Breakthrough Business Results With MVT: A Fast, Cost-Free, "Secret Weapon" for Boosting Sales, Cutting Expenses, and Improving Any Business Process
Charles W. Holland with David Cochran
John S. Wiley & Son (2005)
Holland calls the Multivariable Testing (MTV™) system “the greatest business improvement methodology ever devised” and it was soon obvious to me that Holland really believes that MTV™ really can be and do all that. He cites a number of examples to verify his claim. They include American Express, Boise Cascade, Deluxe, RR Donnelly & Sons, DuPont, Lowe’s, and SBC. He also cites the impressive fact that, years ago, W. Edwards Deming strong recommended him to Ford Motor Company to train managers and suppliers in statistical thinking and quality improvement methods. Since then, his company (QualPro) has been retained by more than 1,000 corporations and completed more than 13,000 projects to provide a range of consulting services that help them to (yes) boost sales, cut expenses, and improve various business processes. “Our experience proves that the results of any process can be improved using MTV if two criteria are met: (1) the process has measurable output and (2) the people in the organization have [their own ideas] about how to improve results.”
The MTV process “is basically testing a lot of different variables/solutions/business improvement ideas all at the same time. When applied to a business problem, it is a 12-step process that starts with dozens of practical, fast, cost-free ideas for improvement and uses advanced statistics to quickly sort out the ideas that will help from the ideas that will hurt or make no difference.” Holland goes on to explain that the essence of an MTV improvement project is rigorous, quantifiable, accelerated learning and the knowledge and understand that result allow organizations to focus their energies on only those actions that matter and make breakthrough improvements in a short time. It is critical that a monitoring system be established to ensure compliance with the new procedure. This ensures that the organization realizes the same dramatic benefits that were achieved during testing.” Holland thoroughly explains the entire MVT process step by step.
PORSCHE'S DEALERSHIPLex 2009-07-24
Wendelin Wiedeking is the Sir Fred Goodwin of Germany. Like Sir Fred, the unassuming-looking Mr Wiedeking once did great things, turning near-bankrupt Porsche into a hugely profitable company. Then his audacious takeover attempt of Volkswagen collapsed under the weight of its debts. Mr Wiedeking is now driving off with a €50m bonus, although schadenfreude may soon replace outrage: he could be dragged before the courts. Other German executives, such as Klaus Esser of Mannesmann, have faced judges over far smaller sums.
The common view is that Mr Wiedeking's departure is also a defeat for Porsche, now saddled with €10bn of debt. But this ignores the broader interests of the Porsche family that a) still controls the sports car maker, which owns 51 per cent of VW, plus options over another 20 per cent, and b) includes VW's very own chairman, Ferdinand Piëch, who wants to leave his family an extraordinary legacy: a recombined Porsche/VW.
With Mr Wiedeking gone, Mr Piëch has had to opt for a less confrontational strategy. Its first step requires recapitalising Porsche SE, the indebted holding company. To do this, the family will “contribute” Porsche Austria, its unlisted car parts distributor, worth some €3bn, into the holding. Ordinary shareholders will meanwhile inject cash via a capital raising. Then the Qataris will take on most of Porsche SE's options over VW; this is their passport into Germany's industrial heartland. Finally, VW will buy a small stake in Porsche AG, the carmaker owned by the holding. This will release cash to Porsche SE. The end result will be a debt-free Porsche SE, owning 51 per cent of VW alongside its minority partners the state of Lower Saxony, with 20 per cent, and the Qataris. The final step is to merge Porsche SE with VW. Even if the Porsche family does not end up with a majority, it will still be VW's largest investor, a remarkable feat. VW, meanwhile, gets the stable investor base it has long craved. It will be impregnable.
