Intellectual Property Law

Tension between Quality Methodologies/Six Sigma and Innovation

By Harry Boadwee

Business Week ran an interesting cover story about the tensions between quality methodologies such as Six Sigma, and innovation and creativity.

In sum, "while process excellence demands precision, consistency, and repetition, innovation calls for variation, failure and serendipity."  According to Management Professor Vijay Govindarajan, "the more you hardwire a company on total quality management, [the more] it is going to hurt breakthrough innovation.... [t]he mindset that is needed, the capabilities that are needed, the metrics that are needed, the whole culture that is needed for discontinuous innovation, are fundamentally different." 

The article mentions one Wharton/HBS study that found Six Sigma leads to incremental innovation rather than "blue sky" work.  After a quality program, patents issued based primarily on prior work (incremental improvements) made up a "dramatically larger" share of the subject companies' portfolios than patents not based on prior work.

It also mentions that several companies, including 3M and Young & Rubicam, have pulled back from their focus on quality methodologies.

What to do?  In the same issue, consultant Jeneanne Rae suggests creating an ambidexterous company, which would reserve process improvement approaches to cases where they are truly needed to cut costs and improve profitability.  She advocates maintaining a separate organization with its own incentives and talent to produce radical innovation.

Source: "At 3M, a Struggle between Efficiency and Creativity," by Brian Hindo, BusinessWeek, June 11, 2007.

Full post as published by AS-IS Blog on June 08, 2007 (boomark / email).