The W. Edwards Deming Institute Blog

Building a Sustainable Organization Using Deming’s Ideas on Management

The linked to article that aims to provides an overview of the essence of Deming’s approach to management and its continuing relevance to managers: The Model of Sustainable Organisation by Alan Clark.

A manager, said Deming, is primarily a manager of People. This is in line with many thinkers, teachers and writers on organisations and management including Douglas McGregor, Frederick Herzberg and William Ouchi. People, given respect, the context and freedom to contribute, make the difference in achieving enduring organisational success. More radically he said management should ensure joy in work and in learning for everyone!

Properly understanding the needs of the customer should lead on to innovation. Deming is often misrepresented as promoting only continual improvement of products and processes. Time and again he emphasises the need for innovation, which is absolutely the responsibility of the supplier or provider.

Deming recognised the importance of viewing any organisation as a whole. The people and parts of the system are all important and work together. His flow diagram shows the integration of all parts of an organisation. The critical feature of the flow diagram is that it models a feedback system that continually adapts the outcomes to keep them in line with customer needs. It is management’s job to Optimise the System with everyone’s help.

The paper includes a set of questions at the end to ask yourself about your organization.

Related: Respect for Employees, Don’t Waste the Ability of PeopleKnowing How to Manage People Is the Single Most Important Part of ManagementDr. Deming Video: Managing the Organization as a System

Cash Incentives Won’t Make Us Healthier by Alfie Kohn

Dr. Deming referred to Alfie Kohn’s work and ideas when he was consulting, giving seminars and in The New Economics. Alfie Kohn will be a keynote speaker at our 1st annual Deming in Education Conference this November 6th to 8th in Seattle, Washington.

In this article (and the embedded presentation included below) Alfie Kohn explores how misuse of incentives, driven by a failure to understand the psychology of extrinsic and intrinsic motivation leads to failure: Cash Incentives Won’t Make Us Healthier

“Extrinsic” motivation (to get a reward or avoid a punishment) is much less effective than “intrinsic” (a commitment to doing something for its own sake). What’s more, the two are often inversely related. Scores of studies confirm that the more we’re rewarded for doing something – at work, at school, or at home — the more we’re apt to lose interest in whatever we had to do to get the reward.

First, address people’s motives and deeper concerns rather than just trying to change their behavior. Second, help people to get some control over their lives. Finally, build on their relationships with others to promote change. Couples and friends tend to lose weight together more effectively than do individuals.

Health can be a tough sell. But it’s clearly something that incentives can’t buy.

Alfie’s books on the problems with using incentives are excellent: Punished by Rewards: The Trouble with Gold Stars, Incentive Plans, A’s, Praise, and Other Bribes and No Contest: The Case Against Competition.

For me, appreciating how important the problems with incentives, extrinsic motivation and the behaviors those lead to (the annual performance review based bonuses etc.) was difficult. Much of what Deming proposed came naturally to me, this part did not. But over time I came to appreciate the wisdom of such thinking.

Related: Peter Scholtes on Managing People and MotivationBuild a Work Environment Where Intrinsic Motivation FlourishesEliminate Sales Commissions: Reject Theory X Management and Embrace Systems Thinking

Myth: If You Can’t Measure It, You Can’t Manage It

It is wrong to suppose that if you can’t measure it, you can’t manage it – a costly myth.

W. Edwards Deming, The New Economics, page 35.

One of the quotes you will see quite frequently “incorrectly” attributed to Dr. Deming is “if you can’t measure it, you can’t manage it.” I suppose you could say it is correctly attributed to him; after all that is a direct quote from the quote listed above 😕 However, I think it would be more accurate to say it is misattributed to him.

His quote is saying the opposite of what most people think it means when they use the quote without the extra words he used. This is one of the dangers in using quotes without context: we try to provide context for quotes by W. Edwards Deming in our quote web site.

Why is the shorter quote used so often and attributed to Dr. Deming? My guess is that he did stress the importance of using data to confirm beliefs about which management strategies and practices are working and which are not. And he did so much earlier than it was common to see things this way in relation to managing organizations. And several of the tools he recommended involved using data (Plan-Do-Study-Act improvement cycle, control charts, etc.). And often when people are told about Deming they get a very short introduction which leaves out most of what he said and they get the idea he was just a statistician.

So when people see a quote emphasizing the importance of data attributed to W. Edwards Deming it seems sensible that he said it. And it is likely shared so often because people notice that their organization is flailing away when they would benefit from using data to improve their management of the situation. So the quote appeals to people seeing their organization fail to use data when they should be using data.

Dr. Deming did very much believe in the value of using data to help improve the management of the organization. But he also knew that it wasn’t close to enough. There are many things that cannot be measured and still must be managed. And there are many things that cannot be measured and managers must still make decisions about.

I wrote a post on my Curious Cat Management Improvement blog about how to manage what you can’t measure (in 2010).

Using data to evaluate what is working and what isn’t is a very valuable management practice. And it is still a practice that is used far too little (even though it is used much more than it was 30 or 50 years ago). But much more than managing what you can measure is needed to manage organizations well.

