W. Edwards Deming

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W. Edwards Deming

William Edwards Deming (October 14, 1900 - December 20, 1993) was an American statistician, college professor, author, lecturer, and consultant. Deming is widely credited with improving production in the United States during World War II, although he is perhaps best known for his work in Japan. There, from 1950 onward he taught top management how to improve design (and thus service), product quality, testing and sales (the latter through global markets). Deming made a significant contribution to Japan becoming renowned for producing innovative high-quality products. Deming is regarded as having had more impact upon Japanese manufacturing and business than any other individual not of Japanese heritage.

Overview

Deming was born in Sioux City, Iowa, and received a B.S. in electrical engineering from University of Wyoming at Laramie (1921), an M.S. from the University of Colorado (1925), and a Ph.D. from Yale University (1928). Both graduate degrees were in mathematics and physics. Deming worked at Bell Telephone Laboratories, later in Japan, then as a professor at New York University, and finally as an independent consultant in Washington, D.C.

Deming was the author of Out of the Crisis (1982-1986) and The New Economics for Industry, Government, Education (1993), which includes his System of Profound Knowledge™ and the 14 Points for Management (described below). Deming played flute & drums and composed music throughout his life, including sacred choral compositions and arrangements of The Star Spangled Banner.

In 1993, Deming founded the W. Edwards Deming Institute in Washington, D.C., where the Deming Collection at the US Library of Congress includes an extensive audiotape and videotape archive. The aim of the W. Edwards Deming Institute is to foster understanding of The Deming System of Profound Knowledge™ to advance commerce, prosperity and peace.

In December 1993, W. Edwards Deming died in his sleep at his Washington home about 3 a.m. due to "natural causes": his family was with him.

Early life and work

Born in Sioux City, Iowa, Deming was raised in Polk City, Iowa on his grandfather's farm, then later in Powell, Wyoming. His father's name was also "William" so he was called "Edwards" (the maiden name of his mother, Pluma Irene Edwards). In 1917, he enrolled in the University of Wyoming at Laramie, graduating in 1921 with a B.S. in electrical engineering. In 1925, he received an M.S. from the University of Colorado, and in 1928, a Ph.D. from Yale University. Both graduate degrees were in mathematics and mathematical physics. Deming worked as a mathematical physicist at the United States Department of Agriculture (1927–39), and was a statistical adviser for the United States Census Bureau (1939–45). He was a professor of statistics at New York University's graduate school of business administration (1946-1993), and he taught at Columbia University's graduate School of business (1988-1993). He also was a consultant for private business.

In 1927 Deming was introduced to Walter A. Shewhart of the Bell Telephone Laboratories by Dr. C.H. Kunsman of the United States Department of Agriculture (USDA). Deming found great inspiration in the work of Shewhart, the originator of the concepts of statistical control of processes and the related technical tool of the control chart, as Deming began to move toward the application of statistical methods to industrial production and management. Shewhart's idea of common and special causes of variation led directly to Deming's theory of management. Deming saw that these ideas could be applied not only to manufacturing processes but also to the processes by which enterprises are led and managed. This key insight made possible his enormous influence on the economics of the industrialized world after 1950.

Deming edited a series of lectures delivered by Shewhart at USDA, Statistical Method from the Viewpoint of Quality Control, into a book published in 1939. One reason he learned so much from Shewhart, Deming remarked in a videotaped interview, was that, while brilliant, Shewhart had an "uncanny ability to make things difficult"; Deming thus spent a great deal of time both figuring out Shewhart's ideas and devising ways to present them with his own twist.

Deming developed the sampling techniques that were used for the first time during the 1940 U.S. Census. During World War II Deming was a member of the five-man Emergency Technical Committee. He worked with H. F. Dodge, A.G. Ashcroft, Leslie E. Simon, R.E. Wareham and John Gaillard in the compilation of the American War Standards (American Standards Association ZI.1-3 published in 1942) and taught statistical process control (SPC) techniques to workers engaged in wartime production. Statistical methods were widely applied during World War II, but faded into disuse a few years later in the face of huge overseas demand for American mass-produced product.

