**Poznan Univeristy EMBA: Operations and
Process Management**

**Assignment** **2: DMAIC Project**

**Insurance**

Download the **Insurance.xls**
file for this assignment.

__Refer to the “ Claims Processing Costs” worksheet to answer
the following questions__

**Preliminary Analysis
[Pre-define phase]**

1. Create
a **Pivot Table** of Cost/Claim by
Region and Product to identify where the biggest opportunity is. Interpret.

2. Draw
**Histograms/Dot Plots** and **Time Series Charts** for **Cost/Claim** by Region and Product.

3. Interpret the results – is there an opportunity for improvement in one or more regions for either product?

Assume that you are the
manager at Region 1 for Product B. You have concluded after some discussion
with the team **rework due to errors**
in processing claims is a major contributor to your problems with cost/claim,
and wish to tackle that as the focus of your project.

__Refer to the “ Claims Processing Errors” worksheet to
answer the following questions__

**Define**

4. Analyze the errors (y) currently being made by the various employees to get a sense of the current state. Create a Project Charter. Clearly define your SMART objective.

(A process flow diagram would be part of the task at this point, but we will skip it for this assignment).

5. How do you make sure that the project goals are reasonable?

**Measure**

You
now wish to analyze the potential causes (Xs) that lead to the errors.

6. Use
the **Fishbone Diagram** to clearly identify
the potential causes for the errors (y).

7. For all the Xs calculate the Mean, Standard Deviation, Minimum, and Maximum values.

__Measurement Errors__

8. Discuss briefly the kind of measurement errors that are possible in the data collected for this project.

**Analyze**

9. Draw scatter plots (optionally, you can also compute correlation coefficients) of each numeric explanatory variable (Xs) against the Error (y) variable. Write a short paragraph interpreting what the graphs/correlations tell you about the relationships.

10. For categorical explanatory variables (gender, training), create a Pivot Table and/or charts to compare the Errors by category.

11. Develop a regression equation to predict the Errors as a function of the explanatory variables. Interpret the coefficients.

12. Report the final predictive equation and its key statistics (Standard Error, R-Square).

**Improve**

13. What are your final recommendations regarding reduction of Errors or Cost/Claim?

(A new process flow diagram would normally be a part of this, but we will skip it for this assignment)

(Hypothesis Testing would also be done here after the improvements were made, to prove that y did in fact improve as a result of your project)

**Control**

14. What steps can you take to ensure that the new process takes hold and employees do not slide back to old ways?