As this century ends, we will surely be reading lists in the media: the Top 100 Events, the Ten Most Influential Persons. Well-known names like Einstein and Henry Ford will appear on most of these lists. There is one other name that should appear but, I suspect, will not: W. Edwards Deming. He was not a statesman, an inventor or a general. But I would argue that his teaching about quality, avidly absorbed by key Japanese industries after WW II, makes him one of the most influential persons of this century and possibly, the next one as well. In essence, Deming’s contribution has been to make us rethink what it means to make a product.

Certainly his impact on the Toyota Production System and what we now call lean manufacturing has been enormous; at the same time, the influence of Toyota’s manufacturing management approach on Deming’s has also been very strong and fruitful. And we have as yet only begun to see the profound impact lean manufacturing will have on how we make things in the coming century.

Looking back

In 1946, General Douglas MacArthur invited Dr. Deming on two occasions to go to Japan as an advisor to the Japanese Census. During these visits, he met members of the Japanese Union of Scientists and Engineers (JUSE). This led to an invitation by its members to lecture on statistical methods for industry. Deming returned to Japan on this mission in June 1950. These lectures led to a meeting with Ichiro Ishikawa, who then arranged for Deming’s meetings with Japanese industry leaders. In this way, Deming planted the seeds of his philosophy in Japan.

The Deming philosophy and the Toyota Motor Manufacturing philosophy of quality are very similar. Does this mean Kiichiro Toyoda, the founder of Toyota Motor Manufacturing, used Deming’s quality principles to create what we know as lean manufacturing?

It’s not as simple as that. As a student of both Dr. Deming and Kiichiro Toyoda, I can see that both men learned from each other. Deming began with a thorough understanding of how the statistics of process variability could help quality. From about 1950 to 1990, his thinking evolved and changed, in part because of what he learned about Japanese manufacturing management, especially Toyota’s. At the same time, Toyota, like other Japanese firms, learned much from Deming’s approach to quality. Lean manufacturing is an integration of Deming’s philosophy of quality and Toyota’s philosophy of manufacturing. And Dr. Deming’s "System of Profound Knowledge" is an integration of his theory of quality and Japanese management thinking. The two philosophies have inspired each other and spurred each other on.

His impact

One of the many ironies about Deming’s impact is that while the Japanese embraced his views as the epitome of American know-how, American audiences were slow on the uptake. It may be that after the war the Japanese were in disarray and ready for fundamental and radical changes in their thinking. It wasn’t until the crisis came for American manufacturing in the ‘80s that new thinking was acceptable and even then it took the form of throwing technology at the problem, seeing computer-aided manufacturing and automation as the means to quality.

Perhaps the frank, outspoken style of his approach accounts for some of the lag in appreciating Deming’s philosophy here in the U.S. For example: "the basic cause of sickness in American industry and resulting unemployment is failure to manage" (Quality, Productivity and Competitive Position [1982]). Again: "Folklore has it in America that quality and production are incompatible. A plant manager will usually tell you that it is either/or. In his experience, if he pushes quality, he falls behind in production. If he pushes production, his quality suffers. This will be his experience when he knows not what quality is nor how to achieve it." (Deming, 1982.)

But style is not all there is to it. Deming’s whole outlook was new and challenging. For example, consider his "chain reaction" theory of how quality works: "Improved quality leads to cost decreases, which leads to productivity improvement, which leads to growth in market share, which leads to a growing business, which leads to jobs and more jobs." Politicians will tell us they are the ones who create jobs. Not so, Deming insists. "Quality leads to jobs and more jobs." To understand how this process works, we must understand Deming’s philosophy of quality.

The Deming philosophy

His philosophy is easy to grasp once we set aside a basic misunderstanding. Since his introduction to a mass audience through the NBC documentary, "If Japan Can, Why Can’t We?" (June 24, 1980), Deming has been seen primarily as an academic and a consultant statistician. It’s true that he began as a statistician but it is wrong to over-emphasize that aspect of his thought. His is really a philosophy of management, with quality as goal and touchstone for everything.

The philosophy is really quite simple. The manufacturer, according to Deming, must have three things:

• an understanding of the variations in all processes

• an organizational structure focused on total teamwork

What’s clear here is his emphasis on seeing the whole picture. This emphasis comes from his sense that manufacturing is a system: "a series of functions or activities within an organization that work together toward the aim of the organization." If quality in one process can be improved by charting the variations within the process, why not see the whole manufacturing effort as a system of processes with standards and variations?

System of profound knowledge

Deming’s "System of Profound Knowledge" was a further development of his thinking, begun about 1987 and first published in a 1990 paper. In it he still ponders what a manufacturer needs but here the needs are for kinds of knowledge and the goal is a new kind of leadership. Deming’s thought evolved to the point where he saw leadership, not statistics, as the crucial element in achieving quality.

His list of needs seems rather abstract and vague at first glance:

• some knowledge about variation

• some theory of knowledge

• some psychology

But his approach is as challenging as ever: "Western management in industry, education, government, is due for sweeping changes. The prevailing system of management has smothered the individual, and has consequently dampened innovation, applied science, joy in learning, joy in work." These four aspects of profound knowledge are the key because to run a system well you need to understand how a system really works. What his list of knowledge hints at is this: people commonly try to run things without the knowledge they need -- without understanding how the system really works, how people really work, how variation works and how knowledge itself works.

Looking ahead

According to Deming, one thing leaders need is the ability to predict accurately. So let me leave you with his predictions for what will happen in the next century with a transformed style of management:

"The transformation will restore the individual; will abolish grades in school on up through the university; will abolish the annual appraisal of people on the job, quotas for production, specified requirements that people work 57 minutes out of every hour, incentive pay, monthly or quarterly reports on business targets, competition between people, competition between divisions and other forms of suboptimization. Leadership will replace these bad practices."