In this episode, John and Andrew unpack a few of the myths Dr. Deming identified that continue to destroy organizations from the inside. John explains how these myths also negatively impact schools and kids - and what to do instead.

0:00:02.0 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with John Dues, who is part of the new generation of educators striving to apply Dr. Deming's principles to unleash student joy in learning. The topic for today is, Management Myths that Keep Fooling Us. John, take it away.

0:00:28.3 John Dues: Andrew, it's good to be back, good to talk again. Yeah, I thought we could build on the last conversation, which unpacked these two education reports. One that had a seminal impact for the last 40 years called A Nation at Risk, and another Sandia Report that we talked about that has a much lesser known. And I was thinking what comes out of some of the reports often as a shake-up, and then there's various ideas about what to do about the crisis outlined in this case. But I think, a lot of the times, those management practices have the opposite of the intended effect. And I think... One of the things I was thinking about is that Dr. Deming, maybe his most radical idea that he put forth is that any outcome that we see within a system, like a system of education, is the result of more than the skills and efforts of the individuals who work within that organization. And what he would say is that most of the performance differences observed between individuals are generated by these complex and dynamic, adaptable systems, and workers are only one part of that system.

0:01:49.8 JD: And I think understanding that sort of core idea of Deming is one of the ways that we can start to move away from the common management and maybe understanding those management myths is maybe the most important part of understanding the new philosophy that Deming was sort of putting forth. I think one of the things that I learned in watching some of his videos from his famous four-day seminars is that he often began those seminars by saying, management is living in an age of mythology, and even though he was saying that throughout the 1980s and even into the early 90s, before his death in 1993. I think that idea applies just as well today across numerous sectors, including education, as it did when he was saying it 30 or 40 years ago, I think it applies the education, applies to government, applies to industry.

0:02:52.6 JD: And what he meant by the age of mythology, at least my interpretation of it, is that leaders in these various industries basically operate according to these assumptions and these myths, and these myths are harmful to our organization. And so when he talked about the transformation process, part of the transformation process is understanding these myths and then moving away from them, actively trying to move away from them. So I thought we could talk about a few of those myths today and unpack those myths, where they originated and what were they are and then what to do.

0:03:29.3 AS: Great, great idea. And I remember he would say something like, how could they know? They did their best efforts, that's all that they have. Who came up with the idea of rating and ranking? Someone just... And then you realize people just may make things up ultimately and then they stick, not based on science or something like that. Sometimes the science creeps in there, but most of the time, based upon emotion. You jarred my thinking process when you're talking about the role of an individual in a system.

0:04:07.4 AS: And I was just thinking about how the beauty of the individual is that the individual is malleable. We're malleable, we're able to be contorted. Whereas when you install a particular piece of machinery that only has... Can produce so many units or such level of quality, it's a very rigid part of the overall system. And I was just thinking how, one of the reasons probably why we're always chasing after the individual, despite the fact that the very, very rigid machine over there is what's setting the ultimate specifications of the output of this is because the human is so easily manipulated. Well, put them over here and we'll do this, we'll do that, we'll start early, go late, try this, try that, whereas with the machine, you just have a lot less flexibility. And so you just made me think about that as I was listening to you talk...

0:05:02.3 JD: Yeah, that brings a good point. One, I think some prescient on your part is you mentioned the myth of rating and ranking, which is definitely one of the myths that I wanna get to. And I think you talk about machines versus workers. I think a couple of things I think of there, one is our organizational systems have become increasingly complex as we moved from the farm field to more of the industrial age, and maybe even the post-industrial age now. And who bought the machine? I think that's a lot what Deming was talking about is who designed the system, who had control over the system. If the machine is a major part of the process, who designed the machine and who bought it? Probably not the individual workers on the line. And yet, they were held responsible, or maybe even still today, held responsible for the results when they didn't design or pick the machine themselves. So I think that's a really good place to start. And I think that also brings up like, where did these management myths originate? Because if we go back a few hundred years, I think there's probably the lack of complexity, there's the...

0:06:26.8 JD: Mostly what we were doing is managing the work of... Managing our own work, I think of the farmer in the field or the craftsman in their workshop, is that sort of first line of management. And then as things got a little more complex, they're management by directing. So think of the craftsman taking on an apprentice, but it's still a pretty simple system and it's the manager, in this case, the master is directing the apprentice directly. And then you get the Industrial Revolution and you get this sort of third wave of management thinking... And here I'm thinking about management by results. And this is numerical quotas come into play, this idea, this common quip of, "I don't care how you do it, just get it done" type thing. And I think this is third generation management, and I think that's the dominant sort of paradigm of the 20th century. I think that probably paradigm in a lot of ways continues to the present day. But I think what Dr. Deming was a proponent of was this sort of fourth generation management, which was "management by method." So he was calling on, especially leaders, management of organizations to work with people on these methods rather than judging them on results, to your point about rating and ranking.

0:07:57.1 JD: And I think that's sort of a big part of the Deming philosophy, is to move from just rating and ranking people and thinking about instead, what are the methods people... What are the processes people are using within our systems to get the work done?

0:08:13.1 AS: Yeah, one other thing it just made me think about is that when you manage people, let's say in the US, people don't wanna be micro-managed, they want... They like to be told, "Well, you figure out how you're gonna do it and then do it." And let me take responsibility for that, right? So it is a bit seductive to forget about the methods and just focus on the individual and say, "Make it happen." And there are times that, that can be a valuable tool, a valuable way of managing when there's just so much going on, but also juxtaposing that to the typical manager in Thailand, which I'm very familiar with, they don't wanna be told that.

0:09:01.3 AS: It isn't necessarily their desire to be independent in their work and to originate the method. There's many managers here that really appreciate the boss that says, "Here's how I want you to get there," or "how do you think we should get there?" And that there's a much bigger discussion on that, maybe it's because there was less of an industrialization over the years, and that that's a newer thing compared to where America is at, but I know that my experience with management here is that managers do appreciate that concept of, "Let's look at the method of how you're gonna get there."

0:09:46.1 JD: Yeah. I think method is important, and I think one of the first myths that I was thinking about is, now label these as we go, but I was thinking of this myth of best practices, which it wasn't exactly what you were talking about, but it sort of made me think of where do the methods come from that we are working with it in whatever sector we're working with.

0:10:12.3 AS: So is this myth number one?

0:10:12.8 JD: Yeah, myth number one.

0:10:16.8 AS: Boom.

0:10:17.3 JD: Myth of best practice, so I think you teed us up really well. And this is an area that I've done some deep thinking on this because this has been a very... With all of these myths, you gotta be careful. You gotta really think about what it is that Dr. Deming was saying. And I'm not... So I'm not saying when I say myth of best practices, I'm not saying don't go out and study what other people are doing and try to bring the best of that to your organization. I don't think that's what Dr. Deming was saying. But I think that you gotta be really careful when you label something a best practice, and then try to incorporate it into your organization.

