Robert William Bob Galvin is recognized as a pioneer and innovative champion of Six Sigma. Bob Galvin was born in 1922 as the son of Motorola founder Paul Galvin. He went to work for Motorola in 1940, and was named president of the company in 1956. Bob subsequently succeeded his father Paul as CEO in 1959 and served in that capacity until 1986.

In 1986, he left the role as CEO and remained the Chairman of the Board of Motorola. Along with Bill Smith and John Mitchell, he implemented the Six Sigma methodology at Motorola. Under his leadership and influence, he grew the company from $216 million in sales in 1958 to $6.7 billion in sales in 1987. As a result, the company was awarded the first Malcom Baldrige National Quality Award from President George Bush in 1988. Six Sigma was subsequently adopted by General Electric (GE) under the leadership of Jack Welch. Jack Welch was quoted as saying, Six Sigma changed the DNA of GE.

In 1979, Motorola realized the full extent and damage being suffered by the company. Galvin began to realize the extent which it had lost market share in many key segments, including televisions, car radios and semiconductors. This realization brought on an awakening by Galvin. Motorola was at a major turning point and things had to change!

Galvin understood that business performance would improve when the quality improved. With his team in place, Galvin set in motion a powerful change strategy focusing on the culture and quality at Motorola. Even though he was firmly committed to these changes, he found that they were not enough. Galvin embarked on massive change that required going from a 10x quality improvement to an 1800x quality improvement. He put trusted leadership in place that he knew could get the job accomplished, and they embarked on this path of profound change.

Over the years, Motorola perfected the Six Sigma process within the organization. The leaders struggled to continually improve their methodology and found their much needed success. Their approach became scientific and deeply analytical. As time passed and leaders grew, matured and improved their commitment to quality, so developed their Six Sigma practice. Motorola quickly became the gold standard for quality and the vision of all sectors seeking the same goals. Galvin’s unwavering focus to the practice of Six Sigma and the absolute power he entrusted with his team, reaped unsurpassed results. They understand that measurement was everything!

The practice was formally embraced by Motorola and was put out across the business in over 52 locations worldwide and in 15 different languages, all within a year.

Bob Galvin, Motorola and Six Sigma will forever be recognized as the champion of Six Sigma. The legacy remains strong, and their success represents the hard won efforts of visionaries seeking absolute quality and performance improvement.

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Today, Six Sigma has an impressive track record of improving processes with its wide array of tools and techniques. Sigma Belts – individuals who are trained in some or all aspects of Six Sigma – are highly demanded by companies looking for people to improve their business performance. However, not many people are versed in the origins of the methodology that they rely upon when their business operations are underperforming.

As the 80s were coming to an end, a man named Bill Smith coined the term Six Sigma. At the time, he was working for Motorola and needed an effective quality management tool to improve business performance. So he got work on the methodology, pouring all his time and energy into what would become the future of quality management. Smith had the full support of the CEO of Motorola at the time, Bob Galvin, which made his work smoother.

After Smith was done, Motorola implemented the methodology companywide. The new process management tool proved successful, which led to Motorola being awarded the Malcolm Baldrige National Quality Award in 1988. This award recognizes organizations in various sectors that have achieved operational excellence.

Soon after that, in the 90s, Jack Welch, the chairman of General Electric (GE), adopted Six Sigma for his organization. The company evolved the methodology, making it connected to compensation for executives and return on investment (ROI). In GE’s annual report, they managed to show that implementing Six Sigma led to financial benefits. That’s when corporations listed in the Forbes Fortune 500 list started implementing Six Sigma as well in order to make their business operations more efficient.

Six Sigma borrows concepts from another quality management methodology: Lean manufacturing. While one might be tempted to think that Six Sigma and Lean are competitors, in the real world, the two are used in a complementary fashion. Their combined effect, know as Lean Six Sigma, has been shown to provide business performance benefits that are simply unmatched. Lean offers a hands-on approach to removing non-value-adding tasks to improve efficiency, while Six Sigma aims to reduce variability within organizational processes to minimize the occurrence of defects.

