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Motorola’s Customer-Defined, ‘Six-Sigma Quality | Case Study

motorola six sigma case study ppt

In this article you will learn case study of Motorola which includes history of Motorola, Motorola’ six steps to Excellence and how Motorola has used six sigma today?

Table of Contents

History of Motorola

The first car radio was invented by Motorola, which is how the name Motorola, which means “sound in motion,” came to be.

It created the first two-way radios (also known as “walkie-talkies”) during World War II, and by the 1950s, Motorola was well-known for its consumer electronics products.

Motorola changed its focus from radios and televisions to advanced telecommunications and electronics products semiconductors, two-way radios, pagers, cellular telephones, and related equipment in the 1970s in response to intense competition, primarily from Japanese companies.

However, at the beginning of the 1980s, Japanese rivals were still outpacing Motorola with better products at lower costs.

In the last ten years, Motorola has made a strong comeback. With a 45% global market share in both cellular phones and two-way mobile radios, it currently dominates all rivals in both markets.

After Intel and NEC, Motorola is the third-largest semiconductor manufacturer in the world. Previously in immediate risk of being driven out of the pager industry.

With an astounding 85% global market share, Motorola currently rules that market. Motorola’s amazing success as a leader was made possible by its slavish devotion to quality.

Motorola’s Six-Sigma Quality Goal

Motorola began an intensive campaign to raise product quality early in the 1980s, first by tenfold and subsequently by a hundredfold.

It established the unheard-of “six-sigma” quality goal. The statistical term “six sigma” refers to the six standard deviations from the statistical performance average.

This indicates that Motorola set out to achieve a defect-free product rate of 99.9997%, or less than 3.4 per million manufactured components.

Six sigma ended up being Motorola’s catchphrase. Motorola was honored with one of the first annual Malcolm Baldridge National Quality Awards in 1988, which recognized “preeminent quality leadership.”

The initial focus of Motorola’s efforts was on enhancing product quality through advances in manufacturing.

To stop defects from arising was the aim. By making things right the first time, every time, and developing products for quality from the start.

This frequently entails enhancing product design.

The extremely successful Motorola MicroTAC foldable, hand-held mobile phone features fewer parts that snap together rather than being connected by screws or other fasteners, reducing component flaws and production problems.

Motorola’s Culture

Everyone in the organization needs to be committed to quality in order to meet the six-sigma standard. As a result, Motorola’s fundamental company culture now places a strong emphasis on comprehensive quality.

Motorola invests $120 million a year in training staff members on quality, and it pays them when they get things right.

Motorola holds its suppliers to the same rigorous quality requirements since its products can only be as excellent as the parts that go into them. Additionally, suppliers who complied saw significant improvements in their own quality.

In more recent times, Motorola has shifted its original emphasis from preventing production errors to emphasizing increasing customer-defined quality and customer value.

The vice president of quality of Motorola says, “Quality needs to do something for the customer.”

Thus, “complete customer satisfaction” is the main goal of the company’s quality movement.

“If the customer doesn’t like it, it’s a defect,” is how we define a defect.

Customer Feedback

Instead of focusing simply on manufacturing flaws, Motorola now asks consumers about their quality expectations, examines customer complaints, and reviews service records in an ongoing effort to increase customer value.

Executives from Motorola frequently go to customers’ offices to learn more in-depth information about their needs.

As a result, Motorola’s total quality management program has accomplished more than just reducing product defects. It has also assisted the corporation in changing from an engineering perspective that is internally driven to one that is externally driven and customer-focused.

The quality program at Motorola now encompasses every department and process. It starts from finance, advertising, manufacturing and product development to market research.

Some critics are worried that Motorola’s devotion with quality would cause pricey products to arrive on the market later than expected. According to Motorola, the opposite is true— superior quality is the most affordable option.

The costs of monitoring and correcting errors may be significantly higher than the expenses of doing things correctly from the start. According to Motorola, its quality initiatives over the previous six years have generated savings of more than 83 billion.

Motorola’s pursuit of excellence so goes on. It plans to achieve near-perfection by 2001, with a staggering rate of just one defect per billion products.

Motorola’ six steps to Excellence

Motorola continues to put quality into our products from the beginning, just as it did in the 1960s. However, by offering a structured method for ongoing improvement, the Six Sigma strategy covers every internal Motorola operation.

This is what we refer to as the “six steps to excellence.” They consist of:

✔Determine the kind of product or service you offer.

