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A Comparison of

Traditional TQM Methodologies

with the Six Sigma Approach
for Quality Management

by Godecke Wessel

June 18 2002

© 2002 Godecke Wessel, Hamburg

A Comparison of Traditional TQM Approaches for Quality Management with Six Sigma 2


1. INTRODUCTION AND AIM .................................................................................................. 4

2. THE TWO DOMINANT STREAMS OF SIX SIGMA ............................................................. 4

3. UNDERLYING DEFINITIONS............................................................................................... 5

3.1. TQM................................................................................................................................... 6

3.2. Six Sigma ......................................................................................................................... 6

3.3. The Difference between the TQM and Six Sigma Approach ....................................... 7

4. DIFFERENCES IN THE SYSTEMS, METHODS AND TOOLS............................................ 8

4.1. Dimensions of Six Sigma and the Differences to TQM................................................ 8

4.1.1. Comparison: Process Improvement ........................................................................... 9
4.1.2. Comparison: Process Design and Process Management........................................ 10
4.1.3. Six Sigma within a firms Control System - Example of the Balanced Scorecard ..... 10
4.1.4. The TQM and the Six Sigma View on Cost.............................................................. 11

4.2. Contrasting Statistical Process Control & Six Sigma Measurement........................ 12

4.3. Comparison of the Cultural Implementation............................................................... 13

5. THE RELATIONSHIP TO COMMON NORMS & AWARDS .............................................. 14

5.1. ISO 9000:2000 ................................................................................................................ 15

5.2. European Quality Award, Malcolm Baldrige Award and Deming Prize .................... 15

5.3. Summary ........................................................................................................................ 16

6. REASONS FOR THE MISUNDERSTANDING OF SIX SIGMA ......................................... 16

7. CONCLUSION .................................................................................................................... 17

8. REFERENCES.................................................................................................................... 18

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BSC Balanced Scorecard
CTQ Critical to quality requirement of an internal or external customer;
not meeting a CTQ requirement results in a defect (see dpmo)
DFSS Philosophy to design products or processes to fully meet CTQ
requirements from the beginning
DMADV 5 steps for process (re-)design: Define, Measure, Analyse, Design,
Verify; a method under the DFSS umbrella
DMAIC 5 steps for process improvement: Define, Measure, Analyse, Improve,
dpmo Defects per million opportunities; widely used measure to assess
the quality of products and processes; a defect refers to not
meeting a CTQ
EFQM European Foundation for Quality Management
GE General Electric Co.
ISO 9000:2000 Norm by the ISO (International Organisation for Standardisation) which
certifies that a quality system of a firm meets certain standards
net-benefit Direct contribution of an improvement project to a company’s bottom
line –profits and cash-flow; calculated by the savings within a
certain period of time minus the cost of the improvement project
(including personnel); a commonly used time period is one year
ensuring that an improvement project finances itself
OD Organisational Development; a planned approach for change
management based on behavioural science; OD methods and tools
consider underpinning values like respect towards the individual,
a supportive organisational climate, and employee involvement
QM Quality management in general; irrespective of the approach
SPC Statistical Process Control
TQM Total Quality Management

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1. Introduction and Aim

Since the late1980s a new phrase has appeared in the management literature: ‘Six Sigma’.
However, Mikel Harry and Richard Schroeder (1999) who had a considerable contribution to its
development, point out that “Six Sigma is one of the most misunderstood strategies ever to hit
the business world”.

This essay aims to work out the common elements and differences between the traditional Total
Quality Management approach and Six Sigma.

2. The Two Dominant Streams of Six Sigma

First of all, a distinction should be made between two main ways of understanding Six Sigma.
The first one goes back to the 1980s and to the development of Six Sigma at Motorola which is
basically a TQM approach.

According to Bhote (1989), low quality of their products and processes were seen as the
underlying reason for Motorola’s problems in their competition against Japanese companies in
the late 1970s and early 1980s. This became visible when the Chairman Bob Galvin visited
Japan and was “stunned to find Japanese plants whose quality performance was 1,000 times
better than Motorola’s” (Gill 1990).

Motorola established a research environment and developed a 6-step process to reduce

variability and defects within its processes (Harry and Schroeder 1999).

