Geçen gün 6 sigma Neyi Başaramaz? başlıklı yazımızda birçok yönetim tekniğinde ve yönteminde olduğu gibi altı sigmanın da pekçok uygulamada şirketi kurma projesi olarak algılandığını yada ona böyle bir misyonun yüklendiğini ifade etmiştik.
Home Depot için: Temmuz 2001'den sonra hisse senetlerinin değerinin, %16 değer kazanan S&P500 endeksine göre %8,3 aşağısında kaldığını;
Honeywell için: Ocak 2000'den sonra S&P500 endeksi %3,6 değer kaybederken Honeywell hisselerinin değeri %7,2 değer kaybettiği söylemiştik.
Ayrıca Şubat 2001'den itibaren GE de %6 değer kaybetmiş görünüyor.
Peki bu bilgileri neden tekrarlıyorum? Bu yazıyı yazdıktan sonra ilgili grafiklerde farkettiğim bir önemli husus nedeniyle yazıyorum. Dikkat edilirse üç grafikte de 6 sigma çalışmalarının başlamasından sonra şirketlerin hisse fiyatları düşme eğilimi göstermiş. Tabi ki bunun sebebi altı sigma çalışmalarıdır demeyeceğim. Ama bu durum bana, şirketlerin bir kriz algılaması içinde olduklarını ve bu krizi kendilerine en uygun gördükleri bir yöntemle karşılamak istediklerini çağrıştırdı. ( Gerçi 2000 yılından sonra özellikle de 2003 Irak işgalinden sonra ABD ekonomisi sıkıntılı bir döneme girdi. ) Kriz algılamaları ister küresel, ister ulusal olsun ister de sektörel yada işletme boyutunda olsun şirketler krize hazırlık olarak yada yeni dönem uygulaması olarak 6 sigmayı seçmiş olabilirler. ( Ne de olsa altı sigmanın en şaşalı başarı hikayesi Motorola'ya aittir. )
Altı sigma da birçok uygulama gibi bir bazı teknikler ihtiva eden bir yöntemdir. Belirli bir felsefesi ve kapsamı vardır. Ama bir proje konusu değildir. Rutin dışı zamanlar için ise hiç uygun olmayabilir. Süreklilik arz eden bir süreçtir. Ve toplamında ortaya çıkacak olan en basit ifadeyle şirketlere bir beceri kazandırır. Şirketin diğer tüm becerileri ve koşulları ile birlikte bir anlam ifade edecektir.
Tarihi: Ocak 19, 2007, 12:25 pm
Peki, bu durumda, biz hangi noktadayız?
Öncelikle; six sigma yada daha bütünleşik bir yaklaşım olarak Lean Six Sigma nedir ? Söylenen ve üstüne basa basa hatırlatılan şey şu: Six Sigma'yı birçok çözemediğiniz problemi çözebilmekte, çözüm sonuçları ise diğer yöntemlere kıyasla daha net, öngörülebilir ve etkili olmaktadır. Çoğu zaman problemi çözmek için çok ileri bir analiz bile gerekmemekte, Yeşil Kuşaklar bu tür problemleri Pareto Analizi ve Kontrol Grafikleri ile kolaylıkla halletmektedirler. Kara Kuşaklar ise daha ileri düzey analiz gerektirebilecek problemleri incelikle sonuca vardırmaktadırlar. Özellikle Lean araçları ile oluşturulan Lean Six Sigma yaklaşımı ile hem katma değersiz işlemleri azaltırken, süreç değişkenliği de minimize edilmektedir. Peki problem nedir ?
Lean Six Sigma her sektörde çaplarına göre de her şirkette uygulanması gerektiğini düşündüğüm bir sistemdir. Bu nedenle yazınızda geçen performans rakamlarına ve tarihlere dayanılarak verilen analizin çok da doğru olduğunu düşünmüyorum. Peki problem nedir ?
