Six Sigma SpotLight: Dr. Sadri Khalessi, Group VP Quality, ABB

Six Sigma SpotLight is a regular feature of the e-Zsigma newsletter, and allows us to introduce one of the global six sigma community's superstars.

In this issue, we have the extraordinary privilege of featuring Dr. Sadri Khalessi, Vice President of Global Quality for BU-Metering, ABB Inc., (www.abb.com), a leader in power and automation technologies that enable utility and industry customers to improve performance while lowering environmental impact. The ABB Group of companies operates in more than 100 countries, employing approximately 146,000 people.

Dr. Khalessi is a highly-regarded and well-known public speaker who continues to share a wealth of experience with his global audiences, drawing on his work with world-class companies which include Philips Semiconductor, where he served as Director of Global Statistical Process Control/TQM, as well as over ten years of consulting experience on quality and productivity, addressing management and process optimization with high technology companies.

Sadri's academic background includes a BA-Mathematics, MS-Computer Science, (University of London, England), MA-Statistics, and Ph.D.-Statistics, (University of Michigan, Ann Arbor, MI).

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1. News: "I have had the privilege of talking with you at conferences around the world, as well as attending your lectures and workshops, Dr. Khalessi.  While you have always engaged your audiences on a wide range of themes, it seems that one topic that creeps into every discussion is that of "managing organizational change".  Is this subject a personal passion for you, or does this suggest that management of organizational change is the most significant factor in the success or failure of companies who endeavor to deploy enterprise-wide business excellence strategies such as Six Sigma?"

1. Dr. Khalessi: "Thank you for your kind words. Accelerating change is indeed a passion for me because I do believe it is key to achieving process excellence and world class performance. Perceiving the need for the change, initiating the change, and managing the change process are defining properties of organizational leadership."

2. News: "Earlier this year, when you were a keynote speaker at IQPC's Miami conference, (www.sixsigmaiq.com), you talked about ensuring a sustainable six sigma program.  With many companies having deployed six sigma several years ago, and who now struggle with that very issue, what advise would you give them in terms of building a foundation that would ensure a consistent, self-sustaining six sigma strategy - that is, a six sigma program that is robust to the internal and external winds of change that tend to wear away at the foundation of the strategy?"

2. Dr. Khalessi: "First, please allow me to take the liberty of changing the word program to process. Six sigma, or any other sustainable initiative is indeed a process, not an event or a program!  The issue here is mainly the senior management's perception and understanding of the six sigma process. 

Many senior managers turn to six sigma because company XYZ has been successful with it. They connect with six sigma intellectually through the left brain. But they lack passion about it. Six sigma requires the right brain, the intuitive mind, to work in harmony with the left brain, which is the analytic side. 

Many CEOs underestimate the cultural implications of six sigma within their organization. Six Sigma is an epidemic, which must engulf the entire organization. The fever of this epidemic must be most intense in the board room, not on the manufacturing floor, engineering or the logistic department. These operations merely reflect the true mind set of the management, not their apparent pep talk about six sigma. 

Constancy of purpose, as Dr. Deming reminds us, is the key to success here. Six Sigma must become the way we work, not the way we run projects. There is a tendency in many companies to speak of six sigma projects versus non-six sigma projects. If any activity is worth investing resources on it, it must be done the six sigma way."

3. News: "It was mentioned that one of your key projects with ABB was the promotion and deployment of Advanced Flow Manufacturing, (AFM).  What have been some of the major hurdles that you have encountered when implementing Flow Manufacturing at ABB in terms of facilities, technology, education, and established paradigms, and how are you overcoming them?"

3. Dr. Khalessi: "The biggest challenge is to make the transition from the class room to the actual process. Typically in a class room environment many generalizations are made without regards to the realities of the implementation site. These include cultural issues, the work force's intellectual capability to change, the capacity to change, and the attitude. 

How you market the concept and how you communicate the need for change is key. Furthermore, many consulting organizations are not really what they advertise to be with respect to their understanding both the cultural and technical issues of AFM. 

For example, the fact that an initiative worked in automotive does not translate directly in Semiconductor manufacturing. The so-called experts here tend to extrapolate the application too prematurely. Often this happens at the user's expense. 

AFM is a process. It must be married to the existing process in an evolutionary, not revolutionary manner. Many technical problems can arise if the organization does not have a comprehensive MRP or ERP system. 

