The W. Edwards Deming Institute Blog

Adaptation of the 14 Points to Medical Service

Dr. Deming’s 14 points for management have been put into various specific contexts by people over the years. Dr. Paul Batalden and Dr. Loren Vorlicky of the Health Services Research Center translated them into a health care context. Dr. Deming included their work in Out of Crisis, pages 201-202:

6. Restructure training.
  a. Develop the concept of tutors.
  b. Develop increased in-service education.
 c. Teach employees methods of statistical control on the job.
  d. Provide operational definitions of all jobs.
 e. Provide training until the learner’s work reaches the state of statistical control, and focus the training to assist the learner to achieve the state of statistical control.

7. Improve supervision. Supervision belongs to the system and is the responsibility of the management.
a. Supervisors need time to help people on the job.
 b. Supervisors need to find ways to translate the constancy of purpose to the individual employee.
  c. Supervisors must be trained in simple statistical methods for aid to employees, with the aim to detect and eliminate special causes of mistakes and rework. Supervisors should find causes of trouble and not just chase anecdotes. They need information that shows when to take action, not just figures that describe the level of production and the level of mistakes in the past.
  d. Focus supervisory time on people that are out of statistical control and not those that are low performers. If the members of a group are in fact in statistical control, there will be some that are low performers and some that are high performers.
  e. Teach supervisors how to use the results of surveys of patients.

As Deming said in Out of the Crisis, “The 14 points…apply to a service organization with little modification.” The truth is applying any of Deming’s ideas require thinking about them and your context and adapting the ideas to the local context (no matter what industry you are in). It isn’t a cookbook with a recipe it is a management system that must be thoughtfully adapted for your organization.

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Using Deming’s Management Ideas at an Auto Repair Company for the Last 30 Years

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Louis Altazan, President of AGCO Automotive Corporation discusses the success AGCO has had applying Deming’s management system to their service organization (car repair). Listen to the podcast.

Auto repair is basically finding root cause. If you don’t find the root cause, the problem is going to come back. You can’t just go in and make a [band-aid ] repair. This [Deming’s ideas] sort of went to the same exact type of philosophy. That is why it made a big impact with me.

I like how he states this. In some systems failure to address the root cause is less obvious than in auto repair. Inside a business there are often so many factors and influences on outcomes that you can find the problems created by root causes popping up all over the place and sometimes it isn’t very obvious at all that they are related.

Once I started reading Deming and understanding I was the problem; thats when things really started to change for me. The first thing I did was call and shop meeting and I actually apologized to everyone there… “everything I did, I didn’t do out of malice, I did out of ignorance. And I promise you this is going to change.”

After that things started to really get a lot better. Of course it took years to get to a point I wanted it to be. We started working on the 14 points pretty much immediately, to the degree we could. We would concentrate on one for awhile and when we thought we had it sort of under control we would move to another and went through all 14 and started again doing PDSAs…

It is nice to listen to people that have been on the journey of improving management for a long time talk about their experience. In the podcast, Louis, mentions that he made changes as best he understood the ideas at the time but as he went to seminars and studied more he learned his original understanding was flawed and so the organization had to make adjustments.

This is one of those truths that is often ignored. People are going to make the best decisions they can but especially when they are new to these ideas it isn’t easy to understand everything and see exactly how to adapt the concepts inside there organization. People must make their best judgements and move forward and then keep continually improving.

He also discusses how the system in many auto repair shops creates incentives for people to put their pay above providing the customer service. Often car repair shops pay employees what amounts to a piece rate. There are prices and times set for various tasks and employees make more by doing work that bills more and by doing work more quickly. It isn’t so surprising when some of them will seek to maximize their income rather than do the best for the customer.

They addressed that issue by moving everyone to a salary. And, not surprisingly, there were grumbling that doing so was mainly to save money on pay. What Louis did was set the salary at the average of the last 2 years pay +10%, which people were very happy with (though some left because they wanted to stay on that old system).