Work in Japan

After World War II (1947), Deming was involved in early planning for the 1951 Japanese Census. His expertise, combined with his involvement in Japanese society, led to his receiving an invitation by the Japanese Union of Scientists and Engineers (JUSE).

JUSE members had studied Shewhart's techniques, and as part of Japan's reconstruction efforts they sought an expert to teach statistical control. During June-August 1950, Deming trained hundreds of engineers, managers, and scholars in statistical process control (SPC) and concepts of quality. He also conducted one session for top management. Deming's message to Japan's chief executives: improving quality will reduce expenses while increasing productivity and market share. A number of Japanese manufacturers applied his techniques widely, and experienced new international demand for Japanese products.

Deming declined to receive royalties from the transcripts of his 1950 lectures, so JUSE's board of directors established the Deming Prize (December 1950) to repay him for his friendship and kindness. The Deming Prize, especially the Deming Application Prize that is given to companies, has exerted an immeasurable influence directly or indirectly on the development of quality control and quality management in Japan.

In 1960, the Prime Minister of Japan (Nobusuke Kishi), acting on behalf of Emperor Hirohito, awarded Dr. Deming Japan’s Order of the Sacred Treasures, Second Class. The citation on the medal recognizes Deming's contributions to Japan’s industrial rebirth and its worldwide success.

The first section of the meritorious service record describes his work in Japan:

• 1947 Rice Statistics Mission member
• 1950 assistant to the Supreme Commander of the Allied Powers
• instructor in sample survey methods in government statistics

The second half of the record lists his service to private enterprise through the introduction of epochal ideas, such as quality control and market survey techniques.

Later work in the U.S.

David Salsburg wrote:

"He was known for his kindness to and consideration for those he worked with, for his robust, if very subtle, humor, and for his interest in music. He sang in a choir, played drums and flute, and published several original pieces of sacred music." (page 254, The Lady Tasting Tea)

Later, from his home in Washington, D.C., Dr. Deming continued running his own consultancy business in the United States, largely unknown and unrecognized in his country of origin and work. In 1980, he was featured prominently in an NBC documentary titled If Japan can... Why can't we? about the increasing industrial competition the United States was facing from Japan. As a result of the broadcast, demand for his services increased dramatically, and Deming continued consulting for industry throughout the world until his death at the age of 93.

In 1982, Dr. Deming, as author, had his book published by the MIT Center for Advanced Engineering as Quality, Productivity, and Competitive Position, which was renamed to Out of the Crisis in 1986. Deming offers a theory of management based on his famous 14 Points for Management. Management's failure to plan for the future brings about loss of market, which brings about loss of jobs. Management must be judged not only by the quarterly dividend, but by innovative plans to stay in business, protect investment, ensure future dividends, and provide more jobs through improved product and service. "Long-term commitment to new learning and new philosophy is required of any management that seeks transformation. The timid and the fainthearted, and the people that expect quick results, are doomed to disappointment."

Over the course of his career, Deming received dozens of academic awards, including another, honorary, Ph.D. from Oregon State University. In 1987 he was awarded the National Medal of Technology: "For his forceful promotion of statistical methodology, for his contributions to sampling theory, and for his advocacy to corporations and nations of a general management philosophy that has resulted in improved product quality." In 1988, he received the Distinguished Career in Science award from the National Academy of Sciences.

In 1993, Dr. Deming published his final book The New Economics for Industry, Government, Education, which included the System of Profound Knowledge™ and the 14 Points for Management. It also contained educational concepts involving group-based teaching without grades, as well as management without individual merit or performance reviews.

Deming philosophy synopsis

The philosophy of W. Edwards Deming has been summarized as follows:

"Dr. W. Edwards Deming taught that by adopting appropriate principles of management, organizations can increase quality and simultaneously reduce costs (by reducing waste, rework, staff attrition and litigation while increasing customer loyalty). The key is to practice continual improvement and think of manufacturing as a system, not as bits and pieces."

