

PPM > USL

PPM Total

PPM < LSL

PPM > USL

PPM Total

PPM < LSL

PPM > USL

PPM Total

0.200000

*

*

0.433160

105

0.196785

0.240062

*

-0.39

*

-0.39

*

*

-0.32

*

-0.32

*

809523.81

809523.81

*

881960.92

881960.92

*

834288.51

834288.51

Process Data

Potential (Within) Capability

Overall Capability Observed Performance Exp. "Within" Performance Exp. "Overall" Performance

Within

Overall

8

DPMO baseline Z

Current Process Capability: as measured in sample size of 105 daily % defects (manual contracts), both Hou and Atl combined consists of:

Mean – .433 St dev – .197 DPMO – 809,524 Equates to an initial Z value of -.875 Hou and Atl capability is similar

9

Process Map (hi-level)

Ext Customerneeds

discussion

Outsidesales

Reviewneeds/processrequest

OSOcapable?

Comp Eq/Svc Config -

submit

OC rechardcopy &Oracle req

OC ReviewQuo summmatch MA?

Book Equip/Svc &

Fwd Pwork

SupplyChain

ShipConfirm

ContractsGroup

Activates

yes

NO - Sales Resubmit

Service ContractProcess

ContractDept

CompleteManual

paperworkOC Review

Quo summmatch MA?

OMModule -

book EquipForward Svc

ContractPaperwork

NO

ContractsGroup - SetUp ManualContract -Activates

Yes

NO - Sales resubmit

ContractSales

Reviewneeds/processrequest

CompleteManual

paperwork

Forward SvcContract

Paperwork

VendorContracts

RicohCanon

Vendor OCreviews Request

Enters EquipOrder

Forwards Paperwork forService

(IB Print, Vendor Form)

SupplyChain

ITT Groupfrom OMD

Region

ICITReceived

OC KeysEquip

manually

Books thruSupply Chain

Equipbooked w/warranty

line?

SupplyChain

ShipConfirm

Local Serviceactive throughwarranty line

Requestoriginal MAfrom OMD

region

ShipConfirm

Process formanual

service setup

YES

NO

Third PartyRequest (otherdealers/localdistributor)

Run ContractCreation Report(OSO failures)

Contract Grouprequests Paperwork

from OC

Review issues/processing errors

Manual Set upcontracts to

resolve

OSODecision

Criteria Page2

Paperwork- Page 3 -

3rd PartyPaperwork/

Request - direct toContract Set up

Group

Enters Equip/Update IB

Prepares contractset up based on3rd party request

ShipConfirm

Changes ineq orderneeded?

yes

NO

ModifyEq/book

Eq changecancels

OSO svc -manualsubmit

yes

IBChanges -email notify

Re-link owner orset up new cont.

10

Process Map - detail

Ext Customerneeds

discussion

Outsidesales

Reviewneeds/processrequest

OSOcapable?

Comp Eq/Svc Config -

submit

OC rechardcopy &Oracle req

OC ReviewQuo summmatch MA?

Book Equip/Svc &

Fwd Pwork

Changes ineq orderneeded?

ModifyEq/book

Eq changecancels

OSO svc -manualsubmit

SupplyChain

ShipConfirmComplete

Manualpaperwork

OC ReviewQuo summmatch MA?

OMModule -

book Equip

Forward SvcContract

Paperwork

ContractGroup

Reviews On-Line Service

Contract -Performs QA

- Activates

ContractGroup

receivespaperwork- Sets up

contract inContractModule -Performs

QA -Activates

OSODecision

Criteria Page2

yes

NO

NO - Sales ResubmitNO - Manual Process

yesyes

Customer Issues:Budget# machtype machwhat covered (Parts, Labor..Response time/daysCopy volumeBilling Freq.Type Lease/buyTerm of Lease/SvcHow many invoices/cycleWho bills

OSO or Manual decision:

OSO CapableEquip in Natl Price BookNot IR 110Svc meets Std Service OfferingNo Price exception for IM/IMPNo Price exception for IM/IMP

Manual If:IR 110 equipEq not in Natl Price BookLease Type:FlexStepRenewal/RefinanceAddendums/AmendmentsAdd or delete svc or equipAdd to existing GroupRecurring Prof Svcs chargesLarge OrderComplex OrderUnlike Meters (color, B/W)Stand alone svc (no equip)IM/IMP Price exceptionIM/IMP Svc exceptionException to Std Svc OfferingLegacy customer - spreadsheet billCycle billing variations (base,over)Other

Sales Personenters requiredfields in OSO

for Service andEq - submits toOC for booking

Customer needsdiscussion occurswith other IKONentities exceptOutside Sales

Manual ServiceContract

Processing

Contract SalesVendor Contracts

Inside SalesITT

3rd Party Dealers

OC Reviews Equiporder/print ofscreensInstalled base listbase and add on eqService Request/billing comparedwith generatedMaint. Agreemnt

