Out of the Crisis - still relevant

I’ve had Dr. W. Edwards Deming’s Out of the Crisis sitting in my to-read pile for longer than I can remember.  I might have even started it several years ago, but put it down.  This time, though, I got through it fairly quickly.  I suspect the things he wrote about 30 years ago are resonating with me now more than they did when I first took a peek.  There are certainly a lot of very familiar ideas in this book.

The crisis in the context of this book is the decline of American (US) industry, as it was seen in the late 1970’s and early 1980’s. The book was published in 1982, following Deming’s many years consulting with companies all over, particularly  in Japan since the 1950’s.

The books’ mantra: The basic cause of sickness in American industry … is failure of top management to manage.

Deming repeats the main mantra over and over: Management owns the system. It is the system that generates the results.  If those results are unacceptable, it is management’s responsibility to investigate and improve the system. Repeatedly. This is continuous improvement and is the only way to survive. Management should not pin the blame on their employees, the equipment, their suppliers, their customers, the weather, or anything else. Management are responsible. Period.

In particular, he condemns the lack of understanding of variability and the resulting ill effects that this generates in business.  Uncertainty and variability exist in all systems. Management should know how to analyze the system - and analyze recommendations for improvement to the system.

Deming’s world and specialty is that of statistics.  So when he talks about the system, he is talking about the system generating measurable output that one can analyze for common cause (within the statistical system) or special cause (outside of the statistical system).

One of the specific things that came from Deming and are reported in this book (possibly for the first time when it was published) were Deming’s 14 Points for Management (paraphrased here) and reported in many many places:

  1. Create constancy of purpose
  2. Adopt the new philosophy of management
  3. Cease depend on inspection to achieve quality
  4. Stop awarding (and taking) business based on price tag
  5. Improve the system constantly and forever (from the perspective of the customer)
  6. Create on the job training
  7. Leadership - how do we supervise management (not just the workers)
  8. Drive out fear
  9. Break down barriers between departments
  10. No more exhortations! 
  11. Eliminate work quotas and management by objective
  12. Remove barriers that rob people of pride of workmanship
  13. Institute vigorous programs of education and self-improvement
  14. Transformation is everybody’s job

A challenge I have with the book - and maybe this is why I put it down the first time - is that he is very strident in his voice in this book.  I think that is intentional, but many of the chapters have the tone of a talk where he really trying to twist the knife of the message he is sending.

Some fun quotes and comments I highlighted as I read:

  • “Defects are not free. Somebody makes them, and gets paid for making them.” (p. 11). This made me think of David Anderson’s comments about the Vice President of Delay. Who gets paid for creating a system that generates poor results? Who gets blamed?
  • “Gadgets … are not the answer either.” (p. 13) and “We doubt that new machinery would bring any improvement. … [It] would bring on a whole new set of problems until management understand what is wrong under present circumstances and what their responsibilities are for improvement.” (p. 400) Automating a broken system, and you get automatically broken results.  And you probably can blame the technology (instead of management - the owners of the system).
  • Constant improvement (point 5 above) makes me wonder about how to maintain the drive. Which then makes me see a connection to Kotter’s concept of urgency. Both creating urgency and this constant drive to improve are not once-in-a-while activities.
  • “There is widespread resistance of knowledge. Advances of the kind needed in Western industry require knowledge, yet people are afraid of knowledge. Pride may play a part in resistance to knowledge. New knowledge brought into the company might disclose some of our failings. A better outlook is of course to embrace new knowledge because it might help us to do a better job.” (p. 59). 
  • “Companies take inventory of physical property, but they fail in taking inventory of knowledge.” (p 472) A topic that has been highlighted by the intellectual capital crowd in the 1990’s.  
  • “Why is it that every endeavor to put out a product or service is one of a kind?” (p. 164) Deming had an interesting thread through the later chapters around this “one of a kind” idea. Why is it that organizations never seem to learn from the last time? Why do they seem to run into the same roadblocks every time? 
  • Chapter 9 on “Operational Definitions, Conformance, Performance” was a great discussion of language and being clear what we mean when we set requirements and specifications for results. 
  • “We shall speak of faults of the system as common causes of trouble, and faults from fleeting events as special causes.” (p 314) Always a good reminder on this terminology.
  • “The company has several products. One of them is fires, and their production of fires is stable.” (p. 323) A specific example of the system generating results that management don’t want, but it is a great example of the system being the problem, not necessarily the people in it.
  • One more time: “The central problem in management, leadership, and production … is failure to understand the nature and interpretation of variation.” (p. 465)

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