In 1985, despite massive investment in their quality management resulting in a substantially

higher quality level than the US industry average, the Japanese competitors were still further

In consequence, an all-embracing Total Quality Management programme called ‘Six Sigma’

was established, integrating the experience and research outcomes of the preceding years.

In contrast, today’s understanding within the literature is mainly based on the further
development at firms like General Electric (GE) who built the methodology around the focus on
profitability improvement, which is the view used in this essay.

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While at Motorola Six Sigma was the answer to the question how to stay in business, GE has
used it since 1995 to dramatically strengthen an already thriving company (Pande 2000).

Fehr (1999) points out that GE’s approach has only a few elements in common with the quality
management programme developed by Motorola.

GE started its Six Sigma program in 1995 internally and subsequently extended it to acquired

According to Fehr (ibid.), GE acquired in the 1990s more than 100 new business lines for nearly
US$ 30bn. Within the last 7 years they have purchased in average 4 companies per week.

As soon as they acquire a new firm, they apply their Six Sigma approach to improve its
profitability. The efforts also target quality improvement, but only as a means to an end. The
focus of the efforts are seen in a direct and measurable increase of profitability. Börse Aktuell
(2002) cites Jack Welch’s philosophy as “Fix it, sell it or close it”.

“Somewhere in 1999 we passed the line of 100,000 projects” Piet van Abdeelen, head of GE’s
global Six Sigma program, states (cited by Fehr 1999). In 1999, GE planned for Six Sigma ‘net-
benefits’ of about US$ 2bn (Fehr 1999).

3. Underlying Definitions
As the examples show, the core of the difference between traditional TQM and today’s Six
Sigma lies within the definition and vision.

Generally, from the users point of view ‘quality’ can be defined as consistently meeting
customer requirement (Slack et al. 2001, p. 555). The degree of quality can be measured by
how well these requirements are met.

A ‘method’ can be defined as a process to go through, targeting a certain objective. ‘Tools’ are
used within these processes to help or enable the achievement of these objectives.

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3.1. TQM
The notion ‘Total Quality Management’ goes back to Feigenbaum (1957 cited Slack et al. 2001,
p. 674). TQM is a philosophy aiming for the achievement of quality in all products and

The British Quality Association (n.d. cited Burcher 2002, p. 20) defines TQM as “a corporate
business management philosophy which recognises that customer needs and business goals
are inseparable. […] It ensures maximum effectiveness and efficiency within a business and
secures commercial leadership by putting in place processes and systems which will promote
excellence, prevent from errors and ensure that every aspect of the business is aligned to
customer needs and advancement of business goals without duplication or waste of effort by
releasing the full potential of all employees […] It involves every department, function and
process in a business and the active commitment of all employees.”

The focus of this definition, which summarises the core points of many authors, lies within the
totality of this approach throughout the entire organisation, as well as the effectiveness and
efficiency to achieve commercial leadership.

However, a lot of approaches, methods and tools have been developed to achieve its objectives
(e.g. Business Process Reengineering, Continuous Improvement (‘Kaizen’)), but TQM itself
does not suggest any methods or tools which should be used.

3.2. Six Sigma

In contrast, Six Sigma is a business system focusing on the systematic increase of a company’s
profitability by reducing the variability in its processes (Harry and Schroeder 1999). Other
authors like Breyfogle III (1999), Magnusson et al. (2001), or Pande (2001) contribute similar

Therefore, it is not the main focus to achieve virtually error-free products and processes, which
is expressed by the slightly misleading term ‘Six Sigma’. If this would be the focus, Six Sigma
would be in line with the traditional TQM philosophy. It aims to achieve an increase in the
process capability; but only when a measurable contribution to the profits of a firm will be

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A common definition for the philosophy of Six Sigma can be found in a brochure of Viterra
Energy Services (Viterra n.d.): “The aim of Six Sigma is to completely and profitably satisfy our
customers’ requirements on the quality of our products and services.”

Later it is stated (ibid.): “In this regard we created our own Six Sigma department […] that
exclusively concentrates on additional value/ benefit by quality improvements.”

