Ative at Work

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Ative at Work

november 2008 - Posts

  • Out of the Crisis - Deming's 14 Points

    In a time where so many are excusing their failure with externalities and saying "it's the crisis" we need leadership and entrepreneurship more than ever. We are in a time of creative destruction and it is precisely these moments that offer great opportunities to those who seek out the new ways of success.

    In the early 1980es, the West faced a similar situation. We were blaming our failure on the Japanese manufacturers "dumping" products - selling below cost, because "no-one could create products so cheaply". Inefficient companies were threatened. Unproductive jobs were lost. The dinosaurs who would not or could not adapt lost their positions. And those who found news ways to improve productivity prospered.

    At that time Dr. Deming came to the fore. His book, "Out of the Crisis" provided a comprehensive overview of the profound system of production that he had taught the Japanese to help them recover from the Second World War. The time had come to apply it in the West.

    It has much wisdom and it is as relevant today as it was then.

    Here are his 14 points, the essence of his teachings:

    1. Create constancy of purpose toward improvement of product and service, with the aim to become competitive and 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.

    3. 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.

    4. End the practice of awarding business on the basis of price tag. Instead, minimize 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 cost.

    6. Institute training on the job.

    7. Institute leadership. The aim of supervision should be to help people and machines and gadgets to do a better job. Supervision of management is in need of overhaul, as well as supervision of production workers.

    8. Drive out fear, 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 in use 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.

    11. (A). Eliminate work standards (quotas) on the factory floor. Substitute leadership. (B). Eliminate management by objective. Eliminate management by numbers, numerical goals. Substitute workmanship.

    12. (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.

    13. Institute a vigorous program of education and self-improvement.

    14. Put everyone in the company to work to accomplish the transformation. The transformation is everyone's work.


    Reading assignment:

    Read (re-read!) Deming's "Out of the Crisis" to get the basics.

    Read Peter Scholtes' "The Leader's Handbook" for a comprehensive guide on to how to use it.

    Then get back to work.

    Stop blaming the crisis. Now is the time to lead.

    Posted nov 05 2008, 02:57 by Martin Jul with 2 comment(s)
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