What benefits does a Six Sigma deployment offer the small or medium-size company?
Six Sigma offers the small and medium sized companies the same benefits as larger companies: rapid return on investment from projects focused on internal productivity savings or improved revenue generation. Most companies today operate three sigma and four sigma, where the cost of quality is 15 to 25% of their revenue. As the company moves to Six Sigma Quality Levels, their Cost of Quality decreases to a level of one to two percent. These dramatic cost savings come as their quality costs move from “Failure Costs†(such as handling customer complaints, or re-routing customer inquiries or products to address errors) to “Prevention Costs†(such as designing processes to add value to the customer experience). The three Sigma organization’s wasted Failure Cost dollars go directly to the Six Sigma organization’s bottom line, to be re-invested in value-added activities that boost sales. So while the three Sigma organization is forever in “catch up†or “fire-fighting†mode, the Six
