American statistician, business consultant, and educator Dr. William Edwards Deming introduced methods and ideas that have left a profound impact on modern businesses and develop the effective management techniques used today.
Born in Sioux City on October 14, 1900, W. Edwards Deming attended the University of Wyoming earning his B.S. in 1921, University of Colorado earning his MS in 1924, and Yale University earning his Ph.D. in mathematical physics. He went on to teach physics at universities, operated in the U.S. Department of Agriculture as a mathematical physicist in 1927, and then worked for the U.S. Census Bureau as a statistical adviser in 1939. Following these positions, he worked as a business consultant and statistics professor at New York University’s graduate school of business administration from 1946 to 1993, and later being chosen as a distinguished professor in management at Columbia University in 1986. Deming founded the W. Edwards Deming Institute just before he passed away in 1993.
The formation of Deming’s principles first began in the 1930s, when he first became interested in methods to increase quality control with statistical analysis. He took influence from the experimentations of Walter Shewhart, who was studying the application of statistical techniques to manufacturing process, and Deming aimed to apply them to activities relating to clerical, administrative and management settings. He first applied statistical process control to the operations of the US Census Bureau during his involvement in 1939, increasing their productivity six-fold. He also taught engineering and design courses to educate people on the developing ideas of statistical process control. Deming’s statistic training program at Stanford used the Shewhart’s Cycle for Learning and Improvement and the PDCA Cycle to educate almost 2000 people.
These methods, still developing were first applied and given notoriety in Japan. Following the catastrophic bombings there at the end of World War II, Japan’s economy was nearly shattered and in desperate need of aid. Deming was invited there in 1950 by Japanese business leaders to educate executive about his methods of quality control methods. As a result of his teachings and the adaptation of his methods into Japanese businesses, Japanese firms soon controlled much of the world’s product markets. At first, his ideas were rejected in the United States, the leading economic power at that time. With this power and envy by the rest of the world, the US did not see a need for his ideas when he first introduced them. By the 1980s, though, they came to adopt them after it was observed how much they helped to rebuild and improve Japanese economy.
The central idea to Deming’s methods is the focus on the importance of variation. In his book Out of the Crisis, he notes that “The central problem in management and in leadership… is failure to understand the information in variation.” This focus lead to the creation of his theory of variation, which states that special variation causes are typically attributed to quickly noticeable factors, like changes of operator or procedure, but that common causes remain after special causes are eliminated. Only managers can change common causes of variation, though they are most easily recognized by workers going through the process.
Deming’s ideas later developed into the addition of his 14 points for management, first introduced in his book Out of the Crisis, which raised the effectiveness of business management. Deming himself states in The New Economics, “My 14 Points for Management follow naturally as application of the System of Profound Knowledge for transformation from the present style of management to one of optimization.” These points were mainly applicable for long term business goals, which became Japan’s general method of operation after the incorporation of his teachings. Deming targeted US industry management specifically when he formulated his seven deadly diseases of management. These principles helped to establish him as a founder of the Quality Management movement, attracting an audience wider than those just interested in general quality. The first deadly disease is a lack of constancy of purpose to organize services that will create a market for company productivity. Second, an emphasis on profits and thinking that are short term, as a result of the need for dividends and fear of unfriendly takeover. Third, performance reviews and annual evaluations. Fourth, allowing managers and job specifications to be flexible. Using only the data available for management is the fifth, having high medical costs being the sixth, and the seventh being high liability costs.
Building off of Shewhart’s Plan-Do-Check-Act (PDCA) Cycle, Deming modified it into the Deming cycle, or the Deming wheel. It involves Planning for changes for improvement, Doing the changes minimally first for testing, Checking to see if the changes and selected processes are effective, and Acting to earn the greatest benefit from the change. These steps are then continued in a cycle for constant improvement.
Though Deming’s principles have been proven useful in many situations, the reestablishment of Japan’s economy being a major example, there are those who criticize their effectiveness in other circumstances. For example, some believe they rely too much on statistics, resulting in a lack of creativity and innovation. His exclusion of Management by Objectives and performance reviews has led to uncertainty with many, and some blame his cost-reduction focus to increased downsizing. One of the major reasons US industries deny the incorporation of his methods is because of the tendency for American businesses to have short-term goals and focus, which is the opposite of Japan’s developed tendency. While he went along with Japanese advisors in developing his theory, he was unwilling to adapt it to American culture by the 1980s, preferring to keep it the way he formatted it in Japan.
Though his theories are not popular in every business culture, they remain relevant in the today’s diverse management culture mostly because of how they are continuously debated and taught in business schools throughout the world. In addition, his 14 points together create a code of management philosophy that falls under two major management schools, successfully combining the two against all doubt: the first being hard scientific management and the second being soft human relations management.
While his principles are still taught and referenced in various basic management courses, those who hold executive responsibility and wish to learn specifically about his principles can attend seminars held by the W. Edwards Deming Institute. For the previous course, held for three consecutive days in April, the first two days were 8 hours each and the third day was four hours, and the cost was $1,100 for individual or first person in group and $950 for each person added. These seminars are held in locations specified by the Deming Institute; this seminar was held in Tipp City, Ohio, and W. Edwards Deming Institute itself is located in Rockville, Maryland.