✔Determine who your consumers are and what they need.

✔Identify your requirements and suppliers.

✔Define your approach to work and your process.

✔Improve processes and get rid of sources of defects

✔Improve the Sigma level over time.

Motorola is continuously attempting to identify, quantify, and get rid of flaws in every process using the Six Sigma methodology.

Additionally, Six Sigma enables companies to keep their attention on the procedures rather than the people. If systems are created to be perfect, individuals will use them to perform perfectly.

How is Six Sigma used by Motorola today?

For Six Sigma, quality is about assisting a business in generating more revenue. Quality in Six Sigma is a value added by a successful business or activity.

Motorola employs Six Sigma to eliminate waste and defects as they are found, maintaining high efficiency. This may occur in the administration or even on a production line.

By reducing variation and eliminating waste (which overlaps with Lean), Six Sigma seeks to improve quality. Motorola was able to provide products and services more quickly and cheaply as a result of this. The three main objectives of Six Sigma are defect prevention, cycle time reduction, and cost minimization.

The efficiency of Six Sigma stems from its capacity to spot and get rid of waste costs, or expenses that don’t add value for customers.

Companies that reject or avoid applying Six Sigma concepts, in contrast to Motorola, frequently have extraordinarily expensive operational procedures. The cost of (bad) quality is typically considerable for businesses operating at low sigma; they frequently spend 25% to 40% of their sales resolving problems.

However, businesses that use Six Sigma often spend less than 5% of their budget on problem-solving. This gap frequently has a significant financial impact.

Companies like General Electric have incurred annual costs of $8 billion to $12 billion as a result. However, Motorola has benefited from and continues to profit from Six Sigma. They were one of its major innovators and have improved it through time. It is not unexpected that they are successful.

Motorola approaches quality from the standpoint of the customer. Motorola only get one chance with each product they offer to positively affect a customer.

They face the risk of losing that customer if the product falls short of their expectations. Simply meeting industry norms is insufficient. Every single product that is delivered to a customer should adhere to a consistent level of quality.

The first twelve years of Six Sigma at Motorola, from 1987 to 1999, produced notable improvements for our company.

Motorola had gotten rid of 99.7% of all in-process flaws by 1999. On a unit basis, the Cost of Poor Quality was decreased by more than 84%. Overall manufacturing cost savings came to more than $18 billion. Employee productivity rose sharply at the same time, rising 12% yearly.

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Six Sigma: A Case Study in Motorola

motorola six sigma case study ppt

A Six Sigma Overview

Nowadays, organizations are constantly striving to understand and meet the customer’s expectations by focusing on the quality of the products offered. Luckily, there are many tools and techniques available which enable management to improve the quality of their products and services. Six Sigma has proven to be one of the most successful tools in this regard. 

Six Sigma is a methodology which uses specific principles and mechanisms that ensure excellence within the organization. The ultimate goal of this methodology is to create products or services with less than 3.4 defects per million products or services produced. Witnessing its benefits, many of world’s most famous and successful organizations have decided to implement and integrate Six Sigma principles in their business processes.

The Beginning of Six Sigma

A look back in history indicates that the implementation of Six Sigma principles was pioneered by Motorola Company in 1980s. Motorola has always been a high tech company, offering highly reliable products. However, by 1970, every business in which Motorola was engaged in, was already targeted by Japanese. 

During that time, Motorola, like many other American companies, was struggling to keep up with Japanese competition. Motorola’s customers were unhappy with the product defects and customer support. On the other hand, Japanese had already built an amazing quality standard that many American companies simply could not keep up with. As a result, dealing with severe financial pressure, Motorola had to take action. 

The top management summoned the Motorola engineers and sought to reduce the amount of errors in their products before they were even shipped out of their factories. They combined all the quality management practices known till that time and created a methodology that would be the baseline of Motorola’s quality improvement program. Bill Smith, an engineer and scientist at Motorola, developed a methodology that would reduce the amount of product defects. He created the original statistics and formulas initiated the implementation of Six Sigma methodology. Convinced in the huge success that this methodology would have, he presented the ideas to CEO Bob Galvin. Bob came to recognize this approach as the solution to their quality concerns. They followed the four phase Six Sigma methodology (measure, analyze, improve and control) and started their journey of documenting their key processes, aligning those processes to customer requirements, and installing measurement systems to continually monitor and improve these processes. 