Problem bu noktada, Six Sigma ile ilgili olarak şirketin performansını etkileyen diğer faktörlerin neler olabileceğini profesyonel gozle görmeyi ve analiz etmeyi gerektirmektedir. Bu faktörler, üst yönetimin six sigmaya olan inancı, uygulama yöntemi ve nasıl uygulandığı, lean six sigma hedeflerinin ne kadar net olduğu ile ilişkilidir. Performansı genel olarak değerlendirirken şirketin six sigmaya başlama tarihini başat unsur olarak almak, şirket performansını etkileyen birçok içsel ve dışsal major faktörü gözardı etmek demektir, piyasa şartları, rakiplerin pozisyonu, dünya ekonomisi, savaşlar, tüketim değişkenlikleri vs. Tek bir rakamı ve unsuru alarak bir analiz yapmak ne kadar objektiftir ?
Yapılan analizle ilgili olarak bazı özet bilgiler:
Home Depot:
Home Depot’da six sigma 2003 yılında gerçekten bir ivme kazanmıştır.
Kaynak:
http://www.sixsigmacompanies.com/archive/six_sigma_at_the_home_depot.html
Although mentioned in 2001 as being applied across the enterprise, it was not until 2003 that Six Sigma started to gain momentum. That was the year Nardelli brought in Carl Liebert to lead operations. Liebert is a seasoned Master Black Belt with a GE pedigree who led Circuit City’s Six Sigma implementation.
Honeywell:
http://www.qualitydigest.com/dec00/html/honeywell.html
"At the time of their 1999 merger, both AlliedSignal and Honeywell had years invested in their respective quality systems. Nevertheless, management would have to face the Herculean task of combining the two"
"In 1994, Rick Schroeder, AlliedSignal's vice president of operations, brought his Six Sigma experience from Motorola to his new employer. By 1999, AlliedSignal was five years into its Six Sigma program, which headed the company's effort to capture growth and productivity opportunities more rapidly and efficiently by reducing defects and waste in all of its business processes--resulting in a $600 million annual savings"
"Honeywell International recently began offering its Six Sigma expertise exclusively to its current suppliers and customers. Services offered range from full deployment, where Honeywell International helps these partners develop and implement an entire customized Six Sigma Plus program, to simple advice"
General Electric:
In 2004, GE was named number one company for employers and employees on the Forbes 500 Global Player list.
Over the years, GE has received several awards honoring them for their accomplishments, values and reputation:
In Fortune Magazine's 2005 "Global Most Admired Companies" list, GE ranked first overall. (February 2005)
In Fortune Magazine's 2006 "America's Most Admired Companies" list, GE ranked first overall. (March 2006)[10]
GE was named to the Dow Jones Sustainability World Index as one of the world's leaders in environmental, social and economic programs.
GE ranked ninth on Fortune Magazine's "50 Most Desirable MBA Employers" list. (April 2004)
Kişisel düşüncemi özetlemek gerekirse:,
1- Six Sigma başlangıç tarihleri ya yanlış yada net değildir
2- Six Sigma uygulaması ile hisse senedi fiyatları arasında kurulmak istene ilişki diğer faktörleri tamamen gözardır etmektedir.
İnternetten konuyla ilgili linkleri ve yorumları aşağıda bulabilirsiniz:
http://blogs.isixsigma.com/
Reports of Our Demise
Okay, okay. I know this has already been covered to death in other blogs and various discussion forums. But I am nonetheless compelled to offer my own take on the Wall Street Journal’s article concerning the departure of Home Depot CEO Robert Nardelli. And more specifically on the comments within that article suggesting that this is a substantial example of Six Sigma “not panning out as promised.”
The article prominently cites a study conducted by QualPro Inc. Before I get started, I’ll freely admit I haven’t read the study. I couldn’t find it on their website, or anywhere else online. (If anyone knows where to get it, please let me know.) So, I’ll have to rely on the words of the article’s author to describe it:
“Now QualPro Inc., a company that markets a competing process-management technique, has issued a study comparing the stock performance of companies that adopted Six Sigma with the performance of the Standard & Poor’s 500-stock index. QualPro has done work for Lowe’s Cos., Home Depot’s main competitor.
“Given that the study was issued by a Six Sigma competitor, it isn’t surprising that the comparisons aren’t flattering.”
