January 11, 2007 03:30 ET

Six Sigma Saves Fortune 500 $427 Billion

BAINBRIDGE ISLAND, WA -- (MARKET WIRE) -- January 11, 2007 -- Over the past 20 years, use of Six Sigma, the popular business improvement methodology, has saved Fortune 500 companies an estimated $427 billion, according to research published in the January/February 2007 issue of iSixSigma Magazine (

The estimate is based on reported savings linked to Six Sigma in public documents. "Our data also showed that corporate-wide Six Sigma deployments save an average 2 percent of total revenue per year," added Michael Marx, research manager for iSixSigma.

These numbers help explain why Six Sigma adoption has increased phenomenally in recent years. "Our figures show that Six Sigma started out slowly in the late 1980s but then took off in the mid-1990s once people started seeing successes at companies like GE and AlliedSignal," said Marx.

As an indicator of its success, he added, "About 53 percent of Fortune 500 companies are currently using Six Sigma -- and that figure rises to 82 percent when you look at just the Fortune 100."

The research study also breaks down the Fortune 500 industries by Six Sigma saturation level, listing those industries in which all companies have adopted Six Sigma (e.g., aerospace and defense) as well as those industries where the majority of companies have not yet embraced the methodology (e.g., food and drug stores).

"Clearly the market for Six Sigma training and consulting is very much open," said Marx, referring to the 47 percent of the Fortune 500 that have not yet embraced the methodology.

"For years, people have been calling Six Sigma a fad," commented Marx. "But that label doesn't seem to fit something that has a 20-year track record of impressive results and is still expanding."

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