Articles

Six Sigma Approach to Reduce Revenue Leakage in Revenue Recognition Process: A Case Study

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This study investigates business process inefficiency of revenue recognition process at Gajah Logistics, which impact to financial loss. The primary objective of this research is to improve the business process of revenue recognition process, with the purpose to reduce revenue leakage using Six Sigma approach. Six Sigma DMAIC methodology was used as foundation of the problem-solving approach, while in each process Six Sigma Tools also applied.

The study conducted in five main approaches following the DMAIC methodology. First, business process related to defined into business process mapping on a swim lane visualization. Secondly, the fault factors measured using Fault Tree Analysis (FTA) and prioritized using pareto analysis. Third, each faut basic event analyzed using inferential statistics. Then the gap analysis conducted to improve with benchmarked state of the art. After that, solution was formulated and prioritized using effort-impact matrix. Finally, the post implementation impact was simulated to give new baseline of the process quality.

The overall process quality measured by DPMO at the current state was 2.5 sigma level, which was causing a huge loss to the company. After implementing sigma level is improved to 3.5 sigma level, while the loss reduce 76%.

The research conclude that Six Sigma approach could give company systematic approach to solve the complex and cross functional process inefficiency. The results also showed that if an organization applies effort-impact analysis, it obtains valuable information necessary to support decision-making processes.

Deciding Financial Problem Solution for a Construction Company using Fault Tree Analysis (FTA) and Fuzzy Analytic Hierarchy Process (Fuzzy AHP)

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PT X is a construction company with clients spread among Central Java, West Java, Papua, Kalimantan, and Sulawesi. This company experienced financial problem and with the absence of financial bookkeeping, the financial issue was difficult to trace and each manager and also the owner had different perceptions toward the financial problem. One said that it was caused by bad financial investment decision, many said that it is because client late payment, while the other said that it is due to lack of orders and competition. In other word, this problem is still a perceived financial problem. This research was conducted to find the root cause of perceived financial problem in PT X as well as to find the best solution to solve it. By establishing 2 methods that consisted of fault tree analysis (FTA) and fuzzy analytical hierarchy process (fuzzy AHP), employing the thinking framework of value-focused thinking (VFT), the best solution was decided. FTA was used to identify the root cause of the problem which was bad investment decision. After that, reverse brainstorming was conducted to find all possible solutions. Before jumping into alternative solutions, VFT, a thinking framework, identified that control and simplicity was the value that the owner considered. 3 alternative solutions which were asking to financial consultant, hiring financial analyst, and training current financial manager, then analysed using fuzzy AHP with context suitability, sustainability, time needed, and cost as the criterion, and found out that training current financial manager is the best alternative to be chosen.