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The Management Philosophy of Edwards Deming - Article Example

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The paper "The Management Philosophy of Edwards Deming" describes that the widespread tendency of many managers (and academics) to latch on to what is tangible and relatively easy to implement (such as tools) suggests little in the way of fundamental change…
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Extract of sample "The Management Philosophy of Edwards Deming"

Deming: A new philosophy or another voice?

Abstract (Summary)

This article questions the widely held proposition that the management philosophy of W. Edwards Deming, with its focus on quality improvement and pragmatic thinking, is a new conceptual paradigm which renders previous management thought, particularly that represented by the scientific management concepts of Frederick W. Taylor, obsolete and wrong-headed. A closer examination of the similarities between older management theories and those of Deming indicates that there is significant commonality. Deming has provided, not a radical new school of thought, but a complementary body of emphases that enrich our understanding of management rather than revolutionize it.

[Headnote]

This article questions the widely held proposition that the management philosophy of W. Edwards Deming, with its focus on quality improvement and pragmatic thinking, is a new conceptual paradigm which renders previous management thought, particularly that represented by the scientific management concepts of Frederick W. Taylor, obsolete and wrong-headed. A closer examination of the similarities between older management theories and those of Deming indicates that there is significant commonality. Deming has provided, not a radical new school of thought, but a complementary body of emphases that enrich our understanding of management rather than revolutionize it.

Background-battles of management thought

In his famous essay on organizational theory, Charles Perrow (1978) remarked that organizational analysis has repeatedly been marked by a battle between the forces of darkness (the mechanical school which treats the organization as a machine) and the forces of light (the human relations school which emphasizes people, accommodation and systems). Though this battle has raged for most of the last century, Perrow concluded that we have learned more about what does not work than what works.

The search for the light has gone on. Over the last ten to 15 years, the forces of light have often been defined by scholars, consultants and practitioners for what has come to be called the "Total quality" movement. Their argument has been that US industry has failed to keep pace with progressive industrial and managerial practice (most often identified with the Japanese). In addition to promising to revitalize US industry, proponents of the total quality movement have boldly suggested that they have found the secret for improving every type of formal organization. As with most movements, promises have exceeded grasp. Clearly, organizational success entails more than a focus on quality, use of techniques such as quality circles, understanding concepts of variation, exceeding customer expectations, consensus, and all the other terms and concepts associated with total quality management (TQM)[1]. Nevertheless, no one has repealed the business cycle, good intentions do not guarantee success, and new paradigms may not fully exploit their promises.

Deming versus Taylor

A common theme during the years of development of management thought is that a new idea (or what appears to be a new idea) must identify some older concept as the cause of failures. We are wont to resist making the intellectual effort to treat new ideas as potential complements to old ideas. As an example, proponents of W. Edwards Deming and his concepts (e.g. Delavigne and Robertson, 1994) have been particularly critical of classical management, in particular the ideas of "scientific management" as proposed by Frederick W. Taylor and his followers (Taylorism). Deming's disciples have frequently argued that basic philosophical perspectives are at war: Taylor representing positivistic, deterministic concepts rooted in the understanding of a predictable, mechanical universe; Deming representing systems-oriented and dynamic pragmatism. Taylorism is condemned as a false doctrine that ultimately seeks managerial dominance over workers and fosters unhealthy outcomes, such as: workers who are but biological parts in some great machine; unhealthy competition between organizational units and individuals; and sub-optimization. It is further condemned for making management and managers dictators and definers who are to decide and enforce upon the workers all aspects of their jobs while mandating compliance. Resulting evils identified include individual performance evaluations, merit pay, trivial slogans and goals, and quality by inspection.

