Chapter 16


Project: Reducing Jet Ski Warranty Costs

Okay, here’s the scenario. The management team of a plant that manufactures fiberglass jet skis has completed a thorough and grueling financial review. The financial review has brought to light that warranty costs for the company are way out of line with the industry average of about 1.5%. Warranty costs have continued to climb and are averaging 5.1% of annual sales of approximately $96 million. This is not good, and it is a threat to the long-term viability of the brand, not to mention the dollars it is taking away from the bottom line. This is an excellent opportunity to apply Lean Six Sigma ...

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