The Extreme Team is made up of six talented individuals: Kris Andrews, Allison Burbage, Tiffany Dillard, Chad Holleman, Brian Nash, and Mathon Culpepper. The Team�s goal of completing a successful Management 320Process Improvement Project was bounded by time and optimality. The Team had a seven week window to complete the project, and was forced to choose an optimal project based on the constraints that were set by the course instructor. The Extreme Team decided to work with Destination Success for the project.

Destination Success is a Personal Development Company that teaches people how to become successful and how to fulfill their career goals. This is done via inspirational or motivational audio tapes that are written, produced, recorded by Destination Success and distributed to customers across the nation. When a customer purchases a tape, they are linked up with an educational source that provides knowledge, wisdom and life skills necessary to becoming successful and achieving career goals.

The Extreme Team decided to focus on the company�s distribution process for the Process Improvement Project. The Team selected the distribution process because it didn�t seem to be up to par with the other three processes (writing, producing and recording) involved in the tape manufacturing procedure. In other words, the distribution process was the "cog in the works." The problem with the distribution process was that it was dampening the company�s profit per unit. The distribution process involved two shipments or transfers for the product to get from Destination Success to the customer. After completion the audio tapes were shipped from Destination Success to a distributor who then shipped them to bookstores who would sell them to customers.

This process had a dampening effect on Destination Success�s profit Margin because the sum of the distributor�s and the bookstore�s cuts were relatively high. Destination Success shipped the audio tape to the distributor with the selling price already marked on the package. Therefore, its sales revenue from the tapes was equal to the package price minus the distributor's and bookstore�s cuts. The distributor was charging $3.41, and the bookstore was charging $9.33 to market these tapes. Destination Success�s sales revenue per unit from this process was $5.21. With a cost per unit of $2.05, Destination Success was only making a $3.16 profit per unit on these tapes.

The Extreme Team thought that this profit per unit seemed a bit low. Therefore, the Team proposed a different distribution process to Destination Success�s management. The proposal was that the company should use a sales staff to distribute the product because doing so would increase profit per unit. Now with the proposal�s way, only one distributor would cut into the company�s profit as opposed to two distributors cutting into it.

The new process works in the following manner: Destination Success hires a sales staff, and allows the individuals to choose which types of tapes to sell. Destination Success sells the tapes to the sales staff who sell them to customers. The Extreme Team recommended that the sales staff buy the tapes as a way of poka-yoking any potential employee dishonesty problems or cash flow problems. In other words, this eliminates any salesperson from any dishonestly regarding tape sales. It also improves Destination Success�s cash flows because with the old method it only received its sales proceeds after the bookstore had sold the tapes, and after the distributor had deducted its fees. Therefore, it sometimes took Destination Success up to six months to receive the sales proceeds. With the new method money is received up front before the tapes are sold. This improves cash flow because now revenue flows in when the tapes go out; instead, of the tapes going out and the money for them flowing in later. The sales staff buy the tapes for $10 then sell them for $20. The selling price has been marked up because management felt that the old price needed changing, but because of contractual agreements with the distributor and the bookstore they were unable to do so. The new process results in a $7.95 profit per unit ($10 minus $2.05). Therefore, the Extreme Team accomplished its goal of increasing profit per unit. The Extreme Team�s proposal was implemented by Destination Success on a trial basis. In other words, the Team and Destination Success took Deming�s advice and ran a small model of a solution to make sure that it was the correct one before implementing it on a grand scale. For the project, an existing line of tapes were selected for to use with the trial version. A brochure was put together advertising sales positions for Destination Success. The brochure included a description of a sales person�s activities, a description of the line of tapes, and a list of the employee�s potential earnings. These brochures were distributed around campus and the implementation was completed.

The Extreme Team�s proposal streamlines the distribution process by eliminating a couple of steps in the process and introducing a single step in their place. The process is changed from one of indirect distribution into one of direct distribution. There are three advantages because of this change. First, profit per unit is increased. Second, error probability is decreased because there are less steps to mess-up. Third, it gives Destination Success greater control over the selling of the tapes because it is done by an employee not an outside party.

The new process also improves quality because with a sales staff is distributing the tapes to customers instead of a bookstore. If customers have questions or complaints about the product they can relay these things directly to Destination Success via the sales representative whereas with the old method these things are indirectly relayed to Destination Success through external agencies. Therefore, with better feed back Destination Success can more effectively tailor its product to meet the needs of the customers.

In conclusion, the Extreme Team�s Management 320 process improvement Project was successfully completed thanks to Destination Success�s cooperation. A problem was found, and a solution was both found and implemented.