Lean has been around a lot longer than Six Sigma, with its origins rooted in the Toyota Production System (TPS) in Japan during the 60s. However, Lean thinking can be traced back earlier than that to the Arsenal in Venice during the 1450s. And in 1913, Henry Ford was the first to put Lean thinking to practice by fully implementing it. 

Lean gained further popularity when Boeing implemented it as part of its manufacturing process in 1993. Although its initial efforts were unsuccessful (not through the fault of Lean but other outdated manufacturing processes being used), Boeing continually invested in the methodology until it paid off.

As far as Six Sigma goes, its story has just begun since it is considered to be a relatively new methodology in the business world. Many organizations across the world are still working on evolving it to make their businesses more efficient through process improvement. Regardless, Six Sigma and the recently revitalized Lean have left an indelible mark on history.

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Bill Smith: Contributions to The Theory of Process Improvement

Bill Smith is the founder of Six Sigma, the powerful methodology that is now being used by businesses the world over for process and quality improvement in the interest of defect minimization and ultimately greater customer satisfaction.

Early life and Career

Bill Smith was born in Brooklyn in the year 1929. He joined the U.S. Naval Academy and pursued further studies at the University of Minnesota School of Business. He spent 35 years of his professional career in the field of engineering and quality assurance.

He joined Motorola as the Vice President in the year 1987 in the Land Mobile Products division. Bill Smith is known as The father of Six Sigma being the key person who invented the concept and revolutionized the concept of quality in organizations around the world.

His Contribution to Six Sigma

Smith started working on the concept in the early 80s. In the year 1984, he shared his notes in two research papers titled Early Life Failures in Electronic Equipment and Reliability Predictions and Customer Perceptions.

Smith identified the correlation between the performance of a product in the field and the amount of work that needs to be re-done during the process of manufacturing. Further, he also discovered that the products with the least nonconformity were the best performing as reported by the customers.

Moreover, Smith observed that products that were built with less nonconformity were the ones that performed the best after delivery to the customer. Latent defects were identified as one of the reasons where the early failure of the product was reported after five loops of environmental testing. These latent defects were directly proportional to the defects observed in components and manufacturing of the products.

The Rise of Six Sigma

Bill Smith convinced Bob Galvin, the CEO of Motorola at that time, that improvement of their products was possible with new ideas and he proposed a couple of them. In 1985, Bill Smith coined the term Six Sigma to explain the expected level of design margin and product quality.

Michael Harry (another engineer known for his contribution to Six Sigma) and Smith together started exploring a standard formula for reducing defects (which were quite a concern for Motorola at that time). The approach was popularly known as MAIC: Measure, Analyze, Improve and Control.

Six Sigma and Motorolla

Bill was one of the major reasons for leading Motorola towards huge success by reducing the defects to 1/100^th in four years and eventually leading it to the performance level of Six Sigma (i.e. 3.4 defects per million units produced). Bill’s concept of Six Sigma was incorporated into the existing new product testing at Motorola and was explained in detail in a white paper by Ken Enger in 1986. Motorola received its first Malcolm Baldrige National Quality Award in the year 1988 from the U.S. Government just two years after Bill Smith coined the term Six Sigma.

In the decade from the beginning of Six Sigma in 1987 and 1997, Motorola achieved a five times growth in sales with 20 per cent increase in profits per year, a cumulative saving of 14 million dollars purely on account of the launch of Six Sigma efforts and again in the stock price compounding to an annual rate 21.3%. 

The Six Sigma Research Institute (SSRI) was established by Motorola in order to accelerate the scope of “Six Sigma and Beyond”. The concept of Black Belt was propounded by the SSRI. Apart from Motorola, giants such as Allied Signal (1993) and General Electric (1995) also adopted the Six Sigma methodology.

Conclusion

Bill Smith, popularly known as the Father of Six Sigma’ has gifted today’s organizations with an amazing concept. Six Sigma not only ensures an upper hand over competitors in terms of quality but also a customer base of loyal and satisfied individuals.

