Does Six Sigma Help or Hurt Business Transformation?

Ann All

I've never been that interested in Six Sigma, beyond thinking it would be cool to be a black belt in anything, even process improvement. A few years back, when I sat through several presentations with large financial institutions that were using it, it struck me as a particularly rigid and inflexible framework, although I do agree with its idea of making quantified financial goals a focus of improvement efforts.


Here at IT Business Edge, I've written about it sporadically at best, focusing more on ITIL, COBIT and other improvement frameworks utilized more often by IT professionals. Way back in 2006, the research director of iSixSigma Magazine confirmed in an interview with me that Six Sigma hadn't gained much traction with IT pros. "Well, no wonder" I thought, when he told me Six Sigma was more commonly applied to IT processes at companies that outsourced IT functions.


He said:

Through the routine use of Six Sigma, companies may be better positioned for outsourcing and, thus, are more likely to use this strategy. Further, if you clean up an IT process first (through Six Sigma), it's easier to determine if it should be outsourced or kept in house. It's hard to say which comes first in companies - IT process outsourcing or Six Sigma - but each can be used in conjunction with the other. I think the process documentation and performance definition required by outsourcing goes hand-in-hand with the process mindset of Six Sigma.

He contended Six Sigma and IT managment were "closely related" as both required close alignment with a company's strategic priorities and goals to be successful.


Interestingly, HCL Technologies CEO Vineet Nayar recently implied that many U.S. university graduates lacked the kinds of skills needed to succeed in IT, including a grounding in methodologies like Six Sigma. One of the folks who commented on my blog post about Nayar's remarks was a reader named Joshua, who said he was a recent graduate who has been working at the same company since a third-year internship. He wrote:

I find the most stupid part of his remarks was suggesting that Six Sigma is somehow more important than developing the next big thing. Although I do a lot of boring work, my desire (and others) to IMPROVE OUR PRODUCT has driven most of the genuine improvements to our code. On the other hand, the countless resources we have wasted on Six Sigma and SAS70 compliance have probably made our stuff worse, as our management makes token gestures to fit the official definition of "best practices."

In another of my posts, from 2007, I cited a couple of Six Sigma critics. Consultant David Taber, in a piece, wrote that Six Sigma didn't work well in product development efforts because focus would likely shift away from customer input and result in overly complex specifications. The EVP of a company called QualPro (which, skepticism alert, has its own process improvement mthodology called MVT) had a number of beefs with Six Sigma. Among them: Six Sigma initiatives can be costly. It tends to yield small, incremental improvements rather than breakthrough transformations. Six Sigma takes responsibility for improvement away from the line organization and assigns it to a Six Sigma expert or two, which he said "tends to dilute the effectiveness of performance improvement efforts."


A BusinessWeek article from the same year featured some quotes that implied Six Sigma's reputation had gotten tarnished after one of its staucnhest champions, former General Electric CEO Jack Welch, retired from that company. While it can help cut costs and boost profits, it can stifle innovation, said Babson College professor Tom Davenport, who added that process management should be "leavened a bit with a focus on innovation and (customer relationships)."


The definition of Six Sigma in IT Business Edge's Knowledge Network doesn't exactly make me want to rush out and get my black belt. A more friendly view of Six Sigma is also found in the Knowledge Network, in this Six Sigma fact sheet from ITBE partner The Art of Service.


I am admittedly no expert. I'd be interested in hearing about other folks' experiences with Six Sigma, both good and bad.

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Jul 14, 2009 10:40 AM Dennis Stevenson Dennis Stevenson  says:


I spent more than a decade at Honeywell (AlliedSignal) under Jack Welsh's protoge Larry Bossidy.  I have had my share of SixSigma indoctrination.  In fact, even though I'm no longer there, I have my Greenbelt certificate mounted on my office wall.

Firstly, I'm not at all surprised that an Indian offshore leader would criticize US Workers for lacking discipline.  I think the Indian developer industry has  made a very hard adoption of process management as a way to establish themselves in the international outsourcing market.  I'll bet there are more SEI-CMM (another process centric methodology) level 5 and 6 companies in India than the rest of the world.  Process Improvement/process management has definitely been the Indian Outsourcer's thing.

Six Sigma is good because...

It offers a disciplined framework for thinking about process.  Methodology, tools, management, the whole bit.  It forcibly reduces all of business into a series of processes and proposes to improve them.  It creates a bias toward measurement-based improvement that pervades a culture.  It drives understanding toward root cause rather than Post Hoc ergo proto hoc analysis.   More importantly it is designed to measure the process gains and ensure that they are not lost over time.

Six Sigma is bad because...

Most of the ideas for improvement are kind of stupid.  They are often driven by a process improvement specialist who is removed from the area of functional specialism.  In my experience, admin or human-centric processes are hard to integrate with six sigma.  Where fuzzy logic prevails, or human initiative are allowed/encouraged, Six Sigma tools are harder to use.  IT is no example.  I used to hate it when the BlackBelt showed up in my work area.  I knew that crazy questions were about to follow.

My Take...

I wouldn't/won't turn up my nose at Six Sigma.  But I think it needs to be used in a manner appropriate to the environment.  Too much Six Sigma religion in IT (which is about research and creativity) is a bad thing.  But the culture of improvement and t he richness of tools is a huge asset.


Jul 16, 2009 5:32 AM Kenneth Gonzalez Kenneth Gonzalez  says:


I think that Six Sigma is great... for adressing a specific set of issues. I don't think that companies have enough understanding of the various "tools" available to them (of which I'd consider Six Sigma one) to use them properly or know when they should apply them.

If the team that is considering/proposing adoption doesn't understand why they are embarking on the exercise, they won't be able to properly evaluate:

  • The fit with their organizational objectives;

  • What it will take to adopt and sustain the required organizational changes;

  • Whether or not the readouts will be clearly visible to the customer and provide sufficient benefit to offest the cost.

In today's climate, it could be a "career limiting move".



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