In the last class, we learned about Six Sigma, a methodology that is used to eliminate waste from business activities, while benefiting a company’s financial performance. Six Sigma uses the idea that all activities are processes that can be evaluated with the DMAIC process (define, measure, analyze, improve, and control). By using data analysis methods and focusing on customer knowledge and core processes, companies can reduce defects significantly, with the ideal target being 3.4 defects per million opportunities.
Private companies have been successfully using Six Sigma to improve their methods and reduce costs for years, and even service sector companies, like hospitals, are using Six Sigma to analyze their processes for areas of improvement and greatly reducing treatment times for patients. In class, we discussed Motorola’s introduction of the Six Sigma process and saw examples of how companies like Caterpillar have used Six Sigma to reduce defects and costs. Forbes.com ran an article a few months ago about the expanding types of organizations that are bettering their operations through Six Sigma, such as the Department of Defense and even Iowa’s state government. Looking at these cases, author Kellan Giuda, questions why top government is ignoring the proposition of using Six Sigma to reduce the national deficit in his article “Lean Government Six Sigma? Why Do Politicians Ignore it?”
As everyone is aware, the economic crisis in 2007 and 2008 has caused a lot of criticism on how the U.S. government functions. Because of this many advocacy groups, specifically seen when Newt Gingrich was running for candidacy, are arguing for higher-tier adoption of this system in order to reduce debt. The argument behind this movement is the $2.45 billion saved by the U.S. Military after introducing Six Sigma in 2008 and the Department of Defense’s integration of the system into their operations. Giuda believes that these cases prove that Six Sigma can be beneficial to organizations outside of the private sector, such as government agencies. He argues that this would provide an opportunity for top government officials to undertake the public debt problem head-on and that Lean Six Sigma is a viable solution for the problems the U.S. government faces.
Thousands of companies worldwide embrace Six Sigma as a tactical improvement system and seeing the various types of organizations that are implementing it shows the transferability of the system. Do you think that using Six Sigma would reduce costs in a national government? Would it be difficult to implement?