Business Performance: A Case Study Of ABC Milk Farm

Performance is the methodology of how a task is being done. In an organization, every task that is performed contributes to the revenue of business being done by the organization in some way. So the process involved in completing the task has a direct impact on the cost involved in completing the task and ultimately the final revenue that is generated by the business. When the desired results from the task is obtained with less cost, in less time and minimal wastage then the task is measured to have a competent performance. Thus in every organization, performance plays a vital role in success and stability of the business. And so organizations strive to continuously improve the performance of their tasks to ensure increased revenue and customer

To illustrate six sigma methodology let us consider a case study of ABC milk farm. ABC milk farm houses 1000 cows and its primary revenue is from the production of milk and milk products. Every month ABC milk farm spends ₹ 10,00,000 in procuring the raw ingredients to feed its 1000 cows. The ABC milk farm CEO wanted to reduce the spending on cattle feed without compromising on the quality of the cattle feed or health of the cattle. A six sigma Champion was called upon to take up the task. As this involved improving an existing process, the DMAIC six sigma methodology was decided to be followed.

In the Define phase the project goal was defined. It is to reduce the cattle feed spending without any reduction to the quality of cattle feed or to the health of cattle. In Measure phase the invoice orders for cattle feed procurement were collected. Data was collected regarding the amount of cattle feed given for each cattle. In the Analyze phase, It was found that in most cases the cattle feeds were purchased from the same vendor even though there were other vendors who provided the same quality of cattle feed at a better prize. Also the cattle feed given to each cattle was fixed and not optimised to be according to the healthy weight of cattle. In many cases the cattle were overfed and cattle feed were wasted. So 2 defects were identified in process of acquiring and utilizing cattle