Introduction
Six sigma strategies are the methods and tools employed for process improvement. It was first developed by Motorola in 1985. It evolved over the years and currently used in different sectors of the economy such as major multinational organizations. Tomkins define it as a program aimed at near elimination of defects from every product. It boosts the profitability, increases the market share and improves customer satisfaction. Through statistical tools, it can lead to breakthrough quantum gains in quality of the processes of an organization. Six Sigma focuses on quality improvement of the process outputs, through identification and removal of the causes of its defects. It also facilitates the reduction of the differences in manufacturing and business processes. It’s a set of quality management and provides the infrastructure for people within the organization with expertise in complex methods.
Six Sigma Strategy Definitions
Six sigma systems focus on daily efforts to achieve stability of results and allow predictions. It sets both short term and long term objectives. It measures the short term goals on a quarterly basis and ensures that the manufacturing and businesses processes have qualities, which can be measured, analyzed and improved. It ensures commitment especially from strategic management (Pride 2012, 47). Six Sigma has other initiatives like achieving financial returns, which can be measured and quantified from a project, management and strong leadership, which should have utmost support and best decision making processes based on true data and statistical methods. Six sigma projects may have either of the two methodologies; DMADV or DMAIC. DMADV project management strategy is also known as DFSS, which means Design for Six Sigma. It has five phases, where a design goal is defined, critical characteristics are identified and measured, analyzing alternatives, designing the best alternative and verifying the design.
DMAIC is the other research methodology. It has five phases. The problem is first defined based on the voice of the customer and the project goals relevant data is collected, and key aspects of the current process are measured, the data is analyzed to investigate and verify the cause and effect relationship, improve the current process and control the future processes to ensure that deviations are corrected before they result in defects (Pyzdek 2009, 176). DMAIC has evolved from the MAIC. It was added the descriptive part so as to enhance its effectiveness. You had first to discuss and describe the problem before proceeding to the next processes.
Samsung Use of Six Sigma Management Strategies in Improving Image and Supply Chain Management
There has been three generations of Six Sigma (Pande 2001, 39). The first generation was between 1987 and 1994 with a focus on reduction of the deficits. Motorola was the first generation company. The second generation was between 1994 and 2000 with cost reduction focus. General Electric and Honeywell are the successful second generation companies. Six sigma management strategies is quality management currently adopted by various leading companies. The third generation focuses on creating value to customers and the enterprise, as well. Among the third generation of six sigma companies are Pasco and Samsung. This generation of Six Sigma brings the idea of the White Belt Six Sigma practitioner. White Belt problems are more localized than the other high ranked belts in other generations. They are departmental problems. White Belt training involves 40 hours of instructions in the methodology of problem solving. It is the best in small and medium sized companies (Pyzdek 2009, 101). It aggressively addresses the service and commercial business processes, and transactions systems quality. The belts theories are a classification of the level of the employees in an organization and have specific relevance.
Samsung has adopted the six sigma management strategy in its supply chain management, which facilitates improvement of quality of the process. In addition, the use of the strategies has also been adopted for the basic purpose of ensuring development of the organization image among various stakeholders. Samsung Electronics Co. (SEC) is perfecting its basic approach to product, process and employees development. This company uses six sigma strategies as a tool of innovation, efficiency and quality. The company has used total quality control techniques, total process management, product data management techniques, enterprise resource management, and supply chain management and customer relationship management techniques. Financial benefits were realizable by six sigma management. This included cost savings and increased profits from sales. Lowering costs has a competitive advantage of this company over the competitors.
Samsung Electronics Co. has long-term objectives developed at the strategic level of management. The management targets Samsung to be borderless global brand with recognition in every household. It targets creation of both qualitative growth and produce competition to stake holders as it maintains its revenue level. These objectives are focused on four major businesses of home appliances, mobile gadgets, office networks and core components. Emphasis has been on creating a firm framework for these products by maximizing the supply chain to ensure efficiency in delivery and time management (pride 2012, 47). Efficiency has been attained by integrating the six sigma strategy into the entire business process.
The company had to secure the best cost competitive method and speed management structure. It targeted to secure the customers by customizing their products according to their wishes and market oriented processes. In addition, the company had to create a very highly competitive information technology infrastructure. Adoption of the six sigma management strategy led to achievement of comparative advantage over the competitors and allowed accessibility to many clients. High information, technology and infrastructure, enhanced cost minimization and high quality products which improved customers' satisfaction. The organization has adopted six sigma management strategies in improving the quality of the products and the general image of the organization.
