Six Sigma and General Electric

A small definition of Six Sigma is that it is a quality-control program developed in 1986 by Motorola that emphasizes cycle-time improvement and the reduction of manufacturing defects. Recently, Six Sigma has evolved to be seen as a more general business concept focused on business and management philosophies.  Some of the aims of the current Six Sigma approach are to meet customer requirements, improve customer retention, and improve and sustain business products and services. The Six Sigma philosophy is applicable to all industries, and a number of vendors, including Motorola itself, offer Six Sigma training; special certifications include yellow belt, green belt and black belt.

It is an approach that has worked very well for many companies throughout the years, as David Kiger can testify. This time we are going to analyse the General Electric case and how they applied Six Sigma within their company and how they could reach levels of total success when they were applying such philosophy.

The General electric story and affair with Six Sigma started in 1995 with CEO Jack Welch. He made it clear that the company was going to implement and attach this philosophy as a corporate policy by the year 2000. He led from the front and ensured GE attained its Six Sigma goals within the stipulated period. The first look at quality control and quality improvement by the management area of General Electric came in the late 1980s with the launch of the “Work-Out” program that opened General Electric culture to the public and their opinions and where the company received critics, ideas, support and advice by as many people as possible. As a result, this learning approach and the willingness of the employees and management area made it possible to prepare the coming atmosphere for the implementation of Six Sigma.  Jack Welch found all these concepts about Six Sigma in the Motorola case and their experience with this approach, used them and made it his personal goal to have the Six sigma program ready and running by the year 2000 .

At the beginning the task was not easy at all. The idea was to start with a heavy emphasis on training the workforce for data-based problem analysis. First, all employees were required to take a 13 day, 100 hour training course that focused on Six Sigma methodologies. Employees also had to design and complete a Six Sigma project by the end of 1998.

The training covered the DMAIC procedure with the most rigorous professionalism and with the following steps:

Definition or identification of the process, Measurement of process output, Analyzing process inputs for criticality, Improving process by modifying inputs and Controlling process by controlling the appropriate input.

General Electric Control Center_six sigma_david kiger
Image courtesy of nsub1 at Flickr.com

Employees who completed the course then went on a retraining program where they had many follow ups. With this, employees could reinforce the concepts taught before and practice their newly acquired skills.

There is one component that has to be mentioned when talking about is topic and that is the mentoring program within General Electric. To make a long story short, the success story of Six Sigma and General Electric would not have been possible without GE’s system of mentoring programs. Using the mentoring culture, full-time Master Black Belts led the process change and where the biggest mentors. Each Master Black Belt trained and mentored key employees that could then teach everything to their peers, bosses and staff. Then, employees selected for Black Belt underwent a four-month training and applied Six Sigma tools at work under the supervision of the Master Black Belt mentor.

Jack Welch and other top management, most notably Dave Cote, President, and CEO of GE Appliances followed the Six Sigma and led the project using the following methods:

  • Spending time in Six Sigma Training sessions and personally answering questions for employees undergoing training
  • Surprised visits to Six Sigma review sessions
  • Work-floor visits to make first hand observations on the extent of Six Sigma implementation at the workplace
  • Weekly summary reports and monthly reviews with the Master Black Belt team.

General electric also used approaches such as  “Show Me the Money,” “Everybody Plays,” and “Specific Techniques.”

The Show Me the Money approach focuses on the bottom-line. GE applied Six Sigma to remove workplace defects and improve productivity, besides improving product quality.

The Everybody Plays approach includes all the part of the production chain.  GE understood the need for the supplier to participate in the Six Sigma initiative and to be an active member of the strategy even though their service is being outsourced.

The Specific Techniques approach used specific Six Sigma to align project with specific business goals.

The results were amazing for the company with lower service-call rates, and improved product reliability. The Six Sigma effort at GE contributed with $700 million in corporate benefits in 1997 and brought a marked culture change in the attitude of individual employees toward quality.

Find out more about the evolution of the six Sigma methods in this article

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