Related: Unknown and Unknowable DataVideo of Dr. W. Edwards Deming: Deadly Diseases of Western Management (one of which is “Use of visible figures only”)

Jim Benson on Applying Deming’s Ideas to Knowledge Work

Deming Institute podcast icon

Jim Benson, founding partner of the Modus Cooperendi and co-author of Personal Kanban is the guest on this Deming Podcast. In the podcast Jim discusses how to apply Deming ideas to knowledge work.

I was actively looking for a set of guiding principles around what would create an actual human oriented, self-aware way of managing work. The four points of the SoPK do exactly that and do it in a very elegant, concise and friendly way.

You need to understand why you are doing lean before you start to do it…
I want them to have the benefit of the Deming moral compass when they are engaging in any lean activity.

Jim helps people take those principles and help people visualize their knowledge work (software development etc.) leading to better communication, collaboration and transparency. Knowledge work often has the challenge of being difficult to visualize which hampers our attempts to understand the processes and improve the processes that make up the work.

The other key for Jim is to limit work in process to allow the work to be done most effectively.

For me the Deming philosophy has 3 major areas: one is respect for people, the second is SoPK, and the third is what I call the one point but is listed as the 14 points. If you add up all the 14 points and draw a summation line underneath it, the results of all of those is that “command and control is an anti-human activity.”

I see respect for people as ingrained in the Deming philosophy, but that term is associated with lean thinking. I also believe emphasizing respect for people is enhanced by using that term. I see it as part of the System of Profound Knowledge (largely in the psychology area) and for example include it in the categories of topics for this blog. I think it is a recognition of how critical respect for people is (and also perhaps how many of our organizations fail at this in so many ways) that people like to emphasize it. Also it is a very good term to capture what is so important and the more it is used the better, I think.

Related: What’s Deming Got to Do With Agile Software Development and KanbanDrowning in Work? (Business 901 podcast with Jim)WIP in Dentistry Fewer Patients-In-Process and Less Safety SchedulingDeming and Software Development

Why do you hire dead wood? Or why do you hire live wood and kill it?

cover image of The Leader's Handbook

The common objection to seniority pay is, “It’s rewarding dead wood!” My response is, “Why do you hire dead wood? Or why do you hire live wood and kill it?”

Peter Scholtes, The Leader’s Handbook, page 331. Peter worked with Dr. Deming and presented at the 2 day Deming seminars with W. Edwards Deming.

You will see this quote attributed to Dr. Deming even though it shouldn’t be. Dr. Deming was very quotable, and often gets credit for wonderful management quotes even when he didn’t say them. Dr. Deming was always careful to credit others when he repeated their quotes in seminars, in writing or elsewhere.

Peter was another management expert who was very quotable and someone that worked closely with Dr. Deming for quite some time so it isn’t surprising people confuse the credit for some quotes. This is one of the best quotes showing the fallacy of blaming the employee when the system is providing evidence that the result is created by the system.

Most managers that complain about “dead-wood” do it quite often and it is obvious it isn’t a special cause but instead an expected result of the system. The result of employees they consider “dead-wood” is a natural outcome of the organization’s management system. Blaming the “dead-wood” doesn’t fix the problems that need to be fixed. To achieve success management needs to focus on improving the system, not blaming individuals.

Related: Find the Root Cause Instead of the Person to BlameQuality Comes to City HallWhere There is Fear You Do Not Get Honest Figures

Lasting Quality Philosophy Presentation by Steven Haedrich

View Steven Haedrich’s presentation at the 2014 Fall Conference with the embedded webcast above. Steven, President of New York Label & Box Works, discusses their Deming journey over the decades.

Give the power to the people that are doing the job. Give those people the tools they are requesting. Give them the right materials. Put them in an environment of quality. And have the systems built around that.

Tools in the context of the quote largely means the knowledge. You need to provide education on how to think of the organization as a system and how to continually improve. Without the necessary knowledge you only set people up to fail.

Your systems have to continuously improve. We are getting very good at improving because the whole company now have, all 75 of us, truly understanding of what systems thinking is.

New York Label & Box Works has been applying Deming’s ideas for 30 years. Benefits of adopting better management start accruing quickly but the benefits of an entire company filled with people operating with a shared understanding of the organization as a system provides benefits that dwarf those achieved early in the journey to better management.

Everyone has to be continually learning.

When you really believe people are the key to success instead of just saying it that should be apparent in the actions in the company not just the words spoken. And when this happens you have systems in place that will result in people continually learning and improving their ability to deliver within the current system and improve the current system.

One result of a great system is having clients that brag about you.

In answering questions at the end Steven provides a good answer to the question “do you ever fire people.” While it is important not to blame workers for the results of the system it is possible that people just don’t have the ability, desire or willingness to do a specific job and management must address that. As he say the Deming way is to train and coach them and give them other opportunities if the responsibilities of the current job are not a good fit. The concern and respect for all of the employees is evident in his response to this question, and also is apparent throughout the presentation.

