Six Sigma
Last Word


Performance Improvement
H. James Harrington

Six Sigma's Long-Term Impact

Does Six Sigma implementation really yield near-perfect results?

Motorola's performance ups and downs have been well-documented. First, the company received a lot of bad press when it sold its TV division, Quasar, to Matsushita. Quasar was famous for its "works in a drawer," easy-to-fix TV design. Once Matsushita got hold of Quasar, defect rates dropped more than 95 percent, morale improved drastically and cost decreased significantly. I toured the Quasar plant near Chicago and was dazzled by the documented results realized when an organization focuses on process, people and quality.

 These results must have surprised William J. Weisz, CEO of Motorola. "In 1981, we developed, as one of the top 10 goals of the company, the Five Year, Tenfold Improvement Program," he said. "This meant that, no matter the operation you were in or your present level of quality performance, or whether you were a service organization or a manufacturing arm, management's goal was to have you improve that level by an order of magnitude in five years. Today, we carry this forward with a program called Six Sigma. Six Sigma is a method of design and manufacture that should yield approximately 99.9997-percent perfect results. It's the next major step toward 100-percent-perfect performance, which is the only acceptable goal." Six Sigma was simply a TQM process that uses process capability analysis as its way of measuring progress.

 One improvement that came out of Motorola's Six Sigma program was the use of process capability studies in all support areas. Unfortunately, we've seen very few examples of how the program has been used in support areas. I bought the Motorola Six Sigma manuscript and discovered that all of the included examples were related to manufacturing. I've even bought the set of books and the 48 tapes on Six Sigma that were prepared by Motorola's Six Sigma Institute, but once again I found mostly manufacturing examples. I'm sure there are a lot of good Six Sigma examples being used in development engineering, quality engineering, manufacturing engineering, personnel, sales, marketing and field services, but I've had a hard time finding them. If you have any good examples of Six Sigma applications in these areas, please send them to me. I'll give the first five people that supply me with concrete examples that I can use a book and a CD-ROM on the 1,000 most-used tools for improving performance.

 But I'm getting off track. Let's consider how Motorola is performing today after using the Six Sigma approach for more than 10 years. Motorola's market share in its main business, wireless phones, has steadily decayed in the past decade. The company's president, Bob Growney, said in February 2001 that Motorola plans to cut costs by closing, or selling, at least four of its 55 manufacturing plants --maybe as many as seven.

 Motorola completely misjudged the transition from analog to digital phones. Six Sigma did not help marketing do its job better. Motorola once owned the wireless phone market. Today, Nokia has 31 percent of the market, and Motorola has 15 percent, according to research done by Dataquest. Nokia's tiny high-end phones serve as today's benchmark. Additionally, Motorola's phones don't make use of many interchangeable parts, which makes them costly to manufacture. "Clearly they need to take quite a lot of cost out of their system," says Vivian Mamelak, an analyst with Arnhold and S. Bleichroeder. It looks like Six Sigma didn't work in product engineering, manufacturing engineering or quality.

 As a former quality professional, I realize we can't completely blame the Six Sigma program for Motorola's performance. But, likewise, we can't give Six Sigma total credit for the company's success. Motorola's problem may be that it has dropped the Six Sigma approach or could only apply it to manufacturing and, to a very limited extent, in the support areas. But management doesn't drop programs that are having a significant positive impact on the bottom line, particularly after the company has invested as much money as Motorola invested in Six Sigma.

 Now, as a COO of an organization that's in the process of going public, I have to look at the long-term results. The company that invented and used Six Sigma for the longest period of time has continuously decreased market share and lost technological leadership.

  I don't mean to pick on Motorola; I've just been following its performance over the years because I have some of my retirement money invested in it.

 The other landmark organization related to the use of Six Sigma is General Electric. As an executive, I will watch closely to see how long the Six Sigma program lasts at GE after its chairman, Jack Welch, retires. I hope GE will keep it as a measurement standard throughout the decade.

 OK, I'm done. E-mail me your best shot.


About the author

 H. James Harrington is COO of Systemcorp, an Internet-software development company. He was formerly a principal at Ernst & Young, where he served as an international quality adviser. He has more than 45 years' experience as a quality professional and is the author of 20 books.

 Harrington is a past president and chairman of the board of both the American Society for Quality and the International Academy for Quality. Visit his Web site at www.hjharrington.com . E-mail him at jharrington@qualitydigest.com .

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