Service management is usually defined as the point in a supply chain that connects sales and customers, but in recent years the concept has morphed from a fairly narrow aspect of overall management and strategy to a broad management orientation that addresses all facets of…
Read about 14 points of Total Quality Management concept – a kind of guideline on management.
Deming’s 14 Points
Deming’s 14 Points are a set of guidelines for management presented in the Out of the Crisis, written by statistician W. Edward Deming in 1982. Deming is credited with inventing the concept of Total Quality Management (TQM) through the ideas presented in the book, although he did not invent the term “total quality management.” The central concept behind Deming’s management philosophy is that variation is the biggest obstacle to productivity; by following the 14 points, he reasoned, organizations could develop their own ways to reduce variation and improve performance and competitiveness.
Deming developed his ideas while working in Japan beginning shortly after the end of World War II. His work originally had nothing to do with business, but rather to apply his skill as a statistician to helping to conduct a census of the Japanese population. During the 1950s, Deming began teaching Japanese engineers “statistical process control,” a methodology that allowed for better quality control in production without applying new processes or equipment; the idea was enormously appealing to Japanese industry, particularly in the capital-lean years following the war, and for Deming’s contribution to resurrecting Japanese manufacturing, he received the rare honor of being awarded a medal by Emperor Hirohito in 1960.
On a side note, that means that Japan’s position as a powerhouse in some industries, particularly automobiles and electronics, owes much of its success to an American statistician who had some free time on his hands while on an unrelated assignment. Pay attention in your math courses, kids; it might just make you a business god someday.
Deming’s 14 Points explained
Point 1: Create constancy of purpose to achieve quality. This is a suggestion to focus on long-term planning rather than a short-term response to changing circumstances and to align periodic planning with the organization’s overall mission and vision.
Point 2: Adopt the quality way of thinking. The implication is that the implementation of the new, quality-oriented philosophy should be sincere; rather than simply imposing it on the workforce, management has to begin the transformation by changing its way of thinking first.
Point 3: Stop depending on inspection to achieve quality. A basic premise of TQM is that quality control is integrated into production processes, therefore, dedicated quality control procedures, which are out of the normal process flow, are unnecessary and work against increasing efficiency.
Point 4: End the practice of awarding business to suppliers on price alone instead minimize cost by working closely with only one or two vendors. The main idea here is to minimize variations in the quality and specifications of supplies and raw materials. Deming’s contention is that there is a greater net cost benefit to establishing long-term relationships in a supply chain rather than chasing lower prices.
Point 5: Constantly improve every process involved in planning, production, and service. This, of course, is the fundamental idea behind TQM: continuous improvement as part of everyday practice.
Point 6: Institute on-the-job training for all employees. This idea goes hand-in-hand with Point 5; if constant improvement is practiced in every other aspect of the business, it must be applied to the workforce as well.
Point 7: Adopt and institute leadership. Leadership, as opposed to mere “management” or “supervision.” This idea is sometimes confusing because Deming does not define the difference very clearly in his own work, although numerous others have tackled the question, with varying degrees of success.
Point 8: Drive out fear from the work environment. Punitive management, that is, where the primary check on performance is to punish performance that is not up to the expected standards, is counterproductive because it discourages workers from working for the organization’s best interests. In other words, they are performing at the minimum level necessary to “stay out of trouble”, rather than trying to excel.
Point 9: Break down barriers between the workers and the management. This point, as Deming discusses it, is not so much a statement on the form of organization but a prescription for another basic idea in TQM, that different parts of the organization have a supplier-customer relationship with one another.
Point 10: Eliminate slogans, exhortations, and targets. In TQM, the presumption is that the likely source of variation and error is the process, rather than the people. Deming views slogans – the sort of thing one might see on those ubiquitous motivational posters – as useless at best, if the process that they are directed towards is not improved.
Point 11: Eliminate quantity-quotas and targets for the workforce and management. This is related to Point 8; continuous improvement is not possible if some “endpoint” is established. The focus of the work will shift from seeking continuously improving quality and productivity to meeting a quantitative goal.
Point 12: Remove barriers that rob people of their pride in workmanship, and eliminate the annual rating or merit system. This particular point is a bit difficult to interpret; Deming’s view is that merit-based performance rating is demotivating, and he ties it in with his general distaste for targets, quotas, and the “carrot-and-stick” approach to performance management. On the other hand, if taken to extremes this point could suggest that performance is not important, which would be an idea most managers would take exception to.
Point 13: Institute a vigorous program of education and self-improvement for everyone. This point is simply an extension of the ideas in Points 5 and 6; “continuous improvement” must be applied to the people as well as processes.
Point 14: Put everyone in the organization to work to accomplish the transformation. This point is related to Point 7; any organizational transformation must include everyone and not simply be imposed on the organization.
The most common criticism of Deming’s 14 Points is that they do not provide any tools to carry out these ideas, and in many ways suggest that tools for measuring and management performance are counterproductive. Deming himself provided little guidance to deflect this criticism; his position was that these were broad objectives and that it was up to management to develop the means to reach them, according to their own organization’s unique circumstances.
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