POLITICS JUNE 13, 2011
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There’s a wry old episode of NBC’s “30 Rock” in which Jack Donaghy and Liz Lemon attend a seemingly fictional “Six Sigma” business conference (motto: “Retreat to Move Forward”) and immerse themselves in the ever-intense world of consulting buzzwords and team-building exercises. “There they are,” says Jack, reverently, pointing to a group of older men, “The six sigmas themselves, each of them embodying a pillar of the Six Sigma business philosophy: Teamwork. Insight. Brutality. Male Enhancement. Handshakefulness. And Play Hard.”
The gag, in part, was an inside joke: NBC’s corporate parent, GE, is a keen advocate of the real-life Six Sigma management strategy, which, at root, just involves using data to improve business practices, but which is often lampooned as a vaguely creepy cult. (It doesn’t help that the program calls for enlisting special experts known as “Master Black Belts,” “Green Belts,” and so forth.) GE bristles at the criticism on its website—“What is Six Sigma? First, what it is not. It is not a secret society, a slogan or a cliche.”—but that hasn’t stopped the snickerers. Tina Fey reportedly carried around Six Sigma for Dummies for a spell, thumbing through its pages for humor material.
Now, however, Six Sigma may be on the verge of becoming the latest political fad. On Tuesday, Tim Pawlenty gave a big campaign speech on the economy and promised that, if elected, he’d apply “Lean Six Sigma” techniques to the federal government and save, quote, “up to 20 percent in many programs.” Meanwhile, a Texas business consultant named Michael George is traipsing around Iowa trying to convince GOP candidates to sign a pledge to adopt Lean Six Sigma techniques that would “eliminate 25 percent of spending per year across the federal government.” (The candidates would also have to attend a two-day Lean Six Sigma seminar.) Newt Gingrich and Herman Cain are on board, and George is holding out hope for a Mitt Romney’s thumbs-up. So what’s going on here? Is there really some magical consulting strategy out there that’s going to solve our deficit woes?
Legend has it (okay, Wikipedia has it) that Six Sigma was first developed by Motorola back in 1986 as a way of cutting down on defects in the manufacturing process. Statistically, a six sigma process was one in which a mere 3.4 products out of every million produced had problems. The idea was that, by investing upfront in data-driven, higher-quality production methods, Motorola could cut down on repair costs. The company has reportedly saved more than $17 billion as a result. Later on, Jack Welch, the former CEO of GE, made it an obsessive focus of his business strategy in the ’90s. “I don't give a damn if we get a little bureaucracy as long as we get the results,” he snarled at his critics in Businessweek. “If it bothers you, yell at it. Kick it. Scream at it. Break it!” To this day, Welch still gives Six Sigma major credit for GE’s turnaround, although the numbers have always been hard to verify.
Such outsized claims have naturally lured out the critics. Other famed consultants, like Joseph Juran, have sniffed that there’s nothing actually new about this fabled strategy, except that “They’ve adopted more flamboyant terms, like belts with different colors.” Skeptical articles in Fortune and Businessweek suggested that the Six Sigma approach was pretty good for improving manufacturing processes, but not great for innovation or the service sector. (When Home Depot’s CEO ordered his employees to go Six Sigma and obsess over data measurement and paperwork, worker morale and customer satisfaction plummeted.) Even Welch concedes in his book Jack: Straight from the Gut, that Six Sigma has its limits: “While it’s worked for many functions at NBC, it hasn’t improved our batting average in picking sitcoms.” (Gawker passes along a tale, possibly apocryphal, that Welch once ordered employees to tally up laughs on NBC’s episodes.)
So is there any reason to think Six Sigma is some miracle government cure-all? In his book, What Is Lean Six Sigma?, Michael George recounts the tale of Graham Richard, a Democrat who became mayor of Fort Wayne, Indiana, in 2001. Richard enlisted a few Green Belts to figure out why the city was churning out construction permits so slowly. One key lesson learned was that crucial documents should be uploaded to a central server so that employees from different agencies could more easily share information. That seemed to help, and Fort Wayne’s permitting process sped up, but it hardly sounds revolutionary.
