One of the most popular individuals of the 1980's in the corporate world was W. Edwards Deming.  It was during the 1980's that his genius began to be recognized in the United States.  Actually, this was really a rebirth of his genius as the U. S. corporate world essentially ignored Deming when he first formulated his ideas just after World War II. Some of this can be best put into perspective by reviewing some of his background. (Source: The Deming Management Method, by Mary Walton, The Putnam Publishing Group, New York, 1986)

Deming's Background

Deming was born on October 14, 1900 in Sioux City, Iowa.  Shortly thereafter the family moved to Wyoming.  He attended college and graduated in 1921 with a degree in mathematics.  He pursued a master's degree in mathematics and physics at the University of Colorado.  This was followed by a Ph.D. in physics from Yale.  While in college Deming had many varied jobs.  One series of summers had him employed at Western Electric's Hawthorne plant in Chicago (then employing 46,000 workers -mostly women- to manufacture telephone equipment in a sweatshop environment).  Some of Deming's management philosophy was formulated at the Hawthorne plant where workers were paid piecework, a system that Deming regarded as degrading to workers.

After he received his doctorate, Deming accepted a position with the U.S. Department of Agriculture.  There he became acquainted with Walter Shewhart, a statistician at Bell Telephone Laboratories in New York.  Shewhart had developed techniques to bring industrial processes into "statistical control."  Through his work, Shewhart was able to define acceptable variation (both upper and lower limits) in any aspect of a worker's task.  He had workers charting their own performance and thereby gave them greater control over their jobs.  It was possible for management to define when to act and when to leave things alone. It was Shewhart's theories of quality control that became the basis of Deming's own work.

Deming learned more about statistics.  He studied the work of Ronald Fisher, a famous British professor, and other scholars.  He invited scholars to give lectures to himself and to his colleagues.  This growth in statistical expertise led to Deming being placed in charge of the 1940 census, the first to use sampling instead of 100 percent coverage.

Through the use of statistics Deming was also able to show that statistical controls could be used in various clerical and industrial operations.  For example, he showed that with proper training and expertise, the rigors of inspecting the work products could be reduced substantially.

During World War II, Deming taught the Shewhart methods of statistical quality control to engineers, inspectors, and others at companies engaged in wartime production.  Deming was personally involved in the teaching of 23 courses which consisted of ten-day sessions. In total, 31,000 students were trained.  The national emphasis on quality led to the formation of the American Society for Quality Control in February 1946.
 

The Post-War Era in the U.S.

In 1946, Deming left the census bureau to enter private practice as a consultant in statistics. He was also a faculty member at New York University, as a professor at the Graduate School of Business Administration (teaching sampling and quality control).

He soon found his services needed overseas.  He went to Greece and India.  Then he went to Japan where he was asked to participate in planning the 1951 census which was to include information on housing, nutrition, employment, agriculture, and fisheries.

In the meantime, the U.S. economy returned to peacetime production.  There was an unparalleled demand for consumer goods and no competition.  The U.S. was one of the few developed countries that had been untouched by the ravages of war.  Prosperity was evident in the economy where cars, washing machines, vacuum cleaners, mixers, lawn mowers, refrigerators, stoves, furniture, carpets, etc. were being produced to satisfy the healthy appetite for these goods.  Scientific management was well in place where mass production lines dictated that no worker could worker slower or faster than a given rate, i.e., this was the era of the assembly line.  Scientific management may have been appropriate at the turn of the century when many unskilled immigrants came to the U.S. with limited abilities in the English language and with little education in general.  It was efficient to employ large numbers of workers with each assigned to do very simple tasks.  To counter the labor movement at the time, Taylor's method also afforded little discretion for workers and supervisors.

It was during the post war period that quality was a distant second priority to production,. If products had defects, they were simply sent back to the factory and reworked.  The profit margin was sufficient to cover defects.  The work of Deming that was so helpful to the war effort was suddenly regarded as time-consuming and unnecessary.  By 1949, Deming's influence on the U.S. corporate world had essentially vanished.

