| by Kamal Hassan
Would you spend millions of dollars for a return of more
than a billion? Sure you would, but that’s just a
fantasy, right? It wasn’t just a pipe dream for GE’s
CEO Jack Welch, who expected to reap a hefty return for
every dollar his company spent on Six Sigma. Needless to
say, he did. In 1997, GE invested $380 million in Six Sigma--mostly
for training--and received about $700 million in documented
benefits from increased productivity and decreased waste.
It’s no wonder Six Sigma devotees at GE and elsewhere
speak of the initiative in terms bordering on miraculous.
Unfortunately, not all stories are as rosy as GE’s.
Many companies that adopted Six Sigma failed to sustain
results, and therefore the program was either put on the
back burner or eliminated completely. They didn’t
realize, or couldn’t accept, that the program takes
years of dedicated work to implement successfully. To succeed
with the initiative, organizations must look at their business
processes in an entirely new way. They must understand
that Six Sigma brings about sustained, long-term change,
as opposed to a quick fix. Any company that applies it
as a Band-Aid will reap little or no benefit. The changes
must be fundamental to the business companywide and persistently
pursued.
During the past two decades, Six Sigma has been widely
used as a management tool to drive quality and process
improvement. Championed by companies such as Motorola and
GE, the Six Sigma methodology has gained worldwide corporate
acceptance in helping companies strive for zero defects.
By providing the tools and skills to systematically streamline
business processes, Six Sigma has proven itself as a comprehensive
approach to improving leadership decision making and corporate
performance. Breakthrough Six Sigma results often contribute
to an organization’s increased profitability by providing
a clear view into its operating metrics, which leads to
informed actions and a reduction in the cost of quality.
A Six Sigma program imposes discipline and encourages positive
cultural change for organizations. In order to implement
and sustain the program, though, a company must dedicate
resources for infrastructure and change management at all
levels.
Companies that have successfully implemented Six Sigma
agree that the most critical success factor is acquiring
and maintaining top management’s support. The executive
team must be sold on the initiative’s benefits, structure,
processes and overall goals. Unless an organization can
embrace Six Sigma fully, which means rallying top management’s
support and providing the infrastructure needed to sustain
results while committing to a possibly radical shift in
its business processes, Six Sigma can easily fail. Other
factors that have contributed to the program’s failure
include:
 Lack
of buy-in, cooperation and ownership from frontline managers
and employees
A deficiency in Six Sigma’s visibility and failure
to share results companywide
Inadequate investment in the information technology
infrastructure to manage the program
To drive Six Sigma success in any organization, regardless
of its size, leaders must ensure a well-managed and sustainable
program. Six Sigma affects all aspects of how a company
does business; it doesn’t confine itself to improvements
in one or two areas. The program breaches organizational
boundaries and involves customers, partners and suppliers.
Knowledge-sharing and replicating Six Sigma projects and
results are essential.
But how can you breach organizational boundaries and
engage your supply chain? Many believe that the hard and
soft costs of implementing Six Sigma hinder employees,
customers, suppliers and partners from embracing the initiative.
However, the Internet’s fluidity and instant access,
along with advances in IT infrastructure, can help all
parties in their resolve to adopt Six Sigma. For example,
e-learning tools and just-in-time resource systems allow
companies to disseminate Six Sigma training content to
an entire organization and
its suppliers in a very cost-effective manner. Well-planned
and -executed e-learning solutions also drive change dynamics
faster and farther into an organization’s fabric.
Large organizations often have thousands of Six Sigma
projects underway at any given time. A Six Sigma executive
might not know how many there are, or how each aligns with
corporate goals, let alone their financial effects and
other results. Proper data collection and management provide
the cornerstones of any Six Sigma program. Horror stories
abound of expensive disasters caused by companies amalgamating
disparate computer platforms and databases or using rudimentary
tools to track data and report Six Sigma progress and results.
Implementing an end-to-end Six Sigma program management
system--which includes knowledge management, projects and
financial tracking, resource management and reporting systems--will
support and sustain a Six Sigma program. The proper software
solution will enable you to manage projects, customers,
resources, processes and budgets. Specifically, Six Sigma
software:
Ensures effective reporting and real-time tracking of
financial results
Helps
the company focus on Six Sigma projects with the greatest
benefits to customers
Assists
Six Sigma programs in allocating and managing scarce and
valuable resources, and training and managing people effectively
Ensures that the most effective resources are available
for the most important projects
The Six Sigma methodology relies on projects, programs,
resources, processes and project management to drive continuous
improvement. It quantifies all feedback and allows organizations
to focus on activities that must change in order to achieve
desired results. With the proper IT infrastructure and
flexible Six Sigma program management software, accuracy
and control can be achieved, enabling your company to execute
the program smoothly. Data sources will be reliable, results
can be monitored and validated in real time and success
shared throughout the organization.
For any initiative to succeed, however, those involved
must be committed to doing things differently. This requires
change management at all levels as well as companywide
commitment. Six Sigma training, control, standard methodologies,
reports, best practices and attention to detail are all
features of a well-managed Six Sigma program in a 100-percent
involved organization. To make this happen, Six Sigma projects
must not only be managed correctly using accurate, real-time
data, their progress and results must be visible--and comprehensible--to
executives, managers and participants involved in decision
making.
Thus, as you look ahead at budget allocations for 2004,
consider the software needs of your Six Sigma program.
Make sure the application you choose has the means of bringing
you the improvement results you envision.
Kamal Hassan, leader of BMG Technology Solutions, has
more than 12 years of software and technology experience
covering all aspects of development, marketing, selling
and delivering technical solutions to global corporations.
He has implemented many complex software solutions for
Six Sigma deployment and project tracking.
Breakthrough Management Group Inc. is a provider
of Six Sigma consulting, training and software support
tools.
BMG augments its Six Sigma training with Web-based support
tools such as e-learning, an online support portal and
project tracking software. For more information, visit www.bmgi.com.
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