This Focused Performance Weblog is a "business management blog" containing links and commentary related primarily to organizational effectiveness with a "Theory of Constraints" perspective. TOC is noted for its applications in Project Management and Multi-Project Management (Critical Chain) and Operations Management (Drum-Buffer-Rope), as well as in Marketing, Strategic Planning and Change Management (TOC Thinking Processes). If you are on an archive page, current postings are found here.
Monday, December 02, 2002
• How Satisfied Are Six Sigma Companies' Customers? -- From Six Sigma Forum (unfortunately, requires registration), this article calls to question the success of Six Sigma in meeting it's "customer starisfaction" goals.
"The American Consumer Satisfaction Index (ACSI) is an economic indicator of customer satisfaction with goods and services purchased in the United States. Customers evaluate quality based on their experiences with their purchases, and the University of Michigan Business School's National Quality Research Center analyzes the data.
It may be too soon to make scientific and precise judgments about what effect, if any, Six Sigma has on ACSI scores. Thorough implementation takes years, and results cannot be expected upon deployment. Additionally, the intersection of Six Sigma organizations and ACSI-measured organizations produces a somewhat exclusive subset. Extrapolations to a wider population may be unreliable.
Still, many organizations have been quite vocal about the financial savings they have reaped from their Six Sigma programs. Perhaps it is high time to begin attending to how those organizations' overall customer satisfaction scores have fared since implementation....
If this limited sampling points to any conclusion at all, it is that Six Sigma is not yet improving, or even noticeably affecting, ACSI scores:
* GE has not yet managed to equal its ACSI high score of 84 in 1995, the year it implemented Six Sigma.
* With Six Sigma, Whirlpool Corporation, Apple Computer, Delta Airlines, Bank of America, and Wells Fargo & Company have not matched their 1994 baseline scores.
* Dell Computer is the only company to show a steady increase in scores; however, that increase halts in 2001.
* The only company to show a continual decrease in scores, Starwood Hotels and Resorts, is a newcomer to both the ACSI and Six Sigma.
* Gateway’s score dropped five points from 2000 to 2001, corresponding with its first year of Six Sigma customer service projects.
* GE's score dropped three points from 1995 to 1996, its first year of implementation; since implementation, GE has yet to match its 1995 score and has exceeded the industry average only in 2001.
* Scores for Wells Fargo & Company and Bank of America are noticeably lower than the banking industry average.
* For Hewlett-Packard, Apple Computer, Honda Motor Company, Delta Airlines, Bank of America, and Wells Fargo & Company, pre- or early Six Sigma scores from the mid 90s are noticeably higher than later Six Sigma scores.
In contrast to the extraordinary savings results that some Six Sigma organizations report, changes in ACSI scores appear to be negligible, gradual, and variable..."
... if not downright troubling.
"Then again, the emphasis placed on Six Sigma savings may present a more sobering explanation for drops in ACSI scores. “Customer satisfaction appears to be negatively related to cost-cutting efforts,” Claes Fornell asserts. Whirlpool Corporation and Gateway serve as cases in point: with new cost-cutting measures in place, these Six Sigma companies showed ACSI drops of three and five points respectively in 2001."
Then again, given the pervasive practice of cost allocations, I wonder how much of those "savings" actually reached the bottom line.
Another link to the publicly open ACSI site itself goes into more detail about the scores' trends, with additional comments on the questionable ability of "quality programs" like Six Sigma to actually impact customer satisfaction.
As demonstrated in too-common failures of TQM, real improvement is a matter of focus on what to change.
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