Or take Pawlenty himself. In 2003, one of his cabinet officials, the head of Minnesota’s Pollution Control Agency, brought in Six Sigma experts to meet with her staff. Again, the agency had been issuing permits far too slowly, and, by the time the Black Belts and Green Belts pored over the data, Politico notes, “the agency greatly accelerated its work and began issuing 70 percent of the permits within that time frame—all without layoffs or relaxing environmental standards.”
That’s impressive, but here’s a caveat. This is hardly some breathtaking secret that only Pawlenty is privy to. The EPA itself touts Minnesota’s success on a portion of its website devoted to “Lean Government.” In fact, the EPA has an entire section detailing the virtues of Six Sigma—along with a slew of other in-vogue management techniques. It’s not as if federal employees have never given any thought to how to improve government efficiency—or that once Pawlenty rolls into the White House with a few consulting buzzwords he learned second-hand, improvements will materialize like magic, and whole agencies will become significantly leaner overnight. While there’s no doubt always room to do better, a lot of this stuff is already being done.
Indeed, Pawlenty is hardly the first politician to promise that he can make government more efficient by applying some old-fashioned private-sector pixie dust. George W. Bush was the self-styled “MBA President,” and Ronald Reagan used to brag about how he implemented “more than 1,600 ... modern business practices” back when he was governor of California. Spending, as we know, still went up under both presidents. In that sense, there’s nothing new about Pawlenty’s boasts. Virtually every former governor talks about how he or she managed—poof!—to shave away waste and fraud in their state. And, it’s true, there are often some real success stories therein. But there’s no case of a politician applying these techniques and getting the sweeping savings that Six Sigma fans are now talking about. And, conversely, often fancy consultants aren't even needed to make government work better. Barack Obama seems to have resurrected FEMA, and all he did was put a guy with actual emergency-management expertise in charge of the agency, instead of (as the CEO president did) a former horse-trading lobbyist. No Black Belts needed.
Then again, it’s always possible I’m woefully underestimating the power of Six Sigma. As one of its advocates, Mikel Harry, told Politico: “It'll strip you buck naked in the middle of the street and leave you pretty exposed, so you got to be prepared for that. It’s a no-BS tool used to bring about achievement in a direct way.” Don’t knock handshakefulness until you’ve tried it.
Bradford Plumer is an associate editor at The New Republic.
18 comments
Paul Krugman has it right: for purposes of budgeting it is best to think of the U.S. federal government as a tremendous health insurer that also has an army. Given that Medicare is already something like 15% more efficient than private insurers, I find it difficult to imagine that Six Sigma's particular brand of management voodoo is going to make much difference. If it could I would have thought that Kaiser or AFLAC or a few of the Blue Cross/Blue Shield would've glommed onto 6-Sig a while ago.
- AaronW
June 13, 2011 at 7:21am
Too bad that Lean Six Sigma and data showing that the the I-35 bridge ranked near the bottom of federal inspection ratings nationwide couldn't help Pawlenty and his Transportation Department identify that the bridge that was about to collapse. Yes, we've heard it all before from Republicans, how their business acumen was going to apply to the Federal Government - George W. Bush, the "first MBA President". We all remember how well THAT turned out.
- dubyadoubte
June 13, 2011 at 8:14am
Again, having a bridge collapse in your capital city isn't exactly a testimonial to your management skills or effectiveness as a Governor. Then again, we set the bar amazingly low for Republicans.
- dubyadoubte
June 13, 2011 at 8:31am
Yeah, I've done Six-Sigma. It's a reasonably good manufacturing quality improvement process. It gets mis-applied quite often to management and service environments. And it's loaded with nice intuitive buzz-words that management can use to appear to be dynamic cost-cutters and problem-solvers, while not actually accomplishing very much. You'd think, after so many years of running on Waste, Fraud, and Abuse, that the Republican Party would be ashamed of having left so much Waste, Fraud, and Abuse in place so that they could run on it again. Or, perhaps the Waste, Fraud, and Abuse they keep pointing to doesn't really exist, at least not in the volume they say it does. Unless, here's an idea, they think all of Medicare/Medicaid and Social Security IS "W,F,and A". That would explain a lot.