They go on:
“A number of former GE executives -- including W. James McNerney Jr., former CEO of 3M Co.; Dave Cote, CEO of Honeywell International Inc.; and Mr. Nardelli -- helped spread the Six Sigma word but have seen their companies’ stock prices lag.
“Since announcing the adoption of Six Sigma on July 1, 2001, Home Depot shares are down 8.3% compared with a 16% rise in the S&P 500 over the same period. The stock rose more than 2% yesterday on the New York Stock Exchange, to $41.07, after Mr. Nardelli’s resignation.
“Honeywell shares are down 7.2% since its Six Sigma announcement in early January 2000, compared with a 3.6% fall in the S&P 500. Shares of 3M are off about 1% since late December 2003 versus the S&P 500’s 29% climb. GE shares rose sharply in the 1990s, but they’re down 16% since July 2000, when the company adopted Six Sigma, compared with the 2.6% fall in the S&P 500.”
First of all, I know I speak for most of us when I howl: correlation does not necessarily indicate causation. There’s enough material for several blog entries here, but I’ll restrain myself because there are more interesting things to quibble with here. For example, what to make of this?
“Of the 58 companies reviewed in the QualPro report, 52 underperformed the S&P 500 index from the time they launched their Six Sigma programs through Dec. 5, 2006. Other underperformers include Lockheed Martin Corp., Ford Motor Co. and Xerox Corp.”
Yet the George group claims on their website that “our client index has tripled in value while the S&P 500 has declined.” Further, on the back cover of this month’s iSixSigma magazine you can see their data indicating that “George Group clients outperform all major indices.” Presumably a large portion of those clients deployed Six Sigma. So what does it all mean? Is Six Sigma a good thing or a bad thing for stock price? George Group and QualPro both cite Xerox as an example – what are we to take from that? The point is, it’s impossible to tell. I’ve no doubt that QualPro and George Group both used accurate data analyzed correctly. And yet they report diametrically opposite conclusions. Clearly what was measured and how it was measured must be different, but none of that nuance is communicated. Again, there are several blogs’ worth of questions to ponder here.
More importantly, neither study asks the more interesting question, which is: what would the stock price of these companies have done over the period of the study if they had not deployed Six Sigma? And that’s a question that we can’t answer, because it requires an experiment that’s impossible to run. No one understands Y=f(x) for stock price (at least, no one worth less than 10 figures), so talking about single data points collected on a single x for a particular company doesn’t carry much weight. And given the massive differences company-to-company, I’m not sure aggregating 50 different companies together in a single study is any better. It just sounds better to the casual reader.
While I’m on the subject of QualPro, I found some of the statements on their website, um, interesting. For example, they say:
“Most of us were taught that the optimum process for gaining knowledge is to test one-thing-at-a-time and hold everything else constant. It is called the scientific method. MVT® (Multivariable Testing) proves that the scientific method doesn’t really work in the real world.”
I feel compelled to point out that the scientific method has been around for about 2900 years. Has QualPro suddenly discovered something that minor logicians like Aristotle, Descartes, and Gödel missed? Can QualPro seriously believe what they are saying? It’s ridiculous. In a sense they win by default, because I can’t even formulate a cogent argument to the contrary. It’s like trying to box with a swamp vapor – you can’t hit a bad smell.
http://www.airacad.com/Profiles.aspx
By: Rick Murrow, CEO, Air Academy Associates
A rebuttal to "The 'Six Sigma' Factor for Home Depot"
as published in January 4, 2007, edition of The Wall Street Journal
"Honest” reporting or merely advertising? The Karen Richardson article “The Six Sigma Factor
for Home Depot” questions the validity of Six Sigma. I don’t know who I feel more concern for --Ms. Richardson or for the reader who now takes what she has written and deduces that “if a company engages in Six Sigma their share price is going to decrease.”
This journalist displayed a total lack of understanding of the complexities involved in determining stock price. Instead of an honest article on the true worth of Six Sigma, backed with facts, she basically served as an advertiser for one company. She focused on one point that a company, QualPro, made in what appears to be an attempt to drive sales on their product and services.