0:10:58.9 JD: And I was thinking in my role over the last two decades or so, maybe decade and a half, I've been fortunate because I've been a part of an informal network of schools and I've been able to sort of leverage that network, and go on many, many school visits probably many than the typical educator, even one that's in a leadership position. Dozens, I counted them up a couple of years ago over the last decade and a half, I think I've gone on over 120 school visits, and that's all types of different schools. Traditional public schools, public charter schools, private schools, and all over the United States, in South Midwest where I'm based out of here in Columbus, the Western United States to northeastern parts of the country. And I think on one hand, these visits have been extremely beneficial. I was able to observe classrooms and school practices in these many different places.

0:12:00.3 JD: I was able to speak with teachers, building administrators, school district leaders about the many challenges they're facing, how they're counteracting those challenges and the solutions they've developed with. And I think I've always tried to pay very careful attention to what context is this particular school operating under - what's their student demographics? What resources do they have both financially and from a human resource standpoint? Where are they situated? Are they in a city or in a town? Are they in a rural area? Some of the factors associated with those different practices. So I pay attention to those.

0:12:45.4 JD: And every time you go into a school, each school has its own culture, it has its own feel. But I think that... Well, I have this appreciation of the context, I think as I've thought more about these various practices, I've grown more skeptical. I think there's really an under-appreciation for these contextual elements within which these best practices often operate. There's... I remember hosting my own school visit and we, in our own schools, in our elementary schools, we have these carpets where kids come to do reading, read-alouds.

0:13:29.5 JD: And after one of these school visits, one of the superintendent said, we're gonna go buy these carpets and we're gonna do this too. These carpets are great in the classrooms and I don't know how it worked out, but I got the sense that there was sort of like, there's a whole system, a whole set of processes and procedures that are set up. It's just not having the carpet in the classroom, it's how it's used, it's how the kids move to the carpets, it's what's happened once you get to the carpet. You can sort of under-appreciate all of the sort of thought went into something as simple as the read aloud carpet that you see in a classroom.

0:14:07.2 JD: And I think there's this part of about context, and then there's just also a part about, is this practice... Does it have a sound research-base as well? So you're looking at both of those things. And I think in education, those best practices, often the research base is very, very thin. And then there's this whole other side of things where you really have to understand what is the context, the different variables that went into making that practice work. It may have been something that unfolded over four or five years, and you just can't pull it out of that school and then drop it into your own setting. So I think one of the things that Deming said about best practices is "to copy is to invite disaster." And so I think there, he's not saying, "Don't go study other organizations," but it's not as simple as, "Oh, I see this curriculum or this teaching practice or this method in one place. We're gonna do that tomorrow." It's just not that simple. So I think this is, like I said, one of these myths that I've come to appreciate how important in the context that they're operating under is before you can take it to your own school or network.

0:15:20.0 AS: Yeah, a great way of thinking about this one is, imagine that you take a General Motors car. Let's take a, I don't know what's fancy these days, but let's say a Cadillac as an example. And we say, here is the design for the Cadillac and here's everything you need to know, all the parts and everything, and you deliver that to Toyota, and say, "You have a car factory, so build this car." What you don't realize is that in particularly with the Toyota production system, that the whole production operation at every company is built around an infrastructure or a context, as you said, that sets the stage for how that is done.

0:16:29.4 AS: And therefore, things are not interchangeable. And so if your idea is, I'm just gonna go around to these 120 different schools and look for best practices and bring them in, it's like an amalgamation of unnaturally developed things. And also the other thing that it made me think about is that the whole point of PDSA is that you're working in your own organization to build a deeper understanding of a particular problem and solution. And when you repeat that process, you are also building a unique competitive advantage. Now, whether that in, let's say, in the world of business, that competitive advantage may be kept secret or not necessarily shared - in the world of education, it may be made public, but it's very hard to duplicate something that has been constructed internally through process of learning. And so just putting amalgamation of different things onto a body or onto a facility doesn't make the combination of those something great.

0:17:35.7 JD: Yeah, and I think of, what's the idea of the day? For schools coming out of the pandemic currently, 'cause the impacts of the pandemic and learning loss and those things are still sort of obviously being felt by schools, and we're seeing that ramification show up and in test scores and other measures. So one of the things that has been sort of promulgated as a silver bullet is high dosage tutoring, which means like a significant amount of tutoring happening for an individual student or a small group of students on a regular basis where what happened three or four times a week. And you see this in education publications, you see this policy makers and even legislatures are pushing this idea.

0:18:33.3 JD: But the problem is, while the research base for that particular intervention may be strong somewhere and under some set of conditions, the question for a practitioner is, well, who are these tutors? How will these tutors be trained here? Who is training these tutors? What curriculum are the tutors using? What financial resources are there to pay these tutors and to acquire the curriculum? Where in the school day is that going to happen? What are kids that are going to high-dosage tutoring gonna miss in the school day to be able to attend that tutoring? If it's not happening during the school day, if it's happening before or after school, how will kids get home from that tutoring?

0:19:22.0 JD: Who's providing the management of the tutors? How are those tutors hired? How are those tutors replaced when they inevitably will turn over? I could go on and on and on and on and on and on about these things, well, someone tells me that as an educator leader that, yes, for sure high-dosage tutoring is the best practice that you should drop into your organization, those questions remain unanswered and those questions are actually the thing that will actually make the practice come to fruition and work or not, and oftentimes, when these different ideas are being thrown about, none of those questions have been answered. And so I think we do this over and over for certain in the school world that I'm in.

0:20:10.5 AS: It reminds me of that old time song that maybe our older listeners and viewers would remember, "Who takes care of the caretaker's daughter when the caretaker is busy taking care?"

[laughter]

0:20:22.9 AS: So who's taking care of all those different things behind the scenes and putting them all together? So that's a great one to help us realize that it's good to understand best practices, it's good to go out and survey and get them and consider them, but then what really matters is how do you take best practices that you see, narrow them down, the one that you think will fit in your system and then develop it slowly and steadily, so it becomes a permanent improvement in your system? I think that's what you're getting at. Would that be right?

0:21:02.4 JD: Yeah, that's exactly right. So I think of something that may come to us through something like a randomized controlled trial, like the effectiveness of high-dosage tutoring, I think looking at RCTs or other similar... That's sort of the gold standard research. But even...

0:21:20.4 AS: RCTs for the listener is Randomized Control Trials?

0:21:25.0 JD: Randomized Controlled Trial, a study where people are randomly assigned to groups and then there's a treatment for one group and not a treatment for another group, there's no real differences between those two groups, and then you see if there's an effect. I don't think there's a lot of the studies that sort of rise to the gold standard RCT, there are other types of studies in education for sure, but either way, I think that's to the difference between when an ideas come through a randomized controlled trial where it's worked somewhere for some group under some set of conditions.

0:22:03.5 JD: Versus the Plan-Do-Study Act cycle that we've talked about, I think reading the research base can give you a starting place, give you some indication of the types of interventions or the types of curricula, or the types of practices that may work, but the Plan-Do-Study Act cycle allows you to sort of take an idea in your context and try to get it to work under the very conditions under where the idea or the practice would ultimately have to be working for it to be effective in your organization.