In the 1970s, Dr. Deming's philosophy was summarized by some of his Japanese proponents with the following 'a'-versus-'b' comparison:

(a) When people and organizations focus primarily on quality, quality defined by the following ratio:

          $Quality\ ={\frac {results\ of\ work\ efforts}{all\ costs}}$,

then quality tends to increase and costs fall over time.

(b) However, when people and organizations focus primarily on COST, then costs tend to rise and quality declines over time.

The Deming System of Profound Knowledge™

"The prevailing style of management must undergo transformation. A system can not understand itself. The transformation requires a view from outside. The aim of this chapter is to provide an outside view-a lens-that I call a system of profound knowledge. It provides a map of theory by which to understand the organizations that we work in.

The first step is transformation of the individual. This transformation is discontinuous. It comes from understanding of the system of profound knowledge. The individual, transformed, will perceive new meaning to his life, to events, to numbers, to interactions between people.

Once the individual understands the system of profound knowledge, he will apply its principles in every kind of relationship with other people. He will have a basis for judgment of his own decisions and for transformation of the organizations that he belongs to. The individual, once transformed, will:

• Set an example
• Be a good listener, but will not compromise
• Continually teach other people
• Help people to pull away from their current practice and beliefs and move into the new philosophy without a feeling of guilt about the past

The layout of profound knowledge appears here in four parts, all related to each other:

• Appreciation for a system
• Knowledge about variation
• Theory of knowledge
• Psychology

One need not be eminent in any part nor in all four parts in order to understand it and to apply it. The 14 points for management in industry, education, and government follow naturally as application of this outside knowledge, for transformation from the present style of Western management to one of optimization.

The various segments of the system of profound knowledge proposed here can not be separated. They interact with each other. Thus, knowledge of psychology is incomplete without knowledge of variation.

A manager of people needs to understand that all people are different. This is not ranking people. He needs to understand that the performance of anyone is governed largely by the system that he works in, the responsibility of management. A psychologist that possesses even a crude understanding of variation as will be learned in the experiment with the Red Beads (Ch. 7) could no longer participate in refinement of a plan for ranking people."

The System of Profound Knowledge™ is the basis for application of Deming's famous 14 Points for Management, described below.

Deming's 14 points

Deming offered fourteen key principles for management for transforming business effectiveness. In summary:

1. Create constancy of purpose for the improvement of product and service, with the aim to become competitive, stay in business, and provide jobs.
2. Adopt a new philosophy of cooperation (win-win) in which everybody wins and put it into practice by teaching it to employees, customers and suppliers.
3. Cease dependence on mass inspection to achieve quality. Instead, improve the process and build quality into the product in the first place.
4. End the practice of awarding business on the basis of price tag alone. Instead, minimize total cost in the long run. Move toward a single supplier for any one item, based on a long-term relationship of loyalty and trust.
5. Improve constantly, and forever, the system of production, service, planning, of any activity. This will improve quality and productivity and thus constantly decrease costs.
6. Institute training for skills.
7. Adopt and institute leadership for the management of people, recognizing their different abilities, capabilities, and aspiration. The aim of leadership should be to help people, machines, and gadgets do a better job. Leadership of management is in need of overhaul, as well as leadership of production workers.
8. Drive out fear and build trust so that everyone can work more effectively.
9. Break down barriers between departments. Abolish competition and build a win-win system of cooperation within the organization. People in research, design, sales, and production must work as a team to foresee problems of production and use that might be encountered with the product or service.
10. Eliminate slogans, exhortations, and targets asking for zero defects or new levels of productivity. Such exhortations only create adversarial relationships, as the bulk of the causes of low quality and low productivity belong to the system and thus lie beyond the power of the work force.
11. Eliminate numerical goals, numerical quotas and management by objectives. Substitute leadership.
12. Remove barriers that rob people of joy in their work. This will mean abolishing the annual rating or merit system that ranks people and creates competition and conflict.
13. Institute a vigorous program of education and self-improvement.
14. Put everybody in the company to work to accomplish the transformation. The transformation is everybody's job.