Ms. Richardson attempts to show that if a company embarks upon Six Sigma their stock price will decrease, and she backs that up with select data that has been supplied by QualPro. The fact is, there might be a correlation between the two factors (Six Sigma and share price), but there is no proven causality. It is very similar to the example we give in one of our training classes. The town of Oldenburg, Germany, from 1930-1936 records an increase in the population of humans at the same time that there is an increase in the population of storks. Now Ms. Richardson and her followers would say, “Disney is correct, storks bring babies.” We all know that is absurd. In fact, if one investigates the situation and studies the data they would show that Germany was industrializing at the time; people were moving into the cities from the outlying areas; people needed houses in which to live. During the 1930’s the architecture employed gables. It so happens that gables are attractive to storks and so they build their nests under gables. In fact, an increased number of gables, caused by a swelling of population, caused an increase in the population of storks. Now, using the logic of Ms. Richardson and QualPro, they would have us believe that storks brought many babies to live in the town of Oldenburg. Yes, this conclusion is ridiculous, but it is just as ridiculous to conclude from the data presented in the Richardson article that Six Sigma caused the price of stocks to go down.
The poorly researched article implies that the implementation of Six Sigma has actually been very damaging for companies who have embarked upon improving processes using the Six Sigma methodology. Most people are savvy enough to know that there are many factors that have an impact on stock price and the use of an improvement methodology is not the only factor. Factors such as leadership, industry, market sentiment, revenue, world events, world markets, company size, debt, earnings volatility, dividends payout ratio, dividend yield, sales, expenses, news coverage, etc., have a big impact on share price.
The facts that the article uses are rather baffling. Honeywell, GE, and Home Depot are all highlighted as companies that have embarked on Six Sigma since the beginning of 2000 and their stock prices are down. Ms. Richardson states that “GE shares rose sharply in the 1990s, but they are down since July 2000, when the company adopted Six Sigma.” First of all, GE embarked upon Six Sigma in 1996. Check the records and one will see that the stock price rose steadily from that time to 1999. In fact, it did so well that in 1999 the stock split 3-for-1. Can one now deduce that Six Sigma was the sole reason the stock prices rose so high? Of course not; that would be making the same mistake that Ms. Richardson and QualPro have made. Six Sigma cannot be given sole credit for either direction the stock price goes. It is important that Charles Holland investigate the facts before he makes a claim about GE that is totally erroneous.
The article claims that Home Depot, Honeywell, and GE stock prices have all declined since the companies’ launch of Six Sigma. I don’t know of any program or management endeavor that is effective immediately (regardless of what QualPro might say). For large companies it can take some time before changes in their business system of management take hold. Interestingly enough, all three charts at the end of the article show that since 2002 the stock prices of these three companies have steadily and aggressively climbed. One might use the argument that it was Six Sigma that helped the companies climb out of their lows. What has happened in the article that Ms. Richardson wrote is that she has used some facts without fully investigating and then made statements which border on absurd. One can take the same facts and say that Six Sigma is solely responsible for three companies completely reversing their stock price decline and driving a dramatic surge.
An example of two different businesses was used in the article to question whether Six Sigma is applicable/relevant in all industries. Of course there is a difference between “wanting to talk to somebody about buying a chainsaw” and “running a light-bulb plant efficiently.” As opposed to concluding that neither company should try to improve the way they do business, one should conclude that each company needs to look at how they perform their process, make their products, and perform their services and then determine the best approach to take to improve how each is done. In other words, not all companies who embark upon Six Sigma will or should implement and deploy the same way and with the same level of intensity.
The subject article gives the impression of an “advertorial” -- written with the intent of spotlighting a particular company and its methodology. That is okay if the readers understand that advertising is taking place and not honest, fact-based reporting. We have addressed that stock price is far too complicated to focus on one input factor as the driver behind it. It would have been much more reasonable if one factor had to be blamed, that the writer point to September 11 or corporate mismanagement as the cause for the stock price to decline. But let’s not be foolish enough to say Six Sigma caused the decline. Many corporate leadership teams would disagree with that conclusion.
