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Case study of general electric six sigma implementation

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Articles Six Sigma Case Study: In fact, more than half of all Fortune 500 companies use Six Sigma to improve and streamline their own processes. In fact, it took a long time since its earliest inception for companies to start using it effectively. Manufacturers like Motorola pioneered modern Six Sigma in the 1980s, although earlier versions of the methodology existed as far back as the 1920s. After Jack Welch brought Six Sigma into the General Electric fold, those same principles would go on to generate enormous interest.

And not just in the US, but around the world.

Case Study of General Electric: Six Sigma Implementation

Before Six Sigma, there was little else like it, and nothing else more effective. But what difference did Six Sigma make to General Electric? And when did it first begin? In this article, we look at the history of Six Sigma at General Electric, how they have used it, and how they benefited.

Six Sigma Before General Electric Before we can answer the above questions, we first need to understand what the conditions were that made it necessary for General Electric to adopt Six Sigma practices. What set them on that course?

How General Electric Used Six Sigma to Transform Their Company

Motorola pioneered Six Sigma was in 1981. Their lead engineers concluded that their mandatory method for measuring defects per thousands of opportunities did not provide enough fine detail. As such, they decided to switch to measuring in millions, to provide more granular data.

  • Enormous energy and passion for the job — a real leader — sees it operationally, not as a "staffer;
  • In addition, the car may not be finished by the date on which the customer is expecting it.

One of the most prominent benefits of doing so was the staggering increase in savings the company experienced. While the interest was great during this period, there were still few companies who managed to implement Six Sigma successfully. Least of all on the same scale as Motorola.

However, it was only a decade later when General Electric began using Six Sigma. This was the beginning of an exciting new renaissance for process improvement.

  • Their lead engineers concluded that their mandatory method for measuring defects per thousands of opportunities did not provide enough fine detail;
  • Welch called six sigma the most difficult stretch goal GE had ever undertaken;
  • Today, net profit is no more the only objectives or goals that global manufacturers are aiming for;
  • The reason why does companies decide to emphasis in quality program could be much easier to justify because there are researches have proven that this cost are much cheaper than cost of quality;
  • Before Six Sigma, there was little else like it, and nothing else more effective;
  • Making Quality the Job of Every Employee...

Jack Welch and General Electric In the late 1980s, General Electric turned their focus towards ensuring excellent quality. They did so through their use of the Work-Out program, which exposed GE to a world of new ideas. He instigated a new corporate policy for GE that pledged to acquire Six Sigma goals by the millennium.

Welch took a lot of inspiration from companies like Motorola, using Six Sigma concepts in much the same way. Welch was the driving force behind this implementation, acting as a figurehead for the rest of the company to rally behind.

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Under his watch, he strove to ensure the company fully integrated Six Sigma into their operations. Welch recognized that GE required a complete overhaul of all its fundamental operations. Working with engineers and consultants, Welch detected a great deal of defect that had previously gone unnoticed.

This build-up of waste was holding the company back, losing them money, and slowing down their production. Welch knew what to do. He had seen it in action and knew it could save General Electric from itself.

He knew Six Sigma could help streamline the company, make it more efficient and productive, eliminate waste, and change it for the better. Welch would go on to become a lifelong advocate of the Six Sigma methodology, championing its effectiveness in businesses, large and small, all over the world.

Case Study Examines GE Six Sigma Implementation

Following its unprecedented achievement at General Electric, many more companies started using Six Sigma. Many of these companies, including a huge number of multi-nationals, experienced immediate and continuous success through Six Sigma implementation.

How Did They Do It? By training their employees in data-based problem analysis, they overcame many obstacles for which they had previously been unprepared. All GE employees were required to take a training program in using Six Sigma methodologies in the workplace.

Employees would learn how to define and identify processes, as well as to measure process output. Additionally, they would analyze criticality of process inputs, while devising improvements through modifying the inputs. Finally, they would learn how to control processes by controlling the relevant inputs.

Upon completion of the course, employees would then undergo follow-up training to bolster their new skills and utilize them. This involved a four-month training program in which they learned to apply Six Sigma techniques in their work, while mentored by their MBBs. Strong Leadership Finally, Six Sigma demands effective leadership if it is to be successful.

  1. Employees would learn how to define and identify processes, as well as to measure process output. He had seen it in action and knew it could save General Electric from itself.
  2. We want to make our quality so special, so valuable to our customers, so important to their success that our products become the only real value choice. Today, net profit is no more the only objectives or goals that global manufacturers are aiming for.
  3. Afterward, employees were asked to complete a project implementing those methodologies. Learn from experts every month for free Valuable information direct to your email Easy to read and you can cancel anytime This iframe contains the logic required to handle AJAX powered Gravity Forms.
  4. For example, cost of poor process such as internal failure cost results from defects that are discovered during the production of a service or product.

Without a strong leader to direct and support your Six Sigma Belts, any attempts at implementing Six Sigma will likely fail. General Electric, however, is a prime example of the importance and success of strong leadership, training, and mentoring. Without these three key factors, much of what GE did may not have been successful.

  1. Manufacturers like Motorola pioneered modern Six Sigma in the 1980s, although earlier versions of the methodology existed as far back as the 1920s.
  2. Welch took a lot of inspiration from companies like Motorola, using Six Sigma concepts in much the same way. With a deep sense of urgency, Galvin spread dedication to quality to every facet of the corporation, and achieve a culture of continual improvement to assure Total Customer Satisfaction.
  3. Within four years, "we want to be not just better in quality, but a company 10,000 times better than its competitors," he announced. Welch took a lot of inspiration from companies like Motorola, using Six Sigma concepts in much the same way.
  4. If an organization does not apply Six Sigma techniques wisely, it will fail. And this actions gained a great success in profiting the company.

He linked opportunities for promotion and bonuses with quality improvement, aligning employee incentives with Six Sigma goals.