SUBMITTED BY

ANKUR SINGH
ANJALI AGATHA LAKRA

Introduction
What is Corporate Restructuring?
Corporate restructuring is the process of redesigning one or more aspects of
a company. The process of reorganizing a company may be implemented due
to a number of different factors, such as positioning the company to be more
competitive, survive a currently adverse economic climate, or poise
the corporation to move in an entirely new direction. Here are some
examples of why restructuring may take place and what it can mean for the
company.
Restructuring a corporate entity is often a necessity when the company has
grown to the point that the original structure can no longer efficiently
manage the output and general interests of the company. For example, a
corporate restructuring may call for spinning off some departments into
subsidiaries as a means of creating a more effective management model as
well as taking advantage of tax breaks that would allow the corporation to
divert more revenue to the production process. In this scenario, the
restructuring is seen as a positive sign of growth of the company and is often
welcome by those who wish to see the corporation gain a larger market
share.
However, financial restructuring may take place in response to a drop in
sales, due to a sluggish economy or temporary concerns about the economy
in general. When this happens, the corporation may need to reorder finances
as a means of keeping the company operational through this rough time.
Costs may be cut by combining divisions or departments, reassigning
responsibilities and eliminating personnel, or scaling back production at
various facilities owned by the company. With this type of restructuring, the
focus is on survival in a difficult market rather than on expanding the
company to meet growing consumer demand.

Corporate restructuring may take place as a result of the acquisition of the

company by new owners. The acquisition may be in the form of a leveraged
buyout, a hostile takeover, or a merger of some type that keeps the
company intact as a subsidiary of the controlling corporation. When the
restructuring is due to a hostile takeover, corporate raiders often implement
a dismantling of the company, selling off properties and other assets in order
to make a profit from the buyout. What remains after this restructuring may
be a smaller entity that can continue to function, albeit not at the level
possible before the takeover took place.

In general, the idea of restructuring is to allow the company to continue

functioning in some manner. Even when corporate raiders break up the
company and leave behind a shell of the original structure, there is still
usually the hope that what remains can function well enough for a new buyer
to purchase the diminished corporation and return it to profitability.

Case study on 3M
Seven years ago, leaders in 3Ms abrasives business saw that customer
complaints were on the rise and belt failures were the no. 1 cause. The
organizations sales representatives were spending 40 percent of their time
handling complaints instead of pursuing sales activities. Customers suffered
and the organization lost sales, which limited business growth and financial
objectives. As one vice president declared, it was time for a quality
revolution.
About 3M and Coated Abrasives
3M was founded more than a century ago with a single technology
abrasives, often called sandpaper. Since then, the organization has grown
into a $25 billion diversified technology giant, serving customers in six
market-focused businesses. The abrasives division is part of the industrial
and transportation business and provides innovative products such as tapes,
adhesives, coatings, and abrasives for industrial and transportation
customers. The organizations coated abrasives come in many converted
forms such as portable belts, back stand belts, utility sheets, cartridge rolls,
utility shop rolls, and more
The Stage for a Quality Revolution
As customers of 3Ms abrasives products provided feedbackfrequently
complaintsto the sales, customer service, and quality teams, the need for
significant quality improvement was apparent. When the executive vice
president of the industrial and transportation unit declared the need for a
quality revolution, he noted, To achieve our growth goals we need a stepchange improvement in quality. Strategic goals rolled down to every
division, factory, and product line with annual targets. Soon thereafter, the
abrasives division established the following goals:
Reduce defects in parts per million (DPPM) by 25 percent per year.
Trim total complaint resolution time by 15 percent per year.
Specifically, the business unit initiated an improvement project to reduce belt
DPPM from 12,000 to 500. To spearhead this work, the Abrasives Belt
Fabrication Improvement Team was chartered in 2003.
Team members estimated that, if successful, the belt improvement project
would have a positive impact on several goals, such as:

More robust products.

Reduced defects.
Better processes and product understanding.
Increased process capability.