0:22:36.4 JD: So I think that's the two differences. Those two things, the RCT and the PDSA cycles can be complementary, and I think that's how I actually think of those two things, but you can't just... Can't force these best practices into contexts that they weren't designed to be in. And you gotta figure out all those questions that I talked about with any idea, I use high-dosage tutoring, but those are the types of questions that you can start to... If you're gonna try that in your organization, you can start to hash that out through the PDSA cycle, so I may say... Instead of saying, we're doing high-dosage tutoring in our school district, what I may say is, "What would it take to provide targeted tutoring to one student for one week?" I'm gonna plan that, I'm gonna do it, I'm gonna study the results and I'm gonna act on it.

0:23:31.8 JD: And in that one week, what you may find is a whole host of things in your context that you did not consider where you can't even get this to work with one kid, [chuckle] let alone a 1000 kids, or if you're in a bigger district, 10 or 15 or 20,000 kids and even those kids, even though they're in your district, they might not even be all operating under a similar context 'cause they're in different buildings with different adults and those types of things.

0:24:01.4 JD: So things become much harder when it comes to implementation, when you start to think in that way, "How would I get this thing to work with one student?" Come do that with me and you see the challenges person pushing high-dosage tutoring and then you can extrapolate that out to 1,000 kids or like I said, 10,000 kids, and you can start to see how this stuff falls apart pretty quickly in practice.

0:24:27.9 AS: Well, I think that's a great description of this first myth of best practices. So what myth number two?

0:24:37.4 JD: This is the myth I call myth of the hero educator. I think we latch on the hero stories in all kinds of walks of life. Hero stories stretch back to ancient times and they capture our attention for good reason. Ya know, they have these archetypes and we can identify with those archetypes, but when it comes to education, I think... I'm thinking about outlier educators with some type of... Some center of exceptional and rare talents, and I think one of the best known movies that captures this from an education perspective is Stand and Deliver. You may...

0:25:22.4 AS: That's what thinking about when you... I couldn't remember the name of it, but I remember that movie.

0:25:27.5 JD: Yeah, it's a prototypical hero teacher, biopic. It's Jaime Escalante in Los Angeles, basically, the movie depicts him leading his 18 inner city math students from basic math to calculus in just two years time, but then when you actually... Jaime Escalante is a real person, he's a real teacher in California at Garfield High School, but when you go study what actually happened, it's very different from... The movie is very different from what actually happened in real life, so when you look at what he actually did...

0:26:08.9 AS: Funny that.

0:26:10.7 JD: Oh yeah, can you believe it? But we latch on and say, "Oh, if he could do it... Or this is based on a true story. We can do this in two years." And what actually happened was that Escalante, the teacher, it took him eight years to build this math program that's depicted in this movie, he completely revamped the Math Department at his high school, he had to start by convincing the principal to raise the sort of math requirements at the school in general. Then he designed this whole pipeline of courses to prepare students for what they ultimately were trying to get to is AP Calculus and then he hand-selected top teachers to instruct those courses along the pipeline, and he even went to the junior high schools that fed into his high school and convinced them to offer algebra to eighth graders.

0:27:07.8 JD: So he's actually... What is actually really doing is setting up this math system basically that hadn't been there before, so he's actually thinking like Deming and setting up a system of pipeline that makes sense, and none of Escalante's actual students moved from basic math one year to AP Calculus, the following year, that's a complete misnomer, instead, it was the sort of system transformation that unfolded through the cooperation of obviously numerous educators and students over this eight-year period.

0:27:42.3 JD: Now, putting that the side, it didn't happen like you didn't move is still a pretty amazing story, whether it took two years or eight years, he set up this pretty amazing system. So I think most of us are not gonna rival Escalante and his tenacity and the results that he got with his students, his results are so far outside the norm, they made a movie about this guy. So they made the movie for a good reason, but I think my take away and thinking about this myth of the hero educator is that knowledge about variation, this component that we've talked about, part of Deming System of Profound Knowledge. Knowledge variation... Knowledge about variation tells us that the vast majority of educators perform within the enabling and constraining forces of an organization system.

0:28:35.9 JD: So most teachers, most principals, most superintendents, do not have Escalante's tenacity to set up a brand new system. Most of us just don't have that in us, but we create these mythologies around heroes like this hero teacher, they're embellished, they leave out important details, and I think these hero educators do exist, but they make up a tiny fraction of the educators in the United States, and same thing on the flip side, teachers, especially in the last decade or so, have caught a lot of slack are often blamed for test results and other sort of ills of the education system, but what I've found, and I think what the research bears out is that on the other side of the hero spectrum, those that are unfit, that really shouldn't be in front of a classroom of students, that's also a very tiny fraction of the educator workforce.

0:29:37.7 JD: And that the point I would take away is that all of this points to the fact that it's really the system where the vast majority of the improvement potential lies. So you get this hero educator myth, it makes for good drama in Hollywood, but it's a really, really poor strategy for educational transformation and improvement.

0:30:00.9 JD: We sort of go back to these myths, whether it's best practices, "Why don't you guys do it like them? They can do that over there, you make it work in your system. Well, if this guy in California can do this, why can't you do it over here?" But it's really not about the individuals, it's about creating these strong systems where the vast majority of people that are sort of in that... A majority bucket, not the heroes, not those that probably shouldn't be in front of students, how could we make the systems work for those folks? I think that's sort of my take away from that myth.

0:30:42.2 AS: Yeah, in fact... So a couple of things I was thinking about. The first thing is, I bet you if we go there and look at what's the progress in what he did, that in some cases, you could see it's all gone, because some opposing person who was upset by it or didn't agree with it, or didn't like the idea of one person standing out to that extent knocked it down. I watched the education... There was a master's in marketing program here in Thailand at one of the universities that was, I would say, world class. The lady who ran it was amazing, and what she and another guy built out of it was really about 30 years of continuous improvement. They just kept improving.

0:31:30.6 AS: And so it really was an impressive program and there was a new dean of the school that came in and he didn't like it, and he didn't like that person, and he basically, between him and his forces, knocked it out and destroyed it, and it's completely gone, and that was an interesting example that I saw. So the first point is that, is it really lasting improvement? Well, we have to admire the people who have so much tenacity, and we definitely wanna get everything that we can to improve the system, but just that one person rising up does not mean that the system's gonna necessarily be improved.

0:32:12.6 AS: So that's the first thing I thought about. The second thing I thought about was, one of the amazing defining qualities of McDonalds is everywhere you go, and I've eaten McDonalds everywhere in the world, basically. Now, we can debate about the quality of the food, but I would say that the consistency is amazing, and it's done with... That back in America when I was young, it was done with 16-year-olds on summer break, and it was done because they continually improved the system to make it so that the worker could deliver that consistent quality, and any new idea had to be implemented... Had to be able to be implemented worldwide in that system or else it wasn't gonna get into the system. So those are two things that I was just thinking about. How do those relate to this myth of the hero educator?