The concept of Six Sigma has reduced the amount of waste created in organizations during the creation of products and services. This is a powerful methodology of product and process improvement which can lead to the desired financial performance keeping the defects under control.

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Six Sigma is a set of techniques and tools used for process improvement that was developed by Motorola and promoted by General Electric. These set of tools and techniques have a wide range of applications beyond manufacturing. The application of the Six Sigma methodologies in sourcing and procurement processes can lead to exceptional results in terms of business process improvement.

Six Sigma can be applied to a wide range of procurement projects, in spite of the level of process quality goals that have been set. The application of these set of tools requires that the process in question be clearly defined in order to be addressed within a reasonable period of time. It also requires that the process should produce significant returns to warrant the diversion of organizational resources into the task of process improvement.

The following are some of the instances where Six Sigma has been applied to achieve better procurement processes:

Reduction of Cycle Time

Lengthy procurement cycles can have an adverse impact on the budget. Also, long cycles tend to erode the commitment of the managers to the project. Using reliable data, a clear definition of the process, amongst other techniques, you can cut down procurement cycle time.

Six Sigma can be applied to the most fundamental aspects of your procurement process, be it invoice receipt and approval, drafting contracts, or sourcing process cycle times. Six Sigma seeks to minimize errors and perfect processes, while at the same time eliminating processes that do not adhere to the CTQ (Critical To Quality) benchmark.

Transaction Quality

Besides perfecting processes and identifying those that are not Critical To Quality, other projects that should be considered are:

• First-Pass Invoice Rates: Six Sigma methodologies can enhance the purchase order, invoice and receipt details to minimize data errors.
• Electronic Orders and Deliveries: Six Sigma enhances the process and allows you to make the most of electronic systems with minimal errors.
• Coding and Classification Codes: Requisitions need to be correctly matched with their corresponding classification codes.
• Spend with Line Item Visibility: Get more value from your SRM (Supplier Relationship Management) system by using visibility and analysis tools more effectively.

Six Sigma is a discipline and it may not be the standard to use to gauge some of these processes. However, getting over 90% results for these processes would mean that you are operating within world-class standards.

Adoption of Technology

From time to time, organizations find that they need to deploy new technology to gauge procurement performance and tweak it further. Six Sigma has been found to be an enabler in the adoption of new applications, IT infrastructure, and digital systems needed in these organizations.

One way the deployment and adoption of new technology can be enhanced is by tracking metrics such as the adoption rates of users, vendors, and external contacts. Some of the processes that can be tracked include:

• Tracking the Supplier Management Tools for User Adoption Rate: Supply management tools used in procurement such as AMD can achieve a 100% adoption rate compared to other organizational wide systems that are not tailored for specific end users.
• Tracking Percentage of Enabled Suppliers: Six Sigma proposes the use of the Pareto Principle. Focus on the suppliers contributing 80% of the spend, more than those contributing 20%.
• Tracking Indirect RFQs through E-Sourcing: Find out the total percentage of indirect RFQs. An 85% score is impressive, but an exceptional score for direct RFQs would be around 50%.

An ERP (Enterprise Resource Planning) software is the basic setup for the system required to generate transactional data. However, other applications may be integrated if the quality of the transactional data is found to be unreliable.

Compliance

We must acknowledge the fact that every process exists to generate a desired output. The output of these processes must adhere not only to customer’s expectations, but also to local codes and government regulations. The acknowledgement of this fact will help businesses avoid legal risks and costs associated with non-compliance.

Six Sigma based processes may need to be initiated to track some of the following issues:

• Data and information on contracts drafted, vendors on-boarded, issuance of purchase orders and receipt of invoices
• Renewals of expiring contracts, certificates and accounts
• Costs incurred through engagement with unwanted or blacklisted vendors
• Monitor Call For Bids by tracking uncompetitive bids or ignore bids from a list of vendors

Conclusion

Looking at the big picture, it is clear that the tools and techniques outlined by Six Sigma and the strategic sourcing process have the same objective; enhance, improve and adopt a more cost-effective approach to business. These methodologies improve processes by ensuring decisions are derived from reliable metrics.