Seven Deadly Diseases

The Seven Deadly Diseases:

1. Lack of constancy of purpose.
2. Emphasis on short-term profits.
3. Evaluation by performance, merit rating, or annual review of performance.
4. Mobility of management.
5. Running a company on visible figures alone.
6. Excessive medical costs.
7. Excessive costs of warranty, fueled by lawyers who work for contingency fees.

A Lesser Category of Obstacles:

1. Neglect of long-range planning.
2. Relying on technology to solve problems.
3. Seeking examples to follow rather than developing solutions.
4. Excuses such as "Our problems are different".

Quotations and concepts

In his later years, Dr. Deming taught many concepts, which he emphasized by key sayings, or quotations that he repeated. A number of these quotes have been recorded. Some of the concepts in Deming's quotations might seem to be an oxymoron or contradictory to one another; however, the student is encouraged to reflect about the meaning over time.

• "What is a system? A system is a network of interdependent components that work together to try to accomplish the aim of the system. A system must have an aim. Without an aim, there is no system. The aim of the system must be clear to everyone in the system. The aim must include plans for the future. The aim is a value judgment. (We are of course talking here about a man-made system.)"
• "A system must be managed. It will not manage itself. Left to themselves in the Western world, components become selfish, competitive. We can not afford the destructive effect of competition."

• "To successfully respond to the myriad of changes that shake the world, transformation into a new style of management is required. The route to take is what I call profound knowledge - knowledge for leadership of transformation."

• "The problem is at the top; management is the problem." "Management’s job. It is management’s job to direct the efforts of all components toward the aim of the system. The first step is clarification: everyone in the organization must understand the aim of the system, and how to direct his efforts toward it. Everyone must understand the damage and loss to the whole organization from a team that seeks to become a selfish, independent, profit centre."

• "They realized that the gains that you get by statistical methods are gains that you get without new machinery, without new people. Anybody can produce quality if he lowers his production rate. That is not what I am talking about. Statistical thinking and statistical methods are to Japanese production workers, foremen, and all the way through the company, a second language. In statistical control you have a reproducible product hour after hour, day after day. And see how comforting that is to management, they now know what they can produce, they know what their costs are going to be."

• "I think that people here expect miracles. American management thinks that they can just copy from Japan—but they don't know what to copy!"

• "What is the variation trying to tell us about a process, about the people in the process?" Dr. Shewhart created the basis for the control chart and the concept of a state of statistical control by carefully designed experiments. While Dr. Shewhart drew from pure mathematical statistical theories, he understood data from physical processes never produce a "normal distribution curve" (a Gaussian distribution, also commonly referred to as a "bell curve"). He discovered that observed variation in manufacturing data did not always behave the same way as data in nature (Brownian motion of particles). Dr. Shewhart concluded that while every process displays variation, some processes display controlled variation that is natural to the process, while others display uncontrolled variation that is not present in the process causal system at all times. Dr. Deming renamed these distinctions "common cause" for chance causes and "special cause" for assignable. He did this so the focus would be placed on those responsible for doing something about the variation, rather than the source of the variation. It is top management’s responsibility to address "common cause" variation, and therefore it is management’s responsibility to make improvements to the whole system. Because "special cause" variation is assignable, workers, supervisors or middle managers that have direct knowledge of the assignable cause best address this type of specific intervention.

• (Deming on Quality Circles) "That's all window dressing. That's not fundamental. That's not getting at change and the transformation that must take place. Sure we have to solve problems. Certainly stamp out the fire. Stamp out the fire and get nowhere. Stamp out the fires puts us back to where we were in the first place. Taking action on the basis of results without theory of knowledge, without theory of variation, without knowledge about a system. Anything goes wrong, do something about it, overreacting; acting without knowledge, the effect is to make things worse. With the best of intentions and best efforts, managing by results is, in effect, exactly the same, as Dr. Myron Tribus put it, while driving your automobile, keeping your eye on the rear view mirror, what would happen? And that's what management by results is, keeping your eye on results."