Quotesummary does

not matchMaint Agree -kick back to

Sales - rework

If OC needs tomodify equip orderthru OM module -

any changescancel original

Service Requestthru OSO - Manual

paperworkforwarded to

Contracts for Setup

Complete Svc Config:TermCopy AllowanceEntit. B/S/GMach #, componentsPricing: New, Natl,RetailCoverage 8x5x4 defaultBilling Opt: mo/annLease or Buy# Eq = # ContOnly new equip, no exist grpSvc Price CheckLink Equip to 1 contractNatl Std Price pickInput Ovg ratesBlend MetersShow Base/OvgBill to selectMtr contactsSave = QA run - Pass?Succes Sale = Contr. #

Paperwork

Paperwork-pg3,fwd by fax,mail

Same as Outside sales-Manual paperwork

forwarded

No-resubmit pwork

yes

D&A

11

OSO Criteria

OSO DecisionCriteria

Notsupported

in OSOsystem(ManualSet Up

required)

Capable of On-Line

Processing

EquipmentIR 110Items not in Natl Price BookItems in Natl Price Book but not Config.ServiceLease types:FlexStepRefinance/RenewalAddendums/AmendmentsAdd or delete equip/service to Exist GrpRecurring Prof ServicesLarge Order (defn?)Complex Order (defn?)Unlike Meters (Color & BW)Stand alone service( no equip sale)IM/IMP price exceptionIM/IMP service exceptionExceptions to Standard Service OfferingsLegacy Customer being spreadsheetbilledCycle billing options limited to selectionsNo cost / copy options, only allowanceDiscounted pricing beyond StandardOther

Manual Process

OSO Process

SOURCE:

Any Requirement toProcess ServiceContract initiated by: - Contract Sales - Vendor Contracts - Inside Sales - ITT - 3rd Party Requests - OSO Fail toProcess Report - OC chg to Eqorder- IB changes- OSO capable butdidn’t

Equip. in Natl Price Book Service Offering in Standard Services Guide No Price exceptions (IM/IMP) No Service exceptions (IM/IMP)

Manual Processing

Y = % of ManualContracts

X = Sources +OSO limitations

12

Measurement System Analysis

Not complete Plan – Defect Decision (OSO or Manual) at time of

Processing initial request 3 Sales Personnel, process 30 sample orders, Repeat Attribute characteristic known (Manual or OSO) 30 sample orders = 15 OSO, 15 Manual 15 Manual = 5 ea from 3 categories

13

Data Collection/Samplingneed e-Ikon logo version 1.???

Sales Rep NameMarketplace Order Coordinator Name

OR: Initiating Source Name

Reason for Manual Entry:INITIATING SOURCEOutside Sales/OC - specify reason(s) belowContract Sales - manual onlyVendor Contracts - manual only3rd Party Sales - manual only

Reason for Manual Entry from Outside Sales/OCEQUIPMENTiR110 / 150Selling other equipment not listed in Natl Price BookLEASE TYPES

Flex Lease

Step Lease

ADDITIONAL NON-SUPPORTED EXCEPTIONS

Refinance / Term Renewal

Lease Addendums / Amendments (adding/deleting equipment or service)

Add/Delete/Modify Equipment or Maintenance to Existing Group Bill

Recurring Professional Services Maintenance Fee

Stand Alone Service (no equipment sale)

IM/IMP Lease with Price Exception

IM/IMP Lease with Service Exception

Unlike Meters in Service Plan (Color, B&W)

Exception to Standard Service Offerings Sold: (specify below)

OSO Initiated Request - Modified in OM Module (canceled Service)

Cycle Billing option not available - specify below

Large/Complex Order - if checked, detailed description required:

Other - if checked, please describe:

Sales Rep SignatureDate

OC Signature

Manual Order Entry Request

Customer Name

The Sales Online order entry process was designed to accommodate the majority of IKON's business needs. At this point in time, there are several recognized reasons why an order cannot be submitted by the Sales Professional through the Sales Online applica

14

Current Voice of Process

20 40 60 80 100

0.0

0.5

1.0

Observation

%Def

Tot

Number of runs about median:Expected number of runs:

Longest run about median:Approx P-Value for Clustering:

Approx P-Value for Mixtures:

Number of runs up or down:Expected number of runs:

Longest run up or down:Approx P-Value for Trends:

Approx P-Value for Oscillation:

51.000053.4952

13.0000 0.3123

0.6877

64.000069.6667

6.0000 0.0929

0.9071

Run Chart for %Def Tot

15

Project Issues – next steps

Initiate Data Collection on X’s (Source/Categories of why manual and #’s)

Perform MSA, Attribute Gage R&R, id testers Pareto X’s for size of buckets Discussions of Technology

enhancements/improvements/availability to other than Outside sales

Data on financial benefits, id current backlog, overtime, %contribution of manual contracts