QualPro indicates that they have worked with some companies and have achieved success. Is that to imply that providers of Six Sigma can’t provide a list of companies that they have worked with that have had tremendous financial gains? Most Tier 1 providers of Six Sigma services can show by validated financial data that the companies they work with save an average of 2 percent of total revenue each year.
The article and the QualPro website trumpet QualPro’s methodology (which is called Multivariable Testing--MVT), indicating it is a “fix-all” that only QualPro has. I visited the QualPro website to see what the company has to offer. I was a bit disappointed in the information that the website carried. Once again I found some statements to be very short-sighted and in many cases, inaccurate. Included in the inaccurate statements are: (1) “The four-step Six Sigma methodology lays out a very loosely structured path”…(Six Sigma is a five-step methodology and it is very rigorous if complied with); and (2) “The tools used in Six Sigma are not powerful.” (Those who know the capability and opportunities provided by design of experiments, discrete event simulation, multiple response optimization, robust design techniques, etc., can experience the full range and power of the “tools.” See the article “the Dumbing Down of Six Sigma” by Dr. Mark Kiemele at www.airacad.com.)
It would be wise for Ms. Richardson to use the methodology she is espousing in her article, namely Multivariable Testing, to accurately assess the impact that Six Sigma is having on share price. Anytime there are a number of factors that can impact a response variable such as share price, Six Sigma mandates the use of Multivariable Testing (or Design of Experiments, which Air Academy Associates has been introducing to clients since 1990) to be able to independently determine what the effects of each of the factors and their interactions are on the response variable, in this case share price. It is ironic that the author is denigrating and failing to use the very methodology that she is trying to promote in her article.
The QualPro website contains the following statement -- “Although MVT® could become one of the most widely used management tools and has been applied by leading companies in every industry to create billions of dollars of value--no book on it has been published, until now.” QualPro has now published a book and understandably would like to create sales. I can’t help but wonder if that desire helped prompt the article that was written by Ms. Richardson. I would be interested in seeing the documentation that supports QualPro’s claim of the validated billions of dollars that MVT has saved industries. I would also like to see the supporting evidence that MVT caused those savings and that it was not some other yet-to-be-identified cause. Savings of this magnitude are truly documented and verified by many companies, to include those highlighted in the article, and those savings have been documented to be driven by process improvement efforts such as Six Sigma.
I invite Ms. Richardson to publish this response. Better yet, I invite her to truly investigate what effects Six Sigma has had for many companies to include decreased expenses, increased revenue, decreased warranty costs, decreased office mistakes, decreased insurance premiums, increased profit margin, increased market share, etc. Rather than accept the erroneous conclusion that Ms. Richardson arrived at in her article “The Six Sigma Factor for Home Depot,” one should look at years of facts which support the positive results of Six Sigma efforts implemented and deployed correctly. Just as our analysis supports that storks do not bring babies, the data also supports that Six Sigma does not drive down stock price.
http://www.sixsigmacompanies.com/archive/six_sigma_saves_the_fortune_500_427_billion.html
Six Sigma Saves the Fortune 500 $427 Billion
[ 11 January 2007 ]
Let me introduce you to the iSixSigma published report, Six Sigma Saves a Fortune. Featured in the January/February issue of iSixSigma Magazine. The research is sure to interest the entire Six Sigma community – advocates as well as naysayers.
Press release:
“Over the past 20 years, use of Six Sigma, the popular business improvement methodology, has saved Fortune 500 companies an estimated $427 billion, according to research published in the January/February 2007 issue of iSixSigma Magazine.
“The estimate is based on reported savings linked to Six Sigma in public documents. "Our data also showed that corporate-wide Six Sigma deployments save an average 2 percent of total revenue per year," added Michael Marx, research manager for iSixSigma.”
We have real numbers that estimate Six Sigma savings to be quite significant. A management philosophy that has saved nearly a half a trillion dollars at Fortune 500 companies alone since 1987 is quite an accomplishment.
So if you’ve been reading the negative press Six Sigma has been getting lately (Fortune article, Dilbert comic, and the recent WSJ article) don’t be too quick to judge Six Sigma. Let these savings numbers speak for themselves.
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