Using a Two-Pronged Approach for Quality Improvement

When a situational analysis confirmed that belt and splice com-plaints were
the no. 1 quality complaint for industrial abrasives, the team developed a
two-pronged approach to steer improvement:
Act immediately on the needs of 3Ms leading customers through a
Top-200 program.
Drive long-term continuous improvement with Lean Six Sigma.
Identifying Potential Root Causes
To pinpoint the root causes of belt complaints, the improvement team
used process mapping, cause and effect diagrams, Pareto charts, and
other quality tools. For the Top-200 process, the team used basic
graphing, data analysis, and other communication tools to gather
information from customers. Then, they began the Lean Six Sigma
approach, attacking more chronic problems with the structured define,
measure, analyze, improve and control (DMAIC) model to identify
possible factors causing variation in 3Ms products and processes.
Data and data analysis were key in both the Top-200 and Lean Six Sigma
improvement processes to help determine root causes and relationships.
First, with the Top- 200, complaint and belt testing information was sliced
and diced to support analysis and conversations with key customers about
problems they experienced with belt products. 3M also established an
extensive data collection system to gather data from raw materials, process
information, finished product testing, and waste.

Process: How, Who, Rationale Why Tool Was

Used

Method

Top-200

Define Top-200
customers

Daily complaint
review and

Analyze and
communicate with
sales

scorecard update

CFR database
Tools

Pareto by sales

Who

Sales
management

Excel

Possible Root
Causes
Lack of procedures
Incomplete
instructions
Tests not predicting
performance
Product
uses/application

Product lab testing

Customer visits
E-mail and phone

Lean Six
Sigma

Tools

Manufacturing quality Quality coordinators

Equipment capability

Define

Project charter
Stakeholder
analysis

Measure

Analyze

Process map

Failure mode and

effects analysis
(FMEA), Risk priority
numbering
(RPN), Pareto chart,
Process
capability, Control
charts

Cause & effect

Gauge R&R

Process measurement
Test method
development

Graphing
Who

Product
manager
Master Black
Belt

Black Belt, Green

Belt, Project team

Project team

Both internal and external stakeholders provided valuable input, as sales,

technical service representatives, and end users supplied problem
information and samples. For example, team members met with a Top-200
customer to complete a cause and effect matrix focusing on belt life and
reasons why the belts could fail. Engaging customers in this type of
partnering activity proved to be a powerful business tool for the
organization; subsequently other business units have since replicated this
approach.

The final root causes and improvement path selection for the Top-200
process followed an investigative approach. The team used 5 Whys,
stakeholder dialogue, consensus, and documentation. On the other hand,
statistical software to generate trend charts, compare data sets, and
calculate capability values guided the Lean Six Sigma path.

Validating Final Root Causes

Final Root Causes

Validation
Internal tests
Documentation updates
and

Lack of procedures
approvals
Top-200 Incomplete instructions
Audits
Improper product
use/application
Customer trials
Technical service
customer visits
Gauge R&R and
multivariate studies
Poor equipment
capability
Equipment capability
Lean
Lack of process control
measurement
Six
Sigma Inadequate test method Finished product testing
Voice of customer
development
aligned with
voice of process

In the Top-200
program, the
final causes centered around instructions, handling procedures, and
application settings. These were validated through internal test-ing, audits,
customer trials, and customer service visits. In the Lean Six Sigma process,
final root causes focused on equipment capability process control, and
inadequate testing. Gauge repeat-ability and reproducibility (R&R) studies,
equipment monitoring studies, and finished product testing were useful for
validating the suspected causes.

Developing Solutions
Next, the team focused on possible solutions in the Top-200 pro-cess with

brainstorming activities, experimentation, and sample testing. Possible

solutions were developed somewhat intuitively, based on experience, speed,
and cost of implementation. Data analysis came into play after problem
samples were tested, allowing the team to compare them to historical
information.
In the Lean Six Sigma process, the team employed process map-ping, cause
and effect diagrams, and failure mode and effects analysis (FMEA) for
developing potential solutions to the belt issues. Team members used the
FMEA tool after the first three phases of the DMAIC cycle to create a score or
risk value for potential solutionsthose with the highest scores earning the
highest priority. Risk values were calculated based on severity, occurrence,
and detection of the failure or variation in the pro-cess or product variable.
The criteria for selecting final solutions were similar for the Top-200 and Lean
Six Sigma approaches and included trial results, expected customer impact,
speed and ease of change, as well as implementation costs.
The team selected final solutions for the Top-200 by completing a
customer resolution evaluation that involved reviewing complaints,
samples, test results, and customer feedback. These were documented in a
Top-200 scorecard. For the Lean Six Sigma projects, the FMEA risk numbers
were ranked and entered into Pareto charts. The team also used an oldfashioned gut check as members reviewed the lower-scoring variables
and failure modes from the FMEA to ensure they had not overlooked any
worthwhile solution.
Validating Solutions
The most common solutions in the Top-200 process involved product
specification changes, such as new splice tape or splice preparation
condition. These solutions were validated internally with sample production
and internal product testing. Externally, the solutions were verified by
following up with customers after trial orders were shipped. On the other
side, common solutions with Lean Six Sigma centered on process equipment
modifications. The team validated these equipment changes internally
through hypothesis testing, process capability measurement, and designed
experiments. These experiments produced response surface plots and
mathematical models that helped define process windows and targets,
support troubleshooting, and provide training media for the team.
Overcoming Resistance
As with any process changes, the team did encounter some resistance.
Internally, as the Top-200 process changes were introduced, resistance to

