In addition to the 14 principles, Dr. Deming taught us about a number of deadly management diseases and obstacles that impede the growth of companies:
The 7 deadly diseases of management
1.- Lack of constancy in purpose
Management constantly changes direction: today it is ISO 9000, yesterday Reengineering, before Total Quality. You go from one methodology to another, you send mixed signals to the staff. Projects are abandoned, for being with the "flavor of the month", but the constancy in the purpose of constantly improving processes and products is not noticed. The commitment is not noticeable. In a company that was in the Total Quality process, the same Manager asked us, how we were doing with the implementation, the answer was: «terrible, if you are the one who asks». Luckily today the same ISO requires that the quality policy establish continuous improvement and highlights the importance of the involvement of Management. It had to be made mandatory for its importance to be understood.
2.- Emphasis on short-term profits
It is difficult for a management, which spends every day reviewing the figures for the month, trying to guess the reason for the losses obtained, to achieve the transformation; he is so preoccupied with today that he can hardly see tomorrow and even less the day after tomorrow. We remember a sad experience when a manager wanted to buy a raw material of dubious origin but at a very low cost. Profits for the period depended on that purchase, and on profits from the renewal of his contract. In this type of company, the company does not change, the manager is changed. But what happens when you are the owner? Companies are sold, they merge, they disappear.
3.- Performance evaluation, classification according to merit
The habit of passing the blame to the lower level of bad results, makes performance evaluation enthroned, in order to identify the culprit. What Ishikawa said has been forgotten, that 85% of problems are the responsibility of Management. Using evaluations to spare a few pennies on increasing employees is not well seen, when despite all their effort they cannot achieve the results, which happens when a management is disconnected from the processes. We have experienced that some companies have turned the excellent strategic tool of the Balanced Score Card into a poor tool to evaluate performance, that is, not wanting to see where the evil is.Some effort is being made to change the focus with the famous "360 ° Assessment, although we must recommend the last chapter of Mary Walton's book," How to Dispense with Performance Assessments with the Deming Method.
4.- Management Mobility
The emphasis on short-term profits and managing based on visible numbers, causes the manager to be moving from one company to another. It is better to change ships while there are profits, no one hires someone who has worked in a company that closed. Others seek a better position in a new company. The managers that we knew 2 or 3 years ago are gone, new leaders come with new ideas, constancy in the purpose of continuously improving products and services is abandoned.
5.- Manage a company based solely on visible figures
What Dr. Deming told us, more than 30 years ago today Prahalad, Kaplan and many other authors repeat to us, the visible figures that financial accounting shows us do not reflect what a company is worth. Customer loyalty, high product quality, market share, employee knowledge, managerial ability, what is now known as intangible assets are not accounted for. When a manager manages with only visible figures, very soon he or she runs out of figures, or company to manage.
6.- Excessive medical costs
When companies began to notice that with the new prerogatives of social security, employees were absent with the excuse of going to Insurance, they changed the concept to company doctor, to prevent them from leaving the facilities. In recruiting ads, it's presented as a benefit. Absences and disabilities are a sign of something more than vagrancy of the worker, it is that there are companies where working is a nuisance, because human resources are not valued. The worker must endure calls for attention due to poorly designed processes, lack of leadership, lack of motivation, lack of planning, lack of vision from their bosses, lack of ability to make the company the best place to work. The doctor.Deming said that this was only for the US industry but it is also a reality in our Latin American companies.
7.- Excessive warranty costs
There are audible complaints and there are inaudible complaints, the former probably becoming complaints that must be addressed and in many of them honor the guarantee. But beware of those customers who do not complain, but stop buying. "This is what we can do best, period, take it or leave it." With this quality we want to withstand the avalanche of foreign products and compete in international markets, we are even willing to sign free trade agreements. Competitiveness is not in laws, infrastructure, industrial reconversion, reciprocity, financing, it is in the quality of the products and services that are offered. If we understood the concept of the "chain reaction" another legacy of Dr. Deming, everything would be different.
The 13 obstacles that prevent the growth of the company
1. Neglect of long-term planning and transformation
Strategic planning processes are a ritual that does not really change any company. The rigorous question we ask is »What if we did not do anything of the above, would the company continue to survive? The answer is often yes. The planning processes, with few exceptions, seek the transformation of companies, they are spiritual retreats, which last as long as the process lasts. Goals with 10% over recent years, and the usual complaints about how bad the government is. It is a matter of observing some "visions", which hang in the reception of companies. What is the challenge they pose? All will be leaders.
2. The assumption that problem solving, automation, mechanical or electronic novelties, and new machinery will transform industry
We already saw it with the Structural Adjustment Program, 1, 2 and 3, the economic structure, except for the software industry, remains exactly the same, the Tax Credit Certificates or "Cats" did not help either, nor did the industrial reconversion. It is the transformation of the management that is needed and in many cases of our leaders in any of the aspects in which they find themselves, be they politicians, businessmen or trade unionists, the latter also have the responsibility for the development of our countries. When one watches the news on topics of economy, industry, etc. the same ones always appear, with repeated arguments, the problems are not solved.
3. Looking for jobs (labor mobility)
Despite talk of unemployment, newspapers and many ads in companies continue to request personnel. There are areas where employees rotate between the different companies in the area, we even heard a case that when a person changes, their friends go with them. It is so unappealing to stay in a company, there is so little encouragement. Indeed, many see their employees as "paid enemies", wasting the potential they have to achieve the transformation that companies need. Often we hear almost as a plea, "you know, if you know something for me, let me know." Everyone is willing to change companies. Suggestions are not listened to, they are not involved in problem solving.
