Six Sigma for improving cash flow deficit: a case study in the food can manufacturing industry

Sánchez-Rebull, Maria-Victòria; Ferrer-Rullan, R.; Hernández-Lara, Ana B.; Niñerola, A.

Abstract:

Purpose Cash flow deficit situations and working capital control are major challenges for many companies, especially those whose suppliers and clients have strong bargaining power. This study aims to describe the application of the Six Sigma methodology for solving these problems in a large German food can manufacturing company. Design/methodology/approach This paper follows the qualitative methodology of case study research. During different define, measure, analyse, improve and control process phases, the problem and critical aspects are identified to improve the quality of the payment process and improvements are suggested and implemented. Findings The results provide evidence of how Six Sigma can be useful in administrative–financial processes that are carried out within a company. This result is particularly interesting because it is about processes that have not applied Six Sigma methodology. For the company studied, this methodology has balanced its cash flow and this meant large amounts of savings, especially in bank interest to avoid having to ask for bank credits. Originality/value This case can be extrapolated to other companies, regardless of the company size, that present similar symptoms of cash deficit, especially if their bargaining power with suppliers and customers is low.

Year:

2020

Type of Publication:

Article

Keywords:

Six Sigma; Process improvement; Accounts payable; Can industry; Cash flow deficit

Journal:

International Journal of Lean Six Sigma

DOI:

https://doi.org/10.1108/IJLSS-12-2018-0137