Six Sigma is much more than a passing fad - it can actually deliver results. In fact, a number of Fortune 500 companies claim that it has made a significant difference in the quality of their processes and products. How new is the Six Sigma method? Well, some of it is new, especially its label, but most of it isn’t. Some of the tools and techniques used with Six Sigma are simply some very tried and true tools and practices that have been available for many years. However, Six Sigma does organize these tools into a more disciplined, focused, and aggressive methodology.
In addition, Six Sigma programs are often broader in organizational and process scope. They cover not just production concerns but also any business process that impacts customer satisfaction or any other areas of company performance, for that matter. Taken literally, Six Sigma means that any product or process will have no more than 3.4 defects per 1,000,000 units produced, tasks performed, orders filled, customers served, and so on. Working toward perfection keeps everyone involved in the process, striving for continuous, unrelenting improvement. It does not mean that the office copier won’t jam hundreds of times per million sheets or that there won’t be defects for every car that rolls off an auto assembly line. Rather, Six Sigma means that whatever the error or defect rate currently is, it will be substantially lower in two weeks, two months, two years—because managers and workers at all levels are focused on improving the process. Six Sigma programs are driven by the following goals:
- Creating products and processes that are “defect-intolerant”
- Continually analyzing each element of a process, be it the predictability of a process, the defect rate from a process, or the accuracy with which customer orders are filled — to determine how it compares in its current state with a perfect, error-free process.
How Six Sigma Solves Problems
The Six Sigma methodology for solving problems is similar to many other approaches. The differences arise mostly from Six Sigma’s emphasis on statistical techniques to isolate and quantify undesirable variations in process and product performance. The mathematical techniques and analysis are central to Six Sigma steps for problem solving. The general steps one would follow with Six Sigma are:
- Identify a process or product variation that is creating undesirable performance results.
- Define the scope and parameters of the problem.
- Develop and apply initial measures of process or product variability.
- Estimate the business performance impact.
- Prioritize the project with other Six Sigma projects to establish when analysis begins.
- Collect and organize the data needed to carry out a thorough analysis.
- Analyze the data to pinpoint the cause or causes of variation.
- Develop an action plan for improving the process or product and a time frame for full implementation of the action plan.
- Implement the improvements.
- Establish the control and feedback mechanisms for continuous improvement of the process or product.
Six Sigma dovetails nicely with performance improvement initiatives intended to transform a traditional manufacturing company into a lean supply chain operation. An effective Six Sigma program can help to improve customer response time, cut cycle times, and improve product quality in engineering and performance. These improvements appear not just in a narrow “reduction of defects” but can also generate revenue based on improved customer satisfaction. Customer satisfaction improves not because goods are more reliable and have fewer defects but because the entire process that the customer experiences from start to finish, from the sales office all the way through delivery and post-sale servicing and technical support, is improved. In addition, companies that implement Six Sigma programs can get additional benefits just by advertising their commitment to Six Sigma, as many have done, thereby raising the company’s public profile. There is one important caveat, however: Six Sigma’s heavy reliance on mathematical and statistical techniques for determining process as well as product performance intimidates many managers, making it harder to sell as an approach to key people within the organization. Six Sigma has its advocates, but it also has its detractors.
Resistance to Six Sigma arises sometimes because managers see Six Sigma advocates as “blind zealots” wedded to a single performance improvement philosophy. Companies that are considering implementing a Six Sigma program should be prepared to understand and cope with such resistance.
TQM and Six Sigma: A Comparison
Are Total Quality Management and Six Sigma really different? There is a lot of disagreement about this. Some say that TQM is too laissez-faire and its advocates tended more toward representing the quality function in an organization rather than the broad business view of Six Sigma. While it’s true that TQM often just resided in the quality organization, the same could be said for Six Sigma. Neither TQM nor Six Sigma, however, was ever intended to be just a separate quality function. Quite the contrary, both were intended to cut across all functions and boundaries of the organization. The problem often was and still is a problem of how TQM and Six Sigma are applied and interpreted within an organization. There is a significant overlap between TQM and Six Sigma (see Figure SS-1).
The primary difference between the two is that Six Sigma is much more mathematically intensive in the pursuit of process performance improvement. In addition, Six Sigma advocates have raised the bar by which its techniques should be applied at all levels and functions within the company. This means top management needs to mandate the adoption of Six Sigma focusing on the improvements needed to achieve the company’s strategic goals and objectives. The question here is often, “Do we really need this type of an approach to business process improvement?”
I recognize my comparative table could spark spirited discussion from advocates of either side. Some do not even like comparisons of TQM and Six Sigma to be made because many Six Sigma advocates believe they are practicing a new form of improved management. But most executives see Six Sigma as another quality initiative. I believe Six Sigma to be a part of the continuous evolution of techniques for achieving higher levels of quality in business and production processes. It is unlikely that any rigid business philosophy and methodology will be universally adopted across all manufacturing companies. No doubt, there will be variations, some good and some bad.
Still, using Six Sigma, companies aim for perfection just as they would following lean manufacturing. Companies that initiate lean manufacturing or Six Sigma programs need to be intensely focused on promoting quality through every aspect of their organization. These initiatives include services as well as goods, and all business processes and the people in them, not just those involved with production in the plant.