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Trimming Waste Fast

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Oct 10, 2006, By Tod Newcombe

But it wasn't always like that. In the 1970s, the company struggled to make TVs with no defects. Finally it gave up and sold the factory to a Japanese firm that quickly changed operations and began cranking out TV sets with one-twentieth the number of defects produced under Motorola's management.

Disgusted with its poor manufacturing quality, Motorola's executives took a long, hard look at the problem. They implemented several initiatives aimed at improving quality and customer satisfaction. At the top of the list was something called Six Sigma.

According to the American Society for Quality, there are differing opinions on Six Sigma -- whether it's a philosophy, a set of tools or a methodology -- but it's best described by the American Society for Quality as a "fact-based, data-driven philosophy of quality improvement that values defect prevention over defect detection. It drives customer satisfaction and bottom-line results by reducing variation and waste, thereby promoting a competitive advantage."

Six Sigma uses statistical and management tools to improve quality. A process -- whether it involves manufacturing or a service -- is said to have reached Six Sigma when it has a failure rate of 3.4 per 1 million, or 99.99966 percent accuracy. The industry average, according to James Lucas in his 2002 article, The Essential Six Sigma, is 6,200 defects per 1 million, otherwise known as Four Sigma. Lucas said the strength of Six Sigma is its "simple and effective management structure."

Compatible with Six Sigma is another process that also got its start in manufacturing: Lean Flow.

Famed automobile manufacturer Henry Ford is sometimes credited with devising the idea as a way to eliminate waste from the manufacturing and assembly line processes when building the Model T in the early 20th century. Ford likened his Lean Flow process -- also called Lean Manufacturing, Continuous Flow and Just-In-Time Manufacturing -- to a river that flowed continuously. Anything that disrupted the flow was a waste that had to be eliminated.

Peter Peterka, president of SixSigma.us, said Lean Flow and Six Sigma have strong commonalities and complement each other. "They share the goal to identify and eliminate sources of waste and activities that do not add value," he wrote in an article posted on his company's Web site. When the two are combined, he said, they make it easier to identify and resolve quality issues.


How It Works
Together, Lean Flow and Six Sigma have become a defined approach to quality improvement embraced by some of America's leading business firms, including Dell, General Electric (GE), Johnson & Johnson, Lockheed Martin, Motorola, Northrop Grumman and Xerox, to name a few.

Motorola's use of Six Sigma improved quality and reduced errors to such an extent that the company won the prestigious Malcolm Baldridge Award for national quality. At GE, Lean Six Sigma (LSS) also had a huge impact.

When Jack Welch, former CEO, heard about Motorola's success with LSS, he developed a quality improvement program that became known as the GE Way. His goal was quite far-reaching. "We want to change the competitive landscape by not just being better than our competitors, but by taking quality to a whole new level." In the first two years GE implemented LSS, revenue increased 11 percent and profits grew 13 percent.

All organizations that embrace LSS use a standard, five-step, data-driven approach to re-engineering an existing process for quality improvement. Newton Peters, principal at Xerox Global Services, summarizes the five steps, known as DMAIC, in a white paper about Lean Six Sigma in the public sector:

  • Define -- identifies the problems to be solved and establishes success criteria;
  • Measure -- evaluates the current state of an organization's processes and identifies where a process can be streamlined;
  • Analyze


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