Deming in Japan

While forgotten in the U.S., Deming was embraced by the Japanese.  At the time (late 1940's), "made in Japan" was considered worldwide to be synonymous with "junk".  For Japan the situation was different than in the U.S.  Morale in Japan was low.  Many civilians had died during the war.  Once prosperous, Japan not only went without consumer goods, but there was little food.  The Japanese had lost confidence in themselves and their leaders. Deming had to have his meetings with the Japanese approved by the occupied forces that were still in Japan.  These meetings were encouraged, not just approved.

In 1950, Deming was asked by the Union of Japanese Scientists and Engineers (JUSE) to deliver a lecture course to Japanese research workers, plant managers, and engineers on quality control methods.  He gave a lecture to a crowd of 500.  He eventually gave twelve such lectures.  While this was personally gratifying to Deming, he remembered his experience in the U.S. and wanted to avoid the same mistake in Japan.

During his lectures, Deming realized he was not addressing entirely the right people.  He felt that this enthusiasm for statistical techniques would also burn out in Japan.  He decided that he would have to meet with the association of Japan's chief executives.    The arrangements for such a meeting were made.  Deming met with 21 presidents of Japan's leading industries.  He pointed out through this and subsequent meetings that it was not sufficient to put statistical methods into practice in the workplace.  To properly implement his ideas, Deming's approach required a more global look at not just where you are but also at where you are going.  This would include addressing consumer research and looking toward the future and then produce goods for this future market.  Deming pointed out that since food was scarce in Japan that they would have to export products that others would want and then use the revenues to buy food, etc.  He also noted that at the time Japan was tolerating poor quality in their imported goods.  Finished products will be of lower quality if the raw materials are of lower quality.  Deming insisted that quality went from supplier to consumer.  It was not sufficient to focus on the manufacturing processes.  Without a captive consumer market, quality is more important.

Deming was extremely optimistic.  The Japanese were skeptical, but they also felt they had little to lose.  The courses that had been taught in the U.S. during the war were now being taught on a massive scale to the Japanese.  The results were very positive.  Japan quickly rose to become a formidable economic opponent.  Successes were realized within a few months.  Within four years, the demand for Japanese products was worldwide.  The Japanese recognized Deming's contributions in 1951 by establishing the Deming Prize, a silver medal to be awarded to an individual for accomplishments in statistical theory and to companies for accomplishments in statistical application.  The Deming Prize has become a prestigious and a much sought after award.

Deming is Rediscovered in the U.S.

Despite his success in Japan, Deming had all but gone into obscurity in the U.S.  He published over 150 papers on various topics related to statistics.  He remained known more as a statistician than as the consultant that had turned around the economic conditions in Japan.

In 1980, Deming was approached by a Clare Crawford-Mason, a television producer and seasoned reporter.  Mason wanted to interview Deming for a documentary on the economic decline in the U.S.  She got Deming's name from a professor at American University.  She realized when the first interview took place that Deming had something to offer to the U.S. She contacted a high-ranking economics official in the Carter Administration and asked about Deming, but he was not aware of him.  Mason eventually conducted five 5-hour interviews with Deming.  She also interviewed with a few of his clients in the U.S.  When the documentary was aired on June 24, 1980, it's title had become "If Japan Can...Why Can't We?"  The last 15 minutes of the program were devoted to Deming's work at Nashua Corporation in New Hampshire.  The President of Nashua boasted of saving millions of dollars through the employment of Deming's approach.

The day after the documentary was shown, Deming's telephone was bombarded by calls. Many of the callers were desperate.  His work in the U.S. grew enormously.  He was hired by Ford Motor Company, General Motors, Dow Chemical, Hughes Aircraft, etc.  He had many callers requesting that he conduct the four-day seminars, which he was now conducting through the continuing education program at George Washington University. Attendees included representatives from ARCO, AT&T, General Electric, Dupont, GTE, IBM, Longview Fiber Company, Monsanto, Procter & Gamble, Rohm & Haas, Union Carbide, Wang, Westinghouse, etc.  He also was called to consult in London, South Africa, and New Zealand.

Deming's teachings are now being tested in many work settings within the United States. It is not likely that his influence will quickly vanish into obscurity as it did in the late 1940's.

