I am not so sure all the 14 principles apply today for the information economy. I can’t say for sure about manufacturing though. For what it is worth, here are my quick thoughts. This post got triggered in my mind when I read my friend Jonathan Becher posting on validity of MBOs. http://jonathanbecher.com/2009/02/02/eliminate-management-by-objectives/ . It is a great read – but who would expect less from Jonathan 🙂
Create constancy of purpose for the improvement of product and service with the aim of becoming competitive, staying in business and providing jobs..
Definitely a good thing to keep focus on product and service. But I am not sure constancy of purpose is the best way to put it – purpose changes with market. Sometimes you need to focus on revenue, some times on market share, some times on profit and so on. There is no universal constancy of purpose. Life is all about trade offs.
Staying in business and providing jobs is a good thing too – but not an end in itself. World does not need yet another company doing the same thing. Why not free up the investment for a better opportunity than just stay in business? I do wish the “job for life” principle in Japan was universally true – but it clearly is not.
Adopt the new philosophy of cooperation (win-win) in which everybody wins.
I am not sure whether Deming started this or someone else did – but over time, I have realized there is no such thing as “win win”. Some one loses – or charitably, some one always wins less. “Win Win” is possible for a given interaction for a short time – so the only way in which a vendor and customer has “win win” is if transactions occur repeatedly over very long periods. That very seldom happens given the barrier to entry for competitors will lower over time.
Cease dependence on mass inspection to achieve quality.
This I agree a 100%. And now with big data techniques, and lower HW costs – it is economic to achieve even higher quality at same or lower cost.
End the practice of awarding business on the basis of price tag alone.
Again – agreed a 100%. The only time when I think price is justified as a sole criteria is for commodity purchases. Commodity at spot prices are fine, and should not come with premium.
Improve constantly and forever the system of production, service, planning, or any activity.
Partially agree. The trouble with incremental improvement is that over time it is a guaranteed way to get disrupted by competition.
Institute training for skills.
Partially agree. Institutional training is fine for manufacturing skills probably . But encouraging a culture of continuous learning where the onus is on employee to keep up with the modern techniques is way more productive today. Corporate training has serious limitations on speed and agility.
Adopt and institute leadership for the management of people, recognizing their different abilities, capabilities, and aspiration.
100% agree – absolutely a necessity. And sadly not enough of that happens in our industry. High time we took a better interest in leadership development.
Drive out fear and build trust so that everyone can work effectively.
100% agree – but sadly a lot of IT industry is based on fear. Many will not admit it in public, but fear is routinely seen as a management instrument.
Break down barriers between departments.
100% agree – there should be absolute minimum barriers. My team once spent 2 months designing BI security for a customer , and then I asked the COO of the company why there is such a lack of trust between employees. 15 minutes later, he killed that tight control mechanism. Anything not mandated by legal requirements was canned. Ever since, I proactively ask such questions to the highest rung person I can find before we start a project. It is unbelievable how much lack of trust exist in the world.
Eliminate slogans, exhortations, and targets asking for zero defects or new levels of productivity.
Slogans do tend to work for a short period. But beyond that we get into eye rolling territory. Over advertising internally or externally is a bad idea and will back fire. I have had fierce arguments on this topic with colleagues and usually I have lost.
Eliminate numerical goals, numerical quotas and management by objectives. Substitute leadership.
This is where I have strong disagreement . If there is no trust between leader and followers, I think MBOs dont mean any thing. However, if some trust exists – MBOs and quantitative goals are by far the best way to ensure baseline performance.
The root cause of all evil is in the necessity to predict performance, especially in public companies. If the CEO and CFO has to commit to a numerical EPS or revenue or whatever to street, they cannot then stop driving those things down the chain.
Abolish the annual rating or merit system that ranks people and creates competition and conflict.
Partially agree – doing it just annually means little to nothing. However, competition is a good thing as long as it is done with good spirits and trust. Some conflict is also unavoidable and I dare say it is a good thing to have some healthy conflict. Someone needs to give a heads up when emperors walk around naked.
Institute a vigorous program of education and self-improvement.
Again, institutional training is a limited vehicle for education in my opinion. I have rarely seen it work for informational workers, especially the experienced folks.
Put everybody in the company to work to accomplish the transformation.
Agree 100% – this is why it is important to set a strategy and then tie all goals of individuals and teams to the corporate strategy. Random projects and proof of concepts generally don’t go anywhere because there is no tie to something the company as a whole is tied to. Transformation cannot be accomplished by a corporate strategy group or a group of Vice presidents with slogans . It needs everyone to pitch in. And they wont pitch in till they believe in the end state. I would rather see no transformation than people chasing vague concepts and ideas that someone up the chain thinks is important, but cannot articulate in a way that rest of the company understands.