WILLIAM EDWARDS DEMING

The origin of his work can be found in the Japanese manufacturing

industry. There he learned about the management principles of
statistical process control (SPC), a precursor of Total Quality
Management (TQM). This is also why William Edwards Deming was
considered to be the most influential non-Japanese person in the
field of the Japanese manufacturing industry.
Statistical Process Control (SPC)
- Statistical process control (SPC) is a method of quality
control which employs statistical methods to monitor and
control a process. This helps to ensure that the process
operates efficiently, producing more specification-conforming
products with less waste
Total Quality Management (TQM)
- is an extensive and structured organization management
approach that focuses on continuous quality improvement of
products and services by using continuous feedback.
- Total quality management originated in the industrial sector of
Japan (1954).

Deming's 14 points
1. Create constancy of purpose toward improvement of product and
service, with the aim of becoming competitive, staying in business
and providing jobs.
2. Adopt the new philosophy. Western management must awaken to the
challenge, must learn their responsibilities and take on leadership
for change.
3. Cease dependence on mass inspection. Build quality into the
product from the start.
4. End the practice of awarding business on the basis of price tag
alone. Instead, minimise total cost. Move towards a single supplier
for any item, based on a long-term relationship of loyalty and trust.
5. Improve constantly and forever the system of production and service
to improve quality and reduce waste.
6. Institute training and retraining.
7. Institute leadership. The aim of supervision should be to lead and
help people to do a better job.
8. Drive out fear so that everyone may work effectively for the
company.
9. Break down barriers between departments. People in research,
design, sales and production must work as a team, to foresee and
solve problems of production.
10. Eliminate slogans, exhortations and targets for the workforce
as they do not necessarily achieve their aims.
11. Eliminate numerical quotas in order to take account of quality
and methods, rather than just numbers.
12. Remove barriers to pride of workmanship.
13. Institute a vigorous program of education and re-training for
both the management and the workforce.
14. Take action to accomplish the transformation. Management
and workforce must work together.

1. Create constancy of purpose

Strive for constant improvement in products and services, with the

aim of becoming competitive and ensuring consistency in the way
business is done, which will ensure retention of employment. Do not
just make adjustments at the end of the production process, but
evaluate if improvements are necessary during the process and get
started immediately.

2. The new philosophy

A new (economic) time offers new chances and challenges, and

management must take responsibility for being open to such
changes. Without change, a company can not sustain itself in a time
when innovation occurs every day.
3. Cease dependence on inspection

End the dependence on inspections and final checks to ensure

quality. It is better to that quality checks take place during the
process so that improvements can be made earlier. This section
links back to the first point, which promotes the importance of
interim improvements.

4. End ‘lowest tender’ contract

Move towards a single supplier for any one item. Stop doing business
and negotiate with suppliers based on the lowest price. It is
worthwhile in the long term to build a good and long-standing
relationship with suppliers, which fosters trust and increases loyalty.
An organisation should be able to rely on their suppliers; they supply
the parts for the production line and are the first link to a high quality
product.

5. Continually seek out problems

Improve constantly and forever. Continuous process improvement of

production and service results in improved quality and productivity,
which in turn leads to cost reduction. This part also relates to the
first and third points. Improved quality leads to less waste of other
raw materials, which subsequently has a cost-effective effect.

6. Institute training on the job

Training and development of employees is necessary for the survival

of an organisation. By integrating it into the organisation, it will be
considered as normal for the employees, as part of their Personal
Development Plan.

7. Institute supervision
Adopt and institute leadership. Leadership needs to be stimulated.
By leading and supervising, managers are able to help employees
and make machines work better. Their helicopter view ensures that
they can see everything that happens on the workplace. They will
also have to delegate more tasks so that they can fully focus on the
big picture.

8. Drive out fear

Fear is paralysing. Therefore, fear must be eliminated on the work

floor so that everyone can work effectively for the company, feel safe
and take risks. Transparent communication, motivation, respect and
interest in each other and each other’s work can contribute to this.

