Through the statistical representation of Six Sigma, we see quantitatively how a process is performing. We have known that to achieve Six Sigma, a process must not produce more than 3.4 defects per million opportunities. In Six Sigma, a defect is anything outside of customer specifications.
To someone who is not familiar with how quality systems work may doubt if this process is indeed achievable, or is even doable. However, case studies show that it is.
Motorola, for example, credits Six Sigma to helping them win the first Malcolm Baldrige National Quality Award. Also, the company continues to reap profits because of Six Sigma processes. General Electric (GE) cut invoice defects and disputes by 98%. The company’s business in medical systems used Six Sigma design techniques to reduce patient full-body scan from a few minutes to 30 seconds.
In 1999, Honeywell (AlliedSignal) saved more than $600 million when its employees implemented multiple Six Sigma projects. Twelve-billion-dollar giant Textron deployed 225 full-time Six Sigmaexperts in 2001 and appointed a corporate vice president of Six Sigma Transformation in 2003. This was in support of what they considered their “most important corporate process improvement initiative.”
Another high-tech manufacturer found the development unit of a cooling system having numerous and redundant inspection steps. These pushed millions of money down the drain. When it adopted Six Sigma, the number of inspection steps were reduced resulting in a $1,300,000 savings.
Clients of a mutual fund company were unable to make informed decisions because asset values on the website did not have timely updates. Six Sigma was applied, thereby improving processes, resulting in timely updates, retention of key clients, and a 20% reduction in operating costs.
A glass manufacturer was doing excessive rejects due to scratches and chips created by contaminate in a critical production process. With Six Sigma, the company was able to reduce rejects by 92% improving line up-time by 79% and realizing $840,000 in annual cost savings.
One accounting department’s delinquent accounts receivable had remained above $7,000,000 for the past 12 months. Six Sigma established new processes, improved cash flow and finance charges, and saved over $350,000 annually.
Yet again, a rubber manufacturer was unable to perform fast-mold changes. This greatly affected their delivery schedules and customer satisfaction. Six Sigma was applied, reducing mold change time by 53% and creating $525,000 in sales capacity.
With these testimonies, one would wonder why other companies are not jumping into the same strategy?
