Invoice Errors

The experiment data in below table was to evaluate the effects of three variables on invoice errors for a company. Invoice errors had been a major contributor to lengthening the time that customers took to pay their invoices and increasing the accounts receivables for a major chemical company. It was conjectured that the errors might be due to the size of the customer (larger customers have more complex orders), the customer location (foreign orders are more complicated), and the type of product. A subset of the data is summarized in the following Table. If you uses an excel spread sheet pleas attach in separate file.

Table: Invoice Experiment Error

Customer SizeCustomer LocationProduct TypeNumber of Errors
19
+13
+4
++7
+3
++23
++13
+++20

Customer Size: Small (-), Large (+)

Customer Location: Foreign (-), Domestic (+)

Product Type: Commodity (-), Specialty (=)

Reference: Moen, Nolan, and Provost (R. D. Moen, T. W. Nolan and L. P. Provost. Improving Quality through Planned Experimentation. New York: McGraw-Hill, 1991)

Use the date in table above and answer the following questions in the space provided below:

1.What is the nature of the effects of the factors studied in this experiment?

The experiment used Customer size

2.What strategy would you use to reduce invoice errors, given the results of this experiment?

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