As a result, Motorola’s performance improved instantly. However, even though they were doing well, the analysis revealed that Japanese were still way ahead of them.

Thus, to remain competitive, top management vowed to make improvements in their quality by tenfold over a five-year period. Initially, this seemed to be impossible, but by the end of 1985, everyone in Motorola had started working toward that goal. 

By the end of the five year period, every business in Motorola had reached their targeted scale of improvement. Motorola managers decided to fly to Japan to better evaluate how their competition was doing, and what they found out was mind-blowing. They saw that the Japanese companies were doing 2000 times better than them. This was due to the fact that Japanese had been using similar technologies for a longer period of time. 

The information unveiled in Japan changed the objectives of Motorola again. The executives became even more ambitious, and decided to set a tenfold target one more time, but deadline was set for a two year period now. Motorola goal for 1992 was to have 3.4 defects per million opportunities. 

After implementing Sig Sigma, Motorola realized how important the methodology had been in improving their processes. In fact, they have documented more than $16 billion in saving as a result of Six Sigma adoption. Therefore, they decided to make the methodology public for every company that wanted to adopt it in their processes. Since then, tens of thousands of companies around the world have been considering Six Sigma as a way of doing business. 

Bearing in mind the previous points, it can be concluded that Motorola implementation of Six Sigma has been a stepping stone in the modern times of quality improvement. We may wonder where will the Six Sigma journey lead us to. This path, however, will certainly be challenging while we seek perfection. But the highly satisfied customers, motivated employees, increased benefits, among many other reasons, lead to believe that the employment of Six Sigma as the best business support will never cease to exist.

Author:   Hana Tahiri is the Portfolio Marketing Manager for Quality Management System and Transportation, Telecom and Energy at PECB. She is responsible for continually conducting research and writing articles and marketing materials related to QMS and TTE. If you have any questions, please do not hesitate to contact her: [email protected] .

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The purpose of this study is to present a complete overview of continuous improvement and justify its supreme importance to present-day organizations. A case is made why organizations should strive to improve continuously. By analyzing the history and evolution of quality and of continuous improvement in specific, it becomes clearer how its concept developed and how today's most popular paradigms and methodologies came to be. Times of economic crisis triggered revolutions in this field and many organizations recovered and rose to the top thanks to their continuous improvement efforts. These paradigms and methodologies — namely Lean, Six Sigma, Theory of Constraints and Lean Six Sigma — are then dissected in order to understand what they consist of, their methods and tools, and their strengths and weaknesses. Through the comparison of the first three methodologies mentioned above, it is shown that neither can be classified as the best. All are effective, but it is up to the organization to find which better suits its strategy and needs. Lean Six Sigma, on the other hand, integrates two methodologies and thus has the potential to provide greater benefits for organizations, although it must still develop further toward an effective integration model. In similar fashion, other hybrid methodologies show signs of potential and therefore are believed to be the future of continuous improvement. A secondary purpose of this dissertation is to identify universal principles common to all continuous improvement paradigms and methodologies. These are rules or "commandments" that hold true for every organization and must be followed if a continuous improvement initiative is to be successful.

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Six Sigma Introduction

  • First Online: 16 November 2019

Cite this chapter

motorola six sigma case study ppt

  • Reiner Hutwelker 2  

Part of the book series: Management for Professionals ((MANAGPROF))

1305 Accesses

Six Sigma is a concept with at least three meanings:

William B. Smith and Mikel J. Harry (1986) developed Six Sigma at Motorola. The trigger was a specific quality problem in Motorola’s semiconductor division and one customer explicitly required a performance level of 6 sigma.

This requirement was the impetus for the development of the DMAIC method and the origin of the name for the whole improvement program (personal message from Motorola).

Jack Welsh (1995) at General Electric perfected the implementation, penetration, and sustainable establishment of the improvement program in the whole organization (Fig. 2.1 ).

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Harry, M. J. (1988). The nature of six sigma quality . Schaumburg, IL: Motorola University Press.

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Shewhart, W. A. (1939). Statistical method from the viewpoint of quality control . Washington, D.C: Reprint of the Graduate School, Department of Agriculture.

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Hutwelker, R. (2019). Six Sigma Introduction. In: Six Sigma Green Belt Certification Project. Management for Professionals. Springer, Cham. https://doi.org/10.1007/978-3-030-31915-1_2

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Six Sigma in Action: A Case Study at 3M

Introduction to 3m.

