Dr. Deming

1. Quality is the foundation of business success, not profit

Quality is pride of workmanship.

Quality drives profit. Deming argues that focusing on quality leads to lower costs, higher productivity, and increased market share. This contrasts with the conventional view that quality and profit are trade-offs. By improving quality, companies reduce waste, rework, and customer dissatisfaction, ultimately leading to higher profits and loyal customers.

Customer-centric approach. Quality should be defined from the customer's perspective, not just meeting specifications. This includes reliability, ease of use, and overall satisfaction. Companies that prioritize quality create products and services that genuinely improve people's lives, fostering long-term success.

Continuous focus on quality. Deming emphasizes that quality improvement is an ongoing process, not a one-time effort. This requires a shift in organizational culture, where everyone from top management to front-line workers is committed to quality as a core value.

2. Understand and reduce variation to improve quality

Variation is a fact of life.

Types of variation. Deming distinguishes between common cause variation (inherent in the system) and special cause variation (assignable to specific factors). Understanding this distinction is crucial for effective problem-solving and improvement efforts.

Statistical process control. Deming advocates for the use of statistical tools, particularly control charts, to identify and reduce variation. These tools help managers distinguish between normal fluctuations and significant changes that require intervention.

Avoid tampering. Reacting to every fluctuation in a stable system often leads to increased variation. Managers must learn when to take action and when to leave a process alone, focusing on systemic improvements rather than constant adjustments.

3. Continuous improvement is essential for long-term success

Improve constantly and forever the system of production and service.

Plan-Do-Study-Act cycle. Deming promotes the use of this iterative approach to drive continuous improvement. It involves planning changes, implementing them on a small scale, studying the results, and then acting on what was learned.

Never-ending process. Improvement should be viewed as a continuous journey, not a destination. Even when a process or product seems perfect, there are always opportunities for further enhancement.

Innovation and improvement. Deming emphasizes the importance of both incremental improvements and breakthrough innovations. Companies must balance these approaches to stay competitive and meet evolving customer needs.

4. Cooperation, not competition, drives true progress

Cooperation is win-win. Competition is win-lose.

Internal cooperation. Deming argues against internal competition and ranking systems, which he believes create barriers between departments and individuals. Instead, he advocates for a collaborative approach where all parts of the organization work together towards common goals.

Supplier relationships. Rather than pitting suppliers against each other for the lowest price, Deming recommends developing long-term, cooperative relationships with a single supplier for each item. This fosters trust, quality improvement, and mutual benefits.

Industry cooperation. Deming even suggests that companies should cooperate with competitors on issues that benefit the entire industry, such as research and development or establishing standards. This approach can lead to faster innovation and market growth.

5. Leadership must focus on systemic change, not individual blame

A bad system will beat a good person every time.

System perspective. Deming emphasizes that most quality problems are due to systemic issues, not individual failures. Leaders must focus on improving the overall system rather than blaming or punishing individuals for poor results.

Management responsibility. Quality is primarily the responsibility of management, as they have the power to change the system. This includes setting policies, allocating resources, and creating an environment that supports quality improvement.

Breaking down barriers. Leaders must work to eliminate organizational barriers that prevent effective communication and collaboration between departments. This includes aligning goals and incentives across the organization to support quality and continuous improvement.

6. Fear destroys productivity and innovation

Drive out fear, so that everyone may work effectively for the company.

Psychological safety. Deming argues that fear in the workplace stifles creativity, open communication, and problem-solving. Employees must feel safe to express ideas, report problems, and take calculated risks without fear of retribution.

Trust-based management. Leaders should create an environment of trust and mutual respect. This involves being transparent about company goals and challenges, and involving employees in decision-making processes.

Encouraging innovation. By eliminating fear, companies can tap into the full potential of their workforce. Employees are more likely to suggest improvements, experiment with new ideas, and take ownership of their work when they feel psychologically safe.

7. Education and training are critical investments

Learning is not compulsory... neither is survival.

Continuous learning. Deming emphasizes the importance of ongoing education and training for all employees. This includes both job-specific skills and broader knowledge that can contribute to overall improvement efforts.

Leadership development. Managers and leaders must be trained in the principles of quality management, statistical thinking, and effective leadership. This is crucial for implementing and sustaining a culture of continuous improvement.

Long-term perspective. Education and training should be viewed as investments in the company's future, not as expenses. The benefits of a well-trained workforce far outweigh the costs in the long run.

8. The annual performance review is counterproductive

Eliminate numerical quotas for the work force and numerical goals for management.

Flaws of traditional reviews. Deming argues that annual performance reviews and management by objectives are counterproductive. They often focus on short-term results, encourage competition rather than cooperation, and fail to address systemic issues.

Alternative approaches. Instead of annual reviews, Deming suggests ongoing feedback and coaching. The focus should be on helping employees improve and aligning their efforts with organizational goals.

Intrinsic motivation. By eliminating arbitrary performance measures and rankings, companies can tap into employees' intrinsic motivation to do good work and contribute to the organization's success.

9. Adopt a long-term perspective for sustainable growth

A common disease that afflicts management the world over is the impression that their problems are different.

Short-term thinking dangers. Deming warns against the dangers of focusing solely on short-term results, such as quarterly profits. This can lead to decisions that harm the company's long-term viability, such as cutting corners on quality or underinvesting in research and development.

Constancy of purpose. Organizations need a clear, long-term vision that guides decision-making at all levels. This includes a commitment to quality, innovation, and continuous improvement.

Balancing stakeholder interests. A long-term perspective involves considering the needs of all stakeholders - customers, employees, suppliers, shareholders, and the community - rather than prioritizing short-term gains for any one group.

10. Statistical thinking is crucial for effective management

In God we trust; all others must bring data.

Data-driven decision making. Deming emphasizes the importance of using data and statistical methods to guide decision-making. This helps managers distinguish between random variation and significant trends or problems.

Understanding systems. Statistical thinking helps managers understand the complex interactions within organizational systems. This includes recognizing the limitations of simplistic cause-and-effect thinking and appreciating the role of variation in processes.

Avoiding common pitfalls. Knowledge of statistics helps managers avoid common errors, such as overreacting to normal fluctuations or drawing false conclusions from limited data. This leads to more effective and efficient management practices.

Last updated: November 2, 2024