Outdated Management Techniques and Methods and Their More Effective Modern Replacements

(W. Edwards Deming's Influence On Modern Management Systems)

 (W. Edwards Deming's Influence On Modern Management Systems)

Overview:

Management techniques and methods, as a concept, can probably be traced back to the teaching methods of ancient philosophers and scholars, such as Socrates. Socrates was famous for his method (the Socratic method,) in which he would answer a question as though it were an answer, so as to stimulate further discovery on a subject or problem, while at the same time filtering out spurious, or unproductive discourse as the process proceeded.

Management techniques and principles, are developed and formalized to help improve personal, or organizational performance, for various forms of human endeavor, in a systematic, efficient, and consistent manner. Management techniques and methods can be applied to most any process or endeavor.

Time Management, Weight Management, Personal Management, Business Management, Quality Management, Sales Management, Project Management, and Financial Management, are among some of the fields of management, that are most often associated with the formulation of management techniques and methods today. The development of management principles for all manner of human endeavor has mushroomed in the latter half of the 20th century, into a lucrative cottage industry, as people and organizations from all walks of life, strive for improvement and competitive excellence.

Traditionally, organizational management techniques and principles are most often associated with the fields of Quality Management and Business Management. W. Edwards Deming, often referred to as the father of modern quality, effected some of the most profound changes in management techniques applied to business, and in particular to manufacturing, in the 20th century.

TQM:

Deming's Total Quality Management (TQM): 14 Points, outlines most of the seminal ideas, statistical techniques, and principles of modern business management practices. The essence, of the Japanese Kaizen team building principles he championed, his SQC (statistical quality control) methods, and his famous " Plan, Do, Check, Action," cycle for "Continuous Improvement," frequently form the basis for the cornerstone principles of more modern management systems such as Six Sigma, developed at Motorola, by Bill Smith and others. (ref 1)

Six Sigma:

An example is Six Sigma's DMAIC (Define, Measure, Analyze, Improve, & Control,) which is essentially a restatement of Deming's Plan, Do, Check, Action," cycle, as it is applied for example, to the selection and resource allocation of a company's business projects. In fact, Six Sigma derives its name from a statistical term, sigma (a standard deviation from the average of a population of data points,) that is the cornerstone of process capability science, developed and promoted by Deming.

Six sigma proper, is six standard deviations from the mean or average value, and corresponds to a defect rate of 3.4 ppm (parts per million opportunities.) For long term variation, 3.4 ppm is calculated to be 4.5 standard deviations (6 sigma - 1.5 sigma shift.) The Six Sigma Management system seeks to achieve 3.4 ppm defects for all manufacturing and business processes within a company.

(ref 1)

The Black Belt quality management structure found in Six Sigma, is also a variation on Kaizen teamwork principles popularized in the West by Deming. Employees are ranked based on their expertise at, and involvement in, Six Sigma activities to improve quality. Master Black Belts, work at Six Sigma activities full time. Black Belts, and Green Belts are the next two tiers below Master Black Belts. Yellow Belts have rudimentary proficiency at the Six Sigma System and conduct more limited Six Sigma activities than the other belt degrees in the organization.

The driving force behind the high standards of excellence in the Six Sigma method can be traced directly to the cornerstone of TQM, "Continuous Improvement." Six Sigma, defines a quantitative goal at 3.4 ppm (3.4 defects per million opportunities.) The continuous improvement principle in TQM, presupposes that this goal will naturally be reached as processes are continuously improved. Importantly, Deming stressed quality should achieved without setting goals and quotas that invite the potential for poor quality, caused by the rush to reach the goal or qouta.

BPR:

Business Process Reengineering (BPR,) as developed by Hammer and Champy in 1993 is defined as "the fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service and speed." This business method (i.e., BPR,) introduced another variation on Deming's Plan, Do, Check, Action cycle for continuous improvement. "Develop the vision and process objectives, identify the business process to be designed, understand and measure the existing processes, identify IT levers, and design and build a new prototype of the new process." In BPR an additional step is added ( no.4 identify IT levers.)

IT is important, to even the smallest of businesses today, and with the advent of effective use of modern computers, software, and a maturing internet, IT has become an essential part of improvements of business and manufacturing processes today. So much so, that it seems breaking out the use of IT as a tool for reengineering in a separate step, might have been novel and relevant in 1993, but could be regarded as a redundant or superfluous step in today's technologically oriented business environment. (ref 2, 3)

ISO 9001/14001:

The International Organization for Standardization developed international standards for quality systems, ISO 9001 in 1994, and environmental management systems ISO 14001 in 1996, in order to gradually over time, reconcile and standardize management systems developed independently, by the regulatory arms of individual governments world wide (e.g., FDA's QSR for medical devices,) industry technical associations (e.g., the IEEE electronics association IEEE 730 for software quality assurance,) and individual large corporations (e.g., GM's QS-9000). Deming's "Continuous Improvement" principle and his Plan, Do, Check, Action cycle are at work in most all of these standards as well.

reference 1: http://en.wikipedia.org/wiki/Six_Sigma

reference 2: http://www.valuebasedmanagement.net/methods_bpr.html

reference 3: Reengineering By Emily Neidhart

http://edweb.sdsu.edu/people/ARossett/pie/Interventions/reengineering_2.htm

Copyright JJ Haugh 2010, First published on Factoidz.com 3-30-10

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Posted on Sep 20, 2010