Deming s 14 Points for the Transformation of Management

Transcription

1 Deming s 14 Points for the Transformation of Management It is not necessary to change. Survival is not mandatory W. Edwards Deming 2008 E: marval.co.uk

2 Profile W.Edwards Deming was a world famous business man whose concepts and methods dramatically altered the economy and working methods of Japan. He was virtually unknown in his native United States until his expertise in quality management was noticed and applied by the Ford Motor Corporation. Subsequently, he helped many, many companies in many industries to turn around their productivity and competitiveness the effects of which are still felt in the US Economy today. E: marval.co.uk 2

3 Profile Deming s formulation of his Fourteen Points is seen by many as the management equivalent of the 10 Commandments. Like many quality driven approaches, the fourteen points take a holistic view of an organisation, how it works, and its relationships with its stakeholders. E: marval.co.uk 3

4 Point 1. Create constancy of purpose towards improvement of product and service, with the aim to become competitive, to stay in business and to provide jobs E: marval.co.uk 4

5 Point 1 Supporting Notes For Deming, the idea of constancy revolves around the customer. Success depends on how well a company evaluates its processes, products and markets in order to understand future customer requirements. On a macro level this entails long term commitment to invest and adapt to changes in the market place. On a micro level, it means fine tuning of every function around changes in strategy that may be needed to meet long term market needs E: marval.co.uk 5

6 Point 2. Adopt new philosophies. Management must awake to new challenges, learn their responsibilities and take on leadership for change. E: marval.co.uk 6

7 Point 2 Supporting Notes In Deming's view, the concept of quality becomes the mission. Quality means giving the customer what he or she has a right to expect. Business cannot afford to tolerate mistakes, defects, poor workmanship or anything else that detracts from quality. Defects of any type are costly, reliable products reduce costs. E: marval.co.uk 7

8 Point 3. Cease reliance on mass inspection to achieve quality. Eliminate the need for mass inspection by building quality into the product in the first place. E: marval.co.uk 8

9 Point 3 Supporting Notes Dependency on inspection at key points in a process to ensure quality is too late, expensive and ineffective. With this type of policy, companies are paying workers to make mistakes and then correct them. Quality comes not from inspection but from improvement of the process. By spotting problems in the process early, they can be nipped in the bud. E: marval.co.uk 9

10 Point 4. End the business of awarding business on the basis of price tags. Instead minimise total cost. Move towards a single supplier for any one item, based on a relationship of long term loyalty and trust. E: marval.co.uk 10

11 Point 4 Supporting Notes Price has no meaning without a measure of the level of quality being delivered. An example is the purchase of a product after a tender process from the lowest bidder without careful attention to specification. This can only increase costs elsewhere. When the concept of quality becomes the central focus, the idea of buying from the lowest bidder gets abandoned. Deming insisted that the principle of close cooperation between customer and supplier would inevitably lead to a process of continuous improvement. E: marval.co.uk 11

12 Point 5. Improve constantly and forever the system of production and service to improve quality and productivity, and thus constantly decrease costs E: marval.co.uk 12

13 Point 5 Supporting Notes Deming believed that each product should be regarded as one of a kind and that there is only one chance of success. In his view the concept of quality should be built in at the design stage and team work in design is fundamental to the process. Deming was an exponent of the Shewhart cycle as an approach to process analysis and improvement. E: marval.co.uk 13

14 Point 5 Supporting Notes The Shewhart cycle can be summarised as follows: Plan a change of what needs to be improved Carry out the change on a small scale Observe the result Study the results and decide what can be learned The underlying concept in simplistic terms is : Plan-Do-Check-Act... E: marval.co.uk 14

15 Plan-Do-Check-Act methodology for service management processes Copyright British Standards Institute E: marval.co.uk

16 Point 6. Institute training on the job. E: marval.co.uk 16

17 Point 6 Supporting Notes Too often workers learn their skills from other workers who themselves have inadequate training. It is useful to train as many workers as possible to recognise when a system is drifting out of control. Workers can do this more efficiently than quality engineers. In addition, workers and managers need to be trained to identify improvement opportunities. E: marval.co.uk 17

18 Point 7. Institute leadership. The aim of supervision should be to help people and machines to do a better job. E: marval.co.uk 18

19 Point 7 Supporting Notes Deming's ideas of leadership revolve around the concept of turning the role of managers and supervisors from policeman to trainer. Since lead management plays a key role in the realisation of quality, management reviews should include discussion on problems and potential solutions. Lead managers should not judge workers on their performance, instead they should look at their own performance to see how that can improve the effectiveness of others. E: marval.co.uk 19

20 Point 8. Drive out fear so that everyone may work effectively for the good of the organisation E: marval.co.uk 20

21 Point 8 Supporting Notes Coercion or management through fear is destructive. It impedes production and interferes with quality work. People cannot perform at their best unless they are secure and are not afraid to express their opinions and fears. Workers who fear their managers or supervisors may well produce the minimum required, but they will not achieve quality. E: marval.co.uk 21

22 Point 9. Break down barriers between departments. People in research, design and production must work as a team to foresee problems of production and use that may be encountered with product or service. E: marval.co.uk 22

