Page 299 - Peterson 85 Years and Going Strong

Peterson, back to his roots as a project manager at Power, working on the global account data center team.
Shop Supplies and Small Tools: Bill Bean (2004)
Bill Bean
Bill Bean’s 2004 project fo- cused on streamlining the purchase of shop supplies and small tools to a list of vendors that could actually fit on one page. “Back then, the cost to generate one vendor P.O. was $41.81 be- cause of all the manpower
involved. We centralized a lot of those purchases to Caterpillar and got that figure down to $7.43,” explains Bean, current VP and GM of Peterson Machinery. “We were doing a P.O. for every- thing. We might have an auto parts store deliver a four-dollar filter, but because of the cost of gener- ating a P.O., our actual cost was forty-one dollars on top of the cost of the filter. That was part of what led us to buy almost everything from Cat.” Bean’s team came up with a primary vendor list (Caterpillar), and a secondary list of discounted alternatives. In the end, they were able to cut the transaction cost by 82 percent, which has saved Peterson a boatload of money every year since. “Six Sigma taught me to keep digging,” says Bean. “And if something doesn’t look right, I can’t let it go until I check it out, which has worked well for me in a lot of different situations.”
Reman Cores: Danny Fong (2005)
Six Sigma commendations for group projects
tomer, and when Peterson got reimbursed for it from Cat. The interest expense during that interim period was their target concern. It went from a 92- day turnaround down to 25. That’s a 73 percent decrease and a giant improvement. “Before this project, there were three or four people processing reman cores in California, but never one consis- tent person,” explains Fong. “There’s a lot of steps to it, and many of the processes fell through the cracks. Up north they had one person in Portland, and then every other location did their own when they had time.” The solution was to centralize the inspection points to San Leandro and Portland, with two full-time people dedicated to the process. “Before we focused on this, nobody really knew how much money we were losing on core credits. Now we’ve jumped from being at the bottom of the pile to the second-best Caterpillar dealership in North America.
“A lot of the processes I use today came from Six Sigma,” says Fong, now the Standard Jobs and
Danny Fong
Danny Fong’s 2005 reman core project is still one of Peterson’s most successful projects to date. One of the metrics under scrutiny was the turnaround time be- tween when Peterson first issued a core credit to a cus-
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