文德林•魏德金(Wendelin Wiedeking)就是德国的弗雷德•古德温爵士(Sir Fred Goodwin)。和弗雷德爵士一样，外表谦和的魏德金也曾有过丰功伟绩，将几近破产的保时捷(Porsche)转变为一家极具盈利能力的公司。之后，他 大胆收购大众(Volkswagen)的尝试在债务重压下宣告失败。如今魏德金带着5000万欧元的丰厚奖金离去。不过，幸灾乐祸可能很快就会取代愤怒： 魏德金有可能被告上法庭。其他几位德国高管，例如曼内斯曼(Mannesmann)的克劳斯•埃塞尔(Klaus Esser)，就曾因为小得多的奖金数额被诉诸法庭。
普遍看法是，魏德金的离开也是保时捷的一项失败——该公司如今背负着100亿欧元的债务。但这种看法忽视了保时捷家族更广泛的权益：其一，该家族仍 然控制着跑车制造商保时捷，而保时捷持有大众51%的股权，以及另外20%股权的认购期权；其二，大众的董事长费迪南德•皮耶希(Ferdinand Piëch)本身也是该家族的一员，他希望能给家族留下一笔非凡的遗产——重新合并的保时捷/大众。
魏德金离开后，皮耶希不得不选择一种较为温和的战略。第一步要做的，就是对负债累累的控股公司保时捷SE进行资本重组。为此，保时捷家族将“贡献” 出价值约30亿欧元的未上市汽车部件分销商Porsche Austria，并入控股公司。与此同时，普通股东将通过资金募集进行注资。然后，卡塔尔人将接手保时捷SE的大部分大众认购期权，这是他们进军德国工业 核心地带的通行证。最后，大众将购买保时捷SE旗下的汽车制造商保时捷AG的少量股份，给保时捷SE带来现金。最终结果会是，偿清债务的保时捷SE将持有 大众51%的股权，其它持有少数权益的合伙人包括持有20%股权的下萨克森州政府以及卡塔尔人。最后一步是将保时捷SE与大众合并。即便保时捷家族最终没 能获得多数股权，他们也仍将是大众的最大投资者，这本身也是一项傲人功绩。而大众将获得渴望已久的稳定投资者基础。它将变得坚不可摧。
Lessons in smiling that have left me open-mouthedBy Lucy Kellaway 2009-07-27
In Japan, workers are being subjected to a new sort of control – computer scanning to see if their smiles are wide enough. Every day, staff at 15 railway stations in Tokyo are having to bare their teeth at a computer that rates the curvaceousness of their smile on a scale of one to 100. For those who can't muster a broad enough grin, the computer issues directions on how to improve performance. Lift up the corners of your mouth more, it orders. Staff are then given a print-out of their best smile to refer to as needed.
Oddly, the very same day that I read about the smile police in the east I received an e-mail from the west about a less coercive but no less enthusiastic attempt to get us to beam at each other. Smile and Move is a movement based in Richmond, Virginia, that is peddling its message on Facebook, Twitter, mugs, books, posters and videos. On YouTube, there is a three-minute video trying to brainwash us into smiling. “Love it! Keep it up!” say the comments posted on the site. Later on that same day, I cycled to the dentist and in the waiting room picked up a copy of The Times. The main feature showed a life coach photographed with a pencil clamped between his jaws demonstrating how to improve our smiles.
What is going on? I wondered. Should we all be smiling more?
Certainly not, is the view of the British public. Last week, the BBC website asked people whether they would like more customer service to come with a smile. They mainly replied that no, they would not. They weren't anti-smiling per se, they were anti-smiling-to-order. One man said that if someone was smiling at him for no reason he'd want to knock his block off. Almost everyone agreed that smiling inanely was creepy and made people look like the Stepford Wives – a fake smile was worse than none at all.
While I'm profoundly British in temperament, I'm with the Japanese and Americans on smiling. People serving others should smile more. In fact, anyone who wants to make themselves amiable and get what they want should smile more. I disagree that faking is bad – it is part of what it is to be a good employee.