Deming's Basic Approach

Deming's approach to management is to look at the entire organization and to include the workers in the company's objectives.  Every part of the organization, much like any living organism, must be nurtured and cared for.  Deming has devised his 14 points that help to describe his overall approach.  Also, he noted specific diseases that present stumbling blocks.

THE FOURTEEN POINTS

1. Create constancy of purpose for improvement of product and service.  Dr. Deming suggests a radical new definition of a company's role.  Rather than making money, it is to stay in business and provide jobs through innovation, research, constant improvement, and maintenance.

2. Adopt the new philosophy.  Americans are too tolerant of poor workmanship and sullen service.  We need a new religion in which mistakes and negativism are unacceptable.

3. Cease dependence on mass inspection.  American firms typically inspect a product as it comes off the line or at major stages.  Defective products are either thrown out or reworked; both are unnecessarily expensive.  In effect, a company is paying workers to make defects and then to correct them.  Quality comes not from inspection but from improvement of the process.  With instruction, workers can be enlisted in this improvement.

4. End the practice of awarding business on price tag alone.  Purchasing departments customarily operate on orders to seek the lowest-priced vendor.  Frequently, this leads to supplies of low quality.  Instead, they should seek the best quality and work to achieve it with a single supplier for any one item in a long-term relationship.

5. Improve constantly and forever the system of production and service.  Improvement is not a one-time effort.  Management is obligated to continually look for ways to reduce waste and improve quality.

6. Institute training.  Too often, workers have learned their job from another worker who was never trained properly.  They are forced to follow unintelligible instructions. They can't do their jobs because no one tells them how.

7. Institute leadership.  The job of a supervisor is not to tell people what to do or to punish them but to lead.  Leading consists of helping people do a better job and of learning by objective methods who is in need of individual help.

8. Drive out fear.  Many employees are afraid to ask questions or to a take a position, even when they do not understand what the job is or what is right or wrong.  People will continue to do things the wrong way, or to not do them at all.  The economic loss from fear is appalling.  It is necessary for better quality and productivity that people feel secure.

9. Break down barriers between staff areas.  Often staff areas - departments, units, whatever - are competing with each other or have goals that conflict.  They do not work as a team so they can solve or foresee problems.  Worse, one department's goals may cause trouble for another.

10. Eliminate slogans, exhortations, and targets for the workforce.  These never helped anybody do a good job.  Let people put up their own slogans.

11. Eliminate numerical quotas.  Quotas take account only of numbers, not quality or methods.  They are usually a guarantee of inefficiency and high cost.  A person, to hold a job, meets a quota at any cost, without regard to damage to the company.

12. Remove barriers to pride of workmanship.  People are eager to do a good job and distressed when they can't.  Too often, misguided supervisors, faulty equipment, and defective materials stand in the way.  These barriers must be removed.

13. Institute a vigorous program of education and retraining.  Both management and the workforce will have to be educated in the new methods, including teamwork and statistical techniques.

14. Take action to accomplish the transformation.  It will take a special top management team with a plan of action to carry out the quality mission.  Workers can't do it on their own, nor can managers.  A critical mass of people in the company must understand the Fourteen Points, the Seven Deadly Diseases, and the Obstacles.
 The Seven Deadly Diseases

1. Lack of constancy of purpose.  A company that is without constancy of purpose has no long-range plans for staying in business.  Management is insecure, and so are employees.

2. Emphasis on short-term profits.  Looking to increase the quarterly dividend undermines quality and productivity.

3. Evaluation by performance, merit rating, or annual review of performance.  The effects of these are devastating - teamwork is destroyed, rivalry is nurtured.  Performance ratings build fear, and leave people bitter, despondent and beaten.  They also encourage mobility of management.

4. Mobility of management.  Job-hopping managers never understand the companies that they work for and are never there long enough to follow through on long-term changes that are necessary for quality and productivity.

5. Running a company on visible figures alone.  The most important figures are unknown and unknowable - the multiplier effect of a happy customer for example.

Diseases 6 and 7 are pertinent only to the United States:

6. Excessive medical costs

7. Excessive costs of warranty, fueled by lawyers that work on contingency fee.