The Deming philosophy (Deming, 1986, 1993), on the other hand, is proposed and praised as providing a "correct" theory founded on general systems theory, an accurate understanding of the nature and interpretation of variation, a proper understanding of human behavior, and an understanding of the nature and purpose of "theory". Here, managers are to be accountable, to beneficially coach and to facilitate integration of all parts of the organizational system. Integrative systems concepts to be used include exhortations to exceed customer expectations, emphasize the group over the individual, use communication and involvement techniques, understand the nature and importance of intrinsic rewards, eliminate goal setting and performance evaluations, and teach and use quality charting techniques. Examples of support and admiration for Deming are found in the works of Dobyns and Crawford-Mason (1991; 1994). These authors have extolled Deming's ideas as the work of a philosopher, prophet and revolutionary. They also have given us some insight into why Deming vaulted into visibility and popularity in the 1980s - his messages of customer focus and quality spoke powerfully to US managers who were becoming obsessed with the emergence and power of the Japanese economy and the fact that US consumers increasingly bought quality.

Doming and "profound" knowledge

The Deming philosophy purports to be based in a "system of profound knowledge". In The New Economics (Deming, 1993), Deming described "profound knowledge" as consisting of four components:

1 understanding of the system concept;

2 knowledge of variation;

3 a theory of knowledge; and

4 understanding of human psychology (see also Little (1994)).

Deming took an expansive, open-system view of organizations. In addition to seeing the organization as a purposeful, interactive, interdependent set of components, he included both supply and distribution chains and customers in his sense of system. Every component of the organizational system exhibits process flows, and these components and flows must be effectively linked via cooperation achieved through communication. Systems must be managed to avoid selfish, competitive independence and sub-optimization. Although management is ultimately responsible for all aspects of the organization, it must, above all, exercise control over and improvement of organizational processes with the active help of those who are most intimately involved in and knowledgeable of those processes.

Deming's concepts of variation reflect the work of the statistician Walter Shewhart (1939) who stated that all processes exhibit variation which can be either random (inherent in a process) or externally caused.

Both sources of variation need to be addressed in different ways. Tools, such as statistical process control charts, are valuable in the analysis of variation, and such analyses must be carefully and properly done to avoid counter-productive tampering. Deming was emphatic in asserting that poor system design (a management responsibility) is the overwhelming cause of poor system performance. All organizational members need to develop and share knowledge of variation.

The Deming "theory of knowledge" is pragmatic in that it avoids absolutes and allows for change. It can be characterized as predictive empiricism. Ideas about what should happen under certain circumstances are to be developed using systematic learning about results achieved in past experimentation. Knowledge is achieved when evidence, prediction, and information correlate. This system of knowledge is operationalized through the "Shewhart Cycle" (Deming, 1993, p. 135) containing the steps: plan, do, study, act (PDSA):

1 Plan - using the results of past experimental experience, plan a study that might be expected to lead to process improvement.

2 Do - perform the experiment or study designed in the Plan phase.

3 Study - evaluate carefully the result obtained.

4 Act - if positive results are obtained, implement and use as the basis for continuing study and development using the PDSA cycle. If negative results are obtained, re-enter the planning phase of the cycle and develop a new approach to the problem identified.

Note that knowledge gained through this process is tentative rather than cumulative because it becomes the basis for further analysis and experimentation. Additionally, because Deming believed that the pursuit of process improvement is never-ending, the PDSA model provides a pragmatic structure for framing both organizational behavior and knowledge itself.

Deming's view of psychology reflects the concept of variation in that individuals are seen as differing in learning style and ability. Thus, important responsibilities of management toward employees are ability analysis, training and development. From a motivational perspective, Deming's approach strongly reflects Maslow's needs hierarchy (Maslow, 1954), particularly the esteem and self-actualization levels, and McGregor's Theory Y (McGregor, 1960), particularly in its emphasis on intrinsic motivation and joy of work.

