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Columnist: H. James Harrington

Photo: Scott Paton, publisher

  
   

Six Sigma: Quality's Viagra?

This well-known methodology has brought new life to old tools… for now.

 

 

 

Six Sigma is dying in the United States. We've tried to revive it with such variations as lean Six Sigma, total Six Sigma, design for Six Sigma and Six Sigma for health care, but people are losing interest in the approach.

Reducing variation is the basic concept behind the methodology, and it's long been a good principle. Walter Shewhart, the father of modern quality, believed in it during the 1920s. During World War II, a Cpk of 1.4 was standard for equipment qualification. Joseph M. Juran preached reducing variation, as did Armand V. Feigenbaum and W. Edwards Deming during the 1950s. The process-control standard was plus or minus three sigma in the 1940s.

If you're going to do something a hundred, a thousand or even ten thousand times, three sigma might be good enough. If the cost of an error is $10, and you make 10,000 parts at the three sigma level, you'd produce 668 defects. That's a total error cost of $6,680. At six sigma, that total cost would be reduced to less than $1. Thus, if the cost to improve the process is less than $6,679, there's some value in making the improvement. However, if a defect costs $1 per error, forget about it; it's doubtful that you'll be able to improve the process for less than $667.

Six sigma applies if you do something a million times a day. However, if you're doing something four million times a day, like Bank of America does when it processes checks, then six sigma isn't good enough. Bank of America works at a rate of one error per million checks processed. And just think about all the potential errors that can be made on each check.

The truth of the matter is that we sell Six Sigma to the world based on reducing variation, but that's not what Six Sigma Black Belts do to achieve most of their improvements.

For example, if the time to process an order is 10 days, plus or minus two days, then Black Belts intent only on reducing variation would design a process that produced an order in 10 days, plus or minus two minutes. But that's not what they do. Instead, they'll redesign the process and reduce cycle time to two days. If it costs $15, plus or minus $5, to process an insurance claim, then a Six Sigma program that only decreased variation would reduce the processing cost to $15, plus or minus five cents--not down to $3, which is what really happens.

Very few Six Sigma projects result in decreased variation. Rather, they focus on improving the efficiency and effectiveness of processes. Where have we heard that before? Oh, yes, that's what process redesign and process reengineering was all about.

I'm not against reducing variation; that's a basic objective in the quality profession. It's one thing we can all agree on. However, setting six sigma as the operating standard isn't appropriate for all activities. For some it will cost too much to achieve, while for others it's too loose a standard. Ensuring that car brakes are reliable is a good example of when six sigma isn't good enough.

I get so many magazines each week that I can't read them as they come in, so I scan through them, tearing out articles to read when I have time. (I now have a four-foot pile of "to read" articles.) I recently read a Quality Digest article about Six Sigma in the service industry ("Six Sigma Sharpens Services," Zachery Brice, May 2004). It offered a number of Six Sigma improvement examples. In the first, the author stated that a bank redesigned its international wire transfer process. In the next example, he stated that Six Sigma experts led critical process redesign projects.

When I look at examples of Six Sigma projects in the support and service sectors, most of the tools listed under the methodology's banner aren't the ones that provide the biggest improvements. Motorola's vision of Six Sigma was defined in the books it published as well as in the American Society for Quality's videotapes by Mikel Harry. But those aren't the tools that are making the big gains today. Real gains are made by process redesign methodologies.

We should be training Certified Process Black Belts, not Six Sigma Black Belts. Instead, consultants have folded business process improvement (or redesign) into the Six Sigma methodology to keep it paying off. As someone who's more than 75 years old, I can appreciate how useful that is--dusting off old products to sell under a new name to customers who don't know the difference.

About the author
H. James Harrington is CEO of the Harrington Institute Inc. and chairman of the board of Harrington Group. He has more than 55 years of experience as a quality professional and is the author of 22 books. Visit his Web site at www.harrington-institute.com.