152 0DUNHWLQJDQG6DOHV

W hat isSixSigm a?

. Ph.D. Sorin-GeorgeTom a(Facul

~ Prof tyofAdmi
nistrati
onandBusi
ness-
UniversityofBucharest)

Abstract: Overthepastdecades,severalbusi nessimprovementmethodswerel aunched,i ncludi

ng
theoneknownasSi xSi gma. TheSi xSi gmai mpliestheappl
icationofsci
enti
ficprinciplesto businesspro-
cessesandall
owscompani esto obtain better,f
asterandcheaperproductsandservi ces. M otorol
awasthe
fi
rstcompanythati ntroducedandi mpl ementedSi xSigmaini tsbusi
nessprocessesinthe1980s.
Keywords: ’¡ȱ’–Šǰȱ˜˜›˜•ŠǰȱŒ˜–™Š—¢ǰȱ™›˜ŒŽœœ

Introduction
Improving business performance repre-
œŽ—œȱŠȱŒ›’’ŒŠ•ȱ›Žœ™˜—œ’‹’•’¢ȱ˜›ȱ˜™ȱŠ—ȱŽ¡ -
ecutive management in order to ensure the
effectiveness and efficiency of their compa-
nies.O ver the past decades,several business
improvement methods w ere launched, in-
Œ•ž’—ȱ‘Žȱ˜—Žȱ”—˜ —ȱŠœȱ’¡ȱ’–Šǯȱ‘›˜ž‘ȱ
the application of scientific principles to pro-
ŒŽœœŽœȱŠ—ȱ™›˜žŒœǰȱ‘Žȱ’¡ȱ’–ŠȱŒŠ—ȱ‘Ž•™ȱ
companies to do things better and improve
‘Ž’›ȱ™›˜’Š‹’•’¢ǯȱŠ–˜žœȱŒ˜–™Š—’ŽœȱŠ›˜ž—ȱ
the w orld,such as G eneralElectric,M otorola,
A sea Brow n Bow eri,Polaroid and A merican
¡™›Žœœǰȱ‘ŠŸŽȱœžŒŒŽœœž••¢ȱ’–™•Ž–Ž—Žȱ’¡ȱ
Sigma in their processes and activities.
Defining SixSigm a
—ȱ‘Žȱ•ŠŽȱŗşŝŖœȱŠŽ›ȱ‘Žȱ˜’•ȱŒ›’œ’œǰȱ‘Žȱ
A merican economy w as in a slump. Several
A merican companies understood that the
time for a change in the w ay they did busi-
nesses came.A mong them M otorola proved
˜ȱ‹ŽȱŠȱŸŠ•žŠ‹•ŽȱŽ¡Š–™•Žǯȱ›¢’—ȱ˜ȱ˜ȱ‘’—œȱ
in a differentw ay,the leadership of M otorola
Œ˜—žŒŽȱ‹Ž—Œ‘–Š›”’—ȱœž’ŽœǰȱŠ—Š•¢£Žȱ
customer feedback and discovered various
problems.

