Many of us who worked in the 80s and 90s with the concepts of Total Quality, we observe how today the management principles that Dr. William E. Deming left us are still in force.
These principles were a pillar for the development of quality and allowed countries such as Japan and the tigers and tigers of Asia to position themselves over countries that stand out for their competitiveness, mainly caused by the quality of their export products.
Likewise, the United States, when it discovered itself, returned to occupy the place that as an economic power forces it to have. The famous documentary "If Japan Can, Why Can't We?" Woke them up from a slumber of several decades, rediscovering their own "gurus."
Deming's 14 Principles
1.- Constancy in the purpose of improving products and services:
"Dr. Deming suggests a radical new definition of the role of a company: More than making money, it is staying in business and providing employment through innovation, research, constant improvement and maintenance." *
This first principle is valid and will remain valid for life, as the improvement in products and services will never end. We read in a Spanish magazine that today R&D had to become R & D & I, research, develop and innovate permanently. Some of us still apply the title of that article: "Let them invent", referring to the achievement of the Germans and other countries in Franco's time.
2.- Adopt the new philosophy:
“Poor workmanship and unfriendly service are too tolerated today. We need a new religion in which errors and negativism are unacceptable. ”*
To achieve constancy in the purpose of continuous improvement, it must be accepted as a philosophy of its own, and adopt it to all the tasks of the company. Fortunately, one of the principles of ISO 9000 establishes them: "Continuous improvement of the overall performance of the organization should be a permanent objective of the organization." Unfortunately, many companies move from one philosophy to another, they are eagerly looking outside, having a lot to discover inside the company.
3.- No more reliance on mass inspection:
“Companies typically inspect a product as it leaves the production line or at important stages along the way, and defective products are discarded or reworked. Both practices are unnecessarily expensive. In reality, the company is paying workers to make defects and then correct them. Quality does NOT come from inspection but from process improvement »*.
This principle was misunderstood. We recall a company that, applying the principle to the letter, reduced its quality inspectors from 20 to 4 with the consequent problem in the deterioration of the quality of its products. Inspection is NEVER eliminated, it becomes unnecessary, which is achieved by the growth of your staff, by the control of your processes. If a company has quality problems, it should not only inspect 100%, but not up to 400% to make sure no faulty products reach the market. Deming himself recommended it to us. Once in CR we received a visit from a Japanese acquaintance, a leader in Total Quality. When asked how many companies were in Total Quality, in CR ?, he answered that none, because of all the ones he had seen, he did not find a single control chart,reason for which it considered that there was no control of their processes and therefore they continued with the massive inspection of their products.
4.- End the practice of awarding purchase contracts based exclusively on price:
“Purchasing departments usually work on the order of looking for the lowest priced supplier. This often leads to poor quality supplies. Instead, buyers should seek the best quality in a long-term relationship with a single supplier for a certain item. ”*
As a materials manager in several multinational companies we learned several lessons of what it is to change suppliers, concluding that the cost of a product is not the purchase price but the use price. A raw material that is acquired from a new supplier, even if it is on the list of approved suppliers, famous today, will cause great losses until the process is adjusted and the rest of the inputs are coupled to the new raw material. If it is difficult to obtain the same quality in two different batches from the same supplier, even more so from two different suppliers.
Some companies relied on this principle to develop the concept of "Single Supplier", believing that now they would have a single supplier for all their products. What Dr. Deming promoted was a "single source for each product."
5.- Continuously and forever improve production and service systems
“Improvement is not a one-time effort. Management is obliged to constantly look for ways to reduce waste and improve quality. ”*
In addition to the continuous improvement of products, systems must be improved, as we will hardly reach new goals with the same methods. The study of the process capacity, the narrowing of the tolerance levels until reaching 6 sigma (3.4 defects per million), makes that companies can really stand out in this globalized market. This aspect is specifically reinforced in clause 8.5.1 of ISO 9001, which establishes: «The organization must continuously improve the effectiveness of the quality management system through the use of the quality policy, quality objectives, results of the audits, data analysis, corrective and preventive actions and management review ”.
Very few companies use or understand the concept of the Cpk (Process Capability Index) and its relationship with the variability of the process itself as measured by variance.
6.- Institute on-the-job training:
“Too often, workers are taught their work by other workers who never received good training. They are forced to follow unintelligible instructions. They can't do their job well because no one tells them how to do it. ”*
Permanently train workers and supervisors in their own processes, so that this learning helps to improve them both incrementally and radically. First have knowledge of what is done, beyond following the procedure, the mechanic who knows mechanics, the welding welder, etc. ISO 9000 confirms this in 6.2 when it establishes that "personnel performing work that affects product quality must be competent based on appropriate education, training, skills and experience."
«The organization must:
- determine the necessary competence for personnel performing work that affects product quality; provide training or take other actions to meet those needs; evaluate the effectiveness of actions taken; ensure that your personnel are aware of the relevance and importance of their activities and how they contribute to the achievement of quality objectives.
Today training goes from degeneration to degeneration. Each person who trains degenerates knowledge.
7.- Institute leadership:
“The supervisor's job is not to tell people what to do, nor is it to punish them, but to direct them. Leading is about helping staff do a better job and learning through objective methods who needs individual help. ”*
Much has been written on the subject, and there is agreement on the need for the involvement of the leader so that things change, so it is not necessary to go deeper. In a cause-and-effect relationship analysis we did in a working group regarding the 8 principles of ISO 9000: 2000, we concluded that the trigger for all effort is leadership. Developing leaders at all levels is the obligation of the superior leader, removing the fear that if they are better then he ends up throwing him away.
Leaders establish unity of purpose and direction for the organization. They should create and maintain an internal environment, in which staff can become fully involved in achieving the objectives of the organization.