Related: Deming Auto Repair (2008 post)AGCO created a web site on the Deming’s management ideasDeming Podcast with Fred Wambier and Kelly Allan On Applying Deming’s Ideas at Finishing TechnologyBob Browne Discusses His Experience Applying Deming’s Ideas as a CEO

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The History and Evolution of the PDSA Cycle

Ron Moen and Clifford Norman wrote a very interesting article on the history of the PDSA cycle: Clearing up myths about the Deming cycle and seeing how it keeps evolving.

It is not enough to determine that a change resulted in improvement during a particular test, according to Moen, Nolan and Provost. As you build your knowledge, you will need to be able to predict whether a change will result in improvement under the different conditions you will face in the future.

The experiment in the PDSA cycle is learn about the system in question. I like to call it the Do-the-experiment step to emphasize that doing in the PDSA cycle refers to “doing the experiment”. Otherwise people often forget that what we are doing is running an experiment to learn from. We want to find improvements. But we want to find improvements that are predictable and sustainable.

image of the model for improvement

Image of the model for improvement with the PDSA cycle from their article.

The inclusion of the 3 questions should be familiar to everyone who uses The Improvement Guide. And if you are not using that book, you should be. As I have mentioned before it is the best handbook for applying the PDSA cycle to improve results.

Those 3 questions will greatly aid your attempts to use the PDSA cycle in your organization.

Related: Deming 101: Theory of Knowledge and the PDSA Improvement and Learning CycleTom Nolan at the Deming Institute Conference on PDSA (turn the cycle quickly)Ron Moen Webcast: Prediction is the ProblemKeys to the Effective Use of the PDSA Improvement Cycle

Find Quotes by W. Edwards Deming (Including the Source)

We have added a new web application for quotes by W. Edwards Deming. We hope this will be of use to people searching for quotes by Dr. Deming.

screen shot of W. Edwards Deming Quotes application

The quotes are viewable by category, such as: leadership, managing people, systems thinking and data.

We provide the source for the quotes, when we have sources. For some of the quotes, we also provide comments and links to further information on the topic of the quote.

You may search the W. Edwards Deming quotes database.

We also provide quotes Dr. Deming attributed to others, with proper credit and sources provided.

You may also view the all the quotes selected from Out of the Crisis, The New Economics and The Essential Deming.

We continue to add quotes to the database, add sources as we find them, add categories/topics, and add quotes to appropriate categories. Please send us your suggestions: quotes (with sources), suggested categories to add or categories to link specific quotes to.

The W. Edwards Deming Institute continues to add new services to achieve our aim: “to foster an understanding of The Deming System of Profound Knowledge® (SoPK) to advance commerce, prosperity and peace.” We hope this new quotes application will be useful. Other additions we have delivered in the last few years, include: this blog, The W. Edwards Deming Institute Podcast series, making W. Edwards Deming Videos Available On Demand via the internet and The W. Edwards Deming Twitter account.

Related: The W. Edward Deming Institute Launches a New Podcast SeriesOnline Resources for W. Edwards Deming’s Management IdeasFirst post on the W. Edwards Deming Institute Blog

The Importance of Working with Suppliers Over the Long Term

End the practice of awarding business on the basis of price tag. Instead, minimize total cost. Move toward a single supplier for any one item, on a long-term relationship of loyalty and trust.

Point 4 in W. Edwards Deming’s 14 points for management

Even today many organizations treat suppliers as adversaries to beat at the negotiating table. Dr. Deming explained that the organization was a system that included the suppliers and customers. You need to manage and continually improve that entire system.

And to do so most effectively you need to partner with your suppliers over the long term. You need to treat them as partners. Saying they are partners is nearly worthless. What matters is how you operate. Toyota, Honda and others have taken this message to heart. Many others still have not.

I wrote about this on my personal blog in 2005, Ford and Managing the Supplier Relationship

Nothing has changed from 1990 to today that explains why Ford saying they are going to deal with suppliers differently now should work any better then such statements 15 years ago. Until they acknowledge what problems in their management system have caused them to fail to use sensible management practices that have been well know for decades I see no reason to believe there claims that they will behave differently this time.