• "Knowledge is theory. We should be thankful if action of management is based on theory. Knowledge has temporal spread. Information is not knowledge. The world is drowning in information but is slow in acquisition of knowledge. There is no substitute for knowledge." This statement emphasizes the need for theory of knowledge (see: epistemology, Shewhart cycle, C. I. Lewis). It is considered as a contrast to the old statement, "There is no substitute for hard work" by Thomas Alva Edison (1847-1931).

• "Experience by itself teaches nothing", "Without theory, experience has no meaning. Without theory, one has no questions to ask. Hence without theory there is no learning." These statements emphasize the need to interpret information using a theory or framework of concepts for learning to take place, theory of knowledge. It is considered as a contrast to the old statement, "Experience is the best teacher" (Dr. Deming disagreed with that). To Dr. Deming, knowledge is best taught by a master who provides sound theory through which experience is interpreted; experience, without theory, is raw data that will be not be understood. Deming's view of experience is related to Shewhart's concept, "Data has no meaning apart from its context" (see Walter A. Shewhart, "Later work").

• "The most important figures that one needs for management are unknown or unknowable (Lloyd S. Nelson, director of statistical methods for the Nashua corporation), but successful management must nevertheless take account of them." Deming realized that many important things, that must be managed, couldn’t be measured. Both points are important. One, you can't measure everything of importance to management. And two, you must still manage those important things. Spend $20,000 training 10 people in a special skill. What's the benefit? "You'll never know," answered Deming. "You'll never be able to measure it. Why did you do it? Because you believed it would pay off. Theory." Dr. Deming is often incorrectly quoted as saying: "you can't manage what you can't measure." In fact, he stated one of the seven deadly diseases of management is running a company on visible figures alone.

• "By what method?" When information is obtained, or data is measured, the method, or process used to gather information, affects the results. Dr. Deming warned that basing judgments on customer complaints, alone, ignored the general population of other opinions, which should be judged together, such as in a statistical sample of the whole (Sampling frame). Changing the method changes the results. Aim and method are essential. An aim without a method is useless. A method without an aim is dangerous. It leads to action without direction, and without constancy of purpose. Deming used an illustration of washing a table to teach a lesson about the relationship between purpose and method. If you tell someone to wash a table, but not the reason for washing it, they cannot do the job properly. That does not mean just giving the explanation without an operational definition. The information about why the table needs to be washed, and what is to be done with it makes it possible to do the job intelligently.

See also

• Walter A. Shewhart
• Common cause and special cause
• Analytic and enumerative statistical studies
• Statistical process control
• Control chart
• Shewhart cycle
• Continuous improvement
• Quality storyboard
• Toyota Production System
• Myron Tribus
• Alfie Kohn

Bibliography

Deming, W. Edwards (1986). Out of the Crisis. MIT Press. ISBN 0911379010.

Deming, W. Edwards (2000). The New Economics for Industry, Government, Education - 2nd Edition. MIT Press. ISBN 0262541165.

Shewhart, Walter A. (1939). Statistical Method from the Viewpoint of Quality Control. Dover Publications December 1, 1986. ISBN 0486652327.

Shewhart, Walter A. (1930). Economic Control of Quality of Manufactured Product/50th Anniversary Commemorative Issue. American Society for Quality December 1980. ISBN 0873890760.

Wheeler, Donald J. (1999). Understanding Variation: The Key to Managing Chaos - 2nd Edition. SPC Press, Inc. ISBN 0945320531.

Walton, Mary (1986). The Deming Management Method. The Putnam Publishing Group. ISBN 0-399-55000-3.

• Kenneth T. Delavigne and J. Daniel Robertson, "Deming's Profound Changes: When Will the Sleeping Giant Awaken?" (PTR Prentice Hall, 1994), ISBN 0-13-292690-3

Neave, Henry R. (1990). The Deming Dimension. SPC Press, Inc. ISBN 0945320086.