Six Sigma is often associated with the improvement of the supply chain and manufacturing processes, but the methodology can be applied to a wide range of applications. By following the five phases DMAIC (Define, Measure, Analyze, Improve, Control), you will not only transform the critical business processes, but you’ll also provide clients with a reliable service and be in a better position to adhere to standards and regulations.

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The Start of Six Sigma

Back in the seventies, Motorola invested their time primarily in manufacturing Quasar television sets. This was long before the advent of mobile phones, modern computers, the internet, and many of the technologies associated with Motorola. A Japanese company took over control of Motorola’s Quasar factory at the time and began implementing unheard of changes. They set about revamping and restructuring the way factory operations, rebuilding it from the ground up.

Soon, while under new management, Motorola’s Quasar factory began to produce TV sets with one-twentieth the number of defects than before. Simply put, there was something Japanese management brought to the factory that Motorola didn’t. The factory even maintained the same workforce, machinery, and design work. It soon became clear that Motorola management was the problem.
It was in the next decade that Motorola knuckled down and started treating quality with the seriousness it deserves. Their then CEO, Bob Galvin, redirected Motorola towards on the quality achieving Six Sigma levels of quality. It was this decision that made Motorola a top quality and profit leader in the business world. Six Sigma was the secret to their success. And it’s just as popular and effective today as it was then!

How Does Motorola Use Six Sigma Today?

For Six Sigma, quality is about helping an organization increase profit. In Six Sigma, quality is a value contributed by a productive enterprise or activity. Motorola uses Six Sigma to maintain high efficiency by eliminating waste and defect as they discover them. This may be on a production line or even in administration.

Six Sigma aims to improve quality by minimizing variation and (overlapping with Lean) reducing waste. This helped Motorola improved its products and services, producing them faster and for less. In basic terms, Six Sigma’s goals are preventing defect, reducing cycle time, and minimizing costs. Six Sigma’s effectiveness comes from its ability to identify and eliminate waste costs, i.e. those that provide no value for customers.

Unlike Motorola, companies that eschew or dismiss Six Sigma ideas tend to have extremely costly operating processes. For those operating at low sigma, the cost of (poor) quality tends to be high, often spending 25%-40% of their revenues addressing issues. Companies operating at Six Sigma, however, typically expend less than 5% to fix problems. The dollar cost of this gap is often considerably large. This has cost companies like General Electric between $8 billion and $12 billion annually. Motorola, however, has enjoyed and still enjoys the benefits of Six Sigma. As one of its leading pioneers, they have perfected it over the years. Their success is not surprising.

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The 1.5 Sigma Shift in Six Sigma

Six Sigma is one of the most widely respected business process improvement methodologies available. It comes with a wealth of statistical tools to help businesses understand what aspects of their processes need optimization, and how to practically achieve near perfection and virtually 100% reliability.

Despite this fact, there is a minor controversy and some purely academic debate about the what a Six Sigma process actually is, and if some statistical assumptions that lie at its core actually have merit.

But let’s cover the basics before we can examine the discussion and controversy.

What is the 1.5 Sigma Shift

As you might know, Six Sigma is a methodology that was developed by Motorola in an attempt to reduce defects to such a low value that they virtually become non-existent. When the company first started evaluating and optimizing processes, they soon realized that process deteriorate or shift in performance over longer periods of time. That’s why short-term data can’t really be considered fully accurate or fully predictive for the way the process will work in the long-term. There are just too many factors that subtly change with time that are impossible to control or monitor correctly.

After years of data collection and empirical analysis, Motorola came to the conclusion (mentioned in Six Sigma by Mikel Harry and Richard Schroeder) that the mean of the standard distribution usually drifts with about 1.5 sigma, and since this turned out to be a reliable occurrence, they incorporated this shift into their Six Sigma methodology. That’s why nowadays there are actually two values that one could look at while assigning a sigma value to a process Short Term Dynamic Mean Variation and Long Term Dynamic Mean Variation. While a process can fit the standard statistical criteria to be a Six Sigma process in the short term, the Motorola methodology applies a 1.5 sigma shift, which allows the process to meet just the criteria for 4.5 sigma in the long-term to be called a Six Sigma process.