the extra daily work required of operators surfaced. To help overcome this
resistance, the team gathered stakeholder input on how to improve the Top200 flyer, a bright yellow order form that travels with the material from
station to station. After the order forms were modified and customer
success stories were shared, the team quickly secured commitment and buy
in.
Reducing Defects Leads to Increased Sales
Prior to implementing the final solutions, several modifications were
necessary. For example, with the Top-200, changes were made to products
and standards, special handling procedures such as using new splice tape,
and operator training. On the Lean Six Sigma side, typical changes
included equipment
upgrades as well as process, product, and documentation updates.
This team project created several positive intangible and tangible results,
shown in Figure 4.
A key result of the Top-200 and Lean Six Sigma efforts is evident in the
organizations belt fabrication DPPM chart shown in Figure 5, which
illustrates that 3M reduced its DPPM from 12,000 to just 475 in seven years.
Not surprisingly, customer complaints dropped by 90 percent in the
corresponding timeframe and the business realized the benefits of customer
satisfaction, loyalty, and abrasives sales growth of 54 percent. By driving the
belt defects to such low levels, the team project supported the quality
revolution by meeting defect reduction, cost of poor quality, and complaint
response time goals.
Sustaining the Results
3M sustains the process changes through its ISO 9001 procedures, which
require audits, documentation, quality metrics, corrective actions, and
management reviews. The team developed extensive control plans for both
Top-200 and Lean Six Sigma projects. These plans, along with
documentation, audits, and frequent training, continue to sustain 3Ms
quality improve-ments over time. Several quality and business metrics are
charted and monitored through plant dashboards for any statistical shifts
that may warrant attention. In addition, external and internal feedback data
are gathered through satisfaction and loyalty surveys and monitored to
ensure that changes are delivering the expected results and continue to
align with the organizations goals and strategies. Team members report that
the Top-200 process is now a way of life at 3M. The organization follows up
with all critical accounts by conducting a trial production order and a tech
service customer visit to ensure that 3M products meet the customers

requirements.
Another benefit from this project was improved product and process
understanding (PPU), notes Pribyl. He explains that PPU is the organizations
comprehensive quality improvement methodology linking voice of the
customer data back through tests, product specifications, processes,
procedures, and raw materials. By truly understanding the science and
technology behind our products and processes, we can control critical
variables and deliver consistent products to our customers, says Pribyl, an
ASQ Certified Quality Manager.
Lessons Learned
In addition to the improved PPU, Pribyl cites three important lessons
learned from this team project:
Work directly with customers to understand how they use products.
Develop tests that predict performance.
Use data, not emotions, to make decisions.

Earning Recognition and Looking Forward

As 3M enjoyed the internal and external benefits of this project, others took
note of the teams accomplishments. Not only was this project one of two
2009 corporate quality achievement gold award winners at 3M, it also was
named one of 28 finalists in ASQs International Team Excellence Award
(ITEA) process for 2009-10. This marked the first time that a 3M team
participated in the award process.
The next challenge, notes Pribyl, is to continue the momentum from the
team project and reduce the DPPM by another 25 per-cent each year. He
says that newly introduced products will add to that challenge. We are
launching many new revolutionary abrasive products, some with four times
longer life. These new longer lasting products require our belt splices to hold
together that much longer.