Kilian, Cecelia S. (1992). The World of W. Edwards Deming - 2nd Edition. SPC Press, Inc. ISBN 0945320299.

Haller, Harold S. (1993). Managing with profound knowledge: A management process based on the Deming management theory. Harold S. Haller & Company. ASIN: B0006R22PS.

Joiner, Brian L. (1994). Fourth Generation Management: The New Business Consciousness. McGraw-Hill. ISBN 0070327157.

Scholtes, Peter R. (1997). The Leader's Handbook: Making Things Happen, Getting Things Done. McGraw-Hill. ISBN 0070580286.

• William J. Latzko, David M. Saunders, "Four Days with Dr. Deming: A Strategy for Modern Methods of Management" Prentice Hall PTR (January 26, 1995) ISBN 0201633663

Tribus, Myron (1992). Quality First: Selected Papers on Quality and Productivity Improvement -4th Edition. National Society of Professional Engineers. ISBN 9993853232.

• Gerald J. Langley, Kevin M. Nolan, Clifford L. Norman, Lloyd P. Provost, Thomas W. Nolan, "The Improvement Guide: A Practical Approach to Enhancing Organizational Performance" Jossey-Bass (July 26, 1996) ISBN 0787902578

Baker, Edward Martin (1999). Scoring a Whole in One: People in Enterprise Playing in Concert. Crisp Learning. ISBN 1560525495.

• Howard S. Gitlow, Shelly J. Gitlow, "The Deming Guide to Quality and Competitive Position" Prentice Hall Trade (January 1987) ISBN 0131984411

Mann, Nancy (1989). Keys to Excellence: The Story of the Deming Philosophy - 3rd Edition. Prestwick Books. ISBN 1852510978.

Scherkenbach, William W. (1991). Demings Road to Continual Improvement. SPC Press, Inc. ISBN 0945320108.

• Perry Gluckman, Diana Reynolds Roome, "Everyday Heroes: From Taylor to Deming: The Journey to Higher Productivity" SPC Press, Inc. (March 1990) ISBN 0945320078

Gabor, Andrea (1992). The Man Who Discovered Quality: How W. Edwards Deming Brought the Quality Revolution to America. Penguin. ISBN 0140165282.

Aguayo, Rafael (1991). Dr. Deming: The American Who Taught the Japanese About Quality. Fireside edition. ISBN 0671746219.

Kohn, Alfie (1992). No Contest: The Case Against Competition; Revised edition. Mariner Books. ISBN 0395631254.

Kohn, Alfie (1999). Punished By Rewards: The Trouble with Gold Stars, Incentive Plans, A's, Praise, and Other Bribes. Mariner Books. ISBN 0618001816.

External links

• "Dr. Deming Speaks about Quality in Japan"
• Summary & reviews The New Economics 2nd Edition 1993.
• W. Edwards Deming Institute
• Deming Institute Newsletter, Deming Interaction
• Deming Electronic NetWork
• Selected Papers on the Deming Philosophy

• "THE DEMING DIMENSION: Management for a Better Future" by Dr. Henry R. Neave
• "The Three Careers of W. Edwards Deming"
• "Quality As Defined By Deming": Lecture by Newt Gingrich
• "W. Edwards Deming The Story of a Truly Remarkable Person"
• Obituary from Philadelphia Inquirer, Dec. 1993
• Deming Library Videos
• Deming Library Discussion Guide, "problem is at the top"
• Bay Area Deming Users Group (BADUG), "Deming’s System"
• The Swiss Deming Institute
• The French Deming Association
• The Deming Forum
• Deming Scholars MBA Degree Fordham University
• "Four Days with W. Edwards Deming"
• dharma-haven.org
• Audiotapes and videotapes of Dr. Deming
• Deming's thoughts on various management topics, including citations to his books
• Quality Gurus & Philosophies