Delavigne and Robertson (1994, pp. 3-4) elaborated on the elements of profound knowledge. They have provided the following listing which they claim is representative of the broad spectrum of Deming's writing. This includes knowledge:

* about the statistical concepts of variation;

* of the losses from tampering with a stable process, and missed opportunities for improvement of an unstable process;

* of procedures aimed at minimum economic loss from those mistakes (statistical process control);

* about the interaction of forces (systems theory);

* about the losses due to demanding performance that lies beyond the capability of the system;

* about loss functions and problem prioritization (the Taguchi loss function and the Pareto principle);

* about the instability and loss that come from successive application of random forces (butterfly effect/chaos theory);

* about the losses from competition for share of market (win-win versus win-lose);

* about the theory of extreme values;

* about the statistical theory of failure;

* about the theory of knowledge;

* of psychology and intrinsic and extrinsic motivation;

* of learning and teaching styles;

* of the need for transformation to the new philosophy (management of change); and

* about the psychology of change.

Proponents of Deming's concepts argue that learning and applying this interactive knowledge system constitute a new philosophy of management, one which overcomes the failings of previous approaches to management, and a process for understanding and applying this new philosophy to the needs of modern organizations.

Deming as a revolutionary thinker

As noted above, criticisms of the "failed" approaches have decried beliefs in classical (deterministic and positivistic) perspectives that see knowledge as cumulative and absolute. Thus, frequent targets are the scientific management concepts spawned by Frederick W. Taylor (1913, 1947) -- "Taylorism" and "Neo-Taylorism" (extensions and "corruptions" of Taylor's thinking by others) - and the "limited rationality" approach to decision making as described by Herbert W. Simon (1976), reflective of rationality concepts put forward by Barnard (1968).

Delavigne and Robertson (1994) have presented one of the most expansive criticisms of Taylorism and Neo-Taylorism. According to these authors, Taylorism, among other things, proposed the:

... concept of business as ... amenable to scientific analysis, and, ultimately, control and prediction in Newtonian terms via standardization of all work (Delavigne and Robertson, 1994, p. 17).

Neo-Taylorism similarly fails by emphasizing:

... little more of management beyond hiring, firing, and the giving of orders - and maintaining an image (Delavigne and Robertson, 1994, p. 24).

Specific "flaws" of scientific management are stated to be (Delavigne and Robertson, 1994, P. 24):

* believing in management control as the essential precondition for increasing productivity;

* believing in the possibility of optimal processes;

* having a narrow view of process improvement;

* emphasizing low-level suboptimization rather than holistic, total system improvement;

* blaming people (only) for defects;

* separating planning and doing;

* failing to recognize systems and communities in the organization; and

* viewing workers as interchangeable bionic machines.

In counterpoint, the ideas of Deming are proposed as capable of overcoming these failings by, among other things, emphasizing continuous learning and improvement, helping us understand variation, providing holistic systems understanding, promoting win-win solutions, eliminating sub-- optimizing competition in all forms, eliminating slogans and quotas, and using the PDSA cycle (Delavigne and Robertson, 1994, pp. 25-35).

Little (1994) has pitted Deming against the concepts of "administrative man" as proposed by Herbert A. Simon (1976). Simon's concepts have had particular influence in administrative and organizational theory. Little asserted that Simon's theoretical propositions are based on logical positivism (systematic, cumulative empiricism). In opposition to the rational optimizer ("economic man"), Simon proposed "administrative man," who, living in a world of bounded (limited) knowledge and rationality, "satisfices" (makes satisfactory decisions). Thus, a decision is a means to an end, provided that the decision is appropriate to the ends desired (which may be arbitrarily selected). In Simon's world, the premises of decision making (obvious and subtle environmental signals to the decision maker) determine the decision that is made. Organizational control can be established by controlling decision premises. Criteria such as effectiveness and efficiency, in relation to defined outcomes desired, are important in guiding behavior in economic organizations.

Little also has asserted that Deming, rather than focusing on decision making and decision premises as the arbiter of organizational action, relied on systems and processes to propose action as a response to "theory" (action appropriate to experience). This then produces knowledge that is at best temporarily useful. Thus, the ideas of satisficing, efficiency, and self-interest stand against continual improvement, quality, and joy in one's work. Little proposed a distinction between a perspective that is oriented toward control of organizational members for the purpose of achieving ends, which may be arbitrarily chosen, and a perspective that is oriented toward ever better aligning of customer needs and organizational performance.

