“The Power of Leadership”
Today begins a new series for the ‘Thoughts’ and this series comes from author/trainer Geoffrey James by way of Bnet.com and should in the least spur some interesting feedback and discussions among readers! Here we go…
“Into the life of every office worker, some rain must fall… and often that rain takes the form of the latest jackass fad that your management latched onto. In most cases, a new management fad means endless meetings, new buzzwords for the office toadies, and extra work that ends up either driving you crazy or your company out of business.
This list contains the most heinous, stupid, painful and useless management fads that I’ve ever encountered. It also provides invaluable advice for how to survive the fad until it finally goes away. (Which it will… eventually) Of course, a fad usually goes away because management latched onto a new one, but hey, nobody said work life would be easy.”
Stupid Fad #1: Six Sigma
Created by: Motorola (based on Total Quality Management)
The theory: The idea is to improve the quality of your processes by identifying and removing the causes of defects. You assign various people different colored “belts” (like a karate class) based upon their expertise in the Six Sigma methodology. You also get a series of defined steps and quantifiable financial targets.
The reality: It creates a hierarchy of “belted” experts who run around the company pretending that they know how to do other people’s work better than the people who do the work. Endless meetings ensue, with little or no effect. The consulting firm who’s implementing the Six Sigma walks away with a fat paycheck.
The result: Wasted time and wasted effort. According to one quality control expert quoted in Fortune magazine, “of 58 large companies that have announced Six Sigma programs, 91 percent have trailed the S&P 500 since.” On the other hand, it’s spawned an entire industry of “consultants” who make a living sucking productivity out of your firm.
My opinion of the fad: Oh, please. Potbellied managers running around with little colored belts like they’re part of some Bruce Lee movie on Bizarro world. That’s exactly what’s going to help a company get out of the doldrums. You couldn’t make up this stuff, it’s so incredibly stupid.
Likelihood you’ll run into it at least once: 55%
Your strategy if you do: If your company implements Six Sigma, you’ll be paying a Six Sigma “tax” for about two years. Push out all activities by about 20 percent to account for the time wasted in pointless meetings. After two years, the managers who implemented it will either be fired or move on, in which case the Six Sigma process will fall by the wayside.
“Fit no stereotypes. Don’t chase the latest management fads. The situation dictates which approach best accomplishes the team’s mission.” – Colin Powell
Have a great day ‘Karate Chopping’ your problems away!
Shawn
Performance Institute – A Global Leader in Human Capital and Business Development
Russ M. Miller, LLIF – Chairman and CEO
Sunny Hong Zhang – Managing Partner – China
Shawn M. Miller – Managing Partner – USA
P.S. Your thoughts on our Thoughts are valuable to us and other readers; please post your comments in the Reply box below…
Geoffrey James would probably be disappointed to remember companies such as GE and Honeywell had huge successes using Six Sigma to drive bottom line results. In particular, Jack Welch, PhD, former CEO & Chairman of GE recounts in his autobiography ‘Jack’ that in 1993 he took a ‘Deep Dive’ to turn around a model of CT scanner which routinely failed after only 25,000 scans. This was less than half what their comptetors were achieving. A special project team increased the effectiveness in five years to almost 200,000 scans. In 2000, by applying Six Sigma technology, GE further increased the number of scans to an average of 500,000 scans, which made possible the development of the fastest-selling CT scanner ever, the GE LightSpeed.
Courtesy of http://www.surveymethods.com/glossary/article_six_sigma_seg_l.aspx I found the following additional documentation.
>Six Sigma Success Story: GE
GE consistently ranks among industry leaders in Six Sigma experience and success. An early adopter of the philosophy, GE launched its initial Six Sigma efforts in 1995. In its 1996 Annual Report, the company stated: “It has been estimated that less than Six Sigma quality, i.e., the three-to-four Sigma levels that are average for most U.S. companies, can cost a company as much as 10-15% of its revenues. For GE, that would mean $8-12 billion.”
At the January 1996 gathering of GE’s top managers, CEO Jack Welch called the program “the biggest opportunity for growth, increased profitability, and individual employee satisfaction in the history of our company.” Within four years, he continued, “we want to be not just better in quality, but a company 10,000 times better than its competitors.”
Welch made quality the job of every GE employee: senior bonuses and promotions at all levels would be tied to Six Sigma performance and certification. Welch described it as “changing the DNA of the company.”
Welch’s profit-impact predictions turned out to be particularly insightful, as indicated by the following statistics on the financial impact of Six Sigma implementation at GE from 1996 to 1998 (courtesy of http://www.1000ventures.com):
Revenues have risen to $100 billion, up 11%
Earnings have increased to $9.3 billion, up 13%
Earnings per share have grown to $2.80, up 14%
Operating margin has risen to a record 16.7%
Working capital turns have risen sharply to 9.2%, up from 1997′s record of 7.4
Thanks for your Comments, John, I was looking forward to feedback on these “Fads”. Anyone else have experience with Six Sigma, good or bad???