New Green belt member

[reham elmahdy]

Hello all,

I taking now the the green belt course and I am reallz suks in math.

So I do study alot and make alot of practicces

So I do have some questions such as this one:

A shoe manufacturing firm learned through a Lean Six Sigma project their boot soles
could be made of a different material requiring two less steps in the process. Removal
of these two steps yielded a monthly cost savings of $7,500. Therefore the reported
financial savings for this LSS project were _____________.
a. $45,000
b. $75,000
c. $90,000
d. $120,000

The answer was C.

I do not know how the answer is 90.000

I would appreciate if u can help me

Thx alot

[Oscar Palomino]

The annual saving is 12 times 75,000. That means total saving is 90,000.00

[Varun Pathak]

Monthly saving of $7500
Annual Saving = 7500*12 = $90000

[Ted Hessing]

Hi Reham,

Sorry I’m so late to this one, and welcome. Oscar and Varun have the math right: $7,500 a month x 12 months = $90,000.

Project savings are commonly reported as annualized savings, usually the first 12 months after the change. So when a question gives you a monthly figure, convert it to a year unless it tells you otherwise. That’s also how to spot the distractors: $45,000 is 6 months, $75,000 is 10 months and $120,000 is 16 months.

On a real project, your finance partner usually validates the number and decides what counts as hard savings. There’s more on that in my Financial Measures in Six Sigma article.

Most Green Belt math is arithmetic plus a handful of formulas you use again and again. Practicing a lot, the way you are, is how people get comfortable with it. If you’d like more help with the math itself, I’m building a short course for exactly that, Math Confidence for Six Sigma. Join the waitlist and I’ll let you know when it opens.

Post your next question here any time.

Ted

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