What is Six Sigma
You may have heard a rumor, or you may have read something in
the company newsletter about Black Belt training. You probably thought, “What do martial arts have to do with my job?” Later, during a department meeting, you learned that your group would be part of a companywide effort (every division!) to implement Six Sigma.
Your boss also asked for volunteers to be Black Belts. “What is all this about?” you wondered.
A couple of weeks later, everyone in your division was invited to a big kick-off meeting. Lots of slides were shown, and the company president spoke, mentioning GE, Motorola, and one of your company’s bigcompetitors. Examples of Six Sigma and how it could help your division/ company save money and make customers happier were given. One speaker said that if it could get from 3 sigma to 4 sigma, your division would save $100 million! 100 million? Was he out of his mind? Your head was reeling. Was Six Sigma a new flavor-of-the-month program? Could it really save so much money? “What is this thing called Six Sigma?” you thought. “Is there something in it for me? Is it something to worry about?” Over the past few years, more and more employees of companies that have adopted Six Sigma have asked themselves these kinds of questions. A few of these employees have become Black Belts; others have taken on other roles in this dramatic process of organizational change and renewal. For many employees, the transformation has been both personal and professional.
I never dreamed senior management was really going to support our recommendations. But with Six Sigma, and the data we had to back up our project, they had no choice. When word of the plans to adopt Six Sigma first hits the inside grapevine, it can be confusing and even a little scary. This book will help employees at all levels get ahead of the change curve by explaining :
• What Six Sigma is and how it works
• The new roles employees play in Six Sigma
• The Six Sigma problem-solving process
• Why Six Sigma is not a flavor-of-the-month management trend
• The impact Six Sigma can have on the bottom line
• How Six Sigma affects jobs
• What a Six Sigma team is and how it operates
• What you need to know to be successful in a Six Sigma team
• How your customers will be affected by Six Sigma
This book is no substitute for working through a Six Sigma project or training to be a Six Sigma team leader (that’s what a Black Belt is, by the way). But this book can help prepare, guide, and support any employee who wants to take advantage of the enormous education, experience, leadership, and technical benefits to those who participate in Six Sigma teams.
WHAT EXACTLY IS SIX SIGMA?
Six Sigma is a smarter way to manage a business or a department. Six Sigma puts the customer first and uses facts and data to drive better solutions.
WHAT IS SIX SIGMA?
Six Sigma efforts target three main areas:
• Improving customer satisfaction
• Reducing cycle time
• Reducing defects
Improvements in these areas usually represent dramatic cost savings to businesses, as well as opportunities to retain customers, capture new markets, and build a reputation for topperforming products and services. Although it involves measuring and analyzing an organization’s business processes, Six Sigma is not merely a quality initiative; it is a business initiative. Achieving the goal of Six Sigma requires more than small, incremental improvements; it requires breakthroughs in every area of an operation. In statistical terms, “reaching Six Sigma” means that your process or product will perform with almost no defects. But the real message of Six Sigma goes beyond statistics. Six Sigma is a total management commitment and philosophy of excellence, customer focus, process improvement, and the rule of measurement rather than gut feel. Six Sigma is about making every area of the organization better able to meet the changing needs of customers, markets, and technologies—with benefits
for employees, customers, and shareholders. Six Sigma didn’t spring up overnight. Its background stretches back eighty-plus years, from management science concepts developed in the United States
WHAT’S NEW ABOUT SIX SIGMA?
In the 1980s, Total Quality Management (TQM) was popular. It too was an improvement-focused program, but it ultimately died a slow and silent death in many companies. What makes Six Sigma different?
THE SIX SIGMA SUCCESS STORY 3
Three key characteristic separate Six Sigma from quality programs of the past.
Six Sigma is customer focused. It’s almost an obsession to keep external customer needs in plain sight, driving the improvement effort. (External customers are mostly those who buy your business’s products and services.)
Six Sigma projects produce major returns on investment. At GE, for example, the Six Sigma program resulted in the following cost versus returns:
- In 1996, costs of $200 million and returns of $150 million
- In 1997, costs of $400 million and returns of $600 million
- In 1998, costs of $400 million and returns of more than $1 billion
GE’s CEO, Jack Welch, wrote in the annual report that in just three years, Six Sigma had saved the company more than $2 billion.
We didn’t invent Six Sigma—we learned it. The cumulative impact on the company’s numbers is not anecdotal, nor a product of charts. It is the product of 276,000 people executing and delivering the result of Six Sigma to our bottom line.
—JACK WELCH IN 1997
Six Sigma changes how management operates. Six Sigma is much more than improvement projects. Senior executives and leaders throughout a business are learning the tools and concepts of Six Sigma: new approaches to thinking, planning, and executing to achieve results. In a lot of ways, Six Sigma is about putting into practice the notions of
working smarter, not harder. As we’ve seen, Six Sigma has produced some impressive
numbers.
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