A smile isn't a gesture of spontaneous joy, it's a social thing. A fascinating experiment was done in a bowling alley that showed that when people get a strike they do not smile as they watch the pins come clattering down. It is only when they turn to face others that their faces crack.
We smile to communicate a message. If you put two macaque monkeys in a cage, they start off pretty tense, as even the slightest movement will have them tearing each other to pieces. After staring at the floor, one of them will bare its teeth at the other to indicate non-aggression. If the other bares its teeth back, the next minute they are stroking each other's fur.
With humans, smiles work in the same way. A smile from someone in a shop, say, is a reassuring gesture and a prelude if not to grooming, then at least to conducting business.
As I sat in the cage of the dentist's waiting room, I watched two other patients arrive. One looked at me and smiled and the other marched straight in and sat down, avoiding eye contact. If I had to start a fight with one of them, I know which it would be.
Smiling comes more naturally to some people than to others and the problem is how best to get unsmiley people to smile more. The Japanese way is flawed not because it's like Big Brother but because it wrongly assumes that a bigger smile is a better one. Last week, I had lunch in a fashionable new Italian canteen in Soho, and the Marlon Brando lookalike who made my tea was unsmiling until, at the last minute, he curled the corners of his lips a fraction. It was more rewarding than if he had given me the full monty.
项新式管理——接受电脑扫描，看他们笑得是否足够灿烂。每天，东京15个火车站的员工都必须在电脑前露齿而笑，由电脑对他们笑 容的甜美程度打分，分值从1到100不等。对于那些笑得不够充分的人，电脑会发出有关如何改善的指令。它会命令道：“嘴角再翘一点儿”。之后，员工会获得 一份打印出来的最佳笑容图，以便需要时参考。
奇怪地是，就在我读到东方实施笑容管制消息的当天，收到了一封来自西方的电子邮件，内容是关于一项没那么强制性、但同样热情的尝试：让我们互相微 笑。“Smile and Move”是一项源自弗吉尼亚州里士满的运动，正通过Facebook、Twitter、杯子、书、海报以及视频等传递着讯息。YouTube上有一个3 分钟的视频，试图说服我们微笑。“爱上微笑！保持微笑！”该网站上的贴子上如是说。当天晚些时候，我骑车去看牙，在等候的地方，随手拿起了一份《泰晤士 报》(The Times)。上面一篇重头特稿展示了一位生活教练用上下颚夹紧铅笔，演示如何改进笑容的照片。
在英国民众的心目中，当然不是这样。上周，英国广播公司(BBC)网站询问他们：是否希望更多的客户服务伴随着笑容而来？他们大部分都回答说不，他 们不希望这样。他们不是反对微笑本身，而是反对标准化的笑容。一位男士表示，如果有人无缘无故地对他笑，他会想去扁他。几乎所有人都认为，空洞的笑令人毛 骨耸然，并且会让人看上去像电影《复制娇妻》(Stepford wives)——假笑还不如不笑。
对于有些人而言，微笑比其他人来得更自然，问题在于，如何才是让不苟言笑的人多笑的最佳方式。日本的方法存在缺陷，并非因为它像《老大哥》（Big Brother，有严格监控别人活动之意——译者注），而是因为它错误地假定笑得越充分越好。上周，我在伦敦Soho区一家时尚的新意大利餐厅用午餐，那 个为我上茶的小伙子长得像马龙•白兰度(Marlon Brando)，面无笑容，直到最后一分钟，他的嘴角才开始微微翘起。这比他露齿大笑的效果更好。
Holding a pencil in your mouth is still worse as a smile enhancer. My husband constantly wanders around the house pen clamped between his teeth, not to help the curvature of his smile but because it's where he stows the pen when not in use. I find the sight of him like this so annoying, that I quite often try to wrest it out from his tightly locked jaws – a tussle that ends with no one smiling.
The answer on smiling came to me as I finished my spell in the dentist's chair. It is to have better looking teeth. I have recently spent a not inconsiderable sum on having my teeth bleached, and even though it hasn't worked as well as I'd like, I'm smiling a lot more to try to get value from my investment.