4. Our problems are different
"Although the problem of all companies is the processes, the real problem is how those processes are managed," wrote Hammer in "Beyond Reengineering." Companies do not focus on their processes, but on talking about technical differences, which has nothing to do with the problem. Greater emphasis should be given to managing processes and properly managing the interactions proposed by ISO 9000, understanding the systems approach, deep knowledge of processes, that is what makes different companies, the problems are similar, what are different are the managers. Dr Deming anticipated ISO several decades earlier.
5. Obsolete instruction in universities
When one returns to the classrooms, almost close to the third age, one realizes that the proliferation of universities has not contributed to improving the productivity of companies, due to the total loss of the national reality, in which the majority they are immersed. Many of them teach management history under different names or repeat what was learned in baccalaureate and undergraduate degrees in masters. Statistics rests on theoretical concepts and quantitative methods become the problem and not a tool for decision making. In a university, more importance is given to the puppet work for the dissertation of a thesis, than the depth of the dissertation itself. If nothing is done, with higher education,We will have professionals with a master's degree managing taxis and bazaars. An effort is being made in El Salvador regarding this problem, it is an example to follow.
6. Dependence on quality control departments
Quality is achieved at the end of the line, the product is good or bad if quality says so. The "Taylorian" concept of, some think, others do, others revise is maintained. The measurement of variability is absent, graphs without any utility and poorly constructed. The concept of quality control is maintained, the statistical control of processes is absent, the quality in the design, the analysis of the way and the way in which products fail, the deployment of the quality function is not used. Luckily, good products come out.
7. Blame workers for problems
No process can give more than what it was designed for and who designs those processes? If you know, you know who is responsible for the problems.
The operator performs within what the process allows, he can only keep it within the normal causes of variation, which have been established with the process design, which has not been his responsibility. But who studies how to differentiate the normal causes of variation characteristic of the process, from those that are alien to it?
8. Quality by inspection
Lack of knowledge about what quality is designed, not inspected, absence of techniques such as QFD (Quality Function Deployment), FMEA (Failure Mode and Effects Analysis), DOE (Design of Experiments), statistical techniques for the analysis of data, probabilities, etc.
9. False starts
Administrative techniques are like "flavor of the month." Processes are started, based on the last seminar, the "best seller" of the month or the latest news from the consultant on duty. Solutions are implemented where there is no problem, others are discarded to be the last. "We are no longer in Total Quality, now we are in ISO". All these false starts, demotivate the worker, increase the variability of the processes, simply because we misunderstand the concept that the "only constant is change." The worker no longer understands what it is about, programs, consultants constantly change, new positions appear, new projects are a daily thing. And all of them seeking to overcome one another in order to please the new manager or the corporate director,the priority depends on the importance of the superior's position.
10. The unguarded computer (there is no real use)
Few companies have the data analysis scenario activated on their computer in Excel sheets, to comment on a simple concept. "Dumb" machines that accumulate inconsequential data and on which decisions are not made, as managerial "skill and filling" continues to prevail. In very few of them we have seen an adequate Scorecard with its cause-effect relationships in the various perspectives. We must apply the 5 "S" to computer equipment.
11. Meet the specifications (without verifying if the process has capacity)
A process can be in specification but out of control. The variability of the process shows that it fluctuates beyond the allowable variation. In contrary cases, the specification is breached, although the process is within control, within what it is capable of. This process, no matter how much rewards or penalties are established, does not have the capacity to comply with the specification, although some "good" products will eventually come out.
12. Inadequate testing of prototypes
Products are launched on the street for which the corresponding tests have not been done, products are designed without considering the capacity of the processes that will give them life, the interested parties are not taken into account. Design and production are distant.
All is not lost, ISO 9000 of 2000 forces to comply with a series of requirements for product design that goes beyond what is done today, even for those companies that were certified under ISO 9002, but cannot justify the exclusion of this requirement.
13. Anyone who comes to try to help us should know all about our business
If that were true, those within the company would have already solved the problem, as they are the ones who know the most about the business. Solving problems within the paradigms of the same industry slows down the agony.
The problem is one of processes, of process management, of managing based on data analysis, of incorporating personnel at all levels, it is training, it is deep knowledge, it is leadership.
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Dr. William Deming is known as Edward Deming, which is a mistake, since "Edwards" is his mother's last name. He died at the age of 94, a year earlier he was still giving seminars, worried because the West had not understood him.
Bibliography
- How to get out of the crisis, William E. Deming, ISO 9004: 2000, Recommendations for performance improvement, Total Alignment, Riaz Khadem, Editorial Norma 2002, Bogotá, Beyond Reengineering, Hammer, Michael, 1997, Editorial Norma, ColombiaCuadro de Mando Integral, Kaplan, Robert, 1997, Ediciones Gestión 2000, BarcelonaBenchmarking, Camp, Robert, 1992, Prentice Hall, USA How to understand Benchmarking, Tanner, Steve, 1998, Panorama Editorial SA, MéxicoEmpowerment, Blanchard, Ken, 1997, Editorial Norma, Colombia How to understand Process Reengineering, MacDonald, John, 1996, Panorama Editorial, México Fundamentals of Process Mapping, Roberto Damelio, 1999, Panorama Editorial, México Empowement: Wellins, Richard, 1991, Jossey-Bass Publisher, USA El Control de Gestión Estratégico, Lorino, Phillipe, 1993, Ediciones Alfaomega SAMexicoRethinking the Future, Gibson, Rowand, 1997, Editorial Norma, ColombiaReengineering, Hammer, Michael, 1994, Editorial Norma, ColombiaGerencia de la 4ta Generación, Joiner, Brian, 1995, McGraw-Hill, MéxicoHow to do reengineering, òManganelli, Raymond, 1995, Editorial Norma, Colombia Knowledge is Future, Valdés Luigi, 1996, CCTC, FUNTE, CONCOM, Mexico