9. Break down barriers

By eliminating the boundaries between departments, cooperation

can be better and different expert teams will understand each other
better. This can be done by, for example, the creation of
multifunctional teams, each with an equal share and open to each
other’s ideas.

10. Eliminate exhortations

Remove ‘stimulating’ slogans from the workplace. Such slogans,

warnings and exhortations are perceived as being patronising.
Quality and production problems do not arise from the individual
employee, but from the system itself.

11. Eliminate targets

No more focus on achieving certain margins; that impedes

professionals from performing their work well and taking the
necessary time for it. Rushing through the work can cause
production errors. Managers should therefore focus on quality
rather than quantity.

12. Permit pride of workmanship

Let employees be proud of their craftsmanship and expertise again.

This relates back to the eleventh point. Employees feel more
satisfaction when they get a chance to execute their work well and
professionally, without feeling the pressure of deadlines.

13. Institute education

Integrate and promote training, self-development and improvement

for each employee. This directly connects to the sixth point. By
encouraging employees to work for themselves and to see their
studies and training as a self-evident part of their jobs, they are able
to elevate themselves to a higher level.

14. The transformation is everyone’s job

Transformation is the work of everyone. Set forth concrete actions to

implement and realise transformation and change throughout the
organisation.

Theory of Profound Knowledge

Profound-having or showing great knowledge or insight.

1. Appreciation for a System

What does Deming mean when he talks about having an

"appreciation for a system"? Appreciation of a system means more
than seeing a system as a beautiful thing! Instead, it means that as a
leader in a company (of a quality improvement project, or any
project, really) you ought to understand the system that you are
looking to manage – and that you should understand that system
thoroughly.

Imagine what might happen if someone who did not understand jets
attempted to fix a Boeing 747 engine. That’s not a pretty picture, is
it? If you do not have an appreciation for the system you are trying to
manage, then you won’t be able to fix it. Gestalt theorists are onto
something when they hint that the whole is greater than the sum of
its parts – if you don’t understand the system you are looking to
improve, then how can you possibly fix any of the parts?

2. Knowledge About Variation

Are the variations you’re looking at in the data set part of the system,
part of a specific cause within the system, or part of some error
outside of the system? You cannot possibly have an answer to this
question unless you have an understanding of the different types of
causes of variation. There are two basic types of causes for
variation:
 Common Cause – Common causes of variation result from
within-system structures and can be predicted with
probabilities. When you’re looking at variation with a common
cause, most likely it is something that is consistent, and does
not have statistically significant value that can be traced to a
specific historical event.
 Special Cause – Variation with a special cause is variation that
occurs unexpectedly. The variation from a special cause can
come after a change in the system (with or without realization
that a change has occurred), and special cause variation
cannot be predicted.
If you are familiar with these two types of causes, and some of the
reasons for variation that typify each cause, then you can be more
ready for undertaking quality improvement efforts. Managers who
are able to detect whether variation is arrived at through a common
cause or a special cause are much more capable of conducting
projects that eliminate variation.
3. Theory of Knowledge

How do you know what you know? Are your facts correct? Is there
another way you could be looking at things? Good leaders in
Deming’s System of Profound Knowledge are able to detect what
theory of knowledge is being used. If you are looking at phenomenon
with certainty, and "fixes" as an end instead of a continual process,
then you are setting your system up for failure.

4. Knowledge of Psychology

Finally, leaders within Deming’s system need to have a knowledge of

psychology in order to pull off effective quality improvement efforts.
Do you know how to motivate team members? Are you familiar with
ways to resolve conflict among team members? These are items that
can make or break your ability to effectively manage a project. A
large part of successful project management involves being able to
work well with people.

PDCA Cycle (The Deming Wheel)

Walter Shewhart originated the concept of the PDCA cycle and
introduced it to Deming. Deming promoted the idea widely in the
1950s and it became known as the Deming Wheel or the Deming
cycle.