Case study on CRC

In 1997 CRC Industries first started tracking cost of quality. Since then we
have come to consider it a key measure for improving business results and
the foundation of our continuous improvement efforts. we have reduced
failure dollarsthe money we spend because of products and services that
do not meet our customers requirementsfrom 0.70% of sales to 0.21% of
sales, saving hundreds of thousands of dollars. Of course everyone knows if
you measure it, it will improve, but there was more to our endeavor than
just simply measuring the results. We crafted a straightforward, but not
effortless, process for putting the cost of quality measurement to work for us
as a driver of product improvement and, consequently, the companys
bottom line.
About CRC Industries
Headquartered in Warminster, Pennsylvania, CRC Industries produces
specialty chemicals for maintenance and repair professionals, serving
automotive, marine, electrical, industrial, and aviation markets. We have
been ISO 9001 certified since November 19, 1996, and in April 2003
independent auditors from Intertek Testing Services confirmed that we
successfully upgraded our quality system from ISO 9001:1994 to ISO
9001:2000.
CRC adheres to strict guidelines in all facets of research, development, and
production. We believe our leadership in the maintenance chemical markets
is reflected most positively in our product development, and we have
committed to a quality policy to meet or exceed customer requirements
while complying with statutory and regulatory requirements and ensuring
cost effective operations.
The cost of quality metric therefore seemed like a natural fit for our existing
quality policy, but we could not have predicted the full extent of the impact it
would have.
Why Cost of Quality?
Often misinterpreted to mean the cost of using quality methods, cost of
quality actually refers to the expense of failing to provide a quality product or
service. At CRC, we use the term failure dollars to describe the different
kinds of expensesfrom the cost of materials and labor for rework, to the
cost of correct shipping and customer service errors, to the cost of product
replacement and wastethat make up the total cost
of quality.

In centering our improvement efforts on cost of quality, we are not simply

focusing on CRCs balance sheet. We are also confronting the issues that
keep us from providing the best products and services possible. While
reduced costs and increased savings remain the primary benefits we track,
we understand that improvements in other quality metrics, such as accuracy,
productivity, and customer satisfaction, are tied to cost of quality results
CRC Industries Cost of Quality Journey
Recognizing the importance of the cost of quality metric to our overall
mission, we set about systematizing our use of the metric as a driver of
improvement through the following steps:
Establish the measurement system
Establishing a consistent measuring system required the involvement
of various departments within CRC, most important our finance
department. Specifically, our task was to determine how the data
would be collected and what categories would be tracked.
This may seem like an easy step at first, but measurement definitions
are not always obvious. Questions we had to address included:
How do we count costs for returns due to customer errors or customer
requests, separating them from returns due to product defects?
How much does a customer service entry error or shipping error cost?
Before we could begin to collect accurate data, we had to negotiate answers
to these questions and many more, and we had to standardize our approach.

Collect the data

To establish a baseline for future improvements, we spent the first year
collecting the initial data. During this step, we finalized most of the
measure criteria and refined the measurement system.
The system developed in 1997 has remained the basis of our cost of
quality measure, ensuring the validity of year-to-year comparisons.
We collected data in four categories of failure dollars:
Internal Quality Incidents, defined as the costs related to correcting
any product defect caught prior to shipping the product, includes all
labor and materials involved in reworking the product and any
materials wasted.

 Scrap/Waste includes chemical waste costs and materials scrapped

due to defects.
Customer Complaints/Recalls are all costs involved in resolving a
customer complaint or recall, including product replacement costs,
claims, shipping costs, and labor costs.
Product Destroyed in Field/Warranty is the cost of the deductions our
distributors take for product returned by their customers.
Analyze the data
We reviewed data in several stages, making monthly, quarterly, yearly, and
year-to-year comparisons. By examining first each of these four categories
and then the types of problems within each category, we conducted Pareto
analyses to reveal where we were making the most progress and where we
should focus ongoing efforts.

4.
Improve the results
As Figure 2 shows (page 3), total failure dollars decreased from 0.70% of
sales to 0.21% of sales. This amounted to a savings of hundreds of
thousands of dollars for CRC Industries.
Merely tracking cost of quality could not in itself bring the results we were
seeking. With cost of quality as a driver, several key initiatives contributed
to our improved results:

ISO 9001:2000 certification, achieved in 1996, laid the foundation for

our quality system. When we make changes to process, we update
documentationincluding procedures, checklists, and instructionsto
assure consistency and compliance.

As part of meeting ISO 9001:2000 requirements, we established

quarterly management reviews, which include a review of quality
incidents and customer complaints and the related cost of quality data.
These reviews give upper management a better understanding of the
issues so they can authorize appropriate improvement initiatives.