Typically the AFM consultants down play this issue to get their foot in the door. But the reality is that often organizations do not have full understanding of their ERP systems or they may even have a very primitive home grown system to start with. AFM implementation brings all these inadequacies to the surface. The end result is a less than successful implementation which yields disappointing results." 

4. News: "It is mentioned in ABB's 2001 Annual Report that there will be a focus on three key areas which will deliver the (greatest benefits) in the short term - Supply Chain Management (SCM), Enterprise Resource Management (ERP), and Shared Savings.  What role has and will six sigma play in supporting those initiatives for ABB?"

4. Dr. Khalessi: "Six Sigma methodology is applicable in all of these areas, but it must be applied in an orderly manner. The focus should be in ERP first, the resource management which will bring about the maximum effectiveness with the customer and maximum efficiency for the organization. 

By effectiveness I mean, how well we serve the customer today and how well we anticipate their needs of tomorrow. Efficiency measures the cost of resources we deploy to meet the customer's need.  Clearly resource management is the foundation here. 

Scroll up to right-hand side of page to continue interview...

Sadri Khalessi, Ph.D., Group Vice President, Global Quality, ABB. 
Image courtesy of S. Khalessi and ABB. Unauthorized use not permitted.

Click on image to go to ABB website

Question #4, continued...

Shared services are a major component of the resource management process, because there is a tendency for various organizations to go solo and try to be self-sufficient. If an organization within a group is successful,  (profitable), they are normally given the latitude to create their own company within the company. This is where we go wrong. 

We do not go the extra mile to learn from this successful business and transplant the processes to other areas. Rather than creating a more homogeneous and synergistic organization we will create a few autonomous groups. As a result, the big organization will lack culture and identity. This will lead to duplication of efforts, local optimization, lack of synergism and redundancies. 

Such non-aligned practices and processes, in turn, confuse the supplier base. The chaos from the broken processes will spill over to the supply chain and the vicious circle goes on and on. 

Six sigma is directly applicable to all three phases.  In many cases we must go with DFSS because we will find out, and have found out, that we do not really have a process!  But, where we have existing, working processes, we use DMAIC to start with."

5. News: "The benefits of six sigma have been exalted by many in the financial community, as well as by the companies that have actually implemented the strategy.  When any company, however, lays claim to millions of dollars of savings, how can they be sure that individual six sigma project benefits are, in fact, hitting the balance sheet or income statement?  What are some of your recommendations as it relates to financial accountability for six sigma project benefits?"

5. Dr. Khalessi: "The key is formalization of the improvement process.  This is no different than any other initiative that must be managed through a formal project management with specific goals and ROI’s.  We start with a Project Charter. 

This is a contract between the improvement team and the management. The charter contains a compelling business case. It also clearly states what the problem is currently, what specific goal we are trying to achieve, and by when. What are the financial benefits?  (ABB) have formal templates with specific line items identifying the specific benefits. 

We distinguish between hard savings or direct savings, which comes from the process improvement such as, yield enhancement, cycle time reduction and capacity generation resulting in increased revenues, as opposed to soft savings that involve labor reallocation and other optimizations that improve the enabling processes but do not necessarily result in direct savings.

The financial controller is a key stake holder in all the projects. No improvement is valid unless it is endorsed and verified by the process owner and the financial controller.

It is also important to note that at the Define stage we merely have an expectation and estimate of the benefits. We will have ample opportunities up to the end of the Analyze stage to change or modify the goals and the line items based on what we learn from the data in the Measure and Analyze phases."

6. News: "While not as engaging as attending one or more of the live presentations you make around the world each year, Dr. Khalessi, our readers, as do we, thank you for being in this month's "Spotlight".  Before we close, I would like you to take a few moments and share any closing remarks or thoughts that we can take with us."

6. Dr. Khalessi: "I think (e-Zsigma) and organizations like yours serve a great purpose to build the needed bridge between the informed practitioner and the entrepreneur, and such, I applaud your efforts.

My only hope is that one day the organizations will see six sigma as the comprehensive business improvement initiative - the only one that has all the necessary and sufficient concepts and tools to lead them to operational excellence by managing their processes, and not just their financial results. 

Six sigma must become the way we think and act. It is both strategic and tactical. The boundaries of its benefits are limited only by our ability to comprehend and embrace it."

Rod Morgan, e-Zsigma, Inc. 

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