3.3. The Difference between the TQM and Six Sigma Approach
This quite small difference in the definition – the focus of Six Sigma on the profitability of quality
efforts - has major impacts on the design and application of quality management in a client

While the totality – in terms of embracing the entire organisation – of the TQM philosophy is
also part of the Six Sigma approach, effectiveness and efficiency are only contained indirectly.
Effectiveness means that a process delivers the product or service it is supposed to. Efficiency
on the other hand, refers to ‘doing things at lowest cost’.

The difference between TQM and Six Sigma is based on the realisation that doing things
effectively and efficiently does not naturally mean that it is also contributing positively to the
bottom line – namely profits and cash flows. Therefore, Six Sigma considers the provider of
capital as the main receiver of the company’s outcome (Pande 2000).

An example is given by Gabor (2001), stating that one of the biggest differences between Six
Sigma and TQM at Ford is that previous philosophies focused on fixing the problem and did not
worry about the cost.

Furthermore, Six Sigma is not targeting only small scale improvements as suggested by
‘Kaizen’ (Harry and Schroeder 1999). In 1995 GE set the goal to increase its quality by a factor
of 10,000 within 5 years to achieve 6σ quality (Fehr 1999). Such ambitious objectives are
unique within the approaches for quality management.

Generally, within the TQM philosophy the purpose for the existence of a company is seen in
‘meeting customer requirements’ – without customers there is no company. In contrast, Six
Sigma argues that this purpose is the generation of exceptional profits in the long run to ensure

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that the sponsors of capital stay on board. Increasingly meeting customer requirements is seen
as one way to achieve this (Harry and Schroeder 1999).

4. Differences in the Systems, Methods and Tools

4.1. Dimensions of Six Sigma and the Differences to TQM

The above analysis results in a different design and application of the systems, methods and
tools between these both approaches.

Generally, quality management covers three levels within an organisation. The decision for, and
long-term planning of, the application of quality management is a strategic issue. Secondly, the
implementation into the corporate control system lies between the strategic and operational
dimension. Thirdly, the daily work takes place on the operational level.

On this level, Six Sigma covers three core methods (e.g. Magnusson et al. 1999; Pande 2000),
which will be compared with TQM below: Process Improvement represented by the DMAIC
method (Define, Measure, Analyse, Improvement, Control); Product and Process Design
represented by the DMADV method (Define, Measure, Analyse, Design, Verify); and generally a
Process Management.

Then, differences in the cultural implementation will be discussed.

Illustration 1: Design of the Six Sigma Approach

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4.1.1. Comparison: Process Improvement

The DMAIC cycle (Define – Measure – Analyse – Improve – Control) is obviously very similar to
the PDCA cycle (Plan – Do – Check – Act) suggested by W. Edward Deming (1982) (e.g.
Bicheno 2001).

A key believe of the PDCA cycle is the need for continuous quality improvement which is shared
by Six Sigma. This contrasts it sharply from Crosby’s approach which suggests a discrete set of
activities. By this, Deming followed a long-term orientation for management, criticising mainly
the ‘short term profit focuses’ in the American industry (Beckford 1998). He argues that “anyone
can boost the dividend at the end of the quarter. […] (by cutting) down on research, education,
training.” (Deming 1986, p. 99 cited Beckford 1998, p. 68).

Six Sigma adopted the philosophy of a long-term approach towards quality. Training,
continuous improvement, even though in bigger steps, and long-term orientation is a key
element of Six Sigma, explaining why the PDCA cycle and the DMAIC imply a similar
philosophy and approach for problem solving.

However, in contrast, not to Deming’s philosophy, but his approach, short-term profits are the
key source of finance for the Six Sigma quality function of an organisation. Furthermore, the
DMAIC Cycle also suggests a well-proven tool set for each step of this process. Most of them
are well known, but a major difference lies within the ‘Define’ phase, which will be discussed

Within TQM, the starting point for a project is when ‘critical to quality’ customer requirements
(CTQ) are not met satisfactorily. This is different in Six Sigma.

Six Sigma companies, mainly GE, have developed new tools for project appraisal to ensure that
a ‘net-benefit’ will be achieved within a reasonable period of time. The ‘net-benefit’ is calculated
as the total amount of savings within the considered time period minus the total amount of cost
for the project, including personnel.