No. 8 ~ 2008
 0DUNHWLQJDQG6DOHV 153
All started when a Japanese company žŠ•’¢ȱ Š›ǯȱœȱ‘ŽȱœŽŒ›Žȱ˜ȱ˜˜›˜•ŠȂœȱ
took over a Motorola factory that produced œžŒŒŽœœȱ‹ŽŒŠ–Žȱ™ž‹•’Œȱ”—˜ •ŽŽǰȱ‘Žȱ’¡ȱ
Q uasar television sets in the U nited States Sigma revolution began in the U SA. D uring
˜ȱ–Ž›’ŒŠȱǻǼȱ’—ȱ‘ŽȱŗşŝŖœǯȱ‘ŽȱŠ™Š—ŽœŽȱ
were totally unsatisfied about how the fac-
tory operated. After drastic changes under
Japanese management, the factory began
œ˜˜—ȱ™›˜žŒ’—ȱȱœŽœȱ ’‘ȱ˜—•¢ȱŗȦŘŖ th de-
fects compared with the previous period. It
took for Motorola about a decade, until the
–’ȬŗşŞŖœǰȱ˜ȱž—Ž›œŠ—ȱ ‘Šȱ‘Š™™Ž—Žȱ
and to figure out how to act in the future.
Motorola discovered that customers
Ž¡™ŽŒŽȱ‹ŽŽ›ȱ™›˜žŒœȱ‘Š—ȱ’ȱ™›˜Ÿ’Žǯȱ
ǯȱ Š•Ÿ’—ǰȱ’œȱ‘’Žȱ¡ŽŒž’ŸŽȱ’ŒŽ›ȱǻǼȱ
at that time, directed the company on the
šžŠ•’¢ȱ™Š‘ȱ”—˜ —ȱŠœȱ’¡ȱ’–ŠǯȱȱŠȱ’–Žȱ
when most American companies considered
‘ŠȱšžŠ•’¢ȱ’–™•’Žœȱœ’—’’ŒŠ—ȱŽ¡™Ž—’ž›Žœǰȱ
Motorola appreciated that by improving
quality costs would actually be reduced.
In this respect, Motorola believed that the
achievement of high-quality products should
cost less. This is why, from the beginning, the
’¡ȱ’–ŠȱŽœ’—Ž›œȱŠȱ˜˜›˜•ŠȱŒ˜—ŒŽ—›Š -
ed their efforts on obtaining enhancements in
all operations within a process and did not
focus on improvements in individual opera-
tions with unrelated processes.
Žœ’—’—ȱŠ—ȱ’–™•Ž–Ž—’—ȱ‘Žȱ’¡ȱ
Sigma way made Motorola both a quality
•ŽŠŽ›ȱŠ—ȱŠȱ™›˜’ȱ•ŽŠŽ›ȱ’—ȱ‘Žȱǯȱ—ȱŗşŞŞȱ
Motorola won the Malcolm Baldrige N ational
Table 1- Customer requirements and sigma values
No. Type of variation Customer requirements
H ard to produce output within customer
1. Too much
requirements
Řǯ Moderate Most output meets customer requirements
All output meets customer requirements (less
řǯ V ery little
than 4 defects per million)
No. 8 ~ 2008
‘Žȱ’–ŽǰȱŽ¡™Ž›œȱŠ—ȱŒ˜—œž•Š—œȱ‘ŠŸŽȱŽ -
’—Žȱ’¡ȱ’–Šȱ’—ȱ’Ž›Ž—ȱ Š¢œǰȱŠœȱ˜••˜ œDZ
x Sigma
 is “a statistical concept that rep-
resents the amount of variation present
in a process relative to customer re-
šž’›Ž–Ž—œȱ˜›ȱœ™ŽŒ’’ŒŠ’˜—œȄȱǽŚǰȱ™ǯȱŗǾǯȱ
H igh sigma values (4.5-6) mean high
performance process (Table 1).
x As
 a results-oriented, project-focused
Š™™›˜ŠŒ‘ȱ˜ȱšžŠ•’¢ǰȱ’¡ȱ’–Šȱ’œȱȃŠȱ
way of measuring and setting targets
for reductions in product or service
defects that is directly connected to
Œžœ˜–Ž›ȱ›Žšž’›Ž–Ž—œȄȱǽŗǰȱ™ǯȱŘřǾǯȱȱȱȱ
x ’¡ȱ’–ŠȱŽ–™‘Šœ’£Žœȱȃ‘Žȱ’–™›˜ŸŽ
 -
ment of processes for the purpose of
reducing variability and making gen-
Ž›Š•ȱ’–™›˜ŸŽ–Ž—œȄȱǽřǰȱ™ǯȱŗŗŗşǾǯȱȱȱ
x ’¡ȱ’–Šȱ’œȱȃŠȱ‹žœ’—Žœœȱ™›˜ŒŽœœȱ‘Šȱ

allows companies to drastically im-
prove their bottom line by designing
and monitoring everyday business ac-
’Ÿ’’Žœȱ’—ȱ Š¢œȱ‘Šȱ–’—’–’£Žȱ ŠœŽȱ
and resources while increasing cus-
˜–Ž›ȱœŠ’œŠŒ’˜—ȄȱǽŜǰȱ™ǯȱǾǯ
x As
 a rigorous, focused and highly
effective implementation of quality
™›’—Œ’™•Žœǰȱ’¡ȱ’–ŠȱŠ’–œȱ˜›ȱȃŸ’›ž -
ally error free business performances”
ǽŞǰȱ™ǯȱřǾǯ
Sigma values
˜ ȱǻŖȬŘǼ
’•ŽȱǻŘȬŚǯśǼ
H igh (4.5-6)
154 0DUNHWLQJDQG6DOHV

