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It started on June 24, 1980, when he starred in an NBC White Paper documentary The program was called, If Japan Can Why Can t We Deming was an artist of what works His main tool was statistical quality control He learned it from Walter Shewhart of Bell Labs in the 1930s, used it in American industry in the 1940s, taught it to the Japanese in the 1950s, saw the Japanese add quality circles to Shewhart s methods in the 1960s, and taught.

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the Japanese version to American industry in the 1970s. Before the 1980s, not many listened.5 In Out of the Crisis, Deming singles out MBO for special criticism. To transform the Western style of management, managers must be leaders. For that,6

Lever, torpedo, up to 9 inches long Lubricant (such as WD-40) Mallet, rubber Masking tape Nails and screws, assorted One-way screw removal tool Paint scraper Pencils Pliers, adjustable Pliers, cutting

Focus on outcomes (management by numbers, MBO, work standards, meet specifications, zero defects, appraisal of performance) must be abolished, leadership put in place.

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As an expert in statistical quality control, Deming loved numbers. But he hated the way MBO used them. He believed that MBO led to an evil in which everyone in management or research received a rating every year. That rating system led to something more akin to management by numbers, or, worse, management by fear. For Deming, numbers give you information, and you analyze that information in order to figure out what to do. That allows you to set a numerical goal. But MBO gives you the numerical goal before you figure out what to do. Without a blueprint for reaching the objective, numerical goals often have effects opposite to the desired outcome. Deming especially hated the abuse of averages. For example, a company notices that half its factories or workers are producing at a below-average rate, so it sets a goal for these laggards of meeting the average. Deming would throw up his hands. By definition, half of anything falls below average. That s what average means. Different factories and different workers face different situations, so of course their production will vary. Computing average production does not in any way set a goal for anybody. Thinking that it does is a huge mistake. Instead, you should study everyone, above or below average, to see how to improve people s particular situations. At times, you can see Deming lose patience. He ends up fairly shouting on the page, as if pushing his finger into the chest of a manager who just won t listen:

Drainage pipes These pipes are generally made out of cast iron, galvanized iron, copper, lead, or plastic. Look for low points or sagging sections where solid wastes can accumulate.

Figure 2.12 Electrician s screw-

Do you manage by objective If yes, how much is this mode of management costing you Do you understand what is wrong

drivers (top) are designed for precision work; standard screwdrivers are used on heavier jobs (bottom). (Stanley Works)

In fact, many managers did listen to Deming. The data-intensive Six Sigma system that Motorola, General Electric, and other major companies adopted in the 1980s and 1990s came out of Deming s work. But despite the spread of Deming s methods, old habits die hard. For example, in 2000 and 2001, Lucent Technologies gave its staff the goal of increasing sales and earnings by 20 percent. However, it gave them no means to do it. The number came out of the air or, rather, it came from what stock analysts thought would keep Lucent even with other companies in the sector. The staff protested, but the goal stayed. So the staff met the target the only way they could: by giving their customers discounts and credits that pushed losses into the following year. Before 2000 was over, Lucent admitted the problem. Its stock price collapsed.7 So writing down goals does not show you the path to success. Neither do numbers. Study the numbers. Then comes coup d oeil. Then you plan.

In the 1990s, strategic planning met another avid critic. In The Rise and Fall of Strategic Planning, Henry Mintzberg gave planners a taste of their own medicine when he noted that8

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