23 Point 9 Supporting Notes Breaking down barriers between staff is a matter of team work. There is a lot of truth in the parable that an elephant is a mouse designed by a committee, that did not talk to the creator. E: marval.co.uk 23

24 Point 10. Eliminate slogans, exhortations and targets for the work force asking for zero defects and new levels of productivity. Such exhortations only create antagonistic relationships because the bulk of the causes of low quality and production are a fault of the system and are often beyond the power of the work force E: marval.co.uk 24

25 Point 10 Supporting Notes At first glance such exhortations seem harmless. According to Deming however, such exhortations are aimed at the wrong people. They advertise to workers that management is unaware of the barriers to pride in workmanship, thus creating antagonistic relationships. Because most causes of low quality are systematic, the power to effect improvement lies beyond the work force. Workers can do little to change the system, the burden of improvement rests with management. E: marval.co.uk 25

26 Point 11. Eliminate quotas on the factory floor eliminate management by objective and eliminate management by numbers and numerical goals. Instead substitute leadership. E: marval.co.uk 26

27 Point 11 Supporting Notes The problem with management by objective (MBO) is that an organisation can achieve almost any objective given appropriate resources. The issue is that workers can only function as well as circumstances permit because they focus on the goal rather than the process. Peer pressure will often mean that good workers will achieve the average, where poorer workers will never achieve the mean. The way to improve production is to improve the system and find out who is having problems. E: marval.co.uk 27

28 Point 12. Remove barriers that rob hourly workers of their right to pride in workmanship. This means, inter alia, the abolition of annual reviews or merit ratings and management by objective. The role of supervisors must be changed from monitoring numbers to creating quality E: marval.co.uk 28

29 Point 12 Supporting Notes Often managers do not understand the issue of pride in workmanship because they do not focus on the human processes behind a product or service. Deming believed that performance rating systems were inherently unfair as over time, providing the system was refined and predictable, most workers will perform at the same level, only a few would deviate. E: marval.co.uk 29

30 Point 13. Institute a vigorous programme of education and self improvement E: marval.co.uk 30

31 Point 13 Supporting Notes Although this is similar to point six, the thrust of this point is that educating and improving the knowledge of the workforce enables them to understand the impact of future challenges and to come up with their own solutions E: marval.co.uk 31

32 Point 14. Put everybody in the organisation to work to accomplish quality. Quality is the job of everybody E: marval.co.uk 32

33 Point 13 Supporting Notes According to Deming, the first and most important step on the road to quality is achieved when everyone understands the importance of the fourteen points and becomes an active participant in their implementation. Every job in an organisation is part of the production process, and to achieve the necessary transformation everyone must be committed to analysing every step, because only by understanding the role of each job plays in the company s strategy can the production process be improved. E: marval.co.uk 33

34 The end E: marval.co.uk 34

35 TQM Background Deming & Juran Deming showed how quality problems could be statistically analysed and the root causes highlighted. Joseph Juran also insists upon the human side of quality - that employees would respond to efforts to build in quality, if properly trained. Such training is not just about statistical techniques or technical information but also in holding and participating in meetings, listening to others who had contributions to make and researching problems. Juran's views essentially empower employees to manage quality, to reject sub-standard assemblies, to call for and participate in quality analysis and create ideas for quality improvement. This has often involved the creation of Quality Circles, the formation of groups of employees, often voluntary, who study quality problems and identify causes and solutions. A Management & a Process Issue Companies' attempts to install TQM have often failed. In general, this has been that the company concerned has not taken seriously enough the fact that TQM involves a cultural change for the organisation. It creates a shift in power between boss and subordinate. Many managers, in particular the less well trained, have seen employees as adjuncts to their jobs, as people to be told what to do. People who are disempowered in this way will clearly not take initiative in identifying process or sub-component faults. Human nature being what it is, employees treated this way will say "It's none of my business if the process or sub-components are at fault. Let management get on with it!" Managers have to learn to support, encourage and listen. Empowerment, therefore, has been seen as a necessary part of the installation of TQM. The key to success is to identify the management culture before attempting to install TQM and to take steps to change towards the management style required for it. Since culture is not the first thing that managers think about, this step has often been missed or ignored with resultant failure of a TQM strategy. TQM also stresses the system or process side of the organisation. In some organisations, systems and processes are either absent or ignored. Some managers appear to take a pride in believing that Rules are made for other people, considering rules so much undesirable bureaucracy. Such organisations appear to meet each event as brand new. They rely upon the knowledge in people's heads on how to get things done - and people forget or have varying ideas. TQM is rarely appropriate to the whole of an organization's life. However, in most companies and in most jobs, management or otherwise, 80% of what happens is routine. They key is to focus on this 80%, to systematise it so that energy and attention can be concentrated on the remaining 20% that demands individual or group creativity and thought. The 80% that is routine in most companies is a suitable subject for TQM, whether this be order processing, manufacture, cooking burgers, servicing washing machines or even performance appraisal administration. However, while the system is the focus of quality improvement, it is people who have to identify the issues and opportunities and make changes in the way that they work to accommodate the solutions. Thus, ultimately, the key skill in implementing TQM is the skill of managing change E: marval.co.uk 35