Six Sigma and competitive advantage

Abstract

It is claimed that the Six Sigma programme brings competitive advantages to companies that implement it. This paper studies the validity of this claim by positioning Six Sigma in the paradigms provided by the literature on competitive strategy. The main functionality of Six Sigma projects is to improve operational effectiveness and efficiency. A continual improvement of operational effectiveness and efficiency is vital in order to avoid competitive disadvantage, however it is all but straightforward to convert the results into sustainable profitability. It is more about staying in the race than about getting ahead. In order to use Six Sigma strategically, a company should do more than just conduct Six Sigma projects by the book, but develop the competencies that the programme can bring to an organization. These competencies – disciplined and effective problem solving and decision behaviour – have the potential to be a source of competitive advantage, when integrated with a company's strategy.

Keywords:

• Competitive strategy
• total quality management
• quality improvement
• resource-based strategy