- AllanL5
June 13, 2011 at 9:08am
Brad, I don't think you're misunderstanding 6 Sigma all that much. It's fundamentally an applied version of the basic scientific process; test a hypothesis by looking at the data. However Instead of calling it a hypothesis, it's called a goal, but it can be stated in hypothetical terms, e.g. "Defects can be maintained at (some measure)". At that point, it's often basic statistical analysis, or putting the measurements in place to then allow such an analysis, from which conclusions are drawn and actions determined. You could even argue that the final stage, to control and keep the improvement, is analogous to others verifying your experimental results. However it appears that since Pawlenty and co. already have their conclusions (there's 25% waste just sitting around waiting to be found!), I'm not sure of the point in using 6 Sigma. The ROI for public goods is notoriously difficult to measure, making use of the method somewhat questionable. Old fashioned budgeting, where you listed your expenditures by priority, and just stopped when you meet your expenditure limit/goal would appear to be more in order. Sounds like a novel way to justify pre-determined actions, this time hopefully avoiding embarrassments like "curveball".
- Nari224
June 13, 2011 at 9:12am
As for some "private sector pixie dust", I'd note what happened to Motorola after it was taken over by MBAs, and the engineers were pushed out. Perhaps we could do with less of that? If someone could demonstrate how the unprecedented improvements in productivity the private sector has experienced due to globalization and technology can map to the government, I'd be interested. But until then, we're probably better off assuming it's a very different beast. And to be fair, while I have no brief for Pawlenty, the I-35W collapse was a good old fashioned engineering failure, not a result of deferred maintenance.
- Nari224
June 13, 2011 at 9:18am
Wikipedia says that "A clear commitment to making decisions on the basis of verifiable data, rather than assumptions and guesswork" is a distinctive feature of 6 sigma. It is not going to work very well for President Polenta if he remains unable to distinguish between fact and ideology, for example Polenta's fantasies about the relationship between taxes, growth and revenues.
- aduncanson
June 13, 2011 at 9:41am
I worked at Motorola in the late 80s, when they were pushing the whole notion of 6 Sigma techniques. I was directly involved in helping implement 6 sigma processes in the memory division. Other US industrial companies adopted the technique too not long after. As Nari implied, take a look at Moto today; it is a pitiful shadow of what it once was. One thing that helped kill Motorola was 6 sigma replaced thought processes too often; it became a goal in and of itself when it made zero sense. For example, Mot was applying 6 sigma to the number of chocolate chips in their cookies made in company cafeterias. Six sigma makes sense for design/manufacturing processes but it too often gets taken to an absurd extreme in business. I use 6 sigma techniques in my chip designs to guarantee high yields in the manufacturing process but it has no use elsewhere in my job. And Allan is right, 6 sigma has degenerated into a buzz word by the MBA types that have no idea what it is supposed to really mean.
- tmmats
June 13, 2011 at 10:08am
Agree with tnmats - it's a good tool for the right problem. It has good managerial buy in (or at least they "know" it works), although the cynic in me says that's because the last time they were exposed to the scientific process was probably 10th grade, and they didn't understand it then either. Fun anecdote - was actually told by a rather powerful VP that he didn't see the point of the scientific process because what was the point in trying something that had to be wrong (he was confused about hypotheses needing to be falsifiable). Presumably he was breathing that rarified air Seattle likes to talk about. Oh well, he demonstrates his greater value to society by earning considerably more than I do, as he clearly made better choices in life, like studying law at an ivy, rather than actually being able to produce. I hadn't heard about using 6 sigma to optimize the chocolate chips, but it doesn't surprise me!
- Nari224
June 13, 2011 at 10:46am
I knew the type of people that went to business school. They were the ones who spent most of their time at the bars and frat parties, since their work load wasn't nearly as rigorous as us engineers. And when you think about it, that explains a lot of what's wrong with American business. They're a bunch of grasshoppers who thinks they're ants.