The difficulty is not in reducing the number of suppliers. The difficulty is that you must change the nature of your relationship with the suppliers. And that will require changing the nature of the management systems within Ford. The various factors involved are interdependent.

You cannot expect to achieve success by adopting an individual component of an interdependent system of management.

A recent study says that Toyota and Honda lead USA manufacturers in supplier relationship management. The same study claims Toyota and Honda are far ahead of the others and the benefits to Toyota and Honda are in the hundreds of millions (or billions) a year and the costs to the others are as large).

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Some Statistical Logic in the Management of Quality by W. Edward Deming

W. Edwards Deming wrote Some Statistical Logic in the Management of Quality to fill in some of the missing links in the use of statistical methods, with special reference to responsibilities at the management level for effective mobilization of statistical knowledge and skills.

In the paper, he describes statistical control of quality as a system, not a bag of techniques, focuses on statistical methods in improvement of operations. He provide 24 examples of uses of statistical methods in various stages and types of work, for example: feedback to the production worker, feedback to management, consumer research, tests of drugs and of treatments, and the design of meaningful information systems.

This 22 page paper was delivered by Dr. Deming at the All India Conference on Quality Control, New Delhi, 17 March 1971.

Confusion between common causes and special causes is one of the most serious mistakes of administration in industry and in public administration as well. Unaided by statistical techniques, man’s natural reaction to trouble of any kind, such as an accident, high rejection-rate, stoppage of production, is to blame the operators. Anything bad that happens, it might seem, is somebody’s fault, and it wouldn’t have happened if he had done his job correctly. The worker knows what his job is, yet he turned out defectives. Sounds as if he doesn’t care.

This statement is very often absolutely true, but the truth of this observation will not solve the problem. It may be that workers are putting into the job all that they ever will, under the circumstances. The cause of the trouble may be common to all the machines – e.g., poor thread, the fault of management, whose policy may be to buy thread locally or from a subsidiary. Demoralization, frustration, and economic loss are inevitable results of attributing trouble to some specific operator, foreman, or machine, or other local condition, in a situation where the trouble is actually common (environmental), affecting all operators on all machines, and correctable only at a higher level of management.

The specific local operator is powerless to operate on a common cause.

Fortunately, confusion between the two sources of trouble can be eliminated with almost unerring accuracy. [with the use of a control chart]

A common mistake, even now [as Dr. Deming wrote this in 1971 he meant even in 1971, sadly it is still true even now in 2015 though thankfully more companies due better today than was the case 40 years ago], in quality control programs, and amongst nearly all writers of text-books on the subject, is to assume that they have solved all the problems of the production-line, once they have weeded out most of the special causes. The fact is, instead, they are at that point just ready to tackle what are usually the most important problems, namely, the common or environmental causes, faults of the system.

No fundamental improvement of the production-line will take place until management has a quality control system that works on common causes as well as special causes. [and does so by applying the strategies to address each type of problem properly]

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Deming Podcast with Dr. Bret Champion, Superintendent of the Leander Independent School District

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Dr. Bret Champion, Superintendent of the Leander Independent School District (ISD) in Texas joins us for the latest Deming Institute Podcast (download the podcast). Bret discusses Leander ISD’s efforts from the perspective of his 22 year journey as a teacher through his current role.

In describing the Leander Way he says

[We try to make sure] decisions are made at the most local level possible and work out from there.

When I became superintendent, one of my big things was we need to continue to tear down silos (the notion of barriers between departments).

We’re in each others business… because we are all in this for the same reasons… shared vision (every student exits our system with the same passion for learning they had when they entered our system, without economics determining success). If we are all centered on that, if that is who we are, then it doesn’t matter who is in charge of what, we just need to get the job done.