0:33:10.7 JD: Yeah, I think those are spot on, and I think it could be... When you build a system like Jaime Escalante did in his school, I think it could be drove...The undoing could be nefarious, a new principal could come in that just doesn't like it sort of comparable to what you were talking about, or probably what happens in a lot of cases where an amazing system has been built but it's completely reliant on that hero, once Jaime Escalante retires, it's very possible that that system then collapsed and not because anybody was working against it necessarily, but it could have been just without him and he was such an important part of it. Which would probably speak to what type of system was set up in the first place. Now, without him sort of pulling the levers, then it's very possible, but that would be enough in and of itself for that system not to live on to this day.

0:34:12.8 AS: Now, I can imagine an educator or an executive administrative, he's like, "What are you guys talking about? That was my only hope is to find this hero that could take us to the next level, and now you're just saying, no, no." I'm just curious, thinking about it from that perspective.

0:34:34.1 JD: Well, it's better because I think this is better because it doesn't rely on the hero. I think the same... I think a group of people, certainly have to be dedicated, you have to wanna change the system, but a group of people putting in place a strong process, I think is the point of all of this. That that's really what we wanna do. Do you need strong leadership? Sure, sure you do. But it's necessary, but not sufficient to building systems, you need a group of people working together and putting strong processes in place, processes that are strong enough, whether an individual or individuals over time moving on as they are inevitably really gonna do that the system or that set of processes remains intact. And I think that's what a system like Toyota, who you talked about earlier, that's what they've been able to do.

0:35:40.3 JD: People have changed over the years since the Toyota production system was put in place, but a lot of those processes, of course, they're continually being improved, but they put the process in place that wasn't reliant on any single individual to remain in, say, the CEO position and to ensure that that process or those set of processes would continue over time, that's the whole point of this, so you don't wanna be reliant on a single sort of hero educator or a hero engineer or whatever it is, you want the process... The system be strong enough that it continues to work even after that person retires or moves on to another position or whatever.

0:36:22.9 AS: So we've got two myths here. First a myth of best practices, and then the myth of the hero educator. And in wrapping up, let me just briefly summarize. So in the idea of the best practices, the main point that you're pointing out is be careful about trying to build an amalgamation of best practices, you have to understand where that best practice was developed and what was the context that it was developed under, and then you have to think about how that best practice could potentially fit into your system, and that may be the best idea here is rather than trying to just pull together a bunch of best practices to think about one or two new ideas that could be built into the system to improve the system of education. That's number one.

0:37:16.3 AS: And the myth of the hero educator is just to remember that the outlier educators, both on the great side and on the poor side, are very small group of people, very... And so to think that we can create lasting change from the power and energy of, let's say that really exceptional person is probably making a wrong bet and it's better to then think about, "How can we take from the energy of this person and implement the things that they're doing in such a way that we can build them as some lasting improvement in the system of education so that it doesn't just disappear when that man or woman disappears?" Would that be a summary? Or anything you would add to that?

0:38:09.0 JD: Yeah, it's a great summary. I think the only thing I'd add to the best practices is coming up out of a Nation at Risk, many, many times the reforms were like, if you just do X practice, whatever that thing was, standards or a certain curriculum, there's that under appreciation of context over and over and so I think the PDSA, the Plan-Do-Study Act cycle is a powerful driver for testing ideas in your context on a small scale. First, before moving on to a larger and larger scale until you get to full system-wide implementation. So I think your summary is perfect, I'll just add in the power of that PDSA as a part of figuring out what works in your particular system, in your particular context.

0:38:50.8 JD: Yeah, and with the hero educator, you mentioned you got the hero educator on one side, the positive side, those that probably shouldn't be in front of the classroom with kids on the other side, tiny fractions, a lot of what came out of a Nation at Risk, especially maybe from 2000 on targeted individual teacher performance, thinking that you could get rid of the bad teachers. But again, it's a tiny fraction of the educator workforce, and even if you did that, it's not gonna make a difference because the vast majority of people are in this sort of middle ground that needs strong leadership and strong systems, if we're gonna transform schools.

0:39:35.9 AS: So to wrap up here, we have management myths that keep fooling us, we've got myth number one, best practices and myth number two, hero educator. And we've got more myths to come up in our next episode, which I'm really looking forward to. I think these have sparked discussions and thinking about how to create lasting change and improvement in education. John, on behalf of everyone on the Deming Institute, I wanna thank you again for this discussion. And for listeners, remember, go to deming.org to continue your journey, this is your host Andrew Stotz, and I'll leave you with one of my favorite quotes from Dr. Deming. "People are entitled to joy in work.”

Continuing their discussion from part 3 of this series, Bill Bellows and Andrew Stotz talk more about acceptability versus desirability. In this episode, the discussion focuses on how you might choose between the two.

TRANSCRIPT

0:00:00.0 Andrew Stotz: My name is Andrew Stotz and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with Bill Bellows, who has spent 31 years helping people apply Dr. Deming's ideas to become aware of how their thinking is holding them back from their biggest opportunities. Today is Episode 4 of the Misunderstanding Quality Series, and the title is Quality, Mind the Choices. Bill, take it away.

0:00:31.3 Bill Bellows: All right, Andrew, welcome. So podcast three, I think the title was Acceptability and Desirability. And one correction there, when I went back and looked at the transcript the concept of... At least the first person I heard tie together acceptability, desirability, at least in the Deming community, was a professor, Yoshida, Y-O-S-H-I-D-A. He was a PhD student of Dr. Deming, I believe at NYU but I mispronounced or misspelled his first name. I thought I've heard people refer to him as Kauro, perhaps spelled K-A-U-R-O, maybe that's his nickname, and maybe I just didn't remember properly but his proper first name is Kosaku, K-O-S-A-K-U and he at one point in time was in Greater Los Angeles at Cal State Dominguez Hills. And then I think sometime in the mid '90s, early '90s, last I heard he moved to Japan.

0:01:51.1 BB: I've never met him. I've watched videos of him, there's a classic presentation. I don't know if it's got, it might be online someplace of he did a guest lecture. There was a... Dr. Deming was speaking in Southern California and needed an emergency surgery, had a pacemaker put in, so this would've been '92 timeframe. And Professor Yoshida was called in to give a guest lecture. And that ended up being something that I think was sold eventually. The video, the lecture was sold by Claire Crawford Mason and so he is... I don't know how much of that is online, but anyways.

0:02:38.4 AS: Is Kauro, Kauro wasn't that the name of Kauro Ishikawa?

