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Six Sigma Saves Fortune 500 $427 Billion

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  • #45786

    JDI
    Participant

    Jan 11, 2007
    Six Sigma Saves Fortune 500 $427 Billion
    That’s pretty impressive!
    Just Do It!

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    #150385

    Ken Feldman
    Participant

    Well, gee golly, do ya think the Research Manager for isixsigma.com magazine would publish an article saying Six Sigma Sucks and has no value?  Sorry, not a credible source.  Might believe an independent source with no skin in the game.

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    #150386

    Ken Feldman
    Participant

    Did anyone read the recent WSJ article on Home Depot and Nardelli’s departure?  Six Sigma got slammed nicely.  The clowns from Qualpro were quoted as saying SS is a failure and that most company stocks did worse than the market.  They also claim that their Multi Variable Analysis methodology is far superior to SS and companies using their approach did better than SS companies.  Another independent reputable source.  Not much different than Mikel Harry and UA folks wanting to compile a list of reputable consultants approved by them.

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    #150387

    qualitycolorado
    Participant

    Darth, 
     
    Agree with you completely.  The iSixSigma magazine articleis says “The estimate is based on reported savings linked to Six Sigma in public documents. “
     
    This is just as bad as the recent Wall Street Journal article journal that bashes Six Sigma by taking information from an unpublished, not-peer-reviewed QualPro “report” (I use the term “report” in its very loosest sense) that says that companies implementing Six Sigma lag other companies in terms of some undefined stock price factor.
    Both articles are almost worthless. 
     
    However, I (unfortunately) kind of expect that from the mainstream press, like the Wall Street Journal. 
     
    What is really disappointing is that iSixSigma magazine has taken the same, quick (and incorrect) route in producing its articles.  A magazine about Six Sigma Quality should be able to do much better than this, using even the most-basic quality tools to dig deeper and get the “real” story.
     
    … my 2 cents worth ….
     
    Best regard,
    QualityColorado

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    #150390

    Schuette
    Participant

    D and QC,
    How do you stand (facts) concerning Six Sigma? Are you for it/against it/Indifferent? And have you invented or innovated something in place of it? Also, if you were writing such an article what would it include, can you give an example or two? Looking forward to your input!
    Jim 

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    #150392

    qualitycolorado
    Participant

    Jim,
     
    Thanks for your note.  I can’t speak for Darth, nor does he need me to speak for him — here my additional 2 cents worth:
     
    1. Regarding your questions about “How do you stand (facts) concerning Six Sigma?Are you for it/against it/Indifferent? “:  Hmmm, I’m not sure my “stand” is worth even 2 cents, and these are probably are not the important questions.
    Six Sigma is one of many tools /methodologies available to us to help us improve.  I believe that we have a lot to learn from some Japanese companies (and others) regarding the SIMULTANEOUS use of Six Sigma, Lean, and other improvement methodologies.  I just wrote some material about this is a separate posting today, at this location:
    https://www.isixsigma.com/forum/showmessage.asp?messageID=110252
     
    2. Regarding your question about “And have you invented or innovated something in place of it? ” — No, I have not.  As noted above, I believe in the SIMULTANEOUS, intelligent use of Six Sigma, Lean, and other improvement methodologies, all of which were invented by people who are much more talented than I am. 
     
    3.  Regarding your question: “Also, if you were writing such an article what would it include, can you give an example or two?” — IF I undertook something, the investigation would be serious investigation of topic, rather than a surface investigation.  I would use my quality / Six Sigma tools to develop a plan of attack, based on REAL data and REAL analysis, and then let the data speak to me.  There might be some regression analysis, a peek at correlations, a smattering of various statistical tests — in other words, a search for deeper knowledge and deeper meaning than just a few sound bytes.
     
    Best regards,
    QualityColorado

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    #150393

    Schuette
    Participant

    Thanks for the quick response. Appreciated your input!
    Jim

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    #150394

    Haugen
    Participant

    What is even more impressive is that they spent $627 Billion to generate those savings!

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    #150395

    mand
    Member

    Yes, just do it – the bigger the numbers you invent, the bigger your pay rise !

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    #150399

    Ken Feldman
    Participant

    As QC said, there is nothing wrong with SS. A serious, senior led deployment will yield results. A poor deployment ends in dissatisfaction. It’s not more difficult than that. Since the reported savings of most of these programs include the softer Type 2, 3 and even 4 benefits, I place little value on the reported numbers. For public company clients we like to take the stock price from the time they start deployment until the present and overlay them all against the S&P and other indices. Granted, some will have been successful despite SS and some will have suffered price decline for reasons other than SS. We just look at the overall trend of the group to see a graphical picture of success. Interesting what you see. Numbers aren’t self reported nor are they calculated, they are what they are. http://www.georgegroup.com/

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    #150401

    Schuette
    Participant

    Thanks!