There is a significant statistical correlation between what the scientists call “smile-related quality of life” and the state of one's teeth. I have found a study that shows those with mobile teeth, missing teeth or deep gum pockets barely smile at all.
One of the saddest messages on the BBC website was from a former maths teacher who could not afford to have the two crowns at the front of his mouth replaced. “My smile, my teeth are all part of what makes me a good teacher. So now I am a virtual recluse – on the scrap heap of life.”
Unlike the maths teacher, Gordon Brown could afford to get his teeth fixed and smiles all the time. So much so that he is now ready for the smiling advanced class: learning how to identify the occasions on which smiling is not appropriate.在嘴里夹一根铅笔、以此强化笑容的方法更糟。我丈夫经常用牙齿噙着钢笔，在房里走来走去。这不是为了让自己笑得更甜美，而是因为他不用钢笔时，就会把钢笔放在那里。我很讨厌看到他这副样子，以至于我常常会试图从他紧闭的双鄂中把笔夺下来——这种争斗通常不会以笑容收场。
- Date: July 20th, 2009
- Author: Rick Freedman
The TV connection
In 1967, Motorola released its Quasar model, which was the first all-transistor TV sold in America. The innovative design featured modular, solid-state components in a drawer that could be pulled out and serviced, enabling technicians to access and replace parts quickly and more efficiently. It was plagued with so many quality issues that any productivity gains enabled by the new design were eroded by the need for constant warranty repairs just to keep customers’ TVs working.
Motorola management proved unable to resolve the quality problems with the Quasar TV, so the company decided its best option was to sell the brand, thus beginning the migration of consumer electronics from the United States to Japan. In 1974, Motorola sold its TV division to Matsushita, the Japanese company now known as Panasonic.
Using quality concepts that were gaining wide acceptance in Japan — including Total Quality Management (TQM) ideas that originally imported into Japan by American advisors such as W. Edwards Deming and Joseph M. Juran — Matsushita management was able to reduce defects by 95%, using existing Motorola designs, work-teams, and technology. Matsushita management demonstrated that the problem was management’s fundamental approach to manufacturing; this inspired a member of that Motorola management team to later admit, “Our quality stinks!”
Out of adversity, Motorola sensed opportunity. Bob Galvin, Motorola’s CEO at the time, began the development of a quality program that evolved into Six Sigma; it turned Galvin into a business celebrity, and it eventually led Motorola to win the first Balridge National Quality Award in 1988. Galvin used Motorola’s recognition to publicize his firm’s Six Sigma programs, which have since been adopted by such organizations as GE and American Express, as well as hundreds of smaller firms worldwide. While Motorola has struggled of late in its core businesses, its business line of training Six Sigma practitioners from other firms has been a constant growth area.
Statisticians will recognize the concept of sigma, or the Greek letter σ, which signifies the variability in a process or a statistical sampling. In its most mathematical application, sigma is used by efficiency experts to measure companies’ performance by analyzing the number of defects in its manufacturing procedures. The Six Sigma standard of 3.4 problems per million opportunities represents about as error free a process as humans can deliver, and it’s a far cry from the 67,000 defects that typical companies previously accepted as the norm.
This use of statistical language often leads to the unfortunate conclusion that Six Sigma is a dry and mechanical method, solely focused on driving errors and defects out of manufacturing processes. While defect reduction is an element of the Six Sigma approach, Six Sigma has evolved from a statistical quality-control method to a customer-focused philosophy that challenges organizations to change strategies, focus, internal procedures, and business models. As Rey Moré, Motorola’s Chief Quality Officer, told the 2009 iSixSigma Conference, Six Sigma has evolved from metric, to methodology, to a catalyst to drive change in the organization.