As you can see in the table below, the short term sigma level of 4.5 is the same as the long term 6 sigma level.

Why is the 1.5 Sigma Shift Useful

The reasoning behind implementing such a shift while looking at processes in the long-term is based on the idea that an organization does not want to expend unreasonable amounts of time, effort and resources trying to optimize something that is practically out of their control. Natural process deterioration or drift occurs because of a host of factors that are outside the scope of the methodology, so adjusting the process expectations and guidelines to fit reality is the most productive approach.

Additionally, it’s important to notice that 1.5 is a value that Motorola arrived to based on their own empirical research, but it doesn’t have to apply to all processes. Qualified professionals can use data available about a specific process and assign a different sigma value to the shift between short-term and long-term expectations that is adequate for the particular situation in question. This makes Six Sigma more flexible, and allows it to adapt to all kinds of organizations.

The So-Called Controversy

Let’s be clear, there isn’t a real controversy on the matter and this is more of an academic discussion and bit of prudishness about the name of the methodology. Statistically speaking, a true Six Sigma process should produce only 2 defects in a billion units, while any process that achieves less than 3.4 defects per a million units is referred to as a Six Sigma process in the context of the Six Sigma methodology. As we’ve mentioned, it actually corresponds to 4.5 sigma in purely statistical terms. Of course, this is not an actual discrepancy, but a feature that manages expectations according to reality and makes a process more robust in the long-term.

What do you think about the 1.5 sigma shift? Do you like it and find it useful, or should the Six Sigma community move away from it to reduce confusion? Add your comments below…

If you’d like to learn more about the Six Sigma methodology, check out our video “What is Six Sigma” >>>

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The Evolution of Six Sigma Throughout the Years

Six Sigma is a set of management techniques designed to improve business processes by considerably reducing the odds of defects. It was introduced in the 1980’s by Bill Smith, while working as an engineer for Motorola. To this day, he is considered the father of this process.

While the Six Sigma method is a relatively new and revolutionary process, which keeps on expanding on a worldwide scale as we speak, the methodology used to define it can be traced back to the eighteenth century. Simply put, Six Sigma is not a self-contained method, but rather a complete and diverse blending of quality management practices and techniques over the years.

However, this shouldn’t be perceived as a weakness. In fact, knowing that some of the methods and techniques found in Six Sigma have been successfully used throughout history should render this process quite tempting to try out.

Let’s review a quick timeline containing the most important events that created the Six Sigma of today.

The Moving Assembly Line of Henry Ford 1913

All reputed entrepreneurs out there know that Henry Ford was simply a master of automation, who wished for all his workers to be well-paid and share in the production of an affordable vehicle. As a result, he created the moving assembly line in 1913, completely breaking the mold for those times. In the context of the Industrial Revolution continuously blossoming, it was entirely necessary for only good automobile parts to be available to use right away, as opposed to workers having to sort through endless piles of parts to find one that actually fit.

This required entirely new and distinct methods of testing and assurance that would ultimately render the automobile assembly process faster and more cost-effective, without compromising quality whatsoever. No longer was it lucrative to spend time on testing each individual piece, so Henry Ford foresaw the necessity of implementing an automation process, which he successfully did.

Shewhart’s Process Control Chart 1924

In the mid-1920’s, Walter A. Shewhart introduced a brand-new data collection, display, and analysis form while working for the Western Electric manufacturing plant located in Hawthorne, Illinois. It probably contained the first known process control chart, and made possible the advent of the age of statistical quality control.

The proposed control chart (download free template) required an inspector to keep tabs on the percentage of defective products in a time-ordered graphic format. As data collection progressed across the chart, it helped users understand the typical variation in the process, and separate it from the unusual variation. This helped identify when issues occurred, to assist in problem solving. More powerfully, it also identified new trends and shifts in the process, and allowed workers to prevent the problem from spreading further into the process and getting to the customer.