For example, the best GE subsidiaries only start an improvement project when the ‘net-benefit’
of a project covers its cost three-fold within the first year. This is combined with further selection
criteria; GE selects those projects to be improved which deliver the lowest quality and contribute

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with the lowest profits. According to Töpfer (2000I), these are usually those where the Sigma
level can be increased from one to three - and not necessarily from four to five.

One criticism of this approach is that it is not necessarily the project with the highest long-term
contribution to a firm’s bottom line that will be selected. There might be possible projects which
may negatively affect the company’s bottom-line in the first year, but promise a better return in
the future. However, this ensures that the quality system of a company finances itself.

4.1.2. Comparison: Process Design and Process Management

The Six Sigma process design method and the process management approach are also very
similar to traditional TQM methods.

Six Sigma does not suggest a specific method of process management. Therefore, no
differences to traditional TQM can be identified.

On the other hand, Six Sigma suggests a certain process for designing or redesigning
processes and products, called DMADV (Define – Measure – Analyse – Design – Verify), which
is the most common method under the ‘Design for Six Sigma’ (DFSS) philosophy and also very
similar to Deming’s PDCA cycle.

DFSS refers to doing things ‘right the first time’ when designing a product, service or process –
which is absolutely in line with the TQM philosophy and quite common in many quality
management approaches.

Therefore, the DMADV method and DFSS are not different to TQM. The DMADV method, and
the corresponding toolset, can be seen as a best-practice approach for the design activity.

Examples of the tools used are the ‘Failure Modes and Effects Analysis’ (FMEA), Ishikawa’s
‘Fishbone Diagram’, and ‘Quality-Function Deployment’ (e.g. Slack 2001; Breyfogle III 1999).

4.1.3. Six Sigma within a firms Control System - Example of the Balanced Scorecard
The Balanced Scorecard (BSC) is a popular long-term oriented controlling instrument for the
strategic control of a company and has a key role as a link to the operational level. This

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distinguishes it from purely operational control tools, which accomplish short-term or real-time
measures, and request or demand short-term response (e.g. Control Charts, Dashboards).

The BSC suggests four general perspectives for a balanced representation of the most
important areas of a firm (Norton and Kaplan 1996). These are:
• Processes
• Customers
• Employees
• Finance

The differences in the objectives and design between Six Sigma and TQM result in another
integration in the Balanced Scorecard of a firm, as shown in the following example.

Within the process perspective, the number of defects within the core processes or the number
of improvement projects could be an appropriate measure. Within the customer perspective,
customer satisfaction measures could be used. This is applicable for both TQM and Six Sigma.

However, the Six Sigma role system (see 4.3) usually results in the consideration of a certain
percentage of Black Belts and Green Belts among the employees in the employee perspective.
Furthermore, because of the importance of the contribution to a firm’s profit, ‘net-benefit’
objectives are common in the financial perspective in Six Sigma companies.

4.1.4. The TQM and the Six Sigma View on Cost

The focus on profitability and ‘net-benefits’ also directly results in a different model for the cost
of quality or the cost of poor quality.

Slack et al. (2001, p. 686) describes a common cost model within today’s TQM approaches. He
argues that “TQM rejects the optimum-quality level concept and strives to reduce all known and
unknown failure costs by preventing errors and failure taking place.” He argues that generally
two of four cost categories are open to managerial influence: cost of prevention and cost of
appraisal. The other two – “internal cost of failure and external cost of failure – show the
consequences of changes in the first two.”

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Surely, the underlying assumptions of TQM that prevention efforts have a “significant, positive
effect on internal failure costs, followed by reductions both in external failure costs and, once
confidence has been firmly established, in appraisal costs” (ibid.) have been proven by several
studies. Nevertheless, the probability is very low and no evidence can be found that these
positive effects also take place if only a few defects occur in a process. An improvement project
could cost much more than the sum of all positive effects could compensate.

Therefore, this assumption is rejected by the Six Sigma approach, which is why the ‘net-benefit’
calculation is brought into play.

Töpfer (2000) argues, therefore, that within a framework of this adjusted TQM philosophy and
the Balanced Scorecard as a strategic control element, Six Sigma has higher impact on the
core value drivers of a company than traditional TQM methodology.