Deming as a not-so-revolutionary thinker

Points of view such as these are typical expositions of darkness-versus-light arguments. But are Taylorism and "administrative man" irreconcilably at war with Deming? While a number of people have accepted a perspective that portrays Deming's philosophy and methods as answers to Taylorism, others have proposed that aspects of the Deming philosophy reflect classical and later management theory roots and are not in absolute conflict with them (e.g. Ehrenberg and Stupak, 1994; Spencer, 1994; Anderson et al., 1994; Knouse et al., 1993). Common focuses of similarity include concepts such as scientific analysis and study, systematic decision making, employee selection and training and cooperation.

With specific reference to Taylor, Mooney (1996, p. 7) has argued that, while Taylor made major contributions in developing rules for organizing work, applying scientific analysis, standardizing methods and establishing monitoring and performance criteria, Deming's concepts for modernizing knowledge (the PSDA cycle) build on these rules:

Discrete elements of the knowledge production process are identified and systematically analyzed to reveal the most efficient design. Findings are then used to propose standard work methods and rational rules and procedures for measuring and monitoring performance.

Carson and Carson (1993) have proposed a reconciliation between Deming's distaste for numerical quotas and goal setting and concepts of numerical goals as developed in Locke's goal-setting theory (Locke and Latham, 1984), which have roots in Taylor's task management concepts. Their argument is that there is substantial potential to be gained by integrating Deming's philosophy with the Taylor approach (management by numbers methods).

Duncan and Van Matre (1990) have examined the major themes present in Deming's management philosophy. Their examination has led them to conclude that much of the Deming philosophy is rooted in or consistent with a broad spectrum of management thought and history, including the works of:

* Taylor (1947) - the task idea, the mental revolution, managerial responsibilities.

* Gilbreth (1914) - job design and performance standards.

* Barnard (1968) - organization as common purpose.

* Drucker (1954) - response to customer needs.

* Dennison (1931) - teamwork as an essential ingredient of business success.

* Mooney and Reiley (1931) - coordination.

* Likert (1961) - exploitative authoritarianism.

* McGregor (1960) - integration of individual and organizational goals.

* Maslow (1954) - self-actualization.

* Herzberg (1959) - job enrichment and pride in workmanship.

Perspectives such as these have merit, but writers pointing to them have generally failed to provide detailed analyses based on the original works of those being compared. A rare exception to this lack of depth is the work of Rossler and Beruvides (1994). They have developed a systematic, original-- literature-based comparison of Deming and Taylor in the thematic areas of general management, management of operations, and management of people. Table I summarizes Exhibit 1 from their article and illustrates the extent to which they have found comparable or complementary themes by analyzing the original words of the two authors.

An important conclusion reached by Rossler and Beruvides was:

Deming emphasizes product design and customers, both internal and external, to a much greater degree than Taylor does. Deming also enlarges the scope of top management's planning efforts, making it both strategic and operational. In addition, he enhances our understanding of performance variation and its meaning. Last, he highlights the role that intrinsic motivation plays in work performance. All these additions, however, are extensions of scientific management principles rather than radical departures from them (1994, p. 14).

Coordination and cooperation are the great themes

There is substantial evidence that connections, such as those outlined above, are deep, important, and include the thinking of a number of other significant management theorists. Some illustrations are worth examining.

One of the enduring themes in management and organizational theory is the imperative of establishing and maintaining effective and efficient cooperation between people in organizations. For example, Deming has stated:

An important job of management is to recognize and to manage the interdependence between components. Resolution of conflicts, and removal of barriers to cooperation, are responsibilities of management (Deming, 1993, p. 65).

Frederick W. Taylor believed that "scientific management" was:

... applicable to all kinds of human activities ... which call for the most elaborate cooperation (Taylor, 1913, p. 7).

Chester Barnard, who viewed organizations as cooperative social systems, stated that:

... the functions of executives relate to all the work essential to the vitality and endurance of an organization ... as it must be accomplished through formal coordination (Barnard, 1968, p. 215).