0:02:43.7 BB: That may be where I... Yes that was a Kauro. There's two Ishikawas. There's a father and the son and I... So I'm not sure if Kauro was the father or the son, but anyway correction there. In the first series we did, going back to '23, 2023, I mentioned the name Edgar Schein, but I don't believe I've mentioned his name in this series. So I wanted to throw that, introduce that in this series today and give some background on him for those who have not heard his name or not aware, did not listen to the first series and Edgar Schein, who passed away January of this year. He was an organizational theorist, organizational psychologist, spent the greater part of his career at MIT. And one of the concepts I really like about what he talked about is looking at an organization in terms of its artifacts. So if you walk around an organization, what do you see? What are the artifacts? That could be the colors, it could be the artwork on the wall, but the physical aspect of the organization Schein referred to as the artifacts. And what he also talked about is if you dig beneath the artifacts, they come from a set of beliefs, and then the beliefs come from a set of values.

0:04:23.9 BB: And again, the first series we did, I talked about Red Pen and Blue Pen Companies, and Me and We Organizations, and Last Straw and All Straw organizations. And those titles should make it easy for our listeners who are not aware to go back and find those. And what I talked about is, this imaginary trip report, if you visited a Deming organization, if we could think in terms of two simple organizations, a Deming organization, and a non-Deming organization in this very simple black and white model. And I had people think about the physical aspects of both, if they were to go visit both. What I then followed up on in our conversation is what you see physically comes from a set of beliefs. Now, they may not be articulated beliefs, what Schein would call espoused beliefs. And then you have what they really believe and I forget the term, I use this for that, but it comes from a set... But anyway, the physical comes from the beliefs, the beliefs come from the values.

0:05:39.0 BB: And part of the reason I bring that up for our listeners, and I'm thinking in terms of the people that have a responsibility in their respective organizations. They could be consultants, internal consultants, working in quality likely, given the focus of this series. First of all, you have to start where you are. But even added on, included in start where you are, is you have to start where your management is. So, if your management is tasking you with an improving scrap and rework, then that's what you better be talking about. Now, you don't have to be guiding your actions based on acceptability because the other aspect is scrap and rework are typically associated... Well, not typically, they are associated with acceptability. The lack of acceptability, acceptability is the idea that this is good, it is acceptable, it meets the requirements, defines...the quality requirements that are defined.

0:06:52.0 BB: If it's good, it is acceptable, if it's bad. There's two categories of bad, bad could be I have to throw it away, that's scrap, which means I can't recover it or rework, which means I can do something with it and perhaps salvage it. And so if your management is tasking you with improving scrap and rework, then first of all, where they're coming from, quite naturally, is acceptability. And why do I say that? Because everywhere I've gone, that is the deepest foundation of quality in every organization I've ever met, worked with, I have met people that work from whether it could be... Whether it's clients that I've worked with, whether it's students, my university classes. Acceptability, scrap, and rework, all go together. And, so if that's where your management is, then they're asking you to focus on improving acceptability.

0:08:05.6 BB: But, you may find it invaluable to shift your focus to desirability to improve acceptability. And that will be a focus, well I get into some of that tonight and others or today, and then on a future podcast later. But, I remember once upon a time at Rocketdyne, the executives were, the VP of Quality was task master asking for improvements to scrap and rework and also things called process capability indices, Cp’s and Cpk’s. And if you've heard of a Cp or a Cpk, great, if you haven't all I could say is I find them dangerous. I find them, well I say they're all about acceptability. And what makes it, reason I would encourage people to stay away from them because they appear to be desirability, but they're really acceptability.

0:09:15.7 BB: We'll save that for later. But anyway you have to start where they are. So if people are asking for improvements in scrap and rework, then, instead of fighting them, you go with it. And then what we'll be talking about tonight is, is it worthwhile to shift? Well, what does it mean to improve acceptability and the difference between acceptability and desirability? And relative to the title tonight, Mind the Choices is being aware that there's a place for acceptability and there's a place for desirability. And going back to Yoshida in episode three, what I was referring to is, in presentations he was doing from the early '90s, maybe even going back to the '80s, he talked about Japanese companies are about desirability. So, he presented this model of acceptability and desirability. And then, his explanation of what makes Japanese companies, again, back in the '80s, Japanese companies were viewed as those setting the quality standards.

0:10:20.5 BB: And, he was trying to say that the way they're doing that is that they don't rely on acceptability as other companies in other countries do. They have a higher standard. And that's what I wanted to introduce in our last episode, Episode 3. And, what I wanted to do tonight in this Episode 4, is to put some, add some more to that. But, also reinforce I'm not saying that there's anything wrong with acceptability, it's a question of what does the organization need at that point of time? And, really it has to do with... Really, it has to do with how big a system you wanna look at. So if you're looking at something in isolation, which is, I mean, when you look at something and saying it's good or bad, that is the epitome of looking at something in isolation.

0:11:17.5 BB: You're looking at a pen and saying it's good. You're looking at the diameter of a hole and saying it's good. That is not looking at what goes in the hole, that is not looking at how the pen is being used. So by definition, that's what Ackoff would call analysis, which is looking inward. It's not what Ackoff would call synthesis, which is looking outward. And how far outward you look is all according... I mean you could look, it comes down to how big is the system. And I wanna introduce the name Shel Rovin, Sheldon was his full name. Shel was his nickname. I met Shel through Russ Ackoff in 2006. Shel was, he was in charge of the Chief Nursing Officer program, which was a two-week immersion program at the University of Pennsylvania.

0:12:14.5 BB: And he was doing that in the, 2003, 4, 5, timeframe when I met him. And Shel was a dentist by background. He was Dean of the School of Dentistry at University of Kentucky and University of Washington. And I met him through Russ and invited him to Rocketdyne on numerous occasions. And Shel spoke about relative to looking at a system, 'cause people talk about, well "Andrew, we've gotta look at the whole system," but how big is the system? And, so people say, well, systems thinkers look at the whole system. Well, how big is that? Is that 1,000 foot view? And people say, oh no, Bill, it's bigger than that. Is it a 10,000 foot view? Is it... How big is the system? Well, Shel's perspective, and the word I wanna introduce from Shel is relative to systems is boundarylessness.

0:13:12.7 BB: Say that a few times fast. 'Cause systems have no boundaries. So I'm sure our listeners... I'm sure you have heard, I don't if our listeners have all heard, Dr. Deming would say to executives, does your system include the future? He used to ask questions such as what business are you in? What business will you be in five years from now, 10 years from now? Well, why not 15 years from now? Why not 25 years from now? Native American Indians, associated with Native American Indians is the idea of looking at the seventh generation after you when you're making choices. And so what I would ask people is, well, why seven? Why not eight? Why not nine? Why not 10? I mean, within an organization, we could be working with our supplier to try to get across these quality ideas to our suppliers.

0:14:05.5 BB: Well, that's looking at the system. Well, wait a minute. Do our suppliers have suppliers? Yes. Do their suppliers have suppliers? And so relative to boundarylessness is this idea is when people start talking about the whole system, I don't know what "whole" means. What I'd rather look at is what size system are we looking at? That's a choice. That's a choice. So we could decide to look at our suppliers. We're gonna go one step, we're gonna look at procurement. Who do we buy from? Now, we may educate them and give them the responsibility of looking at their suppliers on... But that would be a way of managing quality. Likewise, we can look at the impact of our work on our customer and give them heads up as to how to look at the impact of their work on their customers. But that's looking at the system in an X, Y, Z, physical coordinate, add onto that, the time dimension. And so, again, all I wanna throw out there is that when it comes to making choices on acceptability, desirability, a lot of it has to do with how big is the system that we're looking at. Some everyday examples of acceptability.

