Six Sigma and Corporate Performance Management (CPM) share culture, management, and organizational themes.
First, they both encourage employee empowerment. They promote the concept of “information democracy” by making data available to all information consumers. As a result, every employee is responsible for quality and performance.
The CPM framework aligns organizational initiatives with strategic objectives, ensuring empowered individuals who can manage on their own. People can now monitor and measure individual key performance indicators or KPIs and performance target levels. Similarly in Six Sigma, the DMAIC and DMADV methodologies empower individuals to identify, understand, and control process inputs to improve performance levels.
Second, both Six Sigma and CPM focuses on the reliance on factual data rather than gut-feel management. In Six Sigma, data serves as the basis for making decisions. CPM also leverages data directly from operational measures to derive KPIs and target metrics to manage, monitor and improve business health. In both, decisions throughout the organization are based on a single source of shared data that is used for collaborative decision making.
Third, CPM and Six Sigma ensures alignment of organizational activities with business objectives. This results in better strategy execution.
In CPM, KPIs are cascaded from the organization’s mission, vision, strategies and objectives. This ensures that all individuals are pulling in the same direction and have insight into what effects their activities have on the entire organization. It helps them understand the relationship between business processes and erformance indicators. In Six Sigma, projects are selected based on consistency with organizational objectives and the potential effect on the bottom line. Project charters, business case analyses and executive sponsors ensure that the Six Sigma projects track with organizations’ strategies and objectives.
The Power of Metrics: CPM and Six Sigma
