Defining the Six Sigma Phenomenon

The phrase “Six Sigma” evokes emotional reactions in the press, in academia, and in business circles. Is it fad or fact, effective or just an overused buzz word from the consulting world? There are hundreds of consulting firms that provide Six Sigma guidance and many educational institutions that train and certify people in Six Sigma processes. It has been credited with reducing mortality rates in hospitalized patients and critiqued as too cumbersome and unrealistic to implement. What makes Six Sigma different from other total quality management processes like Baldrige, ISO 9000 or TQM?

According to Roger Schroeder, lead author of a paper to appear in the June 2008 issue of the Journal of Operations Management, this research argues that although the tools and techniques in Six Sigma are strikingly similar to prior approaches of quality management, it provides an organizational structure not previously seen. The paper looks at two companies, one that was newly involved in implementing Six Sigma and one that had a more mature relationship to the quality management strategy.

Schroeder explains, “While there are many books and articles on Six Sigma, this is the first academic article that attempts to carefully define Six Sigma based on field data. This is a necessary step for future research on the effectiveness of Six Sigma and even for examining if all organizations apply Six Sigma in the same way. We need to define the phenomenon we are studying before we can move ahead with research.” The paper, titled “Six Sigma: definition and underlying theory,” identifies the Six Sigma methodology and builds an academic framework that pulls it out of the hands of consulting gurus and lends legitimacy to its value as a quality management process.

Schroeder and his co-researchers established several consistent elements that were agreed to be essential for successful Six Sigma engagement:

• Parallel-meso structures: Six Sigma operates as a parallel organization, which is the organizational structure dedicated to improving the organization, but incorporates both micro and macro level decision making authority which allows multilevel integration of strategic projects.
  
  
• Strategic Project Selection: Six Sigma organizations develop formal mechanisms to select Six Sigma projects. These mechanisms, sometimes called project hoppers, involve senior management to filter out Six Sigma projects that do not have financial or strategic implications.
  
  
• Leadership Engagement: Leaders are also involved in the ongoing execution of Six Sigma projects.
  
  
• Improvement Specialists: Study participants used full-time improvement specialists, called Black Belts. These specialists were trained in the Six Sigma structured method by typically receiving four weeks of training with hands-on experience in improving one or more processes. Many organizations also train most, if not all, of their employees who are assigned to projects in Six Sigma basics.
  
  
• Structured Methodology: Six Sigma uses a structured method for process improvement. Improvement method used by study participants was the familiar DMAIC (Define, Measure, Analyze, Improve and Control) method. The study found a strong emphasis on finding the root cause of the problem through systematic use of the method. The Six Sigma methodology employs standard quality tools like FMEA, cause-effect charts, and Statistical Process Control.

Six Sigma in the Field

Twin Cities based Ceridian Corporation’s Six Sigma model closely mirrors the study’s main proof points. JoAnn Wroblewski, a Six Sigma master black belt whose focus is Ceridian’s Six Sigma training, explains that this quality improvement process is “how we do business.” Wroblewski points out that Ceridian, a global business services company, uses Six Sigma, not only for process improvement, but also as a tool to identify and groom future leaders, as a filter for designing business critical projects, and as a way of improving customer satisfaction and the bottom line. One of their critical projects focused on reducing customer incidents and calls during their year-end payroll processing. They realized improvements after having planned the process changes using the Six Sigma DMAIC methodology and drilling down with cause-and-effect tools, FMEA and employing statistical process control. They found customer satisfaction ratings improved over 50% while customer incidents and calls decreased 59% and 20% for our two major product areas, says Wroblewski.

Roger Schroeder is the Frank A. Donaldson Chair in Operations Management at the Carlson School of Management at the University of Minnesota. His co-authors are Kevin Linderman, assistant professor in operations and management science at the Carlson School; Charles Liedtke from Strategic Improvement Systems, LLC; and Adrian S. Choo, assistant professor with the Lally School of Management and Technology at Rensselaer Polytechnic Institute. Research for this paper was funded by a National Science Foundation grant completed in 2004.

For more information regarding this research, contact Roger Schroeder at 612-624-9544 or e-mail at rschroed@umn.edu.