Why It Had to Be Invented
In the mid-1980s Motorola was losing ground in every market that they served. Customer dissatisfaction and frustration with Motorola were epidemic. Operating costs were too high, which led to dismal profits. In all cases the lost market share was being taken over by Japanese competitors.
Bob Galvin, Motorola’s CEO from 1970 to 1988 and chairman of the board from 1964 to 1990, saying that if the Japanese had not existed, we would have needed to invent them. I interpreted this to mean that someone had to give us a wake-up call.
Throughout its customer base, Motorola had a reputation for being arrogant. Bob Galvin was chagrined by an article in one of the trade magazines, in which the head of purchasing of one of our major customers for communications equipment was quoted as saying about Motorola, “Love, love, love the product; hate, hate, hate the company.”
Bob cited this quote several times to his leadership team.
Motorola’s systems for doing business were not designed for customer satisfaction. Contract reviews, responses to requests for quote, invoicing, responses to customer complaints, and most other administrative and service operations were victims of a system that allowed for apathetic management and disinterested workers. The internal bureaucracy fed on itself with little regard for serving the customers.
Response times were long, and responses usually were not designed to satisfy the customer.
The quality and reliability of Motorola’s product were also not what they should have been. Customers were receiving too many out-of-box failures. After the product passed their incoming requirements, they often suffered high levels of early-life failures. Warranty returns were a major drain on profits.
A wireless communications division was suffering huge losses, threatened lawsuits, and lost business with a major customer. The division quality manager was tasked with determining what was causing such poor field performance. His study of early-life failures discovered that they were predominately units that had failed at final test and had to go back through a rework cycle.
Fortunately, the same Japanese that were destroying Motorola in the marketplace also provided a benchmark for how things could be done better. A group of senior managers and executives were sent on a benchmarking tour of Japan to study operating methods and product quality levels. They discovered that Japan had a national program for employee involvement and teaming, focused on improving operations to better serve the customers.
The Japanese had managed to use not only the muscle that their employees provided but also their brains and knowledge.
They also discovered, no surprise here, that the more complicated a product, the higher the opportunities for failure.
Motorola’s problems were present in all of their business units and product lines. Something had to happen, and it had to be major, and it had to get positive results quickly. Thus was born the need to create Six Sigma.
The Birth of Six Sigma
From its customers Motorola learned that they needed to change their systems in all operations—manufacturing, service, administration, and sales-to focus on total customer satisfaction. From the Japanese they learned that including all of your employees in the company brain trust was an effective means of increasing efficiency and morale.
From the Japanese they also learned that simpler designs result in higher levels of quality and reliability. From the early-life field failure study they learned that they needed to improve manufacturing techniques to ensure that products were built right the first time.
Motorola’s leaders pulled this together to establish the vision and set the framework for Six Sigma. Posters were hung up, and small cards were given to all employees .
Thus was Six Sigma launched in 1987. The corporate leaders toured the world to all Motorola sites to explain that this new initiative is going to be the operating mantra of Motorola for the future. Bob Galvin personally traveled to most major sites worldwide. Of course, there was a lot of skepticism. This looked like another program .
“We’ll get excited about it, and two months from now nobody will remember” was typical of the statements you heard at all levels.
However, the corporate leaders did a very thorough job of deploying Six Sigma throughout Motorola around the globe. They asked for Six Sigma reports, and they expected quality levels to be the first agenda item at all operational reviews. Soon it became the modus operandi throughout Motorola.
A key figure in all of this was Bill Smith. Bill was a high level quality leader who is credited with developing the mathematics of Six Sigma. The arithmetic of Six Sigma was created as a way of leveling the playing field throughout Motorola.
In Total Quality Control, Armand Feigenbaum defines :
“total quality management” (TQM) as follows:
A quality system is the agreed on, companywide and plant wide operating work structure, documented in effective, integrated technical and managerial procedures, for guiding the coordinated actions of the people, the machines, and the information of the company and plant in the best and most practical ways to assure customer quality satisfaction and economical costs of quality.
In 1989 Bill Smith defined Six Sigma as:
Organized common sense.
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