Six Sigma and Quality Management
Six Sigma is a business management strategy which aims at improving the quality of processes by minimizing and eventually removing the errors and variations. The concept of Six Sigma was introduced by Motorola in 1986, but was popularized by Jack Welch who incorporated the strategy in his business processes at General Electric. The concept of […]
Emergence of ERP System
Introduction Enterprise Resource Planning or ERP is one the most common term used among corporate world, business school and in the technology structure. There are several definitions of the ERP, but the term can be best understood if each word is looked at individually. Enterprise refers to any organization with aspiration and business motive. In […]
What is TRIZ Matrix and How to Use it ?
TRIZ Matrix is a technique developed by Russian scientists to formalise the process of innovations. TRIZ is a Russian Acronym for Theory of Inventive Problem Solving. The English acronym is TIPS and is often used to refer to the same analysis. The TRIZ is a powerful tool that helps brings the insight of years of […]
Business Analytics – Meaning, Importance and its Scope
Introduction The word analytics has come into the foreground in last decade or so. The proliferation of the internet and information technology has made analytics very relevant in the current age. Analytics is a field which combines data, information technology, statistical analysis, quantitative methods and computer-based models into one. This all are combined to provide […]
Enterprise Marketing Automation
Introduction Enterprise marketing automation is part of customer relationship management module. Enterprise marketing automation can also be an independent software installed by the company. The main function of the enterprise marketing automation module is to run different marketing programs in the organization. The enterprise marketing automation module also helps the given organization develop a business […]
As mentioned in the earlier articles, Six Sigma helps the organization develop at various levels viz. operational, tactical and strategic. While the operational and tactical goals of cost reduction and increased customer satisfaction are well understood and appreciated, the strategic intent behind Six Sigma is not well recognized. It is the pivotal factor, however in the success or failure of any Six Sigma initiative in the organization. Here is an explanation of the same:
When Six Sigma was introduced by Motorola, it became a strategic advantage for them. Since, not many of their competitors had the efficiency of Six Sigma tools, they were leading these corporations and the marketplace. However, with the passage of time, every major corporation on the planet has developed a Six Sigma program. Efficiency is now the name of the game. Hence, from a strategic standpoint, there are now Six Sigma programs competing against other Six Sigma programs and the better ones win!
Over the course of time, there have been numerous studies that have been conducted about the efficiency of these Six Sigma programs. It has been found out that companies that follow Six Sigma projects sporadically do not stand to gain as much from it as do companies that have a well co-ordinated effort. Today’s marketplace requires using Six Sigma processes to execute the companywide strategies.
An organization that is truly dedicated to Six Sigma philosophy will find many and varied projects that can be executed. Even an already Six Sigma organization needs to be developed over time. This is because technological changes unleash better ways of doing work and the organization must continuously adapt.
Hence, the challenge lies in prioritizing between the different Six Sigma projects and executing the correct ones. Projects must be checked for strategic fit i.e. how do they help meet the long term goal of the organization in question.
Example: A company like Facebook that relies on intimate knowledge of its customers to place ads, must execute Six Sigma projects related to Customer Relationship Management (CRM) first and then if resources are left must consider alternative projects. Facebook would not want to be operationally efficient at the cost of being misdirected from its long term strategy.
It is for this reason that Six Sigma has been tied up with a process called Hoshin Kanri by the Japanese. Roughly translated into English, it means management of direction. Six Sigma efforts, therefore need to be well directed.
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The Cost of Poorly Performing Processes – Need for Six Sigma
February 12, 2025
