SHARE:

What's Wrong With Six Sigma?

Filed under: Articles, Lean Process Leader Articles * Comments (2)
1 Star2 Stars3 Stars4 Stars5 Stars (1 votes, average: 5.00 out of 5)
Loading...

By Michael J. Webb
Sales Performance Consultants, Inc.
February 2005

At a conference not long ago a speaker (who happened to be a friend) raised objections to applying Six Sigma in sales and marketing. The objections were oddly tangled, with some based on legitimate concerns and others based on misunderstanding. This article examines these concerns and misunderstandings because I've heard them before (and since).

Criticizing Six Sigma for what it IS

Interestingly, one of my friend's principal "criticisms" was that much of Six Sigma is not new. What he really meant was, it "isn't anything special."

In its broadest sense, Six Sigma refers to a method of making customer-focused, data-driven decisions, and of reducing unwanted variables that hinder your business. My friend is right; there isn't much new as far as this goes.

Six Sigma projects employ specific steps - Define (the problem) - Measure (the variables) - Analyze (to determine the cause) - Improve (to test solutions) - Control (to institutionalize the gains). Again, what's new? While it may not be done well all the time, this kind of thing has been around awhile.

Within a company, a Six Sigma campaign is conducted by a dedicated project management team. These people are accountable for aggressive (and sustainable) operational and financial improvements. While having a department dedicated to business improvement projects (as opposed to engineering or construction projects) may not be common, these folks have been around for awhile, often under the rubric of internal consultants or, more archaically, efficiency experts.

Six Sigma projects use analytical tools and techniques that have been with us since the TQM movement began. In addition, Six Sigma attempts to provide management feedback loops and reporting. Similar approaches have been put forth in balanced score card and, for that matter, in business practices ranging from accounting and finance to market research to distribution.

If Six Sigma's use of accepted practices open's it to the charge of not being new, the verdict again is "guilty," or perhaps "proven effective." It seems to me that these characteristics ought to prompt celebrations of Six Sigma's validity, rather attacks on its legitimacy.

However, given these similarities to some other established methods, what is special about Six Sigma?

What's Special About Six Sigma?

Various methods for improving marketing and selling (and other business functions) abound. What, then, is so special about Six Sigma?

The scientific method.

Six Sigma characterizes business problems through precise identification of data and facts. It translates these measurements into mathematical, cause-and-effect relationships, where output, or "Y" is a function of inputs, or "x." Y=f(x). It uses statistical techniques to help distinguish signals (causes) from noise (non-causes). This drive for hard facts ties every project to a measurable result, ideally on the financial statements.

Is this rocket science?

Well, actually yes. At least, to many among us. And those people need explanations, not about the science but about its effectiveness at getting them from where they are to where they want to be in the market, with real customers. In the right hands, Six Sigma provides that capability better than anything that has existed before. That's not just rocket science. It is the dawning of a new age.

Tools for the Intangible

Applying Six Sigma successfully requires practitioners ("Black Belts" and "Green Belts") to distinguish essential factors in a situation from nonessential ones. It takes time and practice for people to become proficient, and to apply that proficiency to business problems. Black Belts have to know their stuff and how it applies to your industry or function. They must also weave their way through the facts, assumptions, and unknowns that constitute a business operation.

While this does not challenge Six Sigma's validity, it does point up one of its difficulties.

The Six Sigma tool kit is not yet complete. (I know to the believers out there, this borders on heresy, but stick with me.) Because it is rooted in manufacturing (where the core processes involve transforming tangible material to the desired state), Six Sigma's tool kit is heavily weighted toward statistical validation of sampling techniques and design of manufacturing experiments.

But, in marketing and sales, where the core processes involve intangibles and transforming people's behavior, additional factors come into play. This does not invalidate the scientific approach. It simply requires sensitivity to these intangible factors and a few new tools for dealing with them. Good practitioners understand these challenges, and new techniques and applications are emerging to address them.

For example, Six Sigma requires process data, which is affected by a broader context of work flow. When that flow is broken in some way, as it often is in sales because of "the human factor," Six Sigma's effectiveness can be crippled. Applied in this context, Six Sigma might simply optimize the "arrangement of deck chairs on the Titanic."

For example, suppose the belief that "sales is a numbers game" drives a sales office to generate large numbers of quotes that do not close. An inexperienced Six Sigma team might jump too quickly into process definition and measurement work.

However, lean techniques (which focus on work flow and value to the customer) might lead the team to ask why the process is set up that way in the first place:

  • What value is a quote to a customer who is not likely to buy anyway?
  • How might we find more likely prospects before we go through the effort of generating quotes?

Lean ensures that the processes have been set up in a rational way, which eliminates a lot of "noise" from the environment.

It is usually these kinds of problems that people refer to when they claim that Six Sigma "doesn't always work," that it "doesn't apply to everything," or that it "doesn't work in non-manufacturing environments." The many success stories presented at Six Sigma conferences by companies like HSBC, Service Master, Starwood Hotels, and others disprove these claims.

