The gospel according to Deming: is it really new? (W. Edwards Deming's business management philosophy)

The Gospel According to Deming: Is It Really New?

Who can help being impressed with the economic miracle of Japan? After World War II Japanese products were a joke. Japanese handcuffs, those mysterious cane tubes that held your fingers so securely a friend had to free you, were ingenious but not the cornerstone of economic miracles. Cracker Jack boxes were the appropriate channel of distribution for Japanese products - not car lots, high-tech electronic stores, or precision camera shops.

All that has changed. Today, names like Honda and Sony are associated with products of the highest quality and successfully compete with General Motors, Kodak, and General Electric around the world. Many believe the person most responsible for this turnaround is W. Edwards Deming.

DEMING: THE MAN

W Edwards Deming began his work with the Japanese in 1950 and started that tiny, war-torn nation on the road to manufacturing excellence. Despite his success in the Far East, Deming has been largely ignored in the United States. Only in the 1980s has Deming and his quality movement been discovered in this country. In 1988 the Wall Street Journal cited a Price Waterhouse consultant as saying that "total quality control is the fastest growing part of our consulting business."

The quality movement began with the publication of Economic Control of Quality of Manufactured Products by Walter A. Shewhart of Bell Laboratories in 1931. Deming studied with Shewhart, and during World War II he taught quality control courses as part of the national defense effort. The postwar boom unfortunately lured U.S. manufacturers toward an almost exclusive concern for quantity, and Deming was subsequently forgotten - ignored.

In Japan, however, Deming found a willing audience. The American experience convinced Deming that an effective quality program had to include the ongoing commitment of top management. To build such commitment he developed a series of points, diseases, and obstacles to impress upon management this important responsibility.

Understanding Deming as a statistician is important to appreciate his points and principles because many can be traced to the concept of variation and distinguishing between normal, routine changes in a process versus unusual, abnormal changes that can be attributed to specific causes. Deming notes (1986, p. 20): "The central problem of management in all its aspects ... is to understand better the meaning of variation...."

Because most managers are not familiar with the technical aspects of Deming, they have difficulty with his managerial insights. Admittedly, some of Deming's writings are not easy to read. Perhaps this explains the popularity of his four-day seminars, where the statistical layperson can be brought up to speed.

THE ESSENTIAL DEMING

The basic concepts and principles of Deming's theory can be summarized with reference to his Fourteen Points, Seven Deadly Diseases (actually five, since the last two - excessive medical costs and excessive costs of warranty fueled by lawyers who work on contingency fees - are acknowledged to apply only to the United States), and a varying number of Obstacles. Brian Joiner (1985) developed a condensed form of the Fourteen Points, listing the three essential elements as: (1) quality; (2) scientific approach (focus on processes, not people, and data-based decisions); and (3) all for one or the idea of the team. This final element Joiner considers "absolutely necessary."

Our review of Deming's work leads us to conclude that his points, deadly diseases, and obstacles can be classified under six general headings that have represented recurring themes in management thought. The Figure provides a summary of these themes.

Purpose and Mission of Business Organizations

As with any philosophy of management, the first issue that must be addressed is the purpose of the organization. Moreover, the issue of purpose must be addressed on two levels, as is illustrated in Deming's theory. The first level relates to constancy of purpose; the second focuses on the specific purpose pursued.

Deming states that all organizations face two kinds of problems - immediate ones and those in the future. American companies focus on immediate issues at the expense of the long term. This is why quarterly dividends are more …