Root Cause Analysis sessions have been key in reducing failure costs related
to internal incidents and customer complaints. Every employee has received
basic training in the relevant techniques needed for these sessions.
The director of Quality Systems facilitates problem-solving meetings to
develop corrective and preventive actions for all significant quality incidents.
These meetings involve production operators, supervisors, mixers, shippers,
buyers, suppliers, and managers as needed to resolve the problem.
As appropriate, we use techniques like ask why 5 times, fishbone analysis,
and process mapping to uncover the root cause of the problem. Immediately
following the session, we put a series of action items in place. In cases of
longer- term projects involving capital approval or training, we add the action
items to a pending list.
Sometimes forming an improvement team to work over several weeks or
months on improving a process is necessary. Action items and improvement
teams progress are tracked and reviewed at the quarterly management
reviews.
We use our Quality Incident Database to track quality incidents that we catch
and correct prior to shipping product. The causes are categorized based on
the 4 Ms: specification errors (methods), operator/mixer errors
(manpower), equipment problems (machinery), and problems with supplierprovided materials (materials). Costs are also tracked in the database and
the information is used in the cost of quality metric
All of these data feed our root cause analysis sessions as appropriate. We
provide some data to suppliers on an annual basis as part of their formal

supplier evaluation. A summary of the information is also presented at

quarterly management reviews, and improvement teams are authorized
as needed based on these data.
Our Customer Complaint Database allows us to collect data and analyze
trends in product complaints from our customers. Prior to the database,
identifying a problem took much longer since several customers could call
in to several different customer service representatives. Each call was
viewed as an isolated problem. While we took immediate corrective
action with the customer, such as replacing product or issuing credit, we
did not identify patterns and thus could not take preventive measures.
With the database, we can consolidate information and use it to identify
and correct a recurring problem much faster. We also can track the costs
related to each complaint.
Customer complaint data are summarized and reported to all employees
monthly. The database is also reviewed for trends quarterly and yearly.
Pareto analysis of the data allows the management team to select projects
that further contribute to a reduction in failure dollars.

CRC Industries Continuing Commitment to Quality

As our key initiatives work together toward improving cost of quality
results, we have witnessed a synergistic effect that facilitates continuous
improvement throughout CRC. We can directly or indirectly link cost of
quality improvements to other improvements, including, shipping error
reductions, customer service order entry error reductions, productivity
increases, hazardous waste reduction, and profitability.
Metric

% Improvement
Since
Tracking Started

Directly related:
Order Entry
Accuracy
Order Shipment Accuracy
Hazardous Waste
Reduction
Indirectly
related:
Orders Shipped Complete
& On Time

0.6%
1.0%
50%

20%

Productivity

65%

Order entry and shipment accuracy are directly tied to cost of quality, as
each error adds $100 to overall failure dollars. Although improvements of
0.6% and 1.0% may appear to be minimal, our order entry accuracy was
already over 99% at the start of our cost of quality project, and our order
shipment accuracy was only slightly under 99%. These gains therefore
brought our accuracy rates even closer to 100%.
Hazardous waste costs are also included in our cost of quality failure
dollars. Part of the overall cost of quality gains we have made can be
attributed to our reduction of hazardous waste by 50% in a five-year period.
Improvements in other areas came as part of the overall continuous
improvement mindset at CRC Industries. Results like our 65% improvement
in productivity and 20% improvement in orders shipped complete and on
time, for instance, stemmed from a deliberate focus on improving our
products and services. However, our cost of quality progress also played a
role, at least indirectly, adding momentum to our ongoing efforts to meet
and exceed customer requirements.

Case study of clipper windpower

With a steady breeze, a wind turbinestretching 262 feet highmajestically
turns its three power-ful blades, generating enough clean, renewable
electricity to power 750 homes for a 24-hour period. When the breeze turns
into a driving wind combined with ice, freezing rain, snow, and even freezing
fog, the turbines anemometer, which measures wind speed and force, can
freeze up and result in costly downtime for wind power compa-nies such as
Clipper Windpower
About Clipper Windpower
Headquartered in Carpinteria, CA, Clipper Windpower is a rapidly growing
company engaged in wind energy technology, wind turbine manu-facturing,
and wind project development. Clipper employs more than 850 people in the
United States, Denmark, and the United Kingdom. At the heart of its
manufacturing operations is an ISO 9001-certified manufacturing and
assembly facil-ity that began operations in Cedar Rapids, IA, in March 2006.