This vision of teamwork sounds so easy on paper. But it requires that there is a strongly shared management vision, with respect for people, and that is not easy for most organization to pull off. It usually takes quite a while to build such a system and such trust. That long term effort over 2 decades, of course, is one of the reasons Leander is in the position to be able to have this work so well today.

I really like Leander’s vision.

The aim of education should be to preserve and nurture the yearning for learning that a child is born with. Grades and gold stars destroy this yearning for learning.

W. Edwards Deming, in a letter to David Bayless, 6 February 1992.

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Discovering Deming: Cultural Evolution at Pluralsight

Keith Sparkjoy – Discovering Deming: Cultural Evolution at Pluralsight from The W. Edwards Deming Institute 2014 Annual Conference.

Enjoy Keith Sparkjoy’s presentation at the 2014 W. Edwards Deming Institute conference – Discovering Deming: Cultural Evolution at Pluralsight using the webcast above.

Once you understand common cause variation versus special cause variation you spend less time investigating noise. We also recognize signals [of a process that needs to be examined] more quickly. [reference suggestion – Understanding Variation by Donald Wheeler]

Understanding variation taught us the danger of tampering.

They replaced the employee handbook with 2 rules:

  • Be respectful, considerate and kind even when you disagree.
  • Always act in Pluralsight’s best interest.

Keith Sparkjoy (at time 48:07 in the webcast):

I’m excited about what we do as a company, our purpose, but even more than that I am super-excited about creating an environment where so many people can come to work everyday, and go home at the end of the day with joy in work.

Joy is not a zero sum game.

Related: Deming Podcast with Keith Sparkjoy on Adopting the Deming Management System at Pluralsightcommon cause variation and
special cause variation
Knowledge, Personality, and Persuasive Power (are the sources of power for a leader)Hallmark Building Supplies: Applying Deming as a Business Strategy

14th Annual In2:InThinking Network Forum June 10-14 in Los Angeles

The 14th Annual In2:InThinking Network Forum (Break the Mold: Aspire, Inspire, Achieve) will be held June 10-14, 2015 in Los Angeles, California, USA (to be hosted by Woodbury University in Burbank).

The conference itself begins on Friday, June 12th with Happy Hour at 5pm and dinner at 6pm, followed by a keynote presentation. The program continues with a full day on Saturday, June 13th, and ends at noon on Sunday, June 14th.

photo of attendees of 2014 forum

Photo of attendees at the 2014 forum.

Topics and speakers at the conference include:

They are also offering a webcast of the conference ($150).

Pre-conference sessions are also offered June 10th, 11th and 12th.

A sampling of the pre-conference sessions:

Related: What I Learned at the 21st Annual International Deming Research SummitThe W. Edward Deming Institute 2013 Annual Conference2013 Annual Deming Conference Recap: Homecoming At Purdue

To Achieve Success Focus on Improving the System Not On Individual Performance

A company could put a top man at every position and be swallowed by a competitor with people only half as good, but who are working together.

W. Edwards Deming in his last interview: ‘Management Today Does Not Know What Its Job Is.

This quote is a wonderful view of Deming’s focus on the organization as a system versus the focus on individuals that is so common today. The annual performance appraisal process and individual bonuses (including massive amounts of money given to senior executives) are tangible examples of the individual focus in so many organizations today.

Creating a management system that focuses on long term continual improvement is much more difficult than repeating nice quotes though – unfortunately.

The related links below provide some ideas. Basically though all of Deming’s work is focused on how you create an organization that is successful and is helping provide people opportunities to create as much value as possible.

From our previous post: Managing the Organization as a System

It is fairly easy to appreciate that optimizing components within a system can easily create problems for the overall system. But it is hard to accept that we have to manage the entire organization in a coordinated way instead of just assigning responsibility for certain areas to executives and holding them accountable for optimizing their areas.

Related: A Bad System Will Beat a Good Person Every TimeA Good Management System is Robust and Continually ImprovingHow to Improve Your Management SystemThe Idea of Performance Rating to Capture Merit is AlluringQuality is Made in the Board Room