Six Sigma is Primarily a Management Program
by Thomas Pyzdek
In the 1970s Motorola learned about quality the hard way: by being consistently beat in the competitive marketplace. When a Japanese firm took over a Motorola factory that manufactured television sets in the United States, they promptly set about making drastic changes in the way the factory operated. Under Japanese management, the factory was soon producing TV sets with 1/20th the number of defects they had produced under Motorola management. Eventually even Motorola's own executives publicly admitted "our quality stinks." Finally, Motorola decided to take quality seriously. Motorola's CEO at the time, Bob Galvin, started the company on the quality path and became a business icon largely as a result of what he accomplished in quality at Motorola.
In accepting the first ever Malcolm Baldrige National Quality Award in the White House in 1988, Bob Galvin briefly described the company's turnaround. He said it involved something called Six Sigma. Among the attendees was a contingent of Baldrige Judges and Examiners, including this author. I assumed that I knew precisely what Mr. Galvin was talking about when he used the term "Six Sigma." I believed that he was speaking of statistical process control, process capability, meeting requirements, the sort of thing that quality engineers had been advocating for years. At that time there was a consensus among quality engineers and statisticians that "process capability" was, roughly, 'plus or minus three sigma.' A process controlled at this level would produce a small percentage of defective items, but the percentage was thought to be acceptable. In the 1980s American automotive companies tightened up the definition to mean plus or minus four sigma, which brought the defect rate down to a few parts per thousand. Mr. Galvin's reference to Six Sigma, I thought, was a minor modification of a tried-and-true statistical approach, which could be entirely described by the illustration shown in Figure 1.
I was wrong.
The linkage of Motorola's program to the classical process control approach served mainly to blind me to the fact that Bob Galvin was describing something entirely new. Six sigma is such a drastic extension of the old idea of statistical control of manufacturing processes as to qualify as an entirely different subject. The statistical difference alone is staggering. A six-sigma process will produce failures at a parts-per-million (PPM) or even parts-per-billion (PPB) level. This contrasts with the old three sigma process which produces parts-per-thousand or even parts-per-hundred (percent) failures. This difference of three to seven orders of magnitude is profound. In science a difference in scale of this magnitude qualifies a subject as a new science, as when one goes from the study of molecular biology to the study of botany.
In short, six sigma is not just a modification of the old engineering idea of three sigma quality levels, it is an entirely new way to manage an organization. Motorola's senior executives learned that achieving such high levels of quality enabled their company to use quality as a strategic weapon, rather than as simply a cost-control device. However, to make it happen they extended the idea far beyond manufacturing. Six Sigma became a way of doing things throughout the entire organization. This task is vastly more difficult than simply improving the control of a machining or assembly process. It requires nothing short of a transformation in the way an organization perceives its environment and its role in that environment. The organization that embraces Six Sigma is, at a fundamental level, different than a traditional organization. It responds differently to the same stimulus, becomes concerned about things that other organizations ignore, and ignores things that concern other organizations.
Sure Six Sigma has a strong technical component, and we will be spending a lot of time on technical issues in this column. But Six Sigma is not primarily a technical program, but a management program. Any organization that fails to keep this foremost in mind is doomed to fail in their efforts to become a world-class organization. Let's take a closer look at how Six Sigma works at one company that understands this.
Six Sigma At GE
Jack Welsh asks each GE employee to become a "quality lunatic." The company is investing hundreds of millions to train its employees to become Master Black Belts, Black Belts, and Green Belts. These technical leaders work with teams throughout the company to pursue quality and process improvements.
According to Business Week in mid 1998, three years after starting its push for Six Sigma, GE was running at a Sigma level of three to four. The gap between that and the Six Sigma level is costing the company between $8 billion and $12 billion a year in inefficiencies and lost productivity.
It was no small decision to launch a quality initiative because it called for massive investment in training tens of thousands of employees in a disciplined methodology heavily laden with statistics. To make the ideas take hold throughout General Electric required the training of so-called master black belts, black belts, and green belts to impose the quality techniques on the organization.
Welch launched the effort in late 1995 with 200 projects and intensive training programs, moved to 3,000 projects and more training in 1996, and undertook 6,000 projects and still more training in 1997. According to Business Week, the initiative has been a stunning success, delivering far more benefits than first envisioned by Welch. In 1997, Six Sigma delivered $320 million in productivity gains and profits, more than double Welch's original goal of $150 million. "Six Sigma has spread like wildfire across the company, and it is transforming everything we do," boasts Welch.
And transformation is what Six Sigma is all about.
Thomas Pyzdek is author of The Six Sigma Handbook and The Pyzdek Institute's online training. You can reach him at
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