| In Six Sigma: The Breakthrough Management Strategy Revolutionizing the World's Top Corporations, Harry and Schroeder explain Six Sigma and show how it's working at companies such as General Electric, Polaroid, and Allied Signal. The authors contend that most companies today are working at a sigma level of between 3.5 and 4, and that with just a one-sigma shift, companies will experience a 20 percent margin improvement, a 12 to 18 percent increase in capacity, a 12 percent reduction in the number of employees, as well as a 10 to 30 percent capital reduction. Sigma is a quality metric that counts the number of defects per million opportunities (DPMO). For example, a sigma level of 3.5 means that a process has 22,700 DPMO; a sigma level of 4.5, 1,350 DPMO; and a perfect six sigma, 3 DPMO. |