0:15:23.5 BB: Again and what I wanna get across is, in part the difference to help people make choices. And so when we were on a vacation in Europe recently, I took a number of photos of people making choices. And,` when I travel, anywhere I travel, especially out of the country, I love walking into supermarkets just to see what they sell that perhaps is not sold in the States or in California. I know there are things you can't find in California that you can find on the East Coast. That's one thing. But I like going into supermarkets just to see what products are there. I mean, you can go to England and find in the refrigerator section, hard cider, apple cider, you know, alcoholic cider that I got exposed to going to a Deming conference in 2000. I've become a fan of it ever since. Well, in the States it's pretty hard to find hard cider, period. You go to England and you'll find, a dozen different brands and each brand may have a number of different types.

0:16:44.9 BB: And so that's, but anyway, relative to that when you walk into a supermarket, if you're looking at canned goods, or just look, well, looking at cider, we can look at this cider versus that cider. We treat a can as a can, whether it's buying tomato soup or cider, we treat all those cans as interchangeable, interchangeable parts. But when we go to into the bakery section, that's where I was taking photos in Amsterdam and I was watching people sort through the pastries. And yet what was laid out were a bunch of pastries of the same style. And yet people were, I want this one, I want that one.

0:17:26.0 BB: Well, part of acceptability is treating all those pastries as the same as we would treat all those cans of tomato soup as the same. Now relative to tomato soup I know you live with your mother, and I'm willing to bet your mom, early, early on when she took you to the supermarket, taught you how to buy canned goods, right? And she says "Andrew when you buy a can of something you pick it up, you're looking for dents," right?

0:17:55.1 AS: Mm.

0:17:56.0 BB: Because if it's dented, that's bad. And if it's not dented, that's good. I know my mother taught me that. So I know when it comes to buying canned good we look for dents. If dented, that's bad. If it's not dented, it's acceptable. But I don't see people sorting between cans of tomato soup made by the same manufacturer. They're just, we treat it as they're acceptable. Acceptable implies either one, the differences don't matter or I don't see differences.

0:18:33.0 BB: Desirability is, you wanna see a great example of desirability, go to the produce section and again, either watch people sort through pastries that are all acceptable, and yet they're looking for the biggest one, or... And when it comes to fruit, we're looking for the ripest banana, or maybe we're looking for bananas that are green because we're not gonna use them for a while. So acceptability, again, I'm trying to give everyday examples of acceptability is going in and saying, looking at all the fruit there, and just taking five peppers, whatever it is, and throwing them in the bag and saying, I need five 'cause my spouse said, go get five. And I throw them in the bag. And it could be time-wise, I don't have time to sort through them, or I quite frankly don't care that they're different. That's acceptability. So acceptability is either acknowledging they're different and saying, I don't care. Or...

0:19:29.6 AS: Seeing them as the same.

0:19:32.4 BB: Or pretending they're all the same. And I had a guy in class years ago, and I was asking about buying fruit and I was trying to use the example of we go into the supermarket. We sort through the oranges looking for the ripest one, and this guy says, well, I don't sort through the oranges. I said, well, how do you buy the oranges? I buy them by the bag. I said, do you sort between the bags? He says, no, I don't sort and his arms were crossed. I don't sort, I don't sort. So then I noticed that he had a ring on his left hand, a wedding ring on his left hand. So I said, I see you're wearing a wedding ring. And he said, yep. I said, did you sort?

0:20:15.2 AS: I don't sort.

0:20:15.3 BB: Meaning... I don't sort. And so when you're looking at things that meet all the requirements and saying there is no variation or the variation doesn't matter, that's acceptability, Andrew. When you look at all the things that meet requirements and you see them as being different and saying, I want this one, that's desirability. And so that could be, when it comes to selecting a spouse, when it comes to selecting an orange, when it comes to selecting a parking spot, in a university, you're looking for the, an ideal, the best professor for Thermodynamics II, and there's 10 professors the university says are acceptable. And you talk to classmates and you find out, oh, no, no, no, stay away from that one. What are you doing? You're sorting amongst things that meet requirements, that are acceptable and saying, that's not good enough for me in that situation.

0:21:17.2 BB: Well, what I wanna say then added to that is, this is not to say desirability is better than acceptability. It really comes down to is desirability worth the effort? Because when it comes to desirability, I am looking beyond, I'm looking at a bigger system. So I'm looking at the fruit in terms of how I'm using it. If I'm aware of that, I'm looking at the parking spots in terms of: I'm gonna be in the store for an hour and I want the most shade, or these parking spots have a little bit different distances between cars, and I want a spot with a little bit more width so somebody doesn't ding my car. So what I'm hoping is with these examples, people can appreciate that every day we make choices between acceptability and desirability.

0:22:11.3 BB: Every day we're making a decision based on saying, this is okay, code word for acceptable, or I'll take that one, that's desirability.

0:22:27.6 AS: That's quite a breakdown.

0:22:28.1 BB: Well, and the idea being... The other aspect of it is when you're choosing to say, I want... When you decide that acceptability is not worthwhile, my proposal it's because you're looking at a bigger system. You've got a bigger system in mind. You're not looking at that fruit in isolation. You are somehow saying, there's something about how I plan to use that, which is the reason for this decision. And then it gets into how big is the system that you're looking at? Are you looking at the person downstream of you at work, which that could be an internal customer. People used to use those terms. Are you looking at the person after them, two down from them, three down from them? And that gets into a choice. So what I would tell the folks I was mentoring at Rocketdyne is that they were designing things or going to see how they were used. And I'd say, first of all, nothing requires you to go see how that's used. Your job as a designer, whatever it is in engineering you design it, you give it to manufacturing. But you don't have to go downstairs and see how they're using it.

0:23:47.5 BB: I said, but if you do, you might learn a lot. And then they might say, "well, so I should go talk to the person who's first using it." Well that might be helpful. And then what about the person after that? Well, that might be helpful. And then what about the person after that? Well, that might be helpful. And I was trying to get across to them, we hire really bright people and if we just turn you down to don't look beyond, just deliver the thing, complete those drawings, do whatever it is, pass it to the next person. I said, the system may not require you to go look to see how it's used.

0:24:31.9 BB: But what Dr. Deming is proposing is, the better you understand how it's used, the better you can serve the system. But then you get into the question of how big is the system that you want to be thinking about? And there I would tell them that there's no right answer. I mean, you wanna be and this is what I would tell them is we hire really bright people and then we condition you to believe that it doesn't matter. What I'm proposing guided by Dr. Deming is that there's a possibility that it matters anywhere from a little to a lot, but you won't know unless you go look.

0:25:12.2 AS: Yeah. It's funny.

