Welcome to MASET News. A monthly publication dedicated to the communication between MASET and our many interested Friends, Customers and Potential Customers
I have been struggling for the last week on how and what to write regarding the disaster of September 11, 2001. My thanks to the many friends and associates who called, e-mailed, inquired about the safety of our family, friends and associates or offered prayers as a result of this terrible tragedy. Many lives were needlessly lost because of some very sick individuals. All of us who believe in a higher power keep asking. "Why did this happen?"
Maybe this is a way for all mankind to realize that regardless of gender, race or religious beliefs we are all inhabitants of this earth and we better learn how to live together. I have never seen a greater outpouring from all parts of the earth towards our common enemy "the terrorists". Maybe this horrendous event will lead us to end conflicts around the world and result in each of us becoming more civil and willing to understand, accept and celebrate our differences. I hope so.
I have just returned from a three-week trip to China and will pass on some of my observations next month.
I found this month's two feature articles well worth reading. The first is titled "I've been thinking . . ." and discusses the financial fall-out following the events of September 11, 2001. I am implementing its message both in my personal and business financial affairs.
The second feature article titled "Why Six Sigma is not TQM" identifies some of the major differences between Six Sigma and TQM. It does a great job bringing out the importance of Senior Management's involvement in the Six Sigma Initiative. In every Maset engagement, the success or failure of the initiative was directly related to the involvement of the Senior Executive. Therefore, if you are thinking about beginning a Six Sigma initiative, contact us. We will assist Senior Management in understanding what it takes to implement a successful initiative.
Some comments from our readers. All comments are welcome.
Great article on project management. I had no idea that there are those who would question the power and effectiveness of project management. Douglas Sankey offered up some persuasive arguments.
As always, it is interesting and informative to receive and read the monthly Maset News. Given my active role in Project Management, and knowing Doug Sankey's vast experience and knowledge in the field, I particularly enjoyed Doug's article this month.
Lou Ripberger an Instructor and Consultant in Six Sigma and many of the Statistical courses has joined our team. Lou joins us with over 27 years of applications experience.
FEATURES OF THIS ISSUE:
"I've been thinking . . ."
By Larry Halverson
The most consistent comment I've heard this week is how difficult it is
proving to be to comprehend what happened last week and what it will mean
for our future. And how this has numbed and immobilized all of us.
I guess we shouldn't be surprised. Whenever any significant "new piece of
information" comes into our consciousness, we are distracted by it. We
want to put everything on hold as we process this new information, sort it
out, and catalog it according to our previous knowledge and experiences.
Then, only after it is all deciphered and neatly filed away, do we feel
like getting on with our lives again.
Such processes are always unsettling. So, we fight them. In fact, our
usual initial reaction is to try to ignore such "news." Then we see it but
deny it, then we question it, then we argue with it, then we try to
downplay it. Big doses of new information can take quite some time to
really understand and accept. This latest example, I suspect, is going to
take a good long while.
I won't repeat, much less try to improve upon, the many wonderful,
insightful commentaries and editorials that have been issued from across
our nation and around the world in recent days interpreting these
horrendous events and providing personal perspectives on how they may have
changed our lives. I do, however, want to describe three personal
perspectives on these events and their likely impact, perspectives that
have only recently begun to crystallize for me. For the aspects of these
perspectives that came knowingly from others, I will provide appropriate
attribution. Otherwise I'll present them as part of the public domain,
knowing that anything that seems like "my idea" does so only because the
thought arrived so subtly and was absorbed so completely that it seems to
be of my creation. My goal is not to claim any unique vision or
understanding here, but only to verbalize some thoughts that I think might
ease and accelerate the process of comprehending and dealing with today's
reality, both for my readers and for myself.
Now and/or forever?
The first of these views came from the good people at ISI Group, our
primary source of economic information and analysis. In a conversation
shortly after the attack, they suggested that such events be classified as
one of two types -- events (like Pearl Harbor) that introduce new systemic
risk into our economic world, or those that may seem equally significant
initially, but which (like the Arab oil embargo) are really just temporary
shocks to our economy.
The problem in nearly all such events, of course, is that no one really
knows initially what type they will become. ISI's current view on the
terrorist attacks is that they are much more in the category of temporary
economic shocks. But, they also fear (and I agree) that terrorism could
remain a very real and immediate part of U. S. citizens' lives, possibly
for years. If so, it would have a significant economic impact, not
necessarily directly through property destruction or infrastructure
disruption of the degree we have seen, but through its psychological impact
on our citizens and their economic behavior.
