Using Six Sigma to improve replenishment process in a direct selling company

Abstract

Purpose

The purpose of this study is to propose a Six Sigma project to improve the replenishment process in the logistic center of Amway Taiwan Company.

Design/methodology/approach

This study elucidates the define, measure, analyze, improve and control (DMAIC) methodology of Six Sigma, using qualitative and quantitative tools. Numerous improvement actions are implemented. A control plan is developed to sustain and enhance the performance of the replenishment process.

Findings

The project has substantially benefited the logistic center, including reducing replenishment frequency and urgent shipping rate, decreasing cost of transportation, lowering the inventory of service centers and shortening the replenishment planning time.

Research limitations/implications

The methodology that is employed in this study can be adopted by the logistic centers of other direct companies. However, they can modify the detailed contents and tools according to their organizational conditions.

Practical implications

This study demonstrates a project in which Six Sigma is adopted to improve the replenishment process of the logistic center in Amway Taiwan. It describes how the project was specified, how the tools were employed in the different phases and how the improvement actions were implemented. In conclusion, the key benefits of, and experience gained from this project are emphasized.

Originality/value

This paper will be of interest to academic researchers and practical managers. The structured methodology of Six Sigma integrated logistic techniques was applied in a leading direct sales company. The project in the logistic center of Amway Taiwan provides a good reference for other companies that plan to implement Six Sigma management.

Citation

Wei, C., Sheen, G., Tai, C. and Lee, K. (2010), "Using Six Sigma to improve replenishment process in a direct selling company", Supply Chain Management, Vol. 15 No. 1, pp. 3-9. https://doi.org/10.1108/13598541011018076