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Pros and Cons of Six Sigma
By Arthur Webb

Pros and Cons of Six Sigma

Six Sigma is a business strategy that seeks to identify and eliminate causes of errors, defects or failures in business processes by focusing on outputs that are critical to customers. It is a measure of quality that strives for the near elimination of defects by using the application of statistical methods. A defect is defined as anything which could lead to customer dissatisfaction. The fundamental objective of the Six Sigma methodology is the implementation of a measurement-based strategy that focuses on process improvement and variation reduction.

When the Six Sigma approach was introduced to many organizations, the initial reactions included a lot of skepticism, such as:

o It is another quality improvement initiative or flavor of the month

o There is nothing really new in Six Sigma compared to other past quality initiatives

o This too shall pass like others

o It is an 'old wine in a new bottle'

o This won't work in our business

o We are doing Six Sigma already

o It is nothing more than a hype

o It is not for us as Six Sigma requires complicated statistical methods
However, the following aspects of the Six Sigma approach were not accentuated in previous quality improvement initiatives:

o Six Sigma strategy places a clear focus on achieving measurable and quantifiable financial returns to the bottom-line of an organization. No Six Sigma project is approved unless the bottom-line impact has been clearly identified and defined.

o Six Sigma strategy places an unprecedented importance on strong, passionate leadership and the support required .for its successful deployment

o Six Sigma methodology of problem solving integrates the human elements (culture change, customer focus, belt system infrastructure, etc.) and process elements (process management, statistical analysis of process data, measurement system analysis, etc.) of improvement.

o The Six Sigma methodology utilizes the tools and techniques for fixing problems in business processes in a sequential and disciplined fashion. Each tool and technique within the Six Sigma methodology has a role to play and when, where, why and how these tools or techniques should be applied is the difference between success and failure of a Six Sigma project.

o Six Sigma emphasizes the importance of data and decision making based on facts, rather than assumptions and hunches! Six Sigma forces people to put measurements in place. Measurement is considered as a part of the culture change...What gets measured, gets done!!
Just like any other quality improvement initiative we have seen in the past, Six Sigma has its own limitations. The following are some of the limitations of the Six Sigma approach, creating future opportunities for research:

o The challenge of having access to quality data, especially in processes where no data is available to begin with (sometimes this task could take the largest proportion of the project time)

o The right selection and prioritization of projects is one of the critical success factors of a Six Sigma program. The prioritization of projects in many organizations is still purely subjective. Very few tools exist for prioritizing projects and this should be the major thrust for future research.

o The statistical definition of Six Sigma is 3.4 defects or failures per million opportunities. In service processes, a defect may be defined as anything which does not meet customer needs or expectations. However, it would be illogical to assume that all defects are equally bad. For instance, a defect in a hospital could be a wrong admission procedure, misdiagnosis, misbehavior of staff members, unwillingness to help patients when they have specific queries, etc. Assumption of 1.5 sigma shift (standard improvement) for all business processes does not make much sense. This particular issue should be dealt with extra caution as a small shift in sigma could lead to erroneous defect calculations.

o Six Sigma can easily digress into a bureaucratic exercise, if the focus is on such things as the number of trained Black Belts and Green Belts, number of projects completed, etc. instead of bottom line savings.

o There is an overselling of Six Sigma by too many consulting firms. Many of them claim expertise in Six Sigma when they barely understand the tools, techniques and the Six Sigma roadmap.

o The relationship between Cost of Poor Quality (COPQ) and Process Sigma Quality Level requires more justification.

What does the future hold for Six Sigma?

In my opinion, Six Sigma will be around as long as the projects yield measurable or quantifiable bottom-line results in monetary or financial terms...when Six Sigma projects stop yielding bottom-line results, it might disappear.

One of the real dangers of Six Sigma is to do with the capability of Black Belts (the so called technical experts) who tackle challenging projects in organizations. We cannot simply assume that all Black Belts are equally good. Another danger is the attitude of many senior managers in organizations that Six Sigma is "an instant pudding', solving all their ever-lasting problems.
I would like to accentuate the point that Six Sigma does provide an effective means for deploying and implementing measurement based thinking based on the following three rudimentary principles:

o All work occurs in a system of interconnected processes

o Variation exists in all processes, and

o The Variation in processes can be measured and controlled

The above principles of statistical thinking within Six Sigma are robust and it is fair to assume that Six Sigma will continue to grow in the next few years. However the total package may change in the evolutionary process and Six Sigma will probably be supplanted by a new business management approach in the near future.

Arthur Webb formed Creative Business Consultants in 2004. Prior to forming his own Management Consultancy, Mr. Webb was a successful Senior Process Consultant for six years with Proudfoot Consulting. In the 15 years before joining Proudfoot, Mr. Webb held a variety of management positions, primarily in banking and the financial services industry. He possesses an abundance of experience in business process analysis and improvement, organizational alignment, cost reduction, management control systems design and implementation

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