Mary Parker Follett echoed similar sentiments:

... there is still another way of looking at business unity which should be one of the chief concerns of the business administrator. He sees the three classes: (1) workers ... (2) consumers, and (3) investors. The chief job of business is to find a method for integrating the interests of these three classes (Metcalf and Urwick, 1940, p. 93).

As expressed by these authors (and many others who might be cited), common goals for managerial effort could be said to include effective and efficient accomplishment of organizational purpose with consideration for all interested parties (we would call them the stakeholders, today).

A continuing jungle of management thought

Despite foundational similarities, the development of managerial thought has displayed a repetitive tendency to pit perspectives against one another in a

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Table I

continuing "I'm right and you're wrong" contest. This has resulted in an ongoing series of often conflicting concepts about the nature and purpose of management. The fact that management is not a real discipline, but relies on perspectives drawn eclectically from any number of disciplines (such as economics, sociology, psychology, engineering, etc.), would seem to argue for effectively identifying and blending the best thought available. Unfortunately, this has not happened. Perhaps the clearest statement of the problem has come to us from Harold Koontz (1980). In defining the "management theory jungle," he noted with some dismay a worsening problem rooted in competing perspectives, rival dictionaries, and a lack of integrative perspective. Were he writing on the subject again today, he would doubtless add the total quality perspective to his list.

Deming was not immune from the tendency to find fault with those who have gone before. In enunciating his concept of "profound knowledge" (Deming, 1993), he placed himself apart from other perspectives which are seen as wrong or at least ill-guided. Despite what might be seen as an integration of perspectives (e.g. mechanistic and organismic concepts (Spencer, 1994)), Deming has added to the difficulty of searching for an understanding of management.

Strongly evident in Deming's perspective is a vitriolic distrust of management education, particularly in areas of finance and accounting. Other targets for his wrath have included goal-setting and slogans, merit pay, performance evaluations, and internal competition. By placing himself apart from and above other management theorists, Deming promoted an image of himself as a revolutionary, armed with a comprehensive theory. Followers must accept the doctrine whole cloth. Unfortunately, Deming's concepts raise more questions than they answer.

What Deming did not explain

In Deming's world, organizational and production systems seem to always exist. The responsibility of management is to facilitate the alignment of these systems to customers, to simplify systems through analysis of variation, to enable workers to engage in processes leading to pride of workmanship. Not directly addressed are vital questions, such as:

* What are the products and their characteristics?

* What are the processes and their components?

* How are jobs defined and by whom?

* How are workers assigned to jobs?

* How are jobs priced?

* How are employees selected, trained, promoted, and paid?

* What is the method for determining what investments are to be made?

Inasmuch as Deming has consistently insisted that "the system" is the responsibility of management, it seems reasonable to assume that the answers to questions such as those posed here reside within the responsibility of management. But how?

It is true that Deming was not silent on such issues, but his advice was sketchy at best. For example, Ranney (1996) has correctly noted that Deming (1993), in addressing the obligations of management for system improvement, advocated that managers have several sources of power, including authority of office, and need to use these sources as appropriate to cause change to occur.

However, Deming's writings were generally short on advice or prescriptions as to how to change structure, processes, job designs, process flows, the steps of operations, human behavior, and a myriad other questions. Clearly, however, such issues must be faced with concrete actions. Consider this situation:

Assume that you are a work study student at a university. You are given an assignment to collate and staple together a 50-page document for a professor. One hundred copies are to be delivered to this person. Yet, you are given no deadlines, you are not told where to do the work, you do not know where the copies to be assembled are located, you have not been trained in any way, and, in fact, you do not know what the word "collate" means. What do you do? How can you get this job done soon and satisfactorily?

Taylor has more to say to you at this point than does Deming. The answers to all the problems posed and the questions stated are fundamental issues in job design and training in method. Until and unless these matters are properly dealt with, this task will cause the worker a great deal of anxiety and even fear. However, after being trained and amassing a reasonable amount of experience, that person may be ready and able to contribute to process improvement and develop ways to do such a job with increased efficiency and skill. At this point, Deming would speak louder than Taylor. But note that the issues here are clearly not mutually exclusive. Rather they are complementary and interactive. Pitting one school of thought against another does nothing to resolve issues such as are portrayed here.