Related: Deming Podcast on The Deming Journey at New York Label & Box WorksApplying Deming’s Management Thinking at Patagonia
Profit and growth come from customers that boast about your products and servicesBob Browne Discusses His Experience Applying Deming’s Ideas as a CEO

Healthcare, Paradigm Shifts and the Influence of W.E. Deming

Guest post by Mike Stoecklein

I’ve been involved with healthcare most of my life. I blogged about my experience in healthcare back in 2011 and described how my “hope level” for improvement in healthcare has gone up and down like a sine-wave pattern over the last 20-30 years. I described this as “I can’t tell you that there’s hope, but I can tell you that there’s hope that there’s hope.” I’m still hopeful, now more than ever.

In 2014 I presented a paper at the 20th Annual International Deming Research Seminar on the topic of “Understanding and Application of Deming’s System of Profound Knowledge in Healthcare.” In this paper I traced the contributions of Dr. Deming to Japan starting in 1950, and how companies like Toyota developed management systems that are now being studied (and copied) by other industries (including healthcare).

Earlier this year, I presented a paper at the 21st Deming Research Seminar on one aspect of Dr. Deming’s philosophy (understanding and managing variation) that I found to be largely missing in the conversations and actions of many healthcare organizations. My goal was to find out why this body of knowledge seemed to be absent. In conversations with many healthcare mangers, clinicians and consultants, I discovered some of the possible root causes and described the implications for not understanding how to react to variation. I focused on how this principle applies when we have figures, as well as when we don’t have figures (primarily in the management of people and behaviors). I recorded a webinar summarizing some of the key points.

I still think that there is hope, and I see evidence of improvement in the healthcare delivery system in the future. There is a growing movement (the beginnings of a critical mass?) that is taking on the transformation of healthcare management. I’ve seen these movements before. This one looks serious; I think it’s going to stick. A new book, Management On The Mend, written by John Toussaint, MD describes a viable pathway for healthcare system transformation. Dr. Deming is cited several times in the book, and the reader will find evidence of Dr. Deming’s thinking throughout the 180 pages of the book.

Why is it so hard for healthcare managers to understand what must be done and to take the necessary action? I don’t have all the answers for that, but I do have some thoughts. I see several interrelated factors. I’d like to describe one of these factors in this blog post.

Factor #1 – Some healthcare executives are just now realizing their world is undergoing a change in worldview – a paradigm shift.

Read the rest of this entry »

First Annual Deming in Education Conference

Join us November 6 to 8 for the First Annual Deming in Education Conference at the Cedarbrook Lodge in Seattle, Washington.

See the agenda.

Hear the stories of leaders who are challenging the status quo to create exceptional learning environments that preserves our children’s natural curiosity and “yearning for learning”. Learn how the systems approach of Dr. W. Edwards Deming will liberate fear and ignite passion in students and educators alike. Come discover the true potential and future of education in our country.

Alfie Kohn and David Langford will be featured speakers at the conference.

This conference is for educators, administrators, business and organizational leaders interested in making a profound and sustained difference in education and quality learning. It is for anyone who wants to effect change that will foster intrinsic motivation, enhance student performance and inspire joy in learning in the next generation of students. Discover how others are improving learning and leading organizations using the timeless principles of Dr. Deming and emerging brain research. This powerful approach will show you the path to transforming our education systems for our children’s development and well-being, and the future success of our country.

Register for the conference.

Dr. Deming Video: A Theory of a System for Educators and Managers

Related: Deming in Education: Education as a System (podcast with David Langford)The Neuroscience of Deming (by JW Wilson)Change has to Start from the Top (webcast with David Langford)

You Burn, I’ll Scrape

our system of make-and-inspect, which if applied to making toast would be expressed: “You burn, I’ll scrape.”

Joe Sensennbrer quoting Dr. Deming in his article, Quality Comes to City Hall

This wonderful quote highlights Dr. Deming’s ability to use humor and create a simple visual to drive home a point.

We can all easily see burning toast and then scraping it to reach the desired state isn’t a very sensible process. But in our organizations how often do we tolerate systems that produce substandard results instead of fixing the process? How often do we blame the people for not scraping the toast well enough instead of having a management system that fixes the process to not burn the toast in the first place?

Related: Process Thinking at PatagoniaThe consumer is the most important point on the production-lineCease Dependence on Inspectionprevious post on the Quality Comes to City Hall article

Photo of Dr. Deming in Greece in 1946

W. Edwards Deming, Greece, 1946

W. Edwards Deming enjoyed meeting the local people during the course of his business travels. This photo was taken in Greece in 1946.

We have been posting old photos of Dr. Deming to our Facebook page for throwback Thursdays. Check it out to see more photos of Dr. Deming. See if you can find one with him not wearing a tie.

Related: W. Edwards Deming photo galleryPhotos of 2013 International Deming Research SeminarPhotos from the 2014 Annual Deming Institute Conference