Appreciation for a System

The System Of Profound Knowledge® (SoPK) is the culmination of W. Edwards Deming’s work on management. The four areas of the system are: appreciation for a system, knowledge of variation, theory of knowledge and psychology. This post explores appreciation for a system in the context of Dr. Deming’s management philosophy.

Taking a systems approach results in management viewing the organization in terms of many internal and external interrelated connections and interactions, as opposed to discrete and independent departments or processes governed by various chains of command. When all the connections and interactions are working together to accomplish a shared aim, a business can achieve tremendous results—from improving the quality of its products and services, to raising the entire esprit de corps of a company.

A system view of the organization views the flow of the processes to create products and services. The interactions between various processes is respected. This is the image Dr. Deming put on the board each day he was providing an overview of management practices to Japan’s leaders in 1950.

image of the organization viewed as a system

The view of an organization as a system by W. Edwards Deming from Japan lectures in 1950’s and also found in Out of the Crisis.

A system view helps create a long term focus. Rather than seeing incidents as isolated (and often looking for the person to blame for a bad result) a system view allows managers to focus on the systemic drivers of results.

For Dr. Deming the purpose of an organization was to create a system that provides benefits to all stakeholders, page 51 of the New Economics:

The aim proposed here for any organization is for everybody to gain – stockholders, employees, suppliers, customers, community, the environment – over the long term.

Dr. Deming continually increased the percentage of problems attributable to the system instead of to special causes (outside of the system) such as blaming a person for a mistake. Obviously that doesn’t mean those problems are inevitable, it just means that the most effective way to improve and avoid those issues in the future is to improve the system.

Out of the Crisis, page 315:

I should estimate that in my experience most troubles and most possibilities for improvement add up to the proportions something like this:

  • 94% belongs to the system (responsibility of management)
  • 6% special

Related: Systems Thinking and the Three Musketeers by Eric Christiansen

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22 Responses

  1. Alex says:

    just picturing robotics in the modern assembly line and how the systems are being perfected to be more and more efficient. I recently test drove a Tesla Model S EV, and was told the company’s objective is to have a car that is maintenance free … electronic control systems that automatically update the systems in the car, even when it is 8 years old. The future looks very bright thanks to Edwards Demming et al.

  1. January 23, 2013

    […] as the deadly diseases of western management. And they need to institute good practices such as viewing the organization as a system, managing with an appreciation for variation, continually improving using the PDSA cycle, adopting […]

  2. March 12, 2013

    […] She discussed quite a few important ideas including:

    The value of cooperation (that is often obscured by a focus on competition)
    Appreciation for systems […]

  3. April 24, 2013

    Did he want us just to accept bad results? No. He was not saying it is the system there is nothing we can do just accept that this is how things are. He wanted us to focus on the most effective improvement strategies…

  4. June 4, 2013

    […] mainly to view a manager is a cog looking at some tiny process and making it efficient without understanding the organization as a system or value chains or customer […]

  5. June 6, 2013

    […] the organization is viewed as a system the inter-dependence of the stakeholders is appreciated. Owners (stockholders) have a right to […]

  6. October 1, 2013

    […] the most important part of the production line seems to still be missed by most organizations. The system view of the organization W. Edwards Deming provided in 1950 paints this picture well. The continued view of the organization […]

  7. March 6, 2014

    […] with a team, you miss the bigger, more complex people picture. According to Dr. W. Edwards Deming, 94% of all failure, troubles, and possibilities for improvement “belong to the system” — not […]

  8. September 16, 2014

    […] 90% of problems are systemic and 10% can be attributed to individual people (Dr. Deming’s work) […]

  9. December 3, 2015

    […] Deming added “Stage 0” to his organization as a system diagram in the 2nd Edition of The New […]

  10. January 18, 2016

    […] Appreciation for a System […]

  11. April 28, 2016

    […] Appreciation for a system is one of the four components of Deming’s management system. In this context the most common item to think of is Deming’s diagram of an organization as a system. That is a powerful diagram. […]

  12. May 29, 2016

    […] encouraging creativity and taking away the pressure of failure.  It’s important to remember Dr. Deming said many of the problems that occurred in organizations were the result of the system and not […]

  13. November 21, 2016

    […] Still, Dr. Deming (an expert in continuous process improvement) says in his book »Out of Crisis« that 94% of the potentials for improvement and better results lie within the system. Only 6% lie within the individual (see also this article). […]

  14. February 24, 2017

    […] I discussed some of my history with Dr. Deming’s ideas on management and my thoughts on the application of those ideas today. […]

  15. February 5, 2018

    […] is to have a clear aim and use his System of Profound Knowledge’s four interrelated areas: appreciation for a system, knowledge of variation, theory of […]

  16. August 2, 2018

    […] Edward Deming, an engineer and management consultant, credited as one of the inspirations that skyrocketed the Japanese industry and its quality after WWII, said that in his experience, 94% of the responsibility falls on management, and the rest on the employee [Source]. […]

  17. August 7, 2018

    […] then provides an image of W. Edwards Deming’s organization as a system diagram which provides a different way to view […]

  18. February 9, 2019

    […] this debate on the greatest professional athlete, I’ve used something called Systems Thinking, or Appreciation for a System.  It’s one of the four parts of W. Edwards Deming’s System of Profound Knowledge.  We can […]

  19. May 23, 2019

    […] Leadership tends to focus in the wrong area for performance improvement, i.e., too much focus on the individual (believing this “accountability” is the panacea when in fact it may do more harm than good) without fixing the system – when truth is both must take place with system fix the highest priority. […]

  20. December 7, 2019

    […] System thinking is a term that is often confusing to people. From my perspective it is important to understand the importance of leverage. Understanding systems lets you find solutions that may not be direct, but provide powerful leverage. Another important point is looking at the organization as a system. […]

  21. January 19, 2020

    […] Edward Deming il 94% dei problemi in un’azienda dipende dai sistemi; solamente il 6% dalle persone. Il […]

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