This switched the role of the inspector from one which would define and sort the defects, to one which would monitor the stability of the process and identify when it had changed.

The Japanese Revolution 1973

Moving a little further in time, let’s take a look at how the Japanese were conducting their businesses. During this period, they were still struggling to make a name for themselves on an international level, but they were doing pretty well internally in terms of improving quality and manufacturing capability.

Companies such as Toyota and Toshiba were focusing on two aspects of productivity, namely: eliminate defects and reduce cycle time. These efficiency gains were significant, so much so that they were acknowledged even by the competition. In contrast, with the ever-increasing productivity of the Japanese corporations, the U.S. corporations were still focusing on increased volume and maintenance of a lucrative market share, which was rendering employees less effective. In other words, while the Japanese were willing to progress with help from their employees, the U.S. were complacent, never progressing in their improvement methodology.

Motorola under the Six Sigma Process 1987

With Bob Galvin in charge, Motorola started investing money in improving the quality of their products by mastering the techniques used by other major corporations.

Those companies shared the new methodology named Six Sigma with their whole team, starting from workers, managers and even down to suppliers. Companies had to improve based on the ever changing expectations of their clients and the demands of the market. Moreover, they should understand that they had to focus on progressing continuously than targeting a particular quality level.

After winning the Baldrige Award, Motorola decided to reveal their ideas to the world. Their methodology was based on the product specification, delivered performance and efforts spent on decreasing any existing defects. Soon afterwards, the whole process was modified by other companies to improve it.

Summary

Currently, it’s quite unclear to tell what the future holds for Six Sigma. Will it merge into a Lean Six Sigma program? Will there be a new initiative called business or continuous improvement? Regardless, Six Sigma is a popular and effective technique, especially among major companies, and the fundamental tools will always be needed to solve problems and increase customer satisfaction.

If you’d like to learn more, check out our Six Sigma video series >>>

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A Quick Overview

Before we explore DMAIC vs. DMADV, we need to cover a bit of history. Six Sigma is a methodology intended to improve effectiveness and efficiency. Six Sigma began at Motorola in the 1980s, when engineer Dr. Mikel Harry began to study variations within the different processes in the company. He noticed that too many variations resulted in poor customer satisfaction, and customer needs were not being met.

The popularity of Six Sigma began to spread throughout major corporations in the following years. In 1995, General Electric had decided to make Six Sigma methodology a corporate-wide doctrine. Approximately two years after the implementation of Six Sigma, General Electric produced over $320 million in cost savings. This put Six Sigma on the map.

Defining DMAIC and DMADV

DMAIC is a one of the building blocks of the Six Sigma doctrine. It is the acronym for the steps involved in the Six Sigma methodology, used to improve efficacy and effectiveness. This tool is used when you have an existing process and you want to bring its current performance level up.

DMAIC

Define – Your purpose for the process
Measure – Know where you are now, use data, map it out to capture current state.
Analyze – Your process steps, see what you are doing.
Improve – Come up with different possible solutions.
Control – Make sure whatever solution you come up with can be sustained.

DMADV is another tool used when there is a brand new service or product, or when the existing process is not working or is substandard. The first 3 steps are the same, but since our scenario is different, the activity involved in obtaining that information would be different.

DMADV

Define – Your purpose for the process
Measure – Know where you are now, use data, map it out to capture current state.
Analyze – Your process steps, see what you are doing.
Design – Here you want to either design or redesign the product, service or process to meet your customer’s needs. Use prototypes and predictive models to validate the design’s effectiveness.
Verify – Since this is for either a new product or service, or a complete redesign from scratch, you want to have pilot runs to see if your new process works in the real world.

Want to learn more about DMAIC and DMADV? Enroll in one of our Six Sigma training courses! Learn more information about 6Sigma.com’s Lean Six Sigma training coursework, available as classroom, onsite, or online options.

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