Why Deming’s Management Philosophy is More Relevant Today

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Edwards Deming has been one of the most influential figures when it comes to management thinking. He is known as the father of the quality movement and was hugely influential in post-WWII Japan, credited with revolutionising Japan’s industry and making it one of the most dominant economies in the world.

There is a lot that has been written about him, his management philosophy and the impact he had while he was still operating. However, there is nothing better than hearing from the man himself talk about his philosophy.

So, when I stumbled onto an hour long interview where he was answering questions based on his thinking, I dug in.

Edwards Deming Interview

You can watch the entire interview here. If you are a management practitioner, do take an hour off your schedule and watch him explain his thinking.

The question I had when I started listening to him was if his philosophy still relevant in today’s times and age.

While there are many people whose ideas lose relevance with time, his ideas and thoughts about management have stayed relevant. They maybe even more relevant today than when he shared them.

His Relevance Today

Here are some things that I think is still relevant for all of us:

1. The most important constraint or opportunity that any organisation has, is dependent on the quality of their top managers and their thinking, mindsets and skillsets. They are the one’s that need the most investment in improving their skills. Every dollar spent on improving them has the potential for the highest RoI.
2. His prediction about American industry being decimated due to their business practices came true.
3. His insight about the top management not knowing what exactly is their job seems relevant today as well. The trust that people have on the top managers are at an all time low.
4. His insight that top managers can’t just learn on the job is spot on. Once we reach top management, the biggest levers we have are our ability to identify and remove our blindspots and this is best done by seeking help. This help could be in the form of attending conferences, talking to coaches or mentors or learning something totally new.
5. His insight that short term and quick fixes that most top managers are looking to deploy, never work in the long term.
6. His insight on having goals on continuous quality improvement that can lead to reduced cost and growing the top line at a company level (global optima) is more important than having limited departmental goals that create local optima.

His thinking was based on first principles and so are still relevant.

System of Profound Knowledge

As mentioned in the Wikipedia article about Deming, he advocated that all managers need to have what he called a System of Profound Knowledge, consisting of four parts:

1. Appreciation of a system: understanding the overall processes involving suppliers, producers, and customers (or recipients) of goods and services (explained below);
2. Knowledge of variation: the range and causes of variation in quality, and use of statistical sampling in measurements;
3. Theory of knowledge: the concepts explaining knowledge and the limits of what can be known.
4. Knowledge of psychology: concepts of human nature.

Each and every one of these parts are still relevant and can benefit us a lot today than it did while he created them. We always say that change (variability) is accelerating and this variation has moved out of our organisations to our markets. This makes managing them that much more difficult and important to understand and manage.

Key principles espoused by Deming

Deming offered 14 key principles to managers for transforming business effectiveness. The points were first presented in his book Out of the Crisis.

1. Create constancy of purpose toward improvement of product and service, with the aim to become competitive, to stay in business and to provide jobs.
2. Adopt the new philosophy. We are in a new economic age. Western management must awaken to the challenge, must learn their responsibilities, and take on leadership for change (All leadership is leading change).
3. Cease dependence on inspection to achieve quality. Eliminate the need for massive inspection by building quality into the product in the first place.
4. End the practice of awarding business on the basis of a price tag. Instead, minimise total cost. Move towards a single supplier for any one item, on a long-term relationship of loyalty and trust.
5. Improve constantly and forever the system of production and service, to improve quality and productivity, and thus constantly decrease costs.
6. Institute training on the job.
7. Institute leadership. The aim of supervision should be to help people and machines and gadgets do a better job. Supervision of management is in need of overhaul, as well as supervision of production workers.
8. Drive out fear (of failure and retribution), so that everyone may work effectively for the company.
9. Break down barriers between departments. People in research, design, sales, and production must work as a team, to foresee problems of production and usage that may be encountered with the product or service.
10. Eliminate slogans, exhortations, and targets for the work force asking for zero defects and 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.
    1. Eliminate work standards (quotas) on the factory floor. Substitute with leadership.
    2. Eliminate management by objective. Eliminate management by numbers and numerical goals. Instead substitute with leadership.
11. Remove barriers that rob the hourly worker (to all employees, specially the white collar worker) of his right to pride of workmanship. The responsibility of supervisors must be changed from sheer numbers to quality.
12. Remove barriers that rob people in management and in engineering of their right to pride of workmanship. This means, inter alia, abolishment of the annual or merit rating and of management by objectives.
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. And the goal of the company is everyone’s goal.

In conclusion

In conclusion, the more I read about the work and the thinking of Deming, the more I feel they are more relevant today than in the past. As leaders, we can benefit a lot more from learning and incorporating his management philosophy.