Notes on the Video THE DEMING OF AMERICA
(Notes by Prof. Wadycki, further edited by Prof. Sclove)

[This VHS videocassette is available as item T-1312 in the UIC Architecture & Art film/video Library, 3rd floor, Douglas Hall.]
The video begins with the following observation:

U.S. quality does not stand up; 70 or 80 years ago the U.S. made half of the manufactured products in the world.

During the Video we see interviews with:

Unwilling to listen in the 50's, now America is in global competition.

More than 40 years ago, Dr. W. Edwards Deming -- a PhD statistician -- helped Japan rebuild.

The Japanese were known for being industrious; for example, they made toys from G.I.'s beer cans. However, their products had a poor reputation -- "made in Japan" meant inferior products. Japan knew they had to change.

Before that, Bell Labs physicist Walter Shewhart had helped the war effort in U.S.

1950-60: 20,000 Japanese managers trained in statistical methods such as those developed by Shewhart

DEMING: "Optimization of system" -- everyone gains.

Japanese managers were eager to learn.

By 1980, Japan surpassed Detroit by producing 11,000,000 cars.

U.S. turns to Deming for help. (Donald Petersen, retired CEO & chairman of Ford is interviewed.) Leaders of U.S. in 40's and 50's didn't understand quality is the most important thing and has to start FROM THE TOP--Quality starts at the top.

DEMING: Management that breaks out of the system will succeed.

OPTIMIZATION -- orchestra example (all are supporting each other -- no SOLOS -- no grandstanding.   Conductor optimizes.)

Managers should not blame people -- managers should blame the system. Managers should try to fit people into what they can do best.

Results, MBO, the bottom line, profit now, high dividends -- ideas most high level executives concentrate on but should NOT.

Deming thinks it should be the the high-level execs -- not the underlings --- who should focus on the details of system. David Kearns, former Chairman of Xerox --- survival problem in 80's (1) Japanese selling products for what it cost Xerox just to make the product. (2) Japanese were getting products to market in half the time Xerox was. People have a choice -- sometimes they buy the imported products.
Exceptions: aircraft -- 70% of world market
Interviewed:   Brian Rowe, Senior VP and Head of GE Aircraft Engines

DEMING idea: DRIVE OUT FEAR

John Pepper, President of Procter and Gamble -----
Deming said "NO" to offer to come to P & G until they could convince Deming they were serious about committing to quality. People come to work wanting to do a good job, but can't:
- not trained
- don't know objectives
Management must do better.

Is Deming anti-union? NO. Unions are an important component of the system.

In negotiations, a focus on self-interest (defending your own interests) results in loss --- the parties must focus instead on optimization of the system. "Grow the business" by working together.

Everybody to gain by working together.
Adversarial competition --- economists are wrong!
Don't go for share of market -- but expand the market.
Market is not a finite amount -- it is expandable!
Worse thing -- to have a lousy competitor (market doesn't grow).

UNDERSTAND YOUR CUSTOMER & SERVE THE CUSTOMER
Often customer doesn't foresee what he needs --
inventions like light bulbs, telephone, etc.

"CUSTOMER" -- not just the final consumer but suppliers also

.

INNOVATION -- crushed by ranking and grading of people;
business is not a game where somebody wins.
Education is serious -- everbody should win.

Ranking is wrong because it is the system that should get the credit or blame for what's produced.

Not ranked? How rewarded? Pride and joy in your work.
Pay is not a motivator -- need just enough needed to live on.

CONTINUOUS IMPROVEMENT idea

QUALITY IN U.S. CARS -- '80 BETTER THAN '70
but Japanese had made so much progress,
U.S. cars in the '80's were perceived to have lost quality

U.S. managers -- had no idea that they had something to learn.
Profound knowledge must come from the outside.
Everyone doing their best in a poor system --
We're being ruined by best efforts from hard work doing what is wrong.
(MISSING:   A THEORY OF MANAGEMENT)

MUST ASK FOR HELP in order to change.

GOLDEN RULE cast in a business context -- treating of people.

OUT OF THE CRISIS -- a book by Deming.

Military applications -- Undersecretary of the Navy
TOTAL QUALITY APPROACH -- shows in the bottom line
Efficiency improves

EDUCATION SYSTEM --
25% drop out; and 25% get only a high school education
systemic change needed
"We grade them, but don't educate them"
Recognition of what SYSTEM is. End product won't change until the system changes.

Business is now sophisticated -- need an education to service car.

15,000 out of 11 million businesses do 95% of the training -- most do none!
(front line workers are getting very little training even in the firms that do train their employees!)

DEMING: Experience teaching nothing -- need theory to have learning occur. Theory leads one to questions. You don't even know what to observe unless you have theory.

Quality circles -- "window dressing"

Need to do more than stamp out fires.

Management by results --- like driving a car by looking in rear view mirror

A VISIT AT HOME IN D.C. WITH DR. DEMING

DEMING:   MANAGEMENT'S JOB --- OPTIMIZATION OF THE WHOLE SYSTEM -- everyone gains, no one loses.

28-Aug-94
latest revision 25-May-98