0:25:12.3 BB: And so what I wanna get... Go ahead Andrew.

0:25:14.4 AS: When I was a supervisor at Pepsi in Los Angeles at our Torrance factory, they asked me to help... Could I figure out how to quicken the pace with which we got 80 trucks or 100 trucks out the gate every morning because it mattered. If you got trucks out an hour late on the LA freeways, now you have overtime and all kinds of trouble. So, what I did is I climbed up... At 4:00 AM I climbed up on top of a building, one of our buildings.

0:25:54.1 BB: Wow.

0:25:54.9 AS: And I had a clipboard, which I always have. I have extra clipboards always with me, here's one right here. And I had paper and then I just observed, and I took a lot of notes. And what I was seeing was all these drivers were, they were checking their trucks and they were spending a lot of time with their trucks. So, after I observed it that morning, the next morning I went down and went around and I asked them, what are you doing? And they said, well I'm checking that the quantity that's on the paper is the quantity that's on the truck. And I said, how could that not be? And they said, the loaders at night don't fill it up right. So, the next night I went and talked to the loaders and I said, drivers are saying that you guys are making errors.

0:26:40.4 AS: No, we're not making any errors. Okay. So, now I gotta dig deeper into the loaders. And then I start to see, okay, the loaders are making errors. So, I went and talked to one loader and said, why are you making this error? He said, well, the production are supposed to put this particular Pepsi item in this spot. But they didn't, they put it in another and I got confused, but it's just 'cause it's normally always there. So, I go to talk to the manufacturer, hey guys come on, why did you put that stuff in the wrong spot? He said, well, sales told us to produce so much that we were overloaded. We didn't have any place to put all of this products. So, we had to basically put it anywhere we could as it's racing off the line and on and on.

0:27:27.9 AS: And then you start to realize like, okay, the system is bigger. Now I went and focused on the loaders and said, how do we make sure that when the loaders load that we can lock the truck and then tell the drivers, you must not open this truck. How do we build the trust between the loaders and the drivers that they're loaded correctly and that they can go, because the drivers don't want to get to San Bernardino or wherever they're going and find out, oh, I don't have what this particular customer wanted and it's supposed to be on here. So that's just a little bit of a picture of kind of a very narrow start that starts to bring in more of the system.

0:28:06.8 BB: Oh, yeah. Oh, that's a brilliant example. And also what you're talking about is a term we used the first series, which is the value of synchronicity. That those handoffs are smooth. And they disrupt...

0:28:26.7 AS: I love that word handoffs, by the way. I was just talking with a client of mine. We were talking about the core processes of the business. And I just now realize that what I was missing and what we were missing in our discussion was how do we make sure that the handoffs work.

0:28:43.6 BB: Well, then the other thing, again a concept you may recall from the first series is, I liken it... I think in terms of two types of handoffs. And, actually, I think in one of the first, maybe in the second episode we talked about this, is associated with acceptability. When I hand off to you something, my report, whatever it is I'm assigned to delivered to Andrew by 5 o'clock tomorrow, you look at it, you inspect it, and you're making sure before you accept it that it is acceptable, that it has all the content. And, if anything's missing a figure, a graph, a label, you send it back to me and then I go through and massage it and then send it off to you. And, part of acceptability is when you say, that's good, then the handoff we're talking about is physical.

0:29:51.6 BB: Right. I mean, there's nothing wrong with a physical handoff. I give it to you physically. And what you may recall me mentioning, I think, again likely episode 2, podcast 2 of this series is I would demonstrate this with people in the class. And I would say, if, if what I give you is not acceptable, what do you do? You give it back to me and you say it's incomplete. And then I go through, massage it. If I now give it to you and all the requirements have been met, it's acceptable. Now what happens? What do you say? And I would kid them and so now you say, thank you. But what I'd also point out is that part of acceptability in a non-Deming organization is the handoff is physical and mental. I mean, physical is: It is yours, not mine.

0:30:38.5 BB: Mental is that if you have trouble with how that fits into what you are doing with it, because that report does not exist in isolation, you're doing something with it. Right. So you're doing your things with it. Now we're looking at the system. And if in the system of you're using it, you have an issue and you come back to me, in non-Deming environment, acceptability is my way of saying "Andrew I'm not sure why we're having this conversation because what I gave you is acceptable." But in a Deming organization, the handoff is physical, but not mental. What does that mean? It means, I'm willing to learn from what you just said and the issues you're having. And now I'm beginning to wonder, there's two possibilities. Either one, what I gave you is not acceptable. There's something wrong with the inspection.

0:31:34.3 BB: Or two, what's missing is desirability, that there's some... What I give you is acceptable, but there's something about how it's, it's um, there's a degree of acceptability, and so instead of viewing it as it's good or it's bad, black and white. Now we're saying there's degrees of good. Desirability is degrees of good. And, so in a Deming environment, when I hand off to you and you have an issue with it, you come back the next day and say, "Bill, somehow this didn't get caught in the control chart." And I said, "well, let me take a look at it," and I may find there was something wrong with the inspection, or I may find that there's a degree of good I'm not giving you that I need to be giving you. So, that can either be an acceptability issue or a desirability issue. I'm willing to have that conversation with you in a Deming environment. So, in a Deming environment, the handoff is physical but not mental. And the learning, as you're demonstrating, the learning that comes from the ability to have those conversations, improves the system. That's a lot more work.

0:32:53.8 AS: So, if you were to sum it up, was that the sum up or would you add anything else to your summation of what you want people to take away from this discussion?

0:33:05.6 BB: Yeah, that's it. I'd like to say one is that there's, acceptability is fine. Choose acceptability, if that's all the situation demands then you've chosen that. But pay attention to how it's used, pay attention to the ramifications of that decision, which may show up an hour from now, may not show up until a year from now. And, the possibility that hiccup a year from now could be either it wasn't acceptable, in which case there's an inspection issue or it was acceptable, which means there's a degree of good, which means it's a desirability issue. And, that gets us into future conversations, talking about degrees of good and the whole idea of variation in things that are good. That's desirability, variation in things that are good.

0:33:57.6 AS: All right. Bill, on behalf of everyone at T      he Deming Institute, I want to thank you again for this discussion. And for listeners, remember to go to deming.org to continue your journey. And if you wanna keep in touch with Bill, just find him on LinkedIn. He responds. This is your host, Andrew Stotz, and I'll leave you with one of my favorite quotes from Dr. Deming. "People are entitled to joy in work."

Education is often touted as data- or evidence-driven. But in this discussion, John Dues contends that educational data is often fiction, given how easy it is to distort, both via the inputs and outputs and through manipulation.

0:00:02.6 Andrew Stotz: My name is Andrew Stotz and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with John Dues, who is part of the new generation of the educators striving to apply Dr. Deming's principles to unleash student joy in learning. The topic for today is Data is Meaningless Without Context. John, take it away.