The PDCA (Plan-Do-Check-Act) cycle consists of four steps or stages

which must be gone through to get from `problem-faced' to `problem
solved.’ Repetition of these steps forms a cycle of continual
improvement:

Plan for changes to bring about improvement.

Do changes on a small scale first to trial them.
Check to see if changes are working and to investigate selected
processes.
Act to get the greatest benefit from change.

Plan
Improvement is the key factor of the activities. What is the desired
output/situation (Soll) and how do you want to achieve this? It is
important to establish sound, SMART Goals that are in conformity
with all the stakeholders. Furthermore, the available resources
should be investigated in advance.

Do

This is about the implementation and realization of the planned

improvements of the entire process. During the execution phase
there will be continuous measurements and registrations of the
output and relevant information will be compiled.

Check

In this control phase the results of improvements will be measured

and compared to the desired situation. If there are significant
differences (‘planning-gap’) it is important to react quickly and track
down the causes of these possible differences.

ACT

(Re-)Act

Upon detection of outcome differences, it is important to make

adjustments. Measures will be taken to achieve the originally
planned results.

Pro-Act

In complex management processes there is also a Pro-Act phase.

The Pro-Act phase is a design phase which investigates how a new
vision and/or strategy can be developed. New possibilities will also
be examined in order to obtain good results. All collected
information can be used in the Re-Act or in the Plan Phase.

The 7 Deadly Diseases of Management

1. Lack of constancy of purpose to plan product and service that will

have a market and keep the company in business, and provide jobs.

As long as the focus is on short term thinking, management will fail to

plan adequately. Without good long term planning, worker efforts will
be irrelevant: Total Quality Management (TQM) cannot be a fad, as
long-term forward progress should always be the ultimate goal for
any organization.

2. Emphasis on short-term profits.

Short-term thinking - the opposite of constancy of purpose - in order

to stay in business, fed by fear of the push from bankers and owners
for dividends. Boosting short-term profits is easier, at it typically
involves the cutting of any expense related to the long term: training,
quality assurance management, maintenance, etc.

3. Personal review systems, or evaluation of performance, merit

rating, annual review, etc. for people in management, the effects of
which are devastating.

Management by objective, on a go / no-go basis, without a method for

accomplishment of the objective, is the same thing as management
by fear. The essential problem with merit systems is that they reward
results rather than process improvement-results will almost always
have a lot of system luck mixed in. Some managers want to reward
people who cooperate more or who seem to have better attitudes,
and will insist that they can recognize the people who are most
cooperative and have the highest work ethic. Instead, managers
should understand that the best way to develop cooperation is by
focusing on the nature of work environment, not monetary rewards.

4. Mobility of management: job-hopping

The simplest and yet one of the most deadly of quality systems
management diseases, management mobility (or when top
management changes organizations every 3-4 years) means
continuous improvement efforts will be broken and disjointed as new
leaders come on board. With changes in leadership, there is a
change in management philosophy. Managers who have an eye on
the next promotion want results - now - to gain the next rung on the
ladder.

5. Use of visible figures only for management, with little or no

consideration of figures that are unknown or unknowable. Some
facts are simply unknowable. Knowing this, Deming insisted that
leaders must still make decisions and manage a situation. This leads
to a basic dilemma-how do you know what would have happened if
you had kept on your prior course?

How do you put a dollar value on the customer loyalty won through
quality improvement efforts?

You can't, because these numbers are unknowable-and this must be

taken into consideration.

6. Excessive medical costs.

For the economy as a whole, health care as a percentage of overall
expenditures has steadily risen for decades, which gradually pushes
numerous businesses into a state of crisis. Potentially the only
remedy for this disease would be a political system attempting to
reform health care.

7. Excessive costs of liability.

W. Edwards Deming blamed America's lawyers in part for the

problems of American business. The US has more lawyers per capita
than any other country in the world, and they spend much of their
professional time finding people to sue. Like health care costs in No.
6, Deming believed the remedy to this disease will probably have to
come from the government.