4.2. Contrasting Statistical Process Control & Six Sigma Measurement

A defect is a defect. Using the number of defects as a measure of the degree of quality is used
within nearly all serious QM systems. A defect refers to a non-conformance to a certain
requirement to both a control limit within a manufacturing process, as well as a specification
limit by a customer or for a product. Therefore, it is suitable for measuring the degree of quality
for manufacturing and service processes.

Process outcomes usually approximate a normal distribution. Even if not, the means of
repeated samples often do. Therefore, the Sigma level on a normal distribution is a widely used
measure in manufacturing and service quality control, which is a variability measure.

However, a differentiation has to be made. Within the control of machine tools a control chart is
often used to indicate whether the manufacturing process is leaving the tolerance range.
Commonly, this is when it leaves the 99% (≈ ± 3σ) probability zone between the upper and
lower control limits under the normal distribution – a 6σ span. This is often confused with the
target of 6σ quality which means that 99.9999998 per cent of the process outcomes lie within
the defined specification limits for internal or external customers.

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These underlying measures are the heart of Statistical Process Control (SPC) and have their
origins in traditional QM. They have been adopted by Six Sigma and are therefore not different
to TQM.

Also, some further measures are common to both Six Sigma and TQM. These are, for instance,
a customer satisfaction index or system down-time.

However, Six Sigma was the first to adopt new tools and techniques to objectively measure the
monetary outcome of the quality efforts. Applying the tool of a ‘net-benefit’ calculation, Six
Sigma ensures that only those quality efforts are carried out which a) promise the highest short-
term return in profits to the company or b) are essential to stay in business.

Based on the Six Sigma philosophy, the ‘net-benefit’ measure has to be a central element of the
Six Sigma measurement system. In contrast, according to the TQM philosophy this is not the
case in a TQM approach.

4.3. Comparison of the Cultural Implementation

According to Magnusson et al. (1999, p. 88) Six Sigma distinguishes from other TQM initiatives
also by being a single systematic and formalised, as well as company-wide, improvement
methodology. Gill (1990) cites a manager at Motorola who states: “The thing that’s so wonderful
about Six Sigma is that all of us can talk quality for the first time in the same language.”

However, although this also might support the acceptance of quality management in an
organisation, there are some significant differences between in the cultural implementation of
TQM and Six Sigma – mainly based in the description of the quality profession.

The Six Sigma Role System

Six Sigma suggests a single way to systemise the roles within a firm’s quality organisation
which is in contrast to traditional TQM approaches which do not suggest one approach.

The Six Sigma approach to organising the company-wide quality efforts are mainly based on a
hierarchical role system. Töpfer (2000) provides the Six Sigma roles, called ‘Belts’, on the
example of GE. Due to the strong similarities within the widespread literature (e.g. Pande 2000,
p. 123ff; Magnusson 1999, p. 40), this can be seen as a common approach.

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These roles are:

• White Belt: All employees; participation only within the scope of their normal work
• Yellow Belt: Specialists; participates occasionally in projects due to their certain
knowledge; support for the Black Belt in parts of a project
• Green Belt: Executives; part-time collaboration in projects; usually about 1 project/ year
• Black Belt: Project managers; full-time Six Sigma executives; about 10 projects/ year
• Master Black Belt: Coach and Trainer; cross-functional full-time Six Sigma executive;
closely linked with the top-management

These roles are characterised by an increasing level of knowledge and experience. A further
role is the project Champion: As a project sponsor he/she should know how to support a Black
Belt but he/she does not have the authority to issue directives.

In practice, the number and description of the different roles might differ in according to the
organisation size and the design of the Six Sigma programme.

One example of the penetration of these roles throughout an organisation is provided by Fehr
(1999): By 1999 70,000 of the 300,000 employees at GE were trained in Six Sigma; 8,000 of
them were Black Belts.

A significant difference between the Six Sigma role system and all other TQM applications is
that these roles are seen as a professional qualification and are widely accepted, even between
competing companies.

There might be some disagreement about applying this one approach in highly disparate
companies with incomparable cultures. However, it is quite flexible and adjustable to the
specific requirements of different firms. Furthermore, it helps to elevate the status of the QM
profession. Furthermore, everybody is somehow part of this system, which supports awareness
and commitment.

