Six Sigma’s creator, Motorola, had a very simple answer to the question asked in this article’s title. This answer: survival. The entire premise behind Six Sigma was to be able to survive in an extremely competitive marketplace, where it was becoming increasingly challenging even to stay afloat. Something had to be done to keep up with the advantages held by many foreign companies who were claiming a large part of the market. This something was primarily quality control; however, not in the traditional sense.
Typically, we tend to define quality as a kind of adherence to internal requirements. This, however, has very little to do with the way Six Sigma works. Instead, Six Sigma functions by permitting a company to optimize its earnings by redefining quality itself. For Six Sigma, quality is instead the value that is added by any given productive effort.
In Six Sigma terms, quality can be broken down into two types:
• Potential Quality - the maximum possible value which is known to be added per unit of input.
• Actual Quality - the current value which is added per unit of input.
There is a difference between these two types of quality, and it is this difference that defines the Six Sigma focus. It is waste that distinguishes these two types of quality, and Six Sigma works to improve quality by reducing the amount of waste. This is done by having companies work to produce better products and services in a manner that is faster and cheaper. This means cracking down on defect prevention, cycle time reduction, and cost savings. At first glance, this may sound like a typical, meaningless cost-cut effort, but where those programs reduce value and quality, Six Sigma concentrates on the identification and elimination of waste costs; those providing no value to consumers.
For organizations who do not use Six Sigma, these costs are frequently staggeringly high. Businesses which run at three or four Sigma will generally spend somewhere between twenty five and forty percent of their income solely on repairing problems. Quality - or lack thereof - on that level comes at an extremely high cost. Conversely, organizations running at Six Sigma will usually spend only five percent or less of their earnings on resolving problems. This is a tremendous gap in spending, and, understandably, is well worth a company’s while to get under control.
By understanding the difference that Six Sigma makes, it’s not at all difficult to comprehend Motorola’s initial motivation for it’s creation, and maintained use.
Craig Setter is a certified Master Black Belt for Aveta Solutions - Six Sigma Online. Six Sigma Online offers online six sigma training and certification classes for 6 sigma black belt, green belt, yellow belt, lean and DFSS courses. They have an extensive customer list including such companies as Pfizer, Microsoft, UPS, Bank of America, and State/Federal Governments. For additional information in regards to Six Sigma or to see how Aveta Solutions Six Sigma Online can help you, please visit us at http://www.sixsigmaonline.org