Deming’s 14 Points for Management Although Deming espoused the belief that theory was important to the understanding of quality improvement, the closest he ever came to expounding a theory was in his 14 points for management. The foundation for the 14 points was Deming’s belief that the historic approach to quality used by American management was wrong in one fundamental aspect: Poor quality was not the fault of labor; it resulted from poor management of the system for continual improvement. Although this might now seem obvious, at the time Deming taught this, it was a revelation to managers. Taken as a whole, the 14 points for management (see Table 2-2) represent many of the key principles that provide the basis for quality management in many organizations. Create constancy of purpose toward improvement of product and service with the aim to become competitive, stay in business, and provide jobs. Constancy of purpose means that management commits resources—over the long haul—to see that the quality job is completed. This is in contrast to managers who want to achieve quick returns and get bottom-line results after embarking on quality “programs.” In recent years, more people have come to realize that U.S. management is too short-term-oriented in its thinking. Unfortunately, quality improvement requires time to be effective. The Japanese experience was instructive. Deming helped to begin the Japanese quality revolution in the early 1950s. As already stated, the Japanese displayed remarkable commitment to and focus on quality improvement. Even with all this effort, the Japanese were not really recognized as world leaders in quality until the late 1970s. Adopt a new philosophy. We are in a new economic age. Western management must awaken to the challenge, must learn its responsibilities, and must take on leadership of change. Planned obsolescence was the order of the day when Deming first discussed the new economic age. During this time, automobiles were designed to last 80,000 miles. Deming referred to an age in which Americans would no longer accept defective products. Now that many firms have excellent quality at a reasonable cost, they are turning to service quality to make the next big advances. More and more, specification measurements are being replaced by customer service metrics as the important measures of quality. Cease dependence on mass inspection to improve quality. Eliminate the need for inspection on a mass basis by building quality into the product in the first place. In many companies still, the “quality department” performs in-process and final inspection of a product. In this scenario, responsibility for quality lies with the quality department. However, by the time the quality department inspects the product, either the quality is built in or it is not built in. At this point, it is too late to add quality. Deming’s alternative is quality at the source. This means that all workers are responsible for their own work and perform needed inspections at each stage of the process to maintain process control. Of course, this is possible only if management trusts and trains its workers properly. End the practice of awarding business on the basis of price tag alone. Instead, minimize total cost. Move toward a single supplier for any one item, based on a long-term relationship of loyalty and trust. Traditionally, U.S. firms maintained many suppliers. The theory behind this approach was that competition among suppliers would improve quality and decrease cost. In reality, however, the existence of many suppliers caused an overemphasis on cost and an increase in variability. For example, if a metal fabrication company has multiple suppliers, the result is great variability in the makeup and consistency of the incoming stock. The alternative supply chain approach used by many firms is single source purchasing. This approach minimizes the number of suppliers used, resulting in decreased variability. Also long-term contracts are used that result in the capability to develop and certify suppliers. Often these certifications are based on quality standards such as the Malcolm Baldrige award criteria or the ISO 9000 international standard for quality systems. In other cases, supplier certification is based on an internally developed standard. Improve constantly and forever the system of production and service to improve quality and productivity, and thus constantly decrease cost. This point focuses on the management of the system of production. The system of production includes product design, process design, training, tools, machines, process flows, and myriad other variables that affect the system of production and service. In the final analysis, management is responsible for most of the system design elements because it is management that has the authority and the budget to implement systems. Therefore, the workers can be held responsible only for their inputs to the system. Mediocre or poor performance of a system is most often the result of the poor performance of management. Institute training on the job. People must have the necessary training and knowledge to perform their work. Many companies employing laborers have found they must design job-related training. Note that training, although a necessary condition for improvement, is not sufficient to guarantee successful implementation of quality management. The design of effective training is important for quality improvement. Improve leadership. The aim of supervision should be to help people, machines, and gadgets to do a better job. The supervision of management and supervision of production workers are in need of overhaul. All quality experts agree that leadership is key to improving quality. If assembly line employees become enthusiastic about quality management, they will be able to make some small improvements to their organization. However, this improvement can occur only within the realm of influence of the employee. For wide-ranging improvements to occur, upper management must be involved. It is upper management that has the monetary and organizational authority to oversee the implementation of quality improvement. Without management support and leadership, quality improvement efforts will fail. Drive out fear so that everyone may work effectively for the company. For the most part, Deming was referring to those situations in which employees were fearful to change or even admit that problems existed. Many of these problems still exist. At times, employees who surface problems and seek to create change are considered troublemakers or dissatisfied. It might be true that