“Companies of all types and sizes are in the midst of a quality revolution. GE saved $12 billion over five years and added $1 to its earnings per share. Honeywell (AlliedSignal) recorded more than $800 million in savings.”
“GE produces annual benefits of over $2.5 billion across the organization from Six Sigma.”
“Motorola reduced manufacturing costs by $1.4 billion from 1987-1994.”
“Six Sigma reportedly saved Motorola $15 billion over the last 11 years.”
It’s hard to ignore those kinds of statements. But is Six Sigma right for staffing and recruiting and more specifically, is it right for your staffing business?
Six Sigma was originally a LEAN manufacturing methodology pioneered by Motorola, though many had helped to design the earlier models before Motorola. It was designed to reduce the costs in manufacturing processes through what amounts to incremental process improvement. The Six Sigma methodology has become very popular for just about every other business model including in our own space by industry giant, Volt Technical Resources.
In a nutshell, it’s still a manufacturing methodology that applies to companies that have good training budgets and time for employees to dedicate to becoming certified (which can take a year or more and $5k-15k in costs.) For recruiting and staffing companies, the advantages remain unclear and the marginal process improvements seem to be better identified through other, more common sense means. Some companies have had good success with Six Sigma implementation and yet others have struggled and even failed under it’s hefty formal identification process for improvement documentation.
So should you spend your training budget on Six Sigma certification? All your friends are doing it. All the big companies are doing it. Seems like a good idea right? I’m not so sure. In my estimation, your training dollars are much better spent on something tangible and on something far more productive, like building a sales department that produces repeatable results. Six Sigma will teach you how many defects you will have per run of screws you produce, but it won’t teach you a repeatable sales methodology that increases your agency’s bottom line. What’s more important to your staffing business….how many defects per million screws you produce or how you can be awash in new sales? I’ll leave you to ponder that question. Of course this is an oversimplification of the full Six Sigma methodology, but when it gets right down to it, the part that applies to staffing and recruiting is common sense in my humble opinion.
I’ve included some resources on Six Sigma below so that you can make up your own mind. The methodology in it’s most simple form is to identify the problem and find a solution. That is the only part of Six Sigma that will apply to your staffing company. The other part is either manufacturing specific or just made-up marketing dribble designed to suck your agency’s training budget dry without producing the least bit of empirical success . I welcome feedback from those that have had success in this area, but I doubt there will be many takers. Invest in your own ideas. You know what will make your staffing business more successful? Investing in verifiable results that add real value to your bottom line.
A good article going further in-depth about Six Sigma and recruiting:
Wiki defines Six Sigma