- zardoz67
June 13, 2011 at 11:23am
While I think it's nice that conservatives are paying some attention to making things more efficient rather than just dismantling programs they don't like (i.e. living up to their claim of being fiscal conservatives instead of reactionary revolutionaries), $20 says that Six Sigma will quickly become warped into a new excuse to dismantle programs they don't like. Any takers?
- NR857175
June 13, 2011 at 11:24am
"They're a bunch of grasshoppers who thinks they're ants." Great reference, zardoz.
- NR857175
June 13, 2011 at 11:25am
"I don't give a damn if we get a little bureaucracy as long as we get the results!" I'd tentatively welcome a Republican party that 180ed in such a way.
- frippo
June 13, 2011 at 12:00pm
Brad, For a guy who writes so well and with such authority on environmental issues and policy-making -- areas heavily dependent upon the methods of science and upon data driven analysis -- your scorn for the application of such methods to business and governmental processes is very odd, and equally disappointing. There is no doubt ample basis for accusing Pawlenty of offering platitudes based on his second-hand knowledge of a few buzzwords, but the implication of your argument is also that Lean Six Sigma methods are the equivalent of pixie dust (at least outside of the manufacturing sphere). Based on my experience in industry over the past 35 years, there is a huge benefit to be realized by shifting from management by anecdote to an approach that understands the value of process knowledge, measurement of key data, and analyses that are informed by both. I find it very hard to believe that government-run processes are so much more efficient than those in the private sector that Six Sigma should be dismissed with such disdain. Even if some government agencies / departments have already learned to use Six Sigma, even a casual observer would conclude that there is significant room for improvement. Pawlenty's embrace of Six Sigma may be a sham - an attempt to enhance his serious, pragmatic, problem-solving image - but it doesn't mean that there is no merit in the idea. It makes no sense to understate the potential of these methods simply because there is legitimate doubt about the sincerity and substance of Pawlenty's endorsement of them. Neil
- purcellneil@aol.com
June 13, 2011 at 2:01pm
Having spent 40-plus years working in and supporting both government and industry management, I have no question that Six Sigma can be very valuable in the right situation, and that some of those situations occur in the federal government. Which, of course, is exactly why many federal agencies pioneered in its application and continue to use it widely. Outsiders who imagine they are introducing some dramatically new idea to these agencies are in for a shock -- it happens repeatedly with new appointees. I'm not saying that there are no other areas where it can and should be applied, but they are a lot fewer than some outside Six Sigma enthusiasts imagine. Six Sigma is most applicable when you have a complex process that is functioning but has error or reject rates that are uneconomic. When you have a process that is broken or needs to be reformulated and reorganized in a fundamental way there are better approaches than Six Sigma. A consultant who cannot make the distinction isn't worth what you're paying him, even if it's zero.
- NR126407
June 13, 2011 at 2:36pm
interesting thread so I suppose I shall ruin it. Personally, I believe in one beta techniques in life and have been using them all my life, when you get a black belt in one beta you become a Master Beta, so I am one master beta.
- blackton
June 13, 2011 at 6:15pm
I can't believe it -- no one has mentioned Al Gore's Reinventing Government efforts as VP in the 1990's!! Juran was right. Six Sigma is the program du jour for pseudo-executives who chase the latest catch-phrase. It has a reasonable track record in manufacturing, but is difficult to apply in white-collar environments. An effective quality program does not save money by cutting jobs -- it saves money by streamlining processes and avoiding re-work that results from errors. How exactly does that convert into trillions of dollars in federal budget savings? Our "MBA President" presided over eight years of trickle-down GOP approaches. The result: the slowest job growth in decades and then the biggest loss of jobs since the great depression. These candidates, who aided and abetted that disaster, think the same programs that got us in this mess will get us out. Not one of them knows what they're talking about. Not one of them has any idea how to create jobs.
- dianakunkel
June 13, 2011 at 11:26pm
tmmats nails it. Six Sigma and some other like it (I've had to work with a few different programs) are for design/production environments. They're misapplied outside of them. Management likes them regardless, because it helps keep the board asking them what they do otherwise (seriously). Managers can use the 'data' to produce nice charts and graphs using presentation software which look cool.
- jet
June 25, 2011 at 4:32am