For example, the firm uses the six sigma strategies in management of the supply chain. Samsung Electrical Co. started pursuing a pervasive goal of developing its own internal resources and majorly personnel. The personnel were required to innovate in the development and design of the products. They were required further to innovate new manufacturing and marketing methods as well as their growth. The supply chain was developed such that when supplier demanded goods, the goods, raw materials were procured and the products were manufactured. The manufactured products through the organization supply chain are delivered to the clients. After sale service is provided by the company agents to the customer. Customer feedback is received in various ways and modification done where there are anomalies.
The six sigma management strategies have also been adopted, in management of human resource to ensure derivation of optimal output. This began in 2000 with the training of the management, champions and some employees responsible for deployment planning. After three years of deployment, one out of every three employees in the company had the Master Black Belt, Black Belts or the Green Belts. All individuals in the company must be trained. Black belts were given several projects per year to give guidance (Geof 2001, 98). This increased the projects returns. Various awards like promotions and incentives are given to the best performers.
Six sigma was also applied in the manufacturing using define, measure, analyze, improve and control. These strategies were employed in the process of products development and recommendations to modify the products. This has enhanced customization of products according to the customer wishes. This company has provided reference materials, benchmarked opportunities, reports to the strategic management and enhancement of the six sigma projects in all its branches. The cross-border organizational learning has grown rapidly as the six sigma methodologies are applied widely in all areas.
Performance of the parameters
Samsung electronics Co. managed to undertake 3290 Six Sigma projects between 2000 and 2001. Almost half of these were black belt projects. In 2002, 4720 projects were expected to be completed but were not complete. 1640 of those projects were black belt level. The company’s six sigma projects have contributed to a 50 % reduction in the defects which were present in the products between 1999 and 2001. This improvement in the quality of products is wholly attributed to the Six Sigma strategy. These developments have played the major role in Samsung's recent growth. These are indicated by a rise in the net revenue to $2.2 billion in 2001. The company’s market capitalization was $ 43.6 billion.
According to the company’s annual report, it is among the top 10 electronic and electrical equipment manufacturing companies in the world. It enjoys the best operating profit ratios and has superior fiscal stability. The report also states that it has the lowest debt to equity ratio compared to any top ranking company. Its shareholders equity to net assets ratio has moreover surpassed the average. Its technological strengths are solely on the six sigma quality initiatives and product marketability. Despite the hard economic times, which hit the United States, the company maintained its operating profit margin and this was attributed to the quality improvements and Six Sigma deployment. The company’s quality and innovative strategy helped it emerge the best in 2002 information technology guide (Taylor 2008, 254). This proved that the company’s products were the best and of the highest quality.
A few years back these products were unknown to the United States citizens and hence were cheaper. However, due to the six Sigma strategies there has been widespread advertising and rise of the products demand. These strategies have improved the company sales in America to 37% of the total sales. Six Sigma has been a success in this company for various reasons (Taylor, 2008, 273). There has been a strong support by the management. The management provided the required resources at the asked times. The employees too accepted the Six Sigma implementation in the company, as it was linked with innovations and infrastructure activities with experts and recognition and reward to employees. Assessment and evaluation of the six sigma projects has been done fairly and depict the real results.
Total quality management
Total quality management system is an integrative philosophy of management, which improves the quality of products and processes. It is based on the quality of products and services and processes. It is a responsibility of all the people involved with the creation and consumption of the products or services offered by the businesses. This management of the workforce, suppliers and customers, meet and exceeds the consumer expectations. This management system harnesses the human and material resources in an entity, in the best and effective way to achieve its objectives. It’s a customer-focused organization that involves all the personnel for improvement. It integrates the quality aspect and use strategy, data and effective communications. Customers determine the level of quality. All employees are involved totally toward working for the common goals. The employees are empowered by organizations and thus work without fear. Continuous improvement efforts are integrated in the high performance work systems.
