0071417303_Six Sigma Business Scorecard Creating A Comprehensive Corporate Performance Measurement System (2004)

Excerpts from review by Paul Harmon

Praveen Gupta was at Motorola in 1987 when Bill Smith first proposed what has become Six Sigma, and has been working to improve processes ever since. Somewhere along the line Mr. Gupta became focused on the problems of relating corporate goals and profits to process changes. Mr. Gupta describes the history and practices of Six Sigma in a few succinct chapters. He goes on to compare and contrast Six Sigma measures with ISO 9000 measures and the measures used by the US’s Baldrige award system. In the end he concludes that, while each contributes to improved processes, they do not tend to establish clear links to corporate goals, and ultimately, to corporate profits. Or, put slightly differently, there is no way to conclude, from lots of specific Six Sigma projects, whether the organization, as a whole is getting better.

Next, Gupta considers Kaplan and Norton's Balanced Scorecard system. Balanced Scorecard seeks to shift senior management's attention for financial measures to a more balanced set of measures which include: (1) Financial Measures, (2) Customer-Related Measures, (3) Internal Business Operations Measures, and (4) Learning and Growth Measures. Gupta describes the system and some of its successes. He proceeds, however, to argue that, as a generalization, the Balanced Scorecard has been more successful with senior managers than with operations managers.

In other words, Six Sigma focuses on processes, and rather narrowly defined processes at that, and doesn't reach up to link to strategies and goals. Balanced Scorecard starts with the strategies and goals of senior managers and doesn't reach downward to provide direction for managers and employees engaged with lower-level process improvement.

Gupta concludes that a better performance measurement system is required, and proposes it. Gupta's solution is the Six Sigma Business Scorecard. In a nutshell, he attempts to merge the best of the scorecard approach with some Six Sigma measurement concepts. Rather than rely on four sets of measures, Gupta proposes that companies rely on seven, including:

• Leadership and Profitability
• Management and Improvement
• Employees and Innovation
• Purchasing and Supplier Management
• Operational Execution
• Sales and Distribution
• Service and Growth

...I...recommend this book to those concerned with the measurement of corporate performance, with Balanced Scorecard programs, and with Six Sigma programs. Clearly Gupta has thought long and hard about these issues and he provides detailed discussions of many important and difficult issues that those involved in performance management must solve in the years ahead. A company may not adopt Gupta's entire approach, but this book is a valuable sourcebook that describes specific problems and suggests ways of dealing with the shortcomings of existing practices. It will probably inspire others to work on the important problems that Gupta pinpoints. (Business Process Trends 2004-06-02)

Excerpts from article:

New Book Captures Keys to Short- and Long-Term Business Success

...Six Sigma Business Scorecard, published by McGraw-Hill, combines today's most powerful management concepts...The book starts with a comprehensive review of Six Sigma and its ability to generate significant returns by focusing on customer satisfaction and profitability. Gupta then describes the following seven highly critical areas to manage in any organization: 1) leadership and profitability; 2) management and improvement; 3) employees and innovation; 4) purchasing and supplier management; 5) operational execution; 6) sales and distribution; and 7) service and growth. Using these criteria, Gupta develops the Business Performance Index (BPIn), a comprehensive business guide that can judge the overall performance of any organization. The book also portrays how the BPIn can be used to determine a corporate sigma level that is missing in the Six Sigma methodology used today.

Additionally, The Six Sigma Business Scorecard includes an interview with Bob Galvin, former CEO of Motorola, in which he shares his views on leadership performance... (IPC Review 2004-01-01)

Ensuring growth and profitability through performance

 

PLAN * IMPLEMENT * MEASURE * ADJUST * PROFIT

 

"Great book! The readers should keep their highlighters handy for they will find many points that they will want to remember." -- H. James Harrington, Ph.D., Author of Business Process Improvement

 

"Praveen Gupta provides a new framework by merging two powerful performance improvement processes, Six Sigma and the Balanced Scorecard, to create The Six Sigma Business Scorecard." -- A. William Wiggenhorn, Chief Learning Officer, CIGNA

 

"Not many companies have adopted Six Sigma and for good reason: It's a demanding and difficult task. In this book Gupta puts into perspective what for many has been an exercise mired in statistics. For those who succeed in implementing Six Sigma, however, the payoff is huge and this book makes that endeavor realizable." -- Mike Buetow, Editor in Chief, Printed Circuit Design & Manufacture magazine

 

"The Six Sigma Business Scorecard is a powerful way of measuring and insuring success in today's dynamic environment. Based on the proven methodology of Six Sigma, this book is packed with insights that guarantee superior results for any organization." -- Frank Brletich, President and CEO of the Centre for Strategic Management--Chicago, LLC

 

"Gupta’s Six Sigma Business Scorecard is just what a corporation needs to complement its Quality Management System. This book has opened my eyes to what I should be doing as a manager to help my company reach its highest potential." -- Tom Brickey, Quality Manager, Durex Industries

 

Six Sigma has become widely recognized as the most effective tool available to improve business performance and profitability. While numerous other resources cover basic Six Sigma implementation, Six Sigma Business Scorecard is the first to explore the most critical element of its improvement methodology: performance measurements.

 

Without a strong grasp of performance metrics, a company can have no clear, quantitative indication of its quality improvement. Six Sigma Business Scorecard offers a unique approach to measuring performance. Readers will learn how to track their improvements in quality and profitability -- and make critical adjustments if such improvements are not up to expectations -- while implementing Six Sigma.

 

Written by a longstanding practitioner and a pioneer of Six Sigma methodology, this much-needed guidebook delivers a comprehensive performance measurement strategy allowing you to reap -- and quantify -- the many advantages of Six Sigma. You'll benefit from: 

* Key performance metrics for companies already using Six Sigma, to determine their sigma level 
* A well-defined measurement system, that builds on the "Balanced Scorecard," for use throughout a corporation 
* Business Performance Index (BPIn), specifically designed for CEOs, monitor corporate wellness with ease 
* A methodology for effective implementation at all levels in a corporation

 

No matter if your company is involved with Six Sigma -- or if you want to realize its advantages for the first time -- Six Sigma Business Scorecard will show you how to implement a successful and a measurable Six Sigma program.

9 of 9 people found the following review helpful

 

5.0 out of 5 stars CEO'S DREAM BOOK FOR MANAGING BUSINESS PROCESSES March 18, 2005

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4.0 out of 5 stars A Fresh Look at Contructing the Business Scorecard January 5, 2004

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