Explain why Six Sigma failed in company A but was successful in company B.
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A Tale of Two Companies/3'G Company A was a very large, privately owned com- pany with diverse business units, mostly related to the hospitality industry. The deployment champion at this company had been successful in deploying Six Sigma at a smaller organization. In his new position, he was paid more, and his title was more impressive, but he was at least one layer lower in the organization than he had been at his earlier job. Although he had \"the ear of the CEO,\" he was one of many who did, and there were others in the chain with much more access to that CEO. In his earlier job, he had trained internal people to be Black Belts and, after three years, had advanced the strongest performers among them to become Master Black Belts. At his current company, because his boss wanted Six Sigma to be implemented \"faster,\" they took a shortcut, hiring some Master Black Belts from the out- side. A couple of these deserved the title; most, as it turned out, did not. We had recommended an execu tive session. The deployment champion told us \"that isn't going to happennot as busy as these executives are,\" but he assured us that he had the situation well in hand. He was meeting with them individually, an hour at a time when he could get it scheduled, and had given them all a required reading list. Initially, champion {sponsor} training was sched- uled for three days. Managers toid to attend com- plained to their managers, who managed to get the training requirement reduced to one day. One class of 20 champions attended a one-day workshop. Most of them stayed for the entire day. Some of them even chartered projects. This company had decided to start its efforts with two-week Green Belts, and we began training Green Belts at a rapid pace. When the first wave came to class, half of them were still looking for projects. Of those who did have projects, only a handful had champions who had been to champion training. The rest had been sent by their bosses, who had heard that \"this Six Sigma thing is going to be in my expectations this year, so 1 need to get a project or two done.\" When the first wave came back for their second week, some of the projects had been dropped, some Green Belts were still looking for projects, and some had made a little progress. It got worse in subsequent waves: Fewer projects had champions; fewer of those that did had trained champions (some of the trained champions had been promoted and were no longer able to function as champions}; almost none of the projects could be tied to strategy; almost no one had data or baselines. Some could not even tie their project to a specific process. I expressed this concern to my managing director and told him that the company would be much better off if he diverted its deployment investment from training to coaching and thereby got some projects done. He called the deployment cham- pion. After a 20-minute conversation, my boss hung up and said, \"He's happy with things....He says they are making lots of progress. From his perspective, it's successful, and he wants you to keep going.\" I asked for a meeting with the deployment champion so I could explain my views further. That never hapw pened. W'hat did happen is that we kept training wave after wave of Green Belts. Midway through the second year, the organization held a \"gallery walk\" at its world headquarters to celebrate all the gains they had made in process improvement efforts. I attended this celebration; about 20 projects were on display. Not a single project had been led by a Green Belt. None of the gains could be proven with data. Many of the people involved in the projects questioned the advertised results. At the end of two years, three things happened: 1. Corporate trainers decided to take over Green Belt training. They told me, \"We are cutting out all the statisticsour feedback indicates that stu- dents didn't like it and never used any of it.\" 2. My new managing director had a meeting with the deployment champion, who was furious that he had spent more than half a million dollars on our training but couldn't prove that any of our students had provided any return on that investment. 3. All the Master Black Belts quit and moved to other organizations. In later years, I met several people from that orga- nization. All said pretty much the same thing: \"We really tried, but it just didn't work with our culture.\" Company B was a manufacturer and a spinoff from a larger, Fortune 25 company. This company was in crisis due to the \"buggy whip syndrome\"; in other words, they were very good at what they did, but their business was in trouble because other technologies were overshadowing the need for pro- ducts that had provided the bulk of their sales for a long time. The company had hired as its new CEO a well-known quality champion and author of a book on deploying lean. He hired me because he wanted Six Sigma aligned with his lean efforts to create a sys- tem for process improvement. This CEO personally led a twoday executive session, inviting us to present an overview during the first half of day two. He required his direct reports to personally sponsor pro- jects in the first round. He introduced his COO as deployment champion and told the executive team in no uncertain terms that she was his voice in this deployment. He then opened sponsor training to these individuals and their direct reports, which was scheduled to occur between the second and third weeks of Black Belt training. The top managers left having committed publicly to project ideas that were aligned with strategic objectives. The CEO opened the first session of the first week of every Black Belt training class and required project sponsors for the wave being trained to give an elevator speech about the project they were sponsoring. The deployment champion sat through the entire first wave of training and had her second in command sit through the entirety of every subsequent wave. Each week, we set aside 90 minutes on Monday through Thursday for project reports from the Black Belts. The COO demanded a schedule set in advance for these presentations, and each project sponsor was required to sit in on all his projectsi presentations. The CEO always sat in on the first set of presentations in week two of each wave. In the first set of presenta tions, one of the Black Belt candidates, an engineer, got up to present and said, \"Here is my charter.... I'm afraid that's all I have to report. I haven't been able to get anything else done because I have two other projects that are priorities." The C00, in front of everyone present, immediately turned to the project sponsor and asked, \"Is this project important to you?\" The sponsor started to talk about other priorities, and she cut him off. \"We all have other priorities. What I asked was whether this project is important to you. This project, that you committed to support, that you said would drive a metric at the top of your stra- tegic objectives for the year is this project important to you?\" He again tried to talk about some other pri ority, and she cut him off again. \"Letis meet on this, after the presentations are done.\" She looked over at the CEO and said, \"Are you available?\" He nodded. That engineer was able to report significant progress during the next rounds of project presentations. We never heard any whispers about lack of sponsor sup- port after that. We trained 18 Black Belts in that first round. Two of them were victims of a reorganization (the day of the final exam). The other 16 completed their projects, and the validated NPV for the total portfolio from that first wave was $32 million in the first year. We saw similar results in each subsequent wave. The deployment Champion's second in command took over training at the end of the second year and became the company's Master Black Belt. Most of the Black Belts ran between three and five projects per year, with gains varying between $250,000 and $2 million per project