This management system is process centered (Kaslow 2012, 65). These are the series of steps that inputs are transformed into final products. These steps are monitored and performance measured to established variations. The system is integrated. It incorporates many different departments in the organization. Small processes add up to the larger processes and sum up to the business operations. All the people must understand the mission, vision and guiding principle (Geof, 2001, 98). They must understand the aggregate quality policies, objectives and critical processes of the organization. The business targets are set by the whole organization. This includes the employees in determining the goals of the organization. Every organization has its unique work culture. It is hard for these organizations to excel unless good quality culture has been fostered.
Total quality management involves both strategic and systematic approach. It is the critical part of management to achieving an organization vision and objectives. This involves formulation of long term plans, which integrates quality as the core component. It involves a continuous process practiced by employees for a long duration. This continuity ensures that the organization is analytical and creative in finding alternatives to edge out its competitors. The organization has been able to achieve larger market share, which guarantees higher revenue for the organization, and thus more effectiveness at meeting the stakeholders’ expectations. This management system is fact based in decision making. To determine the performance of business, data on performance measures is collected.
This management assumes continuous data collection and analyzes, so as to improve the decision making accuracy (Kaslow 2012, 69). This also enables forecasting and predictions based on historical data. To ensure day to day operations, effective communications play a major part in giving morale and in motivating the employees. Communication is strategic, involves various methods and is timeless. This management system has been used in Japans Hawthorns electrical industry. The country widely consulted Juran on total quality management and later acquired him as a lecturer. In the 1970’s and late 1980’s, the United States scrambled to use this management system (Juran 2005, 56).
Different schools of thoughts emphasized on different aspects of total quality management. The basic elements of total quality management system for quality control are; policy, planning and administration, product design and design control, control of the purchased materials, production quality control, user contact field performance and assessment, correction action, personnel selection, motivation and training (DE Feo 2005, 130). The basis of total quality control is the invention of new products. It requires that quality standards are initially set by establishing the measurements for a specific commodity and thus define what constitutes quality. When measurements fall outside the band or depict undesirable trend, the production process is stopped until the causes of divergence are solved.
Solutions to total quality management problems
These problems encountered can be solved by participative management. This is continuous improvement of the product and utilizing teams in the organization. This involves all the employees in management and rejecting the traditional vertical management system. The managers are supported in decision making by the subordinates. It involves upper management understanding of operations and is the best for employees who feel that they have control and ownership of the process. The other remedy is a continuous process improvement. This is the recognition of small incremental gains aimed towards the objective of quality products. This necessitates the long term goals of the organization and eliminates stoppages during the production process. It assures customers the continuity of the production process. Teamwork is the other remedy, which involves the organization of cross functional teams within an organization. This team approach helps employees to share knowledge, identify many problems and opportunities. It also helps the employees to have an understanding of their roles in the production process and align their work towards goals of the organization.
Sustaining improvement
In conclusion, six sigma management strategies have been employed widely by many organizations across the globe. The process mainly focuses on ensuring the quality of the processes within the organization, and ensures reduction of loss resulting from poor processes management. Samsung electronics has employed the strategies in improving the supply chain management, and also the image of the organization among different stakeholders. This has been improvement of the processes ensuring delivery of quality products, which are delivered in a timely manner. Therefore, sigma management strategy has been essential for the success of the organization in the global market.
Reference list
De Feo, Joseph A. and William B., 2005. JURAN Institute's Six Sigma Breakthrough and Beyond - Quality Performance Breakthrough Methods. New York: McGraw-Hill.
Geoff T., 2001. SIX SIGMA: SPC and TQM in Manufacturing and Services. UK: Gower Publishing, Ltd
Juran J. M.,2005. Critical Evaluations in Business and Management. New York: Routledge.
Kaslow F. W., 2012. Handbook of Family business and Family business consultation: A Global Perspective. New York: International business press.
Pande. P. S., Neuman, Robert P and Cavanagh R.R., 2001. The Six Sigma Way: How GE, Motorola, and Other Top Companies are Honing Their Performance. New York: McGraw-Hill.
Pride W. M and Ferrell O.C. 2012, Pride & Ferrell Marketing. Hampshire: Cengage.
Pyzdek, Thomas and Keller P. A., 2009. The Six Sigma Handbook, Third Edition. New York: McGraw-Hill.
Taylor G., 2008. Lean Six Sigma Service Excellence: A Guide to Green Belt Certification and Bottom Line Improvement. New York: J. Ross Publishing.
