Blaming Six Sigma

I’m surprised how quickly we blame a methodology for a business’s lack of performance. We’re always looking for some silver bullet to cure all ills. In contrast, Six Sigma integrates many methodologies to achieve sustained profitable results. When Motorola practiced Six Sigma under the leadership of Bob Galvin and George Fisher in the late 1980s, Six Sigma produced significant profit and innovative products for rapid growth, and the cell phone industry was launched.

At Motorola, Six Sigma was used to accelerate improvement to keep up with the customers’ ever-changing requirements. The intent of Six Sigma was lost when it spread from Motorola to other companies. Today Six Sigma is perceived to be a rote statistical method to reduce variation in manufacturing.

Using his tactics and leadership style, Jack Welch used Six Sigma as an anchor to implement his agenda, and he achieved his business objectives. His executive team dispersed around the country, imposed rote Six Sigma, and achieved less glamorous results. Surprise!

If CEOs can become Master Black Belts, then can all Master Black Belts become CEOs? No. There are specific roles for technical people and nontechnical people. CEOs should not be Master Black Belts, thereby creating false perceptions and overriding core leadership skills—taking care of customers, people, and business. CEOs can best help their corporations by understanding the intent of Six Sigma.

Implementing rote Six Sigma ignores its intent—to achieve a lot of improvement fast. An aggressive rate of improvement requires innovation. For example, if a company plans to improve its process performance by 5 percent, its approach will likely be less innovative than if its improvement goal were 50 percent. Using Six Sigma to achieve a 10-percent improvement misuses the methodology and abuses its intent. Incremental improvement means tweaking the process and doing little or nothing differently. Quickly achieving a lot of improvement without using a single statistical tool is closer to Six Sigma’s original intent than incremental improvement with extensive statistical analysis.

The original Motorola-style Six Sigma involved employee empowerment, innovation, leadership accountability, and shared rewards. Today, Six Sigma has been transformed from a methodology that is employee-powered, innovation-driven, and saving-oriented into a training-intensive, intellectually deficient, statistics-heavy, fear-mongering methodology. It has become a “mean” tool for some, and for others a stealth cover for cutting jobs.

I have heard about companies where a new president who claims to be a Master Black Belt takes over a well-run, money-making operation. Before even learning about the business, he announces a 10-percent reduction in its workforce.  Outsourcing becomes the main strategic initiative, employees are threatened with layoffs, and improved processes are dismantled. Everybody in the company can predict the outcome, except the boss. Good employees either are let go for political reasons, or they leave on their own accord. Of course, before long the boss leaves the company in intensive care.

We need to simplify the application of Six Sigma, clearly define roles, understand its intent, and implement it creatively, rather than statistically. Some companies that have implemented Six Sigma properly have seen significant benefits. Others get busy with the act of Six Sigma and forget the business sense. It appears to me that we often take a good methodology, and in rushing to exploit its benefits we take short cuts to make a quick bonus and so sacrifice basic principles and the business’s survival. Employees—primary assets of the company—are perceived as liabilities.

Cost-driven survival is a downward spiral. Not many companies can escape the grip of cost-cutting strategies. Today, the rest of the world is less expensive to operate, thus businesses must look into using Six Sigma, lean, or innovation to create more value rather than cutting costs. Customers buy perceived value, not necessarily the cheapest products or services.  Nevertheless, most businesses compete on price, not value. In contrast, Toyota competes on value instead of price, and keeps growing, gaining market share, and making a profit. Other companies that take a similar approach are Proctor and Gamble, Southwest Airlines, and 3M (prior to its recent application of Six Sigma). Reducing costs without striving toward perfection will lead to cutting the tree limb from which we hang. We must apply improvement methodologies to strive for perfection, create more value, and grow the business.

If businesses strive for profitable growth, we will be applying the methodologies innovatively, realizing savings, creating jobs, and improving the standard of living. We will develop executable strategies, rather than execute people who deploy whimsical strategies. Otherwise, economies around the world will just compete on cost until they reach an equilibrium. The quality of products, service, and leadership affect the quality of our lives. We must see beyond our blinders.

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