Still, I believe that these events and their impact will diminish from
current levels, beginning almost immediately. And, I believe they may even
ultimately diminish more than they recently increased. We will lose some
"freedom" in the process, but we will regain some security.
The point, though, is that investors must make their own judgments. Each
of us must follow the events of the coming weeks and months and years with
this question in mind: Is this a permanent change in the fabric of our
economic lives, or something that can be at least largely muted and that
will have less and less impact over time? I believe strongly that,
although it seems today to be quite permanent, our reality will gradually
move much closer to the other extreme.
What will it feel like?
The next perspective, I'm afraid, is on the other side of the scale. It is
a composite of some of the warnings I've heard in recent days from
President Bush, from some of the cabinet members and from many of our
military leaders (in all of whom I have great faith and confidence). And,
I expect to hear more of such cautionary remarks, along with some
encouraging news about governmental programs and military actions, from
President Bush this evening. In a nutshell, it is this: The "war" we are
about to wage will be extremely difficult for all of us. It will be unlike
any previous war (more like our "war on drugs," but this time with more
global support and a meaningful budget). It will be long and it will be
messy. It will also be frustratingly indecisive with very few definitive
victories, it will never really come to an end, and it will be very costly
. . . in all ways.
What solidifies this perception for me more than anything else is the
recognition that we are a nation which agonizes for years over ending the
lives -- in the most humane way possible -- of admitted, proven serial
killers. We are engaging an opponent that is a loosely knit, renegade,
lawless, soulless band of fanatics scattered worldwide (including some
among us), but hiding primarily within a society that will stone a woman to
death for showing her face in public. Suicide missions against its enemies
guarantee the perpetrators' tickets to heaven. And, except for well hidden
financial reserves, the entire culture is nearly devoid of material
possessions they might hope to preserve and protect. So, they are
committed to our destruction, they have no legal, ethical or moral limits
on what they will do to achieve it, and in their minds and souls, they have
nothing to lose and everything to gain.
The point here: As we wage this war, it will be a formidable weight on our
national psyche, and on our investment markets, for a long time to come.
Returning to normal while forever changed
This last view, I believe, is the trump card. It has the potential to
carry even the weight of the one just described. It started to develop for
me as I watched the umpteenth interviewee on MSNBC describing the strong
desire -- the desperate need -- we all have to "get back to normal" while
at the same time recognizing that this event will almost certainly
permanently impact how we think and live. How can things ever be the same
again, and how can we survive if they aren't? This irreconcilable conflict
is creating for most of us recurring waves of almost overwhelming feelings
of hopelessness and sadness. At such times, even the former stalwarts of
our support mechanisms -- including our families, our faith, and our
learned certainty that "this too will pass" -- are providing only limited
As a custodian and facilitator of many people's financial hopes and dreams,
my concerns extend beyond the emotional well-being of my fellow man. I
also worry about the less important, but still potentially very
significant, impact this hopelessness could have on our nation's financial
well-being. Human expectations can be self-fulfilling. As we all languish
in this despair -- for weeks, then months -- the impact on our economy and
on the investment values it supports could be extremely detrimental.
But, there is an aspect of human nature that most of us haven't experienced
for many years, maybe never on a personal basis, and maybe not within our
immediate families for generations. That is our ability, not to "get over"
this kind of event (because that never really occurs), but to learn to
understand it on a personal level, to find a way to live with it, and to
ultimately gain strength from it. Most of us are not very confident of
this today because we are rank amateurs at it. But, even for those who
suffered the greatest personal losses, it will happen if we let it.
I had the very good fortune earlier this week to listen to Kate Munns, CUNA
Mutual Group's head of Corporate Learning, eloquently and emotionally
describe this remarkable human capability at a company-wide gathering. It
was an extremely welcome and encouraging message for all of us. And it
crystallized in my mind what I have struggled to put into words ever since
that terrible day last week:
Things may indeed never get back to "normal" as we have known it. But,
things will get better from today. And eventually, "normal" will catch up
to things as they are. And we will realize once again that life is good
and we're going to be okay.
