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rdf:ID : Six_sigma

rdfs:label : Six Sigma

Six Sigma is a set of practices originally developed by Motorola to systematically improve processes by eliminating defects. A defect is defined as nonconformity of a product or service to its specifications.

While the particulars of the methodology were originally formulated by Bill Smith at Motorola in 1986, Six Sigma was heavily inspired by six preceding decades of quality improvement methodologies such as quality control, TQM, and Zero Defects. Like its predecessors, Six Sigma asserts the following:

* Continuous efforts to reduce variation in process outputs is key to business success

* Manufacturing and business processes can be measured, analyzed, improved and controlled

* Succeeding at achieving sustained quality improvement requires commitment from the entire organization, particularly from top-level management

The term "Six Sigma" refers to the ability of highly capable processes to produce output within specification. In particular, processes that operate with six sigma quality produce at defect levels below 3.4 defects per (one) million opportunities (DPMO). Six Sigma's implicit goal is to improve all processes to that level of quality or better.

Six Sigma is a registered service mark and trademark of Motorola, Inc. Motorola has reported over US$17 billion in savings from Six Sigma as of 2006.

In addition to Motorola, companies that also adopted Six Sigma methodologies early-on and continue to practice it today include Bank of America, Caterpillar, Honeywell International (previously known as Allied Signal), Raytheon, Merrill Lynch and General Electric (introduced by Jack Welch).

There have been a few retail companies that have attempted to adapt this methodology to their business with mixed success. Perhaps the most notable was former CEO Bob Nardelli's attempt to adapt his systems from his former employer, General Electric, to the retail industry. There is one inherent problem with attempting to apply Six Sigma to retail. Retail=people, Six Sigma=defects. So, you have to look at your lacking areas as defects by your employees. Home Depot attempted to solve this by thinning out their workforce and implementing training programs for the remaining employees in order to reduce defects. On paper, this may work well but once the human factor was applied it led to massive frustration from the employees and the customers due to the lack of salespeople on the floor at any one time. Although the employees were better trained, they were now required to help 22.8 customers per hour rather than the previous 13.4. Other retailers are learning from these mistakes of the first big box retailers to attempt this and are tweaking the methodology to better suit their company goals.

Recently some practitioners have used the TRIZ methodology for problem solving and product design as part of a Six sigma approach.

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