Essay: W. Edwards Deming – Management theory

W. Edwards Deming is best known for his theory of management as exemplified in his 14 points. The points define how to develop a healthier environment in work place for people to work with sense of happiness. The best approach for everyone is to work together as a unit because the solution to problems would only come with cooperation. Dr. Deming called for transformation to a new style of organizational management based on greater cooperation between employees and managers. This transformation could be achieved by introducing ‘profound knowledge into the system. The system of profound knowledge consisted of four parts: knowledge about variation, appreciation for a system, psychology and theory of knowledge. By highlighting statistical models, demonstrations and real world examples in business, Dr. Deming showed how thinking in terms of a system is very important for discovering, analyzing a wide range of problems that businesses continually face like customer satisfaction, product designs and even company morale. (Institute)
Appreciation for a System
According to Dr. Deming the best way to view an organization is to view it as a system. The purpose of the system should be to bring profit to each and every individual in the organization such as shareholders, suppliers, employers, community, customers and the environment. Implementing the system approach would enable the management to view its organization in terms of many internal and external connections and interactions. When all the connections and interactions work together to accomplish a desired objective, a business can achieve positive results.
Knowledge of variation
Rather than thinking of what went wrong or what caused for such poor results? The management should also find the right answers and implement right course of action. Dr. Deming provided the source for management to do just that through knowledge of variation. Variations exist in all businesses in terms of output, between people, and product and services. Dr. Edward Deming identified two types of variations within a working system which were special cause and common cause. Special cause variations represented a unique event that prevails outside the system, such as natural calamities, or an unexpected strike by public transportation workers. Differentiating between variations, as well as understanding its causes and predicting behavior, is key to management’s ability to fully remove the problems or barriers in the system. Without having proper knowledge of variation, management might take actions that actually makes things worse in the organization.
Theory of Knowledge
The theory of knowledge is an understanding of management as a prediction. Deming emphasizes that there is no knowledge without theory and that experience alone does not establish a theory. Theory forms a cause and effect relationship that can be utilized for prediction. Theory leads us to prediction without the theoretical knowledge, experience has no meaning and there is no learning.
The most important and challenging, element of Deming’s ‘profound knowledge’ is about people. Management can create good system, know all about variation and knowledge, and still won’t be able to build up a successful organization if they don’t understand people, and particularly what aspects motivates them to do a good job. The management should be aware of the abilities and preferences of their employees and make maximum optimization of it. Dr. Deming understood that intrinsic needs primarily motivate people, including taking pride in workmanship and working with others to achieve a common objective. He also rejected management by carrot and stick rewards, as well as other practices such as merit ratings, quotas which strives to attach blame and reward on individuals. In their place, he advised management to build an environment of interdependence, trust, relationships and pride of workmanship.
According to Edwards Deming, the present style of management leads to huge losses that cannot be evaluated or measured. Management’s failure to understand the difference between common causes of variation and special causes of variation is considered to be the reason for many wrong practices.

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