›˜–ȱ‘ŽȱŽ’—’’˜—œȱŠ‹˜ŸŽȱ–Ž—’˜—Žȱ ȊȱIt ties quality directly to their bottom

˜ȱ’¡ȱ’–Šȱ ˜ȱŒ‘Š›ŠŒŽ›’œ’ŒœȱœŽŽ–ȱ˜ȱ‹Žȱ line.
ŽœœŽ—’Š•ǯȱ’›œ•¢ǰȱ’¡ȱ’–Šȱ›ŽŽ›œȱ˜ȱŠȱ™›˜ - ȊȱIt provides them a measure of good-
cess viewpoint. Secondly, it clearly defines ness and a methodology for improv-
the customer requirements. It is also obvious ing performance.
‘Šȱ’¡ȱ’–ŠȱŽŠ•œȱ ’‘ȱšžŠ•’¢ǰȱ‹žȱ—˜ȱ’—ȱ ȊȱIt helps them to focus on process
the traditional sense as conformance to stan- management at all levels and to de-
dards. Including economic value and util- velop new processes, products, and
ity both for the company and the customer, services.
a new definition of quality might be “a state ȊȱIt focuses on cycle time reduction.
’—ȱ ‘’Œ‘ȱŸŠ•žŽȱŽ—’•Ž–Ž—ȱ’œȱ›ŽŠ•’£Žȱ˜›ȱ‘Žȱ ȊȱIt guides them into making fewer
customer and provider in every aspect of the mistakes.
‹žœ’—Žœœȱ›Ž•Š’˜—œ‘’™ȃȱǽŜǰȱ™ǯȱŜǾǯȱ ȊȱIt allows them to increase customer
By identifying and eliminating waste satisfaction.
Œ˜œœǰȱ’¡ȱ’–Šȱ˜ŒžœŽœȱ˜—ȱŽ—‘Š—Œ’—ȱšžŠ• - ȊȱIt helps them to prevent, detect and
ity and on helping companies to make more correct their defects.
money by improving customer value. Many ȊȱIt improves their bottom-line
Œ˜–™Š—’Žœȱ‘ŠŸŽȱŽ–‹›ŠŒŽȱ’¡ȱ’–Šȱ‹ŽŒŠžœŽDZȱȱȱȱ profitability.
ȊȱIt helps them to increase their market ȊȱIt allows them to achieve faster work-
share, decrease their costs, and grow ing capital turns.
‘Ž’›ȱ™›˜’ȱ–Š›’—œȱǻ˜¡ȱŗǼǯ ȊȱIt directs them towards more pro-
ȊȱIt permits them to obtain significant ductive research and development
savings. spending.

Box 1- Six Sigma at General Electric [6]

ǯȱŽ•Œ‘ǰȱ‘Žȱ˜›–Ž›ȱ Ž—Ž›Š•ȱ•ŽŒ›’ŒȂœȱǰȱ ŠœȱŠ—ȱŽ—‘žœ’Šœ’Œȱ™›˜–˜Ž›ȱ˜ȱ’¡ȱ’–Šȱ
 ’‘’—ȱ‘ŽȱŒ˜–™Š—¢ǯȱ
ŽȱŒ˜—œ’Ž›Žȱ’¡ȱ’–ŠȱŠœȱ‘Žȱ–˜œȱ’–™˜›Š—ȱ’—’’Š’ŸŽȱŽŸŽ›ȱž—Ž› -
taken by the company. In 1995, under W elch management, each General Electric operation
 ˜›”Žȱ˜ Š›ȱŠŒ‘’ŽŸ’—ȱ’¡ȱ’–ŠǯȱœȱŠȱ›Žœž•ǰȱŒ˜–™Š—¢Ȃœȱ˜™Ž›Š’—ȱ’—Œ˜–Žȱ›ŽŠŒ‘ŽȱřŖŖȱ
–’••’˜—ȱȱ’—ȱŗşşŝȱŠ—ȱ˜ŸŽ›ȱŜŖŖȱ–’••’˜—ȱȱ’—ȱŗşşŞǯȱȱ

Table 2- The number of parts per million (ppm) outside the specification limits, normal distribution centered [3, p. 14]