Six Sigma (as currently practiced) is focused on improving quality in all business endeavors, from manufacturing and assembly of products to customer sales and service. The Six Sigma philosophy starts with a very simple and obvious idea: defects cost money.
Studies show that organizations operating at lower levels of defect prevention, categorized as three or four sigma in statistical terms, tolerate errors of between about 6,000 to 65,000 defects per million, and, more importantly, spend between 25% and 40% of its revenues fixing these problems. Six Sigma companies, on the other hand, spend about 5% in defect remediation. This “cost of quality” has been one of the key drivers of Six Sigma adoption; Jack Welch of GE fame estimated that GE’s adoption of Six Sigma methods saved the company almost $12 billion annually.
Another core element of the Six Sigma philosophy is the application of science and data, rather than politics and hierarchy, as the driver of change. Just as the requirement for observable, measurable data drives scientific debate about, for example, the efficacy of a new drug, Six Sigma practitioners (often known in the Six Sigma lexicon as “black belts”) insist that decisions that affect the business’ performance, processes, or strategies be based on empirical data, analyzed in a scrupulous manner and tested for veracity in the real world. By applying a simple performance improvement model called Define-Measure-Analyze-Improve-Control (DMAIC), Six Sigma practitioners assist organizations in achieving the highest level of perfection possible in the business environments in which they operate. DMAIC is simply a refinement of the well-known scientific method of inquiry optimized for the business environment.
Practitioners are not naïve enough to believe that simply by applying scientific methods we can squeeze all of the politics, culture, history, and resistance out of an organization. In fact, the modern application of Six Sigma has benefited tremendously from some of the errors of earlier process improvement methods such as Business Process Re-engineering (BPR). Most business analysts now agree that BPR foundered on the idea that processes can be redesigned and optimized without much attention paid to the emotions of, and the impact on, the people involved. Six Sigma practitioners now emphasize this “Change Agent” view of their work as much as, or even more than, the statistical and scientific elements.
Six Sigma Handbook
Tom Pyzdek, author of the comprehensive Six Sigma Handbook, notes that organizations undertaking a Six Sigma program need to change in three domains:
- The way people in the organization think: focusing on the individual thoughts, expectations, and conclusions, of the members of the organization;
- The norms: often referred to as corporate culture, every organization has standards, models, and patterns which guide behavior;
- Systems and processes: this is the core work of the Six Sigma practitioner, but can’t be sustained without the success of the prior two organizational changes.
While the benefits of Six Sigma are compelling, the difficulty and complexity of a far-reaching change program are daunting. Pyzdek suggests that the average time to achieve benefits from a Six Sigma program can be more than three years — a period that many enterprises simply don’t have the organizational patience to endure. Still, companies that do take the plunge are rewarded. For example, in a recent study by the American Society for Quality (ASQ), 90% of hospitals that deployed Six Sigma saw improvement in their admissions and discharge processes. 89% in radiology/imaging and 88 percent in pharmaceutical services . With the current focus on the cost and efficiency of health care in the United States, these results are compelling.
Considering the fact that the Six Sigma Handbook runs to over 800 pages, it should be clear that this introductory article is a condensed fly-by of this complex topic. For those who wish to delve more deeply into this topic, the literature is rich, and organizations such as Motorola University and ASQ offer courses and certifications to aspiring black belts.
Six Sigma has been applied to almost every conceivable business endeavor, from software development to project management, and prepares consultants and managers for one of the most important and difficult tasks any leader can undertake: changing the organization for the better.
Tuesday, August 4, 4:00 p.m.
J. Stuart Hunter is professor emeritus of the School of Engineering and Applied Science at Princeton University. In addition to a PhD in experimental statistics that he earned in 1954, Hunter holds a BS in electrical engineering and an MS in mathematics from North Carolina State University. Through his numerous groundbreaking technical contributions, Hunter has both expanded the horizons of the applications of statistics in business and industry and made statistical methods more accessible and understandable to countless practitioners. He knew and admired W. Edwards Deming and his work.