3M is the world’s 3 rd most innovative technology company that strives to create groundbreaking products. The goal of 3M is simple – create products that make positive differences in everyone’s lives. Six Sigma specializes management strategy method that has evolved and modernized since its origin in 1986. It focuses on proactively deterring issues that will arise in production and corporate operations. Like many companies have begun to do, 3M acquired the Six Sigma management strategy and has revolutionized its infrastructure. The “World’s Most Ethical Company” is now a leading innovator in technology, energy, and more due to the success of the method. Now, 3M offers an in-depth case study to show exactly how Six Sigma transformed their company.

Implementing Six Sigma

Gaining control of 3M in 2001, James McNerney placed the Six Sigma methodology into the backbone of the company. McNerney’s unique, considerate approach led to a four-year overhaul of the manufacturing and production processes. From eliminating waste to improving productivity, this methodology grew revenue faster than ever and continues to lead innovative technologies.

McNerney grew 3M other enterprises such as Global Souring, 3m Acceleration, eProductivity, and Indirect Cost Control. As a result, 3M began 2005 with over 30,000 employees Six Sigma certified, with a minimum Green Belt training for all technical and sales staff. Combining the Six Sigma methodology with a strong leadership, 3M consistently practices an ever-improving production process with increasing profits to match.

In addition to substantial revenue growth, this methodology continues to bring out massive savings and benefits. The 2003 Annual Report states that operating income was amplified by more than $500,000 in 2002 alone as a result of the Six Sigma initiatives. This figure is substantially larger than earlier predictions, and the forecast continues to remain high for the following year, sitting at $400,000, an estimate which was successfully met as reported by the Prudential Financial Conference in September 2004.

The Results

Alongside considerable financial growth, 3M enjoys significant corporate network growth. 3M’s network continues to expand by collaborating with numerous companies on over 250 projects such as Ford, Estee Lauder, Motorola, Wal-Mart, and Procter & Gamble. Mature, effective Six Sigma programs are easily spotted, sharing their knowledge with customers, suppliers, and other important personnel. Only Six Sigma has the tools necessary to transforming your business, with total process improvements and reducing defects. Six Sigma drives growth, reduces costs, increases revenue, and produces strong business relationships with customers that last a lifetime.

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Introduction to Six Sigma. Learning Objectives. The Need for Six Sigma Six Sigma - Vision, Philosophy and Statistical Method Breakthrough Strategy and Focus of Six Sigma Six Sigma System - Black Belts, Green Belts and Management. Why Implement Six Sigma Now?. “Nothing New”

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Learning Objectives • The Need for Six Sigma • Six Sigma - Vision, Philosophy and Statistical Method • Breakthrough Strategy and Focus of Six Sigma • Six Sigma System - Black Belts, Green Belts and Management

Why Implement Six Sigma Now? • “Nothing New” • Most of the Six Sigma tools have been around for decades • Neglected due to difficulty and discipline BUT • Worldwide competition • Makes neglect dangerous • Computing resources • Makes application possible

99% Good is Not Good Enough • 5,000 incorrect surgical procedures each week • 20,000 lost articles of mail each hour • No electricity for almost 7 hours each month • Unsafe drinking water for almost 15 minutes each day

PPM 1,000,000 100,000 10,000 1,000 100 10 1 1 2 3 4 5 6 Where Does Industry Stand? IRS - Tax Advice (phone-in) (140,000 PPM) Restaurant Bills Doctor Prescription Writing Payroll Processing • • Order Write-up Journal Vouchers Wire Transfers Airline Baggage Handling Purchased Material Lot Reject Rate Best-in-Class Average Domestic Airline Flight Company Fatality Rate (0.43 PPM) 7 Sigma Scale of Measure

Six Sigma View of Quality • 100% Inspection Inefficient • Management involvement is KEY • Focus on the Process • Continuous Improvement is a Philosophy of Doing Business • Reduction of Variation

Six Sigma Focus Delighting the Customer through Flawless Execution Rapid Breakthrough Improvement Advanced Breakthrough Tools that Work Positive and Deep Culture Change Real Financial Results Passion + Execution = Fast and Lasting Results

Six Sigma is a Vision The Vision of Six Sigma is to delight customers by delivering world-class quality products through the achievement of Six Sigma levels of performance in everything we do.  6

