Out of the Crisis
Author: W. Edwards Deming
Deming, and his book Out of the Crisis (http://www.amazon.com/Out-Crisis-W-Edwards-Deming/dp/0262541157), is part of what has driven my passion for Agile Business Management. While this book is over 30 years old (first published in ’82) and predates the “Agile” movement, many of the concepts and recommendations that Deming makes align to the values & principles of the agile manifesto (http://agilemanifesto.org/).
A call to action
Although written in the context of American manufacturing, Out of the Crisis was a call to action for companies to address systemic problems in the way that western management operated. Where the emphasis on short-term profits, lack of forward planning, use of performance evaluation, inconsistency of management and management by numbers reduced the capability of companies to adapt, innovate and remain successful in the long-term.
Do these seem familiar? 30 years on, and these “diseases”, as Deming called them, are still prevalent in many of the organisations I work with. To be successful, Deming says, managers must “learn how to change”, “innovate … products and services for the future” and “have an unshakable commitment to quality and productivity”. By treating an organisation as a system, sustainable business growth can be driven through the successful management of interactions between business functions, investment in innovation and strong staff engagement.
14 points for managers
At the heart of Deming’s approach to business transformation are his 14 points for management. Although 30 years old, these principles are still valid for any agile organisation. That is why I reference them (with permission) in my own book.
- Create constancy of purpose toward improvement of product and service, with the aim to become competitive, stay in business and to provide jobs.
- 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.
- Cease dependence on inspection to achieve quality. Eliminate the need for inspection on a mass basis by building quality into the product in the first place.
- End the practice of awarding business on the basis of a price tag. Instead, minimize total cost. Move towards a single supplier for any one item, on a long-term relationship of loyalty and trust.
- Improve constantly and forever the system of production and service, to improve quality and productivity, and thus constantly decrease costs.
- Institute training on the job.
- 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.
- Drive out fear, so that everyone may work effectively for the company.
- Break down barriers between departments. People in research, design, sales, and production must work as a team, in order to foresee problems of production and in use that may be encountered with the product or service.
- Eliminate slogans, exhortations, and targets for the workforce, 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.
- a. Eliminate work standards (quotas) on the factory floor. Substitute leadership. b. Eliminate management by objective. Eliminate management by numbers, numerical goals. Substitute leadership.
- a. Remove barriers that rob the hourly worker of his right to pride of workmanship. The responsibility of supervisors must be changed from sheer numbers to quality. b. 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 objective.
- Institute a vigorous program of education and self improvement.
- Put everybody in the company to work to accomplish the transformation. The transformation is everybody’s job.
What I particularly like about this book, is that while these 14 points may seem simple (and obvious to us now), Deming spends the next 400 pages describing the failures of business and how these principles drive continuous improvement. There are some great case studies and examples of the business failure.
My final thoughts; this is a great book and has remained relevant throughout the last 3 decades. Sadly I believe it will remain relevant for decades to come. If you’re after an interesting read, I’d highly recommend it.