Deming’s Philosophy: Quality Improvement through Involvement

Juran’s approach as described above is focused on results. In contrast to this, Deming advocates a philosophy, which calls for transformation of the organizational culture. The focus is on the long – term survival of the firm, not on quarterly profits. The central theme of his approach is reducing variation in processes and products.

Variation is of two types –Common cause variation and Special cause variation.

Statistical thinking will help distinguish between these two types of variation. Special cause variation can be improved by local actions, which can be taken up by operators. Further the Common cause variation can be reduced by actions on the system, which can be taken by the management alone. Deming states that 94% of the problems are management controllable (his earlier estimate is 85%).

In Deming’s view, a major cultural change in the organization is essential for competing with today’s of world-class companies. Deming has given the following 14 points framework for transforming the management culture:

• Provide all employees with a statement of the aims and purpose of the company.  The management must demonstrate constantly their commitment to this statement.
• Learn the new philosophy, top management and every body.
• Understand the purpose of inspection, for improvement of processes and reduction of cost.
• End the practice of awarding business on the basis of price tag alone.
• Improve constantly and forever the system of production and service.
• Institute training.
• Teach and institute leadership.
• Drive out fear.  Build trust.  Create a climate for innovation.
• Optimize the efforts of teams, groups, and staff areas toward the aims and objectives of the company.
• Eliminate exhortations for the work force.
• Eliminate numerical quotas for production.  Instead, learn and institute methods for improvement.
• Remove barriers that rob people of the pride of workmanship.
• Encourage education and self-improvement for everyone.
• Take action to accomplish the transformation.

Each one of these points is aimed at reducing variation.  It is important to note that these points are not in any order and the implementation sequence is not prescribed.  These 14 points caused some confusion and misunderstanding among businesspeople, as they are only end states and how to reach there is not suggested.  However, Deming applied the underlying foundations of the 14 points in what he called “A System of Profound Knowledge”.  Deming’s Profound Knowledge System consists of the following four interrelated elements:

1. Appreciation for a System.
2. Understanding the Variation.
3. Theory of Knowledge.
4. Psychology.

One need not be an expert in all or even one.  The real power is in the synergy of the four elements.

Although Deming believes that quality improvement reduces costs, he rejects the use of cost of quality (COQ) to select projects or as a measurement of quality improvement projects.

Deming believed that COQ accounting is far too crude to capture all the benefits (for example, morale) of improving quality, so the use of COQ will lead to severe errors in quality related decision-making. Instead he favours focusing on the entire business as a system, i.e. global optimization rather than local optimization.

Deming’s approach is designed for participate management style. People are viewed as primarily being self-motivated and self-controlled. Operators are to be trained in the use of simple statistical tools, so that they may monitor, control and improve the system they work in. Managers should focus on education and counseling.

The need for participate style makes Deming’s approach difficult to implement and takes longer time to see bottom line impact. The Japanese companies have followed this approach.

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