What about the Simon-Deming controversy? Clearly, Simon (1976) did not write a primer on "how to manage". Administrative Behavior, building on the thinking of Barnard (1968), presented a perspective of human behavior in organizational systems, emphasizing concepts of decision making within an environment where perfect knowledge and perfect analysis are not possible. Major attention is thus given to the concepts of effectiveness, efficiency and the role of authority. Rather than decry Simon's concepts, one might well use them to explain some of the managerial failings against which Deming has railed. For example, he was emphatic in declaring that US management has "walked off the job" (Deming, Foreword to Walton (1986, p. xi)) by emphasizing short-term profits, stock price, and dividends rather than strategic, long range factors dedicated to meeting and exceeding customer expectations. Simon's insights into influences on and processes of managerial decision making might provide us with useful insights into means and methods to improve managerial focus and performance.

A fundamental Simon concept is that the premises (perceived situational variables and influences) of decisions determine the decisions made. Using Simon's analytic model, an analysis of the environments of modern managers, particularly those of strategic managers, would indicate that quarterly financial reporting requirements, the speed with which information travels, investment speculation, shareholder expectations, and the current emphasis on shareholder wealth produce substantial pressures on managers to promote cost cutting and earnings performance in the short term. Merely to decry these as not rational, inappropriate, or even wrong is not going to make for change in the direction Deming charted. Furthermore, American culture is conditioned to immediacy. These, and other realities, may not be rational, but they exist and they exert predictable influences on managerial behavior. Managers who ignore these realities are often likely to suffer negative consequences. Indeed, one might also assert that Skinnerian conditioning (Skinner, 1971) could be used to explain a considerable amount of managerial behavior in these environments where managers tend to repeat those actions for which they are rewarded.

Let us avoid making the management theory jungle deeper and darker

While Deming did point us in desirable ways, the mechanisms for change are clearly more intricate than he suggested. Behavioral change is a very difficult process. As part of the process of change, it might be useful to examine the ways in which decision environments might be configured to encourage the outcomes Deming earnestly desired.

A useful way to consider the potential of the Deming philosophy is within an examination of the breadth and depth of management and organizational thought. Even a cursory examination of a book such as Daniel Wren's, The Evolution of Management Thought (Wren, 1994), quickly convinces the reader that there are many perspectives that should be considered in evaluating the future of organizations. All of these have something to say to us, and none has said everything. Indeed, they clearly provide a mosaic of complexity and possibility. Managers would be well advised to build a substantial foundation in this literature. Ignorance of this body of thought condemns us to a continuing search for the lessons of the past. We ought to be smarter than that.

Concluding their comparison of Taylor and Deming, Rossler and Beruvides stated:

The widespread tendency of many managers (and academics) to latch on to what is tangible and relatively easy to implement (such as tools) suggests little in the way of fundamental change. Unfortunately, the efficiency experts who followed Taylor but lacked his insights and made a mess of his ideas have re-emerged in the form of modern-day Deming disciples ... Perhaps too many people are just a little too willing to let others interpret for them what others have written or said or done (1994, p. 15).

Managers and those who purport to teach management, be they academics or consultants, need to do the hard work of developing a true knowledge of the field. A failure to do this work condemns us to tampering with managerial concepts. As Deming himself would be quick to tell us, tampering with a system only makes things worse.

A final thought

Knouse et al. (1993) have perhaps given us the best resolution to these arguments by suggesting that the major differences between Taylor and Deming are caused by their relative places along management history's timeline. However, a century after Taylor's time, it remains to be seen whether Deming's ideas will have similar long-term influence and impact.

[Sidebar]

The current issue and full text archive of this journal is available at http://www.emeraldinsight.com/0025-1747.htm

[Footnote]

Note

[Footnote]

1 W. Edwards Deming did not invent nor subscribe to this terminology (Peterson, 1999).

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