Turning to Quality to Improve Turbine Availability

As Clippers first wind turbines came online in northwest Iowa, western
Illinois, and western New York near Buffalo, the winter of 2007-08 hit hard
and fast with freezing rain and fog causing anemometer units to fail. While
the towers continued to run, without the anemometers there was no
guidance on which direction to move the 153-foot blades to harness the
wind most effectively. Clipper initially tried to address the problem through
software upgrades, but soon additional anemometers began to freeze,
compounding the problem and impacting turbine availability.
Without a quick solution available and with growing numbers of
anemometers impacted each day, Clipper initiated a root cause analysis
(RCA), an integral part of the Six Sigma define, measure, analyze, improve,
and control (DMAIC) problem-solving process. The rigorous DMAIC approach
defines the steps a team follows, starting with identifying the problem and
ending with implementing a long-lasting solution. To evaluate potential RCA
projects, Mike Trueg, manager of field quality assurance/ continuous
improvement at Clippers Cedar Rapids plant, uses a matrix that measures
the impact of safety, quality, and turbine availability. For this project the
scoring met the criteria because of the big impact on turbine availability,
explained Trueg, an ASQ Senior member.
An RCA project was chartered to address the weather-related anemometer
issues. The project objective was to identify the root cause of the
anemometer failures that was leading to downtime and decreasing turbine
availability. A project team was tasked with creating an action plan and
implementing corrective actions by the start of the next winter season.
Following the DMAIC Approach
Selecting team members for this RCA project was somewhat challenging,
recalls Ellen Sennett, who served as the projects co-leader. We started
with people who had experience with electrical issues since that seemed to
be the problem, said Sennett, an employee of Clipper for two years. In all,
seven stakeholder areas were represented on the improvement team. Not
all team members participated during every stage of the project; for
example, the vendor representatives came onboard once the root cause
was identified.

Defining the Problem

Soon after the initial weather-related failures, the company began collecting
data each time inclement weather took a turbine offline. This early data
collection led to the charter of the RCA project.
Define the problem
in concrete,
measurable terms.
Measure: Quantify
the problem and
perceived aspects
of the root cause.
Analyze data to
determine the root
cause of the defect.
Improve: Identify
and implement the
proposed solution.
Control: Confirm
improvement gains
through monitoring.

Define and document problem or gap.

Collect data to understand magnitude of failure.
Gather data on current situation.
Develop SIPOC and fishbone diagram.
Filter fishbone items through cause and effects matrix.

Analyze top items through FMEA.

Develop data collection plan for top priorities from FMEA.
Develop test plan.
Confirm root cause with test data.
Evaluate design improvements through validation testing.
Identify corrective action.
Develop implementation plan.
Ensure 100% inspection at vendor.
Mistake proof (poka yoke) wiring.
Update installation instructions and training.

Measuring to Quantify the Problem

The data collected indicated that, although the winter weather conditions
were severe, both precipitation and temperatures fell within the suppliers
specifications for the anemometer. The RCA team developed a supplierinputs-process-outputs-customer (SIPOC) matrix to quantify the problem and
any perceived aspects of the root cause. To pinpoint possible root causes of
equipment failures, they also completed a fishbone diagram, which
generated 45 items for further study. Next, RCA team members entered the
potential causes into a cause and effects matrix to focus on the most likely
culprits. The matrix tool enabled the team to pare down the potential causes
to nine items for a failure mode and effects analysis (FMEA).
Analyzing Data to Determine the Root Cause
The next step for Sennett and her team was to develop a data collection
plan covering the potential causes with the highest risk priority numbers
from the FMEA. In all, data were collected from tests performed on 13 FMEA
potential causesranging from improper training on work instructions for
wiring the heating circuits to issues with heating the transducer cap on the
anemometer.
After data collection and testing of the anemometer, the RCA team
concluded that the suppliers design of the heating circuit did not meet the
advertised specification. This failure led to an insufficient heating circuit for
Clippers application and thus caused weather-related failures of the
companys wind turbines.
Sennett remembers that getting the supplier of the anemometers to
acknowledge that its product did not work in the field as promised was a real
challenge. Eventually, data from the field and the RCA project convinced the
supplier. In hindsight, Sennett feels that perhaps her team could have
involved the supplier in the project a little sooner. It would have been
beneficial to have the supplier go through the DMAIC steps with us and
discover the root cause, instead of us finding it and telling them they had a
problem, she said.
Identifying and Implementing a Solution
With the root cause in hand, the team began to evaluate improve-ments to
the anemometers heating circuits through a series of winter weather-