such employees are dissatisfied. However, does an organization want employees who are satisfied with the status quo? Often, employees who seek to create change should be most prized. Some fear comes from making recommendations for improvement and having those recommendations ignored. Another type of fear should be recognized by top managers who desire to improve quality. Many employees view process-improvement efforts as disguised excuses for major layoffs. Often, after pursuing the easy solution of downsizing or outsourcing, the same cultural and organizational barriers that impeded improvement are still there. However, the company has lost the capability to be creative and really improve its capability to increase value to the customer. One solution was offered by a major Midwestern defense contractor. It developed a written policy stating that management reserved the right to reduce staffing levels as a result of economic downturns. However, the written policy also stated, “No layoffs will result from productivity or quality improvement projects or efforts.” Break down barriers between departments. People in research, design, sales, and production must work as a team to foresee problems of production and use that may be encountered with the product or service. In many companies, the time it takes to get design and marketing concepts to market is extremely long. Ingersoll-Rand produces a hand grinder that once required four years to develop a new generation of the product. One employee was quoted as saying, “It took us longer to develop a new generation of the product than it took the Allies to win World War II.” In the new competitive environment, such delays in design can jeopardize a company’s capability to compete. Honda nearly bankrupted Yamaha because of Honda’s capability to introduce new designs to market rapidly. Hyundai competes by quickly designing and introducing new products. One reason for slow design cycles was the sequential or departmental approach to design. This approach requires product designers, marketers, process designers, and production managers to work through organizational lines of authority to perform work. The alternative is parallel processing in focused teamswho work simultaneously on designs. Eliminate slogans, exhortations, and targets for the workforce that ask for zero defects and new levels of productivity. Such exhortations only create adversarial relationships because the bulk of causes of low quality and low productivity belong to the system and thus lie beyond the power of the workforce. In Deming’s view, exhortations to “get it right the first time” and “quest for perfection” can have the opposite of the intended effect. By pressuring employees to higher levels of productivity and quality, managers place the onus for improvement on the employees. If systems or means for achieving these higher levels of performance are not provided, workers can become jaded and discouraged. Examples of providing systems to employees might be to provide better training, to empower employees to make process decisions, and to provide a strategic structure that ensures alignment of key strategic goals and operational subgoals. Eliminate work standards on the factory floor. Eliminate management by objective. Eliminate management by numbers and numeric goals. Substitute leadership. Deming was very much opposed to work measurement standards on the shop floor. Note that work standards are used worldwide, and companies such as Lincoln Electric have been very successful with the skilled use of such standards. However, often work standards are implemented improperly. It is obvious that if quantity becomes the overriding concern, quality suffers. More subtly, if work standards are in place, employees who perform at high levels might lose the impetus to continually improve because they already will have satisfied standards. Management by objective refers to a process of setting annual goals, typically during a performance appraisal, that are binding on the employee. Although goals are set for employees, systems often are not provided by management to attain these goals. For this reason, Deming disdained performance appraisals. Remove barriers that rob workers of their right to pride in the quality of their work. The responsibility of supervisors must be changed from sheer numbers to quality. Too often, hourly laborers are hired to perform only the physical tasks assigned by management. Such workers often suffer from low morale and low commitment to the organization. Unskilled managers often add to this problem by reinforcing the fact that employees cannot be trusted with decisions and self-determination. Once, while discussing self-directed work teams, a manager commented that he feared he was “turning the asylum over to the inmates.” Such attitudes were obvious on the shop floor, and employees were very dissatisfied with their work environment. The upside is that after seeing the results of self-directed teams, this same manager became one of the biggest allies of the process of employee empowerment. Institute a vigorous program of education and self-improvement. Point 6 referred to training on the job. Point 13 relates to more generalized education. Many quality experts have argued that firms must exhibit the capability to increase and “freeze” learning. Learning in an organization is a function of the creativity of employees and the capability of the organization to institutionalize the lessons learned over time. This is difficult in firms that have high employee turnover. One of the benefits of the ISO 9000 international quality standard is the requirement that firms document their processes and improvements to the processes. Procedure manuals can help make learning permanent. However, this is not enough. Organizational learning requires a structure that reinforces and rewards learning. Such an organization is difficult to create in a command-and-control environment because command-oriented managers will not understand what it takes to allow employees to achieve their best. Put everybody in the company to work to accomplish the transformation. The transformation is everybody’s job. Point 14 reinforces the fact that everyone in the organization is responsible for improving quality. This again reinforces the fact that a total system for improving quality is needed that includes all the people in the organization.
Question:
1. Select one of Deming’s 14 points for management and describe how this point could have resulted in quality improvements in a business or volunteer organization with which you have been involved.