Six Sigma is a Philosophy The Philosophy of Six Sigma is to apply a structured, systematic approach to achieve breakthrough improvement across all areas of our business.  Philosophy 6

Six Sigma is a Statistical Method • Know what’s important to the Customer (CTQ’s) • Reduce defects • Center around target • Reduce Variation

Breakthrough Strategy Six Sigma – Six Sigma Enables Breakthrough Level Improvement! Six Sigma Breakthrough Strategy • Trained & Dedicated • individuals • Analytical Expertise • > 70% Improvement • per project • Standard Approaches • Current Tools • Kaizen • Lean Manufacturing • Re-engineering • Typical TQM Improvement 1 2 3 Timein Years 4 The problem with continuous improvements as the only goal Organization sees improvement BUT loses the game.

 PPM Process Capability Defects per Million Opp. Six Sigma - Aggressive Goal Sigma is a statistical unit of measure that reflects process capability. The sigma scale of measure is perfectly correlated to such characteristics as defects-per-unit, parts-per-million defective, and the probability of a failure/error.

3s This is a 6 Sigma Process What does a 6 sigma process look like ? m Average Deviation from Mean 1s p(d) 1 2 3 4 5 6 s T USL

Six Sigma - Practical Meaning 99% Good (3.8 Sigma) 99.99966% Good (6 Sigma) 20,000 lost articles of mail per hour Unsafe drinking water for almost 15 minutes each day 5,000 incorrect surgical operations per week Two short or long landings at most major airports each day 200,000 wrong drug prescriptions each year No electricity for almost seven hours each month Seven articles lost per hour One unsafe minute every seven months 1.7 incorrect operations per week One short or long landing every five years 68 wrong prescriptions per year One hour without electricity every 34 years

KPIV f (X) Y= KPOV • Y • Dependent • Output • Effect • Symptom • Monitor Focus of Six Sigma To get results, should we focus our behavior on the Y or X? • X1 . . . XN • Independent • Input-Process • Cause • Problem • Control If we are so good at X, why do we constantly test and inspect Y? * Focus on X rather than Y, as done historically

Strategy of Six Sigma • Identifying critical aspects of the business with problems or opportunities for improvement • Targeting those critical areas and designating improvement efforts as Six Sigma Black Beltprojects • Selecting Black Belts from among the best people to work on the projects--full time • Ensuring these people have the time, tools, and resources they need to succeed • Includes 4 months of extensive Six Sigma training (4 weeks classroom, 12 weeks execution)

Six Sigma System - Black Belts Black Belts lead improvement efforts on projects chosen by their Champions • Dedicated resource of highly skilled, trained and focused individuals • Rigorous selection criteria... among the best people on their site • A Black Belt performs 4 to 6 projects per year with a minimum of 2 years assignment commitment • Results in up to $1M savings/year/Black Belt • The BB ensures that the specific process (sequence) is followed for each project --- Measure, Analyze, Improve, and Control • Focus is on fixing the causes using these tools - Y=F(X) • Utilizes problem solving tools provided through Training and MiniTab statistical software (DOE, FMEA, etc.) • Some Black Belts are selected to perform Green Belt training

Six Sigma System - Green Belts Green Beltsare the professional, salaried employees, including managers, who are not Champions or Black Belts. They have key roles in deploying Six Sigma. • Assist Black Belts in completing sections of their projects • Receive detailed training over the next three years to improve their data collection, analysis and problem solving capability • Will apply their learning in their daily performance of their jobs • Will broadly use many of the Six Sigma methods and tools, including FMEA, DOE, SPC, etc • Will be ready-trained as the first round of Black Belts complete their two-year assignments

Six Sigma System - Management Managementis responsible to help drive the total employee population to a higher level of problem solving proficiency • Identifies their best candidates for Black Belt appointment • Demonstrates high enthusiasm to keep Six Sigma moving forward • Provides the lead at getting Green Belts (including themselves) identified and through training • Asks the right questions to all employees to assure the discipline of Six Sigma and its tool kit are properly and fully exploited • Drives the broad use of Six Sigma methods and tools, including FMEA, DOE, SPC, etc • Owns day-to-day & career management of the Black Belt, including appropriate placement when Black Belt reintegrates

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  4. Motorola Case Study / six sigma birth/Strategic Cost Management & Performance Evaluation/CA final

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  6. Motorola Case Study: Six Sigma Implementation for Business Improvement

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  16. Six Sigma at Motorola

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