DMAIC Project: Speeding up Invoicing

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Baseline (Define)

The company's financial management drew attention to the slow turnover of sales invoices. There was a need to investigate the reasons for the delay in invoicing and ways to speed up invoicing. The average invoicing time was almost two months at baseline. The aim of the project was to reduce invoicing time by at least 50%.

Process performance at the beginning (Measure)

The importance of data in defining the baseline situation and in defining and targeting measures was crucial. The available data enabled both monitoring and targeting of various support measures.
At baseline, 92% of invoices were out of spec, with an average invoicing time of 51 days and a variance of 47.

Improvement measures (Analyze & Improve)

Analyses:

• The process performance analysis identified performance problems.
• The control cards illustrated well the problems in managing the process.
• The Individual Value Plot illustrated the differences in performance between individuals.
• In the brainstorming session, end-users worked out the root causes of the problems in a fishbone diagram.
• The process analysis confirmed the challenges related to the usability of the information system.

Examples of root causes => elimination measure:

• The main problem is related to the usability of the billing application, which is difficult to use, especially in special cases => Support when requested and provided on the basis of data.
• Training on how to use the application has been incomplete => Guidance completed and training targeted based on data.
• Inadequate monitoring and intervention on invoicing => Weekly snapshot update for supervisors and management.
• The RACI matrix helped to clarify the different roles.

Results (Control)

• The average billing period fell from 51 days to 22 days and the variance from 47 days to 30 days.
• A further improvement was decided to be done outside the project to improve the usability of the application. The aim is to achieve automatic invoicing in 80% of cases.
• Created a clearer picture of the situation for management, follow-up action launched.
• In particular, the role of management in driving the process has been taken into account and continuous improvement meetings have been implemented.
• Audit agreed to be included in the organisation's audit plan

Lessons Learned:

• Change in a large organisation happens slowly, and the risk of reverting to pre-improvement levels must be taken into account.
• We rarely spend too many resources on engaging management.

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This project was a Lean Six Sigma Green Belt training exercise project, which the participant did as part of the training and received a Green Belt certificate at the end of the project.
If you are interested in learning how to improve your processes using Lean and Six Sigma, and obtain a Green Belt Certification at the same time, please visit the training link: Green Belt training.

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