Specification limit Percent Defective ppm

ƸȦȬȱŗȱœ’–Š ŜŞǯŘŝ řŗŝřŖŖ
ƸȦȬȱŘȱœ’–Š 95.45 ȱȱŚśśŖŖ
ƸȦȬȱřȱœ’–Š şşǯŝř ȱȱȱȱŘŝŖŖ
ƸȦȬȱŚȱœ’–Š şşǯşşřŝ ȱȱȱȱȱȱȱȱŜř
ƸȦȬȱśȱœ’–Š şşǯşşşşŚř ȱȱȱȱȱȱȱȱȱȱŖǯśŝ
ƸȦȬȱŜȱœ’–Š şşǯşşşşşşŞ ȱȱȱȱȱȱȱȱȱȱȱȱǯŖŖŘ

No. 8 ~ 2008

All companies need methods and tools
of measuring what they claim to value. In
˜›Ž›ȱ˜ȱ–ŽŠœž›ŽȱŒ˜–™Š—’ŽœȂȱ™›˜ŒŽœœŽœǰȱ’¡ȱ
Sigma uses metrics that lead to tangible,
šžŠ—’’Š‹•Žȱ›Žœž•œȱǽŘǾǯȱ‘Žȱ‘’‘Ž›ȱ‘Žȱœ’–Šȱ
level is, the better the process is performing.
ȱŠȱ™›˜ŒŽœœȱ˜™Ž›ŠŽœȱŠȱŠȱœ’¡ȱœ’–ŠȱŸŠ•žŽǰȱ‘Žȱ
resulting products and services are almost
ŽŽŒȱ›ŽŽȱǻŠ‹•ŽȱŘǼǯȱȱ
‘Žȱ’¡ȱ’–Šȱ’œȱŠ™™•’Žȱ ’‘’—ȱŠȱœ’–™•Žȱ
performance improvement model known as
Ž’—ŽȬŽŠœž›ŽȬ—Š•¢£ŽȬ–™›˜ŸŽȬ˜—›˜•ȱ
(DMAIC ) model. This model is used to incre-
–Ž—Š••¢ȱ’–™›˜ŸŽȱŽ¡’œ’—ȱ™›˜ŒŽœœŽœȱŠ—ȱŒ˜– - ¢ȱ’—Œ˜›™˜›Š’—ȱ’¡ȱ’–Šȱ’—ȱ‘Ž’›ȱŠŒ -
™›’œŽœȱ‘Žȱ˜••˜ ’—ȱŽ•Ž–Ž—œȱ’—ȱœ‘˜›ȱǽŞǰȱ™ǯȱŚǾDZ
x Define
 the objectives of the improve-
ment activity.
x ŽŠœž›Žȱ‘ŽȱŽ¡’œ’—ȱ™›˜ŒŽœœǯ
 Š›’œŽȱ’—ȱ‘Žȱ’›œȱ™•ŠŒŽǯȱ—ȱœž–ǰȱ‘›˜ž‘ȱ’¡ȱ
x —Š•¢£Žȱ‘Žȱ™›˜ŒŽœœǯ
 Sigma implementation companies make few-
x Improve
 the process.
x C
 ontrol the new process.
In sum, there is a close relationship be-
tween the sigma levels and the performance
•ŽŸŽ•œȱ˜ȱŠȱŒ˜–™Š—¢ǯȱ‘Žȱ’¡ȱ’–Šȱ’–™•’Žœȱ
0DUNHWLQJDQG6DOHV 155
the application of scientific principles to
businesses processes and allows companies
to obtain better, faster and cheaper products
and services.
Conclusions
‘Žȱ’¡ȱ’–ŠȱŒ˜—ŒŽ™ȱ‘Šœȱ›ŽŽ’—Žȱ‘Žȱ
world of work and the way companies operate.
ŒŒ˜›’—ȱ˜ȱ’¡ȱ’–ŠȱŠ™™›˜ŠŒ‘ǰȱ‘Žȱ™Ž›˜›-
mance of companies is measured by the sigma
level of their business processes. Higher sigma
values mean better corporate performances.
tivities, training and education programs for
current and future employees, companies
recreate their processes so that defects never
er mistakes in everything they perform while
increasing their customer satisfaction. The
’¡ȱ’–Šȱ‘Šœȱ™›˜ŸŽȱ˜ȱ‹ŽȱŠȱ™˜ Ž›ž•ȱ‹žœ’ -
ness method that drives improvement in any
Œ˜–™Š—¢Ȃœȱ™Ž›˜›–Š—ŒŽȱŠ—ȱ™›˜’Š‹’•’¢ǯȱȱȱ

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No. 8 ~ 2008