The Six Sigma Mystique

My friend also criticized Six Sigma's dense jargon. He said, "Listening to Black Belts talk to each other is like listening to my kid talk about Pokemon."

Indeed, one of the Six Sigma community's biggest challenges is to communicate the value of its deeply technical capabilities to non-practitioners. It's a problem shared by many specialists. For instance, engineers and accountants are often better analysts than communicators.

But engineering and accounting are generally accepted disciplines, while Six Sigma has yet to achieve that status. Black Belts are supposed to rise above this weakness and communicate effectively with everyone. It's a tall order for many of us.

The jargon of Six Sigma helps practitioners with their local concerns, but it definitely is a hinderance within typical organizations. It can instill fear and cause autoimmune reactions.

Many a Black Belt has faced off against a thousand-pound gorilla (in the form of a Senior VP) saying, "Six Sigma sounds like bushwa to me. You're going to have to prove to me that it works (without my support or commitment). If you can't do that, get lost."

The VP's motives are not the issue. The issue is that it's always difficult to get people to take risks - to think and act differently - and it's difficult to rack up a convincing early success every time.

Thus we hear the constant cry that senior management must support the program. Even the most intrepid Black Belts need senior executives' air cover to protect them and their firepower so they can attack the right kinds of problems.

Leading people, overcoming resistance to change, and dealing with politics are the timeless problems of organizational life. And, ultimately, those problems can't be solved unless the right people understand the issues, and want them to be solved.

Nothing unique to Six Sigma here.

The Consultant's Dilemma

Given all this, most Six Sigma vendors routinely recommend expensive training as a first step. Their rationale, of course, is to create a critical mass of trained process thinkers so that the initiative has a chance of taking hold.

Not coincidentally, training is where much of the money is made in the Six Sigma industry. But training alone does not have a great track record for creating results.

In their book "The Trusted Advisor," David Maister, Charles Green, and Robert Galford describe the "consultants' dilemma" as follows:

What clients frequently want is someone who will take away their worries and absorb all their hassles. Yet all too often, they encounter professionals who add to their worries and create extra headaches, forcing them to confront things they would prefer to ignore. (Doctor, I came to you about my sore feet, and you are giving me grief about my weight. Can't you just treat my feet and leave me alone about my weight?) Since clients are often anxious and uncertain, they are, above all, looking for someone who will provide reassurance, calm their fears, and inspire confidence.

It can take some time for many advisors to realize that it is a central part of their profession to develop these interpersonal skills. Certainly no one ever teaches them to us in our training, either in school or inside the typical professional firm.

Clearly, Six Sigma professionals face the same kind of dilemma as the doctor in this example. Often, giving the patient what they want (but not what they need) is the easiest way to deal with the situation. Robert Schaffer, the renowned author of "High Impact Consulting," points out that hiring consultants is a seductively easy decision for clients:

When you hire a consultant to do a typical activities-based project (such as a training engagement), you take a very modest risk. If the project works out, you can claim credit for it. If there are no results, you can blame the consultant's work.

Schaffer recommends an approach that focuses on the client's results, rather than the consultant's methodology. This seems tailor-made for helping clients learn to use a method like Six Sigma, with its bias toward evidence and its track record of results.

Again, however, the challenges inherent in interactions between consultants and clients are hardly unique to Six Sigma. Why criticize Six Sigma on this account?

Is It the Baby? Or the Bathwater?

Six Sigma (and Lean and other compatible approaches) has finally given businesses a way to apply the scientific method to improve operations and results. If any area could use such approaches, it has to be sales and marketing.

Think about it:

  • Don't know which 50% of your marketing expense is generating a return? Now you have a way of finding out whether you are getting bilked.
  • Can't tell which prospects have the best chance of leading to sales, and which ones are probably giving you a ride? You can learn the characteristics of each set of prospects, and have salespeople spend more time with the former and less with the latter.
  • Is your sales force blocking attempts to measure activities and results? If so, they are protecting something. You might not know what, but now you have a way to find out.

But wait! Aren't those fighting words?

Maybe so. Especially if there are things in the operation that someone would rather not know and rather not change.

Six Sigma and its brethren have stacked up a phenomenal track record based on their ability to hurl sacred cows over the moon. It's our job to show senior management - and sales and marketing executives - what a beautiful sight that can be.

2 Responses to “What's Wrong With Six Sigma?”

  1. Joe says:

    I'm reading your book. At the end of chapter three, it says I can get a presentation about linking cause/effect relationships to financial statements at http://www.salesperformance.com/financial_impact.aspx.

    It's a dead link. Is the presentation still available somewhere else?

  2. Michael says:

    Joe,

    You are correct about that. The new website architecture we switched to wrecked the urls, unfortunately. The Financial Impact whitepaper is the same one as in the Sales Process Basics Section, which requires and opt-in.

    We're working on a way for re-directs to work just as they did before, but not finished yet. Will be soon, however.

    Michael

Leave a Reply