Six Sigma is a management philosophy that emphasizes setting extremely high objectives, collecting data, and analyzing results to a fine degree as a way to reduce defects in products and services. The Greek letter sigma is sometimes used to denote variation from a standard. The philosophy behind Six Sigma is that you can figure out how to systematically eliminate defects from your process and get as close to perfection as possible by measuring a number of defects in your process. In order for a company to achieve Six Sigma level, it cannot produce more than 3.4 defects per million opportunities, where an opportunity is defined as a chance for nonconformance.
History of Six Sigma
The roots of Six Sigma as a measurement standard can be traced back to Carl Frederick Gauss (1777-1885) who introduced a concept of the normal curve. Six Sigma as a measurement standard in product quality can be traced back to the 1920's when Walter Shewhart showed that three (3) sigma from the mean is the point where a process requires correction. Many measurement standards (Cpk, Zero Defects, etc.) later came on the scene but credit for coining the term "Six Sigma" goes to a Motorola engineer named Bill Smith.
In the early and mid-1980s with Chairman Bob Galvin at the helm, Motorola engineers decided that the traditional quality levels - measuring defects in thousands of opportunities - didn't provide enough granularity. Instead, they wanted to measure the defects per million opportunities. Motorola developed this new standard and created the methodology and needed cultural changes associated with it. Six Sigma helped Motorola realize powerful bottom-line results in their organization - in fact, they documented more than $16 Billion in savings as a result of Six Sigma efforts.
Since then, hundreds of companies around the world have adopted Six Sigma as a way of doing business. This is a direct result of many of America's leaders to openly praise the benefits of Six Sigma. Some of those leaders are as follows: Larry Bossidy of Allied Signal (now Honeywell), and Jack Welch of General Electric Company.
Six Sigma's Objectives
A fundamental objective of the Six Sigma methodology is implementation of a measurement-based strategy that balances between the need for variation reduction and cost effectiveness, through the application of Six Sigma improvement projects.
Six Sigma encompasses the best of all worlds: it implements quality measures to achieve effectiveness; it results in cost & time reduction, thus achieving efficiency, and finally, using the programs methodology it gives your organization the flexibility needed for on-going improvement.
The whole Six Sigma process emphasizes the synergy between quantitative methods of Quality Engineering and interpersonal leadership skills of the process' champions (inside the organization).