simulated validation tests. Trueg reports that, having 405 units to replace,
data analysis was vital: Thats why we created our own winter weather
environment with a wind machine and a misting device to verify our solution.
We didnt want to remediate all these sites and then have to do it again.
Following military standard 810F section 521.2 for icing/freez-ing rain, the
Clipper team directed three rounds of laboratory testing to analyze the
performance of three prototypes for an improved anemometer. The first new
prototype was immediately rejected because the simulated winter conditions
created an ice buildup, which quickly caused the anemometer to fail. A
second prototype also failed before a third version finally withstood the
extreme weather conditions of the lab. Once the testing was completed, the
team created an action plan. The plan goal was to have all anemometers on
each of the 405 turbines throughout the country replaced with the newly
designed version by March 30, 2010.
Controlling to Confirm Improvement
In addition to the heating circuit improvements based on the lab testing,
several other controls were introduced:
The vendor conducts 100-percent inspection of the product through
a three-day burn test of the units heating system. This eliminates
the shipment of any defective products.
All anemometers are tested with a turbine control unit in the
manufacturing facility to validate functionality.
The new anemometer design also incorporates a connector that can
only attach one way to the junction box, thus eliminating improper
wiring in the field.
The wiring is color-coded for the operators who install the connectors.
New Design Stands Up to Mother Nature
While field testing began late in the winter of 2008-09, Clipper realized the
importance of carrying over the testing into the winter of 2009-10 to
confirm the effectiveness of its improve-ment plan. Once again, Mother
Nature cooperated by throwing her full bag of winter tricks as 40-50 mph
winds, one half inch of ice, four to eight inches of snow, and temperatures
of minus 15 degrees and below were reported at various wind farms.
Despite these conditions, Clipper recorded only two weather-related
anemometer issues for a 1.6-percent failure rate. Clipper soon discovered
that the two failures were caused by a sup-plier assembly team issue and
were not directly related to the improvements generated by the RCA
project. With the improvements and control verified, the RCA project was officially closed.

The RCA team kept turbine customers informed throughout the DMAIC
process with presentations about remediation steps to reduce the
weather-related failures. Team members walked through the entire DMAIC
process with key customers and
explained how the root cause was determined, as well as plans to
implement corrective action. Sennett added that many of Clippers
customers are familiar with Six Sigma tools, so the RCA process is the type
of problem solving they like to see. This process helps with customer
satisfaction as [customers] know we are taking
the time to find the root cause and using trained people to do
[corrective action] the right way the first time, Sennett said.
External customers werent the only ones who benefited from this RCA
project. Employees at Clippers remote monitoring dis-patch center, which
controls the turbines from the Cedar Rapids facility, saw a decreased
workload as fewer turbines required attention during inclement weather.
Sennett believes that this RCA project and others that followed help
Clippers employees think more proactively and address issues before
they become fleet-wide issues. Our goal is to become more preventive
and look at things before they start to fail, and with the Six Sigma
processes you can do a better job of designing out the defects in the
beginning before implementation, noted Sennett.
Building a Culture of Quality
Both Trueg and Sennett credit this RCA project for opening their eyes to key
issues such as internal testing and expanding the companys supplier base.
As a result of this improvement project, Clipper created a plan for introducing
new suppliers to avoid potential problems caused by single sourcing. Weve
also developed testing here at the manufacturing site so if we have quality
issues, we can test before sending something out into the field that
potentially causes failures or creates the need for a replacement part,
explained Trueg.
Sennett said that while some team members were initially skeptical
about the DMAIC process, they quickly learned the importance of taking
the time for each step, recognizing that without the structured process,
people tend to collect unnecessary data unrelated to the issue. For
several team members, working on this project sparked an interest in
learning more about process improvement and prompted them to
request further training and the opportunity to earn Six Sigma Green Belt
certification. Trueg is amazed at the change in Clippers staff once they

serve on an RCA team: The attitudes and focus on problem solving with
data are a strong part of the Clipper culture.