Larry Halverson, CFA
Senior Vice President
MEMBERS Capital Advisors
"WHY SIX SIGMA IS NOT TQM"
By Thomas Pyzdek
I am often told by my colleagues that there's no real difference between Six Sigma and total quality management (TQM). Indeed, Six Sigma does employ some of the same tried-and-true tools and techniques of TQM. Both Six Sigma and TQM emphasize the importance of top-down support and leadership. Both approaches make it clear that continuous quality improvement is critical to long-term business success. And the plan-do-study-act cycle used in TQM is not fundamentally different than the Six Sigma define-measure-analyze-improve-control cycle.
But there are differences-critical differences. And these differences explain why the popularity of TQM has waned, while Six Sigma's popularity continues to grow.
The primary difference, in a word, is management. Unlike TQM, Six Sigma was not developed by techies who only dabbled in management and therefore produced only broad guidelines for management to follow. Six Sigma was created by some of America's most gifted CEOs, people like Motorola's Bob Galvin, Allied Signal's Larry Bossidy and GE's Jack Welch. These people had a single goal in mind: making their businesses as successful as possible. Once they were convinced that the tools and techniques of the quality profession could help them do this, they developed a framework to make it happen: Six Sigma.
We quality professionals knew we had a winning set of tools that could solve quality problems in manufacturing. Total quality control, invented in 1950, showed that product quality could be improved by expanding quality efforts into upstream areas such as engineering and purchasing. We even had limited success using our tools to improve quality in administrative areas by reducing errors in service transactions. But, despite these successes, we suffered from a number of shortcomings, for example:
- We focused on quality and ignored other critical business issues. Quality trumped everything else. Of course, this made no business sense and often led to organizations that failed despite improved quality.
- We created a quality specialty that suffered from all of the same suboptimization problems as other functions within the organization. Despite all of our talk about a systems perspective, when push came to shove, we fought for our point of view (and budget) just like everyone else. In the typical organization, this resulted in other departments considering "quality" the quality department's territory. Thus, they backed off from-or never started-efforts of their own.
- We emphasized minimum acceptance requirements and standards rather than striving for ever-increasing levels of performance.
- We never developed an infrastructure for freeing up resources to improve business processes.
- We developed a quality career path. Quality professionals tended to lack expertise in other areas of the company. This division of labor, combined with functionally specialized organizations, made it difficult to improve quality beyond a certain level. (I estimate that this type of organization tops out at about 3.5 sigma.)
The CEOs were able to see what the problems were and create an approach that fixed them. Six Sigma addresses them all.
- Six Sigma extends the use of the improvement tools to cost, cycle time and other business issues.
- Six Sigma discards the majority of the quality toolkit. It keeps a subset of tools that range from the basic to the advanced. Six Sigma discards esoteric statistical tools and completely ignores such quality "staples" as ISO 9000 and the Malcolm Baldrige National Quality Award criteria. Training focuses on using the tools, not theory, to achieve tangible results.
- Six Sigma integrates the goals of the organization as a whole into the improvement effort. Sure, quality is good, but not independent of other business goals. Six Sigma creates top-level oversight to assure that the interests of the entire organization are considered.
- Six Sigma strives for world-class performance. The Six Sigma standard is 3.4 failures per million opportunities, but it goes beyond errors. The best of the Six Sigma organizations try to meet or exceed their customer's expectations 999,996.4 times out of every million encounters.
- Six Sigma creates an infrastructure of change agents who are not employed in the quality department. These people work full- and part-time on projects in their areas or in other areas. Six Sigma Black Belts don't make careers in Six Sigma. Instead, they focus on Six Sigma for two years and then continue their careers elsewhere. Green Belts work on Six Sigma projects while holding down other jobs. These subject matter experts are provided with training to give the skills they need to improve processes. Six Sigma "belts" are not certified unless they can demonstrate that they have effectively used the approach to benefit customers, shareholders and employees.
There are many other differences as well. Having worked with organizations that have done TQM and Six Sigma well, I can tell you that successful programs of both types look very much alike. But Six Sigma, by clearly defining this "look," makes it easier for organizations to succeed by providing a clear road map to success. I'm not saying that succeeding at Six Sigma is easy, but organizations are more willing to invest the effort if they know that a pot of gold awaits them at the end.
About the author
Thomas Pyzdek is a consultant in Six Sigma. Learn more about Six Sigma at www.pyzdek.com. E-mail Pyzdek at email@example.com.
Reprinted with permission of Thomas Pyzdek. Article originally appeared in Quality Digest, February 2001, p. 26.
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