Motorola has been known as an innovative and technology driven company. It has been among the early ones to use six sigma quality and 10X cycle-time reduction strategies among its competition. However by year 2000, it started to suffer almost generating no profit at bottom line even though having a sales of USD $27 billion. After initially unsuccessfully trying out the strategies of laying off workers and closing don factories to cut costs, it rightly laid the stress on process driven improvements. This initiative was called Digital six sigma and incorporated Web-based training tools, modelling and simulation tools, digitized process compliance and quality measurement tools. The aim was to do a USD $3 billion cost reduction within 3 years, as there was a lack of profitability. It was a decentralized business model with a great amount of independence being given in how every unit run their business. For the success of digital six sigma stress was laid on collaborating the various activities happening in company and reducing costs by coordinated buy-ins. Global synergy teams were formed and functional areas for improvement were targeted. Various areas that were targeted were:
· Customer service and support
· Sourcing and supply chain
· New product introduction
An assessment was conducted to discover where each sector was in terms of self-service capabilities. Exploratory findings were found on not yet identified strengths and weaknesses and opportunities. Cisco help was brought in and Motorola teams attended sessions with them to learn about industry best practices. It was worked upon how Motorola could take advantage of networking and Web tools in areas of service and support and implement automatic contract management, software downloads and update product specifications. Web automation was also implemented for requirement gathering and remote monitoring methods.
As a result Motorola was successful in saving nearly USD $3 billion in less than years by process improvements. This method was termed as digital six sigma.
References : http://www.cisco.com/web/about/ac79/docs/success/Motorola_Final.pdf
The writer of this article, Naman Jain is a PGP student of Indian Institute of Management, Raipur . He has done his B.Tech in Computer Science & Engineering from Vellore Institute of Technology, Vellore and can be reached at namanvit @ gmail . com