8.- Banish fear:
“Many employees are afraid to ask questions or take a position, even when they don't understand what their job is, or what is going well or wrong. They will continue to do things wrong or they simply won't. The financial losses from fear are terrible. To guarantee better quality and more productivity it is necessary for people to feel safe »*
It has been said that there is no fear of change but of the uncertainty of what will happen with the change. In addition to explaining what the change consists of, few managers show that they have banished fear from their managerial style, pressing on unattainable goals, blaming subordinates for the lack of capacity in the processes that are managerial responsibility. Ishikawa told us that 85% of the problems are the responsibility of the Management, few understand what this means. Banish the fear of being wrong. As we regret in the training within the company, as in the presence of the superior, no one dares to speak, ask or less question, that does cause pain. As soon as he leaves the room, the questions and questions arise by the thousands.
9.- Break down the barriers between staff areas
“Many times the departments or the units of the company compete with each other or have goals that collide. They don't work as a team to solve or anticipate problems, and worse still, the goals of one department can cause problems for another. ”*
Although Hammer and Champy used it as a workhorse in their famous reengineering, this focused on the layoffs of personnel, missing the great opportunity to break down barriers between departments that forget that the battle is not internal but against a competition that does not cease and customers who are unwilling to demand less than the best. There is great wear between departments that makes it difficult to reach correct solutions. Today the process-based approach and the systems approach timidly propose to identify the processes and manage their interactions, but care must be taken to mention that the problem is one of "flowchart", it is one of power, like it or not.
10.- Eliminate slogans, exhortations and production goals for the workforce:
“These things never helped anybody do their job well. It's better to let the workers come up with their own slogans. ”*
Advertisements in newspapers, posters throughout the company, murals with the footprints of the personnel, contribute to the quality environment, but do not improve the quality. If the money that is spent in these campaigns were invested in making in-depth studies of the processes, in knowing the real needs of the clients, the situation would be different. Some companies certified under ISO 9000, abuse the word ISO, as if this were the really important thing, forgetting about the continuous improvement of quality and service. Why, when talking about the achievements of the latest management trends, very little is said about the quality and competitiveness of companies?
11.- Eliminate numerical quotas:
“Quotas only take into account numbers, not quality or methods. Generally they are a guarantee of inefficiency and high cost. The person, to keep the job, meets the quota at any cost, without taking into account the damage to their company »*
If the implicit variability in all of them were accepted as a maxim of all processes and if all the effort was concentrated in reducing it, the goals would be achieved by themselves. What is gained by reviewing the goal of the week or month with its ups and downs, if they vary due to normal causes. Goals are reached and nobody analyzes why; they are not reached and it is not analyzed either, it is admonished, in the following month they are reached and then fall again. A new goal without a new method does not change the process. Rewards and punishments do not improve processes.
12.- Break down the barriers that prevent the feeling of pride that produces a job well done.
“People want to do a good job and are mortified that they can't do it. Too often, misguided supervisors, faulty equipment, and imperfect materials hamper good performance. These barriers must be removed »*
No employee who joins a company new enters demotivated, but in a very short time we take care of demotivating them. People do not make mistakes on purpose, they act within what the system allows them, the fault is in the system, not in the people. Failures in selection, in induction, in training, in recognizing achievements, in studying the causes of failure, in the absence of continuous improvement processes. Some people with the healthy intention of democratizing companies want to involve employees in the definition of the Mission and Vision of the company, but they are not willing to listen to suggestions in improving their own processes. Participation is the way to make a person valuable.
13.- Establish a vigorous education and training program:
"Both the administration and the workforce will have to learn the new methods, including teamwork and statistical techniques." *
This principle complements number 6 on training. This is more referred to what is known as "Training and Development of Competences", which depends on the vision of the company, the objectives to achieve it, the new ways of being able to compete, the new processes to develop, the new behaviors of the personnel at all levels, in synthesis of the cultural change that the company requires.
14.- Take steps to achieve transformation
“To carry out the quality mission, you will need a special group from senior management with an action plan. Workers can't do it alone, and neither can managers. The company must have a critical mass of people who understand the Fourteen Points, the 7 deadly diseases and the obstacles. ”*
The transformation does not come alone, top management must make the decision to want to do it and apply the principle of instituting leadership. To achieve the transformation, it must be more than just calling the consultant, appointing the "management representative", it means committing and being an example, training first, fulfilling their task. Those companies that today give us satisfaction in our work as consultants are those where the General Manager was the pillar of change, established good guidelines, motivated his people, and made a commitment. The best consultant is no substitute for a bad manager.
The 7 Deadly Diseases of Management
In addition to the 14 principles, Dr. Deming bequeathed us a series of management diseases and obstacles to the growth of companies:
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.
14 obstacles to quality
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. We often 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:
"Even though the problem for all companies is processes, the real problem is how those processes are managed," Hammer wrote 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. Dependency of the 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. "Silly" machines that accumulate inconsequential data and on which decisions are not made, since managerial "skill and feeling" 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 everything 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.
Dr. William Deming is known as Edward Deming, which is a mistake, since "Edwards" is his mother's last name. He died at 94 years old, a year before he was still giving seminars, worried that in the West he 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, ColombiaHow to understand Process Reengineering, MacDonald, John, 1996, Panorama Editorial, MéxicoFundamentals of Process Mapping, Roberto Damelio, 1999, Panorama Editorial, MéxicoEmpowement: Wellins, Richard, 1991, Jossey-Bass Publisher, USAStrategic Management Control, 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, ò Manganelli, Raymond, 1995, Editorial Norma, Colombia Knowledge is future, Valdés Luigi, 1996, CCTC, FUNTE, CONCOM, Mexico
