THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Monday, September 11, 1995 TAG: 9509110034
SECTION: FRONT PAGE: A1 EDITION: FINAL
SERIES: TOTAL QUALITY MANAGEMENT
Part 2
TODAY: An American statistician teaches the Japanese his theories to
help them rebuild from World War II. Then the Japanese teach American
business a lesson.
SOURCE: BY LON WAGNER, STAFF WRITER
LENGTH: Long : 150 lines
Total quality management took root in Japan 30 years sooner than in the United States. But the fear driving both countries to the program was the same: economic collapse.
At the end of World War II, Japanese factories had been bombed to rubble and the country wondered whether it would ever recover. By 1980, American industry was being battered by Japanese competition and the U.S. wondered whether it could hold on to its economic strength.
TQM and its quality management kin incubated in the wreckage of post-World War II Japan with the help of W. Edwards Deming, an American statistician.
``Demingism'' was born in Japan in 1950, when the New York University professor, with a Ph.D. from Yale, began teaching the Japanese his statistical quality control and total quality management theories. Deming's methods, his theories of listening to ideas of production workers and of pushing authority to lower levels of a company, are credited these days for Japan's postwar recovery.
Three decades passed before Deming would be called upon to see whether his theories could rescue competition-battered U.S. businesses.
Japanese morale in the 1950s was shattered. People needed something to believe in. Deming helped fill that void. It was an easy time to sell a new theory. Deming became not just a consultant but a guru.
Japanese industry, which in many ways has surpassed that of its World War II conqueror, was founded on Deming's principles. Japan has practiced for four decades what U.S. businesses are only beginning to understand.
The Deming Prize recognizing top quality companies is still awarded in Japan. Its counterpart, the Malcolm Baldrige award for quality, wasn't established in this country until 1987.
In the United States, the desperation needed for executives to finally try a ``radical'' plan such as Deming's would come from economic rather than wartime defeats. Most notably, in the 1980s Japanese car manufacturers pushed their market share toward 25 percent, sending fear throughout Detroit.
Ford Motor Co. called upon Deming in 1980 after NBC featured his successes in a documentary, ``If Japan Can, Why Can't We?'' Deming took Ford's invitation as notice that his home country was finally ready for his program; he continued teaching seminars until he died two years ago at 93.
Deming's management system emphasized surveying customers, consulting production-line workers to help solve quality problems, and teamwork. The system didn't raise hackles in Japan, where workers and management were used to uniformity and allegiance to institutions.
Japan's near-devastation was also an advantage to Demingism: Businesses were essentially rebuilding from the ground up. Nobody would say, ``We've never done it that way before.'' Deming could test his theories on a blank slate. America already had working systems in place.
Many consumer items were scarce after World War II. So demand was strong, regardless of quality.
There were also lots of new, ``modern'' conveniences. Most people had jobs and the income for new cars, toasters, TVs and ovens. Only a few companies were making them - at least by today's more global economic standards.
Production and quantity were key, not always quality.
While U.S. assembly lines rolled out products, Japanese companies learned from Deming to collect the data for statistical monitoring and measuring customer satisfaction.
Japan's goal was to make many of the same consumer goods, but better and cheaper. The country succeeded, much to the chagrin of the United States.
``Made in Japan'' became synonymous with quality: Honda, Toyota, Canon, Sony, Toshiba, Panasonic, Yamaha. The value of the Japanese yen surged while the U.S. dollar declined. By 1989 the U.S. trade deficit with Japan reached $49 billion.
The U.S. recession brewing in the late 1980s took full force in 1990. The need to cut costs and downsize sent businesses looking for a system that would help them do ``more with less'' and still be able to compete globally.
The reason for the United States' fall from economic glory is more involved than the onset of a recession or the rise of Japan. Dr. James Cash, chairman of the MBA program at Harvard University, explained it to Sentara Health System employees when he was in Norfolk in June for the company's semiannual meeting.
The United States is shifting from an industrial economy to a knowledge society. For those who feel brutalized by the changes, there's no end in sight. It took 100 years from the invention of the steam engine for this country to change from a farming society to an industrial economy. The nation is only about halfway through the changes brought on by the invention of the microprocessor and transistor.
``An awful lot of companies and industries are going through today what we call a major economic restructuring,'' Cash says. ``This is the basis of which the next major economy will unfold.''
That's why the world's economy is transforming. But in this country, with its consumer-driven economy, we kicked things up a notch.
The quality movement has grown like kudzu on American soil because of fertilizer we spread ourselves. Businesses raised their quality standards to outpace competitors. Employees learned to at least strive for perfection. Then the workers went home at night and on weekends and shopped.
With what they learned at work, consumers demanded quality and efficiency from their computer retailers, their auto dealers, their churches and schools, their Realtors and the people who make their barbecue.
And they want a smile and a thank you at the end of the sale.
For Volvo Penta in Chesapeake, its customers sometimes suggest that it's not good enough for the marine engine manufacturer to fix a problem under warranty. The fix has to be made quickly.
``They call up and say, `What are you going to do for me?' '' says Roger Kreutzer, technical services manager at Volvo Penta.
It's the same way in the food business. National companies are giving quick, nearly flawless service. If Doughtie's Foods in Portsmouth can't do the same, the sentiment that they're a smaller, local company doesn't carry much weight.
``Before, just getting the food to the restaurant was fine,'' Doughtie's quality project manager Greg Ratliffe says. ``Now, they want it from somebody who's nice to them and they want it at a certain time and they expect you to have everything they order, because that's the level of service they're getting now.''
Workers these days use the quality indoctrination they get at work two different ways: at work and as consumers. It's no wonder they are tough customers, because their customers are tough on them.
Jimmy DeMartino is that way. When he finishes his workday as a quality control supervisor at Ford's Norfolk Assembly Plant, he doesn't quit watching for efficiency. He picks apart the actions of waiters and waitresses when he goes out to eat.
``I watch wasted steps,'' he says. ``I say, `Well, they went to that counter over there three times. They could have gone to it once and saved themselves two trips.' ''
Deming saw businesses as bedrock institutions in a society, much like churches and schools. Some interpret his teaching more as a social interaction than a management tool.
William J. Morin, CEO of Drake Beam Morin, is among them. In his book published this summer - ``Silent Sabotage: Rescuing Our Careers, Our Companies, and Our Lives from the Creeping Paralysis of Anger and Bitterness'' - Morin lambastes companies for making profitability synonymous with success.
Companies can attain long-term success only if business leaders make their employees' contributions matter.
Workers from Hampton Roads participating in a roundtable discussion on quality efforts agreed that they get more out of their jobs than a paycheck.
``It gives a sense of owner-ship,'' said Robert West, who is a chemical tester at Norfolk Naval Shipyard. ``If we're part of the organization and we're using the ideas that we are coming forth with, then it will not only be self-serving but it will improve the efficiency and productivity of what we're trying to put out.''
Employees knew that all along. Well-run companies have understood it for years.
But it took Deming, and a solid tail-kicking from the Japanese, to teach it to the rest of America. ILLUSTRATION: Dilbert Cartoon
KEYWORDS: CONTINUOUS IMPROVEMENT by CNB