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    #150403

    JDI
    Participant

    Source for that figure please!

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    #150405

    Lebowski
    Participant

    Darth,
    Maybe someone needs to look at who and how Home Depot staffed the Six Sigma deployment. The woman that ran it had no clue what was going on just hops from one company to another at the Six Sigma expert. She hires a miniature exconsultant that can’t fix anything. Maybe if we run cause and effect on these two we get some sort of relationship?
    The Harry list is interesting. I talked to a guy who was in the Allied Signal deployment the first year. Harry wanted to approve all designs for DOE’s. This guy is about power not about customer focus. he is like those Sunday morning evangelists, live the way I tell you not as I do and if you want into heaven you will need my personal stamp on your butt.
    Lebowski

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    #150406

    JDI
    Participant

    The URL used in the previous post, is that your sort of “independent source with no skin in the game?”  

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    #150411

    Ken Feldman
    Participant

    Difference is that the data is not self reported and can be independently replicated by anyone.  The stock prices of companies are public knowledge and the S&P/DOW, etc. are also out there for everyone.  If the chart was “savings reported by the company” I too would be suspicious.  You can argue whether stock price is a valid metric.  Did high performing companies adopt SS to get better or did SS help a company perform better?  Did other factors effect the rise in stock price?  How much was attributable to SS?  These are valid questions.  You could do it with your own list of companies and come to your own conclusion.

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    #150418

    Elbowski
    Participant

    Are you like OCD on Harry?

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    #150431

    Be Real
    Participant

    Darth, right on baby.
    See my posts on the six sigma mambo.
    There seems to be eroding integrity in calculating savings.
    First, I know there plenty of examples of hard savings.
    However, six sigma types are like anyone else, they want to protect their jobs. Also, companies, especially in the US are interested in quick, huge wins and savings.
    Resulting in company’s six sigma staff to game the savings. As I have said in previous posts, I have seen MBBs assign BBs to marketing, product develop and other areas to help them simple do reports. Since her BBs “helped” those areas with their reports, she claimed any monies that derived from marketing, product develop and other areas results as her own and her Quality leader went along with it.
    I have seen people go back and grossly inflate baseline numbers that are forecasts / estimates to improve their “financial results”.
    GE was really good at this and they’re extending this wonderful competency to their pathetic NPS initiative.

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    #150436

    Ski VT
    Member

    Be Real, your savings posts are right on the money. They describe my business unit’s saving policies.
    Are you from the Burlington, Vt area? ; -)

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    #150437

    Ken Feldman
    Participant

    Would we all be happy if we restricted declared benefits to verifiable type 1 cost savings or increase in sales plus type 2 cost avoidance if you actually removed money from someone’s budget or prevented the need to add to the budget? Granted, other benefits are “good” for the company but my philosophy is that the cost of SS deployment requires real dollars so the ROI should only be calculated on real dollars. Probably heresy but WTF.

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    #150452

    jack ma
    Participant

    did yo save si sigma sucks. here a good on.  we had a 50% saving in floor space.    went from 3 feet to 1.5 feet…. then have some brain child in Corporate thinks he made a buck.  i know the bs ways of this system..  

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    #150454

    JM
    Participant

    my company works tbm. they claimed a 350000.00 saveing last year….all bs they cooked the books. we went from 200k in lates. to 1.4 million.. you would not be a fool in saying it dosen,t work you would be a fool to think it works everwere

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    #150456

    Ski VT
    Member

    Jack, I know what you mean. I work for a medium sized software company based out of Burlington, VT.
    If you did the math on the average reported savings per Six Sigma Black Belt per year, its millions.

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    #150457

    JM
    Participant

    Six Sigma Black Belt when i here that it make me sick… o i know how to make improvements so i’m a black belt.. da   i got start a new thread/

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    #150480

    Mike Carnell
    Participant

    Where did you get your Six Sigma Mambo? You aren’t being very original.
    Why is a lack of integrity in management a Six Sigma methodology issue? When you lay out a deployment you lay out the rules on calculating benefits (for the likes of that new idiot it doesn’t have to be cost reductions) before the projects even start. If you don’t have this then who’s issue is it? You didn;t have the experience or insight to understand you needed to do it – that is your issue in poor deployment planning. You work for a company that has management with no integrity – now you realize it so what are you doing about it. You work for a company that had no way to calculate benefits from anything before Six Sigma camr along? I guess that means there was no process improvement before Six Sigma?
    When you did Cap Ex nobody had to go back and verify that the benefits they said would be there actually were? If they did whay would you need any different methodology to evaluate a projects benefits?

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