5. The Relationship to common Norms & Awards

A wide range of quality norms and prizes have been established. However, these have different
underlying frameworks and different objectives. Therefore, this section will critically examine to
which extent the most important ones are applicable for TQM and Six Sigma.

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5.1. ISO 9000:2000

The ISO 9000:2000 norm certifies that the quality system of a company fulfils certain
requirements and mainly concentrates on the organisation of the quality management.
Therefore, it does not describe or suggest particular methods and tools to use (ISO 2001).

Due to its practical approach for the design and documentation of the quality management, as
well as reasonable marketing effects ISO 9000:2000 is commonly used for TQM in many
companies – independent of the firm size.

There might be some reasons for Six Sigma companies to certify by this norm. One example is
the necessity of this certification for the participation in some advertised biddings. Therefore,
some attempts to combine the Six Sigma approach with the recently reviewed version of this
norm are undertaken (e.g. Bucher 2000).

However, this is not usual for two main reasons. Firstly, as the above analysis shows (see 4.3),
Six Sigma suggest own ways for its integration in an organisation. Secondly, Six Sigma aims to
distance itself from TQM, but ISO 9000:2000 is most known for TQM.

5.2. European Quality Award, Malcolm Baldrige Award and Deming Prize
The ‘Business Excellence Model’ by the European Foundation for Quality Management (EFQM)
has been introduced in 1992 as a framework for assessing applications for the yearly ‘European
Quality Award’ (EFMQ 2001). This framework is suggesting which areas a successful firm
should cover within its quality system, as well as how the outcomes could be measured.

Thus, management research has developed quite a few ‘Excellence’ based TQM and Six Sigma
approaches which are widely used.

The Malcolm Baldrige National Quality Award (USA), introduced in 1987 by the US Congress,
rewards systems to achieve customer satisfaction (Bhote 1989). Therefore, both TQM and Six
Sigma companies strive for the gaining of this prestigious Award.

In contrast, Deming Prize – established in 1951 in honour of W. Edward Deming – emphasises

a successful application of ‘company-wide statistical quality control’ (ibid.). However, this is also

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in line with both philosophies. Consequently, also this prestigious Prize is the target of both
TQM and Six Sigma companies.

5.3. Summary
Based on the above analysis, both TQM and Six Sigma can always be used within the
discussed frameworks ‘somehow’. However, due to the conflicting philosophies, objectives and
models this only makes limited sense in the case of ISO 9000:2000.

In contrast, all of the discussed Awards/ Prizes are frequently targeted by TQM and Six Sigma

6. Reasons for the Misunderstanding of Six Sigma

Based on the above analysis, three core reasons for the widespread misunderstanding of Six
Sigma in contrast to traditional TQM approaches can be identified.

Firstly, it should be made clear that the phrase ‘Six Sigma’ is misleading – it implies an
emphasis on defect reduction only. The prevalence of the phrase is due to its development at
Motorola where a programme of the same name was targeting total quality and not profitability.

Secondly, due to a lack of explanatory literature, clearly distinguishing between the two views
on Six Sigma is difficult. Many managers might not have recognised the difference, and,
therefore, use the phrase in variant ways.

Thirdly, experience with the Six Sigma approach is a distinctive capability of those firms which
have been using it for some years and understandably, they try to protect this knowledge to
maintain their competitive advantage. Therefore, studies detailing the practical implementation
issues are limited.

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7. Conclusion
In conclusion, TQM can be seen as a philosophy aiming to fully meet customer requirements.
However, although Six Sigma methodology can be used within the traditional TQM framework,
today’s dominant view demonstrates a substantial difference in the two philosophies, resulting
in different organisational design, implementation and outcomes.

Nevertheless, most tools and techniques used within Six Sigma are the same or very similar to
those which are well-tried within TQM approaches. Therefore, Six Sigma is basically also a
‘best-practice’ approach. Nevertheless, some changes like the ‘net-benefit’ calculation took
place to ensure that the differing objectives of the Six Sigma approach can be achieved.
Furthermore, Six Sigma suggests new and proven methods of cultural implementation which
take the dominant models of behavioural science into account.

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8. References
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[Accessed: 22 May 2002].
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HARRY, Mikel J., and SCHROEDER, Richard (1999). Six Sigma. The Breakthrough
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