Essay on General Electric's Quality Gamble

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General Electric's Quality Gamble

The Implementation of Six Sigma

General Electric (GE) is among the most profitable companies and, according to Fortune magazine, the most admired. It stock is the most highly valued in the world. Some critics would argue, if it's not broke, why fix it? Jack Welch, CEO of GE, believes in the "infinite capacity to improve everything." Why does a company that has experienced so much success recently invests over a billion dollars in a quality initiative? Increased competition has GE adopting the attitude that businesses that stand still become obsolete as businesses that continue to grow pass them by. Also by implementing Six Sigma, GE is preparing itself for future profitability
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The result was a culture of the quality that permeated throughout Motorola and led to a period unprecedented growth and sales. Its genesis lies in a classic stretch-target set in 1981 by Motorola's CEO, Bob Galvin, to his people: effect a ten-fold improvement in product-failure levels over a 5-year period. Bill Smith, an engineer at the company, realized that such results could not be achieved without going into the core of what caused defects in the first place So, he conducted a statistical correlation between the field-life of a product and the number of flaws that had been spotted and corrected while the product was being manufactured. The results arrived at in 1985, turned out to be positive. In other words, if a product had been found defective and corrected during the production-process, changes were high and other defects had been missed and would show up later during usage.
An observation had been made that products rarely failed in the first 3 years of customer-usage. Therefore, the simplest way to prevent product-breakdowns was to ensure that the process prevented defects of any kind, making detection and repair redundant. External

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