GE’s tryst with Six Sigma started in 1995 when CEO Jack Welch made it a corporate goal to be a Six Sigma company by 2000. He led from the front and ensured GE attained its Six Sigma goals within the stipulated period. Read on to find out more about Six Sigma and GE.
General Electric’s (GE) focus on quality started in the late 1980s with the launch of the “Work-Out" program that opened GE culture to ideas from everyone and everywhere. The resultant learning environment prepared the ground for Six Sigma.
Credit for the implementation of Six Sigma at GE goes to CEO Jack Welch, who made it a corporate policy to attain Six Sigma goals by 2000. GE adopted most of its Six Sigma concepts and methodology from pioneers such as Motorola.
Six Sigma implementation at General Electric started with a heavy emphasis on training the workforce for data-based problem analysis.
GE required all exempt employees to undertake a 13-day, 100 hour training program in Six Sigma methodologies and complete a Six Sigma project by the end of 1998.
The training covered the DMAIC procedure:
- Definition or identification of the process
- Measurement of process output
- Analyzing process inputs for criticality
- Improving process by modifying inputs
- Controlling process by controlling the appropriate input
Employees completing the initial course went through follow-up training to reinforce these newly acquired skills.
The success story of Six Sigma and GE would not have been possible without GE's system of mentoring programs.
Full-time Master Black Belts, hired specifically for implementation of Six Sigma, led the process change. Each Master Black Belt trained and mentored key process employees for the Black Belt level. Employees selected for Black Belt underwent four-month training and applied Six Sigma tools at work under the guidance of the Master Black Belt mentor. GE soon deployed full time Black Belt teams to implement Six Sigma projects throughout GE.
Part time project leaders or employees who received Six Sigma training that were placed on Six Sigma projects only became Green Belts.
General Electric’s experience in the implementation of Six Sigma shows that the best of training and mentoring efforts would crumble without effective leadership.
Jack Welch, GE’s CEO supported the Six Sigma initiative not just with the necessary financial resources, but also through securing vital commitment from both the senior executives and the workforce. Welch linked promotion and bonus to quality improvement. Forty percent of each top management bonus depended on the successful implementation of Six Sigma goals and a Green Belt became the minimum requirement for the promotion of any employee.
Jack Welch and other top management, most notably Dave Cote, President, and CEO of GE Appliances followed a hands-on approach to Six Sigma and led from the front through 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.
One major reason for the success story of Six Sigma and GE is the focused approach toward implementation.
GE's three time-tested implementation approaches are "Show Me the Money," "Everybody Plays," and "Specific Techniques."
Show Me the Money - GE approaches Six Sigma with a focus on the bottom-line. The need to cut costs in a competitive price-sensitive marketplace made GE apply Six Sigma to remove workplace defects and improve productivity, besides improving product quality.
Everybody Plays - Much of GE’s product lines are comprised of many outsourced parts. GE understood the need for the supplier to participate in the Six Sigma initiative to make the product fully Six Sigma compliant and invested in bringing the suppliers to Six Sigma.
Specific Techniques - GE cultivated the art of ranking projects and aligning them to the business goals through Six Sigma tools such as the process map.
Application of Six Sigma at General Electric brought a marked culture change in the attitude of individual employees toward quality, translating into dramatically lower service-call rates, and improved product reliability. The Six Sigma effort at GE contributed $700 million in corporate benefits in 1997, just two years into the program.
From a small beginning to improving product quality by reducing defects at the workplace, the scope of Six Sigma at GE has expanded over the years, and today Six Sigma’s customer focused, data driven philosophy defines how GE works.
GE: The Six-Sigma Strategy retrieved at http://www.ge.com/sixsigma/sixsigstrategy.html
Trotter, L. (1998, April). "Six Sigma: Driving customer satisfaction in all we do." Retrieved from: http://www.ge.com/edc/dcsixsig.htm
Image Credit: N Nayab