0:00:28.3 John Dues: Yeah, thanks for having me back, Andrew. I'm thinking a lot about educational data, and I think about how it's often presented, and I think so often, what we're actually doing with our educational data is what I call writing fiction, which is taking a lot of liberties with the data that comes into our system, whether it's state testing data or some other type of data that gets reported out to the public, and we often sort of manipulate that data or distort that data in a way that paints our organization or our school system or our state in a positive light, and I think we do that sometimes at the detriment of actually working to improve those organizations or those systems because we spend so much time trying to paint this positive picture instead of just putting the data out there.

0:01:26.3 AS: And it's interesting you talked... One of the interesting things about what you're saying is that it could be accurate and good data, but it's just the context or the structure of how it's presented makes it meaningless.

0:01:39.9 JD: Yeah, we try so hard to sort of paint it in this positive light to make it look like we're doing a good job. Everybody wants to do a good job, but I think we often do that at the detriment of our systems.

0:01:54.7 AS: One of the things that made me think about it, in the financial world, we have a code of ethics, and that is basically that... Particularly for CFA charter holders, financial analysts, that you have to present a complete picture of your performance. So if you have 10 customers that you're managing their money and one of them, you really bombed out and you decide you're gonna do the average of the nine that you did well on and then go out to your clients and say, "This is my performance," that's a very... You have an obligation to accurately represent your performance. And when I think about it in all the charts and graphs that people are making in education all around, I would say that most people probably are just, I would call it CYA, cover your ass type of charts [laughter] of, "How do we make this look good?"

0:02:43.9 JD: Yeah, I think... I read somewhere that there's sort of three ways you can respond to your data. You can actually work to improve the system, which would be a positive, and then the other two ways are two forms of a negative, one is you could distort the system itself, or you could actually distort the data. And a lot of times, there's not sort of a nefarious motivation underneath that distortion, but there's sort of, again, this desire to paint your organization or your system in this positive light. So sometimes they're straight up unethical behavior or cheating, but most of the time, that's not what I'm seeing and that's actually not what I'm talking about here today. It's more of this sort of taking liberties, writing fiction. "Okay, we declined from two years ago, but it's up from last year." Those types of sort of distortions of the data that I think are fairly common in education sector, probably all sectors too, so.

0:03:49.9 JD: I think... Maybe I'll share my screen for the folks that have video and I'll talk through it for the listeners that don't have video, but one of the things I often think of and focus on is state testing data, because so many people are looking at that data all the way from State Departments of Education, the school system, the individual schools, the individual teachers and classrooms with their students, and then of course, families get these state testing reports as well.

0:04:23.8 JD: And a handful of years ago, I was looking at one of these reports from the Ohio Department of Education and sort of picture this fancy, glossy, colorful PDF. It's got this big headline on it, it says, "Ohio students continue to show improved achievement in academic content areas." Then it's got a table with all the state tests, all the different grade levels, and three columns for three different years of data. And then in the last column, there's these up green arrows for where there's been improvement from year over year and then these red down arrows for where there's been a decline, and I was thinking to myself, "Well, in some of these areas, one, some of the percentage changes are so small that just on that... In that realm, they're sort of meaningless, like fifth grade science goes from 68.3% in one year and it goes up to 68.5% in another year. That's essentially a rounding error when you're talking about 100,000 or so students that are taking the test. I think calling that improvement is a stretch at best.

0:05:39.0 JD: And then I was focusing on third grade reading specifically because that's such a critical area. In Ohio, there's actually a third grade reading guarantee, so if you don't pass the test, there's the potential there that you could get held back in third grade, so there's a lot of focus on that data. So I was reading on in that state education department document. It said, "Well, third grade did see this decrease this year, but when you look back two years, it actually had... Third graders actually had an increase of proficiency." So again, you actually have a decline from this previous school year to the more recent school year in this document, and they're still making this claim because if you go back two years versus this most recent year, you do see improvement, and so you start to think to yourself, "Well, what is improvement? Do we have a definition of improvement? And if so, what has to be present?"

0:06:43.4 JD: And a few years ago, I came across this definition in sort of a seminal work in our area called The Improvement Guide, and the author sort of outlined a definition for improvement, and it sort of has these three components, and this made a lot of sense to me. If you're gonna claim improvement, you have to, one, alter how work or activity is done or the makeup of a tool. So you had to change something. Basically change something about the work you're doing. That change had to produce these visible positive differences in results relative to historical norms, and then the third thing is it had to have a lasting impact. And so when I go back and I think about that state testing data or really any type of data, you start to ask this question, Is this really improvement, or again, is this writing fiction? Is this not really improvement, but we're twisting the numbers to sort of fit our narrative?

0:07:45.0 JD: So when we think about that state testing data, do we have knowledge for how worker activity has been altered systematically. And if I can't point to that, then how am I gonna take the so-called improvement and bring it to other places in the state that may not have had those same improvements? Do I have these visible positive differences in results going back and comparing to historical norms, not just last year or even two years ago, but five or six or eight or 10 years worth of data. And then have I been able to sustain that improvement? Has there been a lasting impact? Have I been able to hold the gains? And if I haven't been able to do those three things, point to what we change compared to historical norms and then sustain that improvement, I would argue that we haven't really brought about improvement. We can't claim that we've improved our system.

0:08:46.9 AS: It's interesting. Before we go on the numbers that you were showing, roughly, the average there is something like 60%. What's the 40? That 60% is what? And that means 40% is not that.

0:09:07.7 JD: Yeah, I'll go back. So when you're thinking about state test scores, most states have some type of threshold, like we have this goal that X percent of our students are gonna be considered proficient on any given test. So in Ohio, that threshold is 80%. So the state says, in order to meet the benchmark, any given school needs to have 80% of its students, let's say, on third grade reading test have to meet this proficiency standard. And so what we saw in this particular data is that in the 2015-16 school year, 54.9% of the kids met that proficiency threshold. The following year in '16-17, 63.8% of the kids met that threshold, and then in the most recent year in this particular testing document in '17-18 61.2% of the kids were proficient. So just about 40...

0:10:04.8 AS: So even if it was a sizable increase, it wasn't just statistically insignificant, it's still roughly 40% of the students aren't proficient. No matter even what the government says about what's the minimum standard, it would be hard to really argue too much about improvement when you're so low. [chuckle]

0:10:32.8 JD: That's right, yeah. And that's what you often see in these types of these documents. So 40%, a significant minority of students are not proficient on the third grade reading test, and 60% are, and there's these incremental increases and decreases depending on the year that you're looking at.

0:10:54.6 AS: It's like the Titanic heading for an iceberg and you say, "I've turned the ship one degree, but we're still gonna hit the iceberg."

0:11:01.9 JD: But we're still gonna hit, yep, yep.

[chuckle]

0:11:04.3 AS: Alright, keep going.

0:11:06.0 JD: Yeah. So I think what's really important thinking about data in context, when you start actually stepping back and saying, "Okay, let's look at third grade reading over the course of 16 or 17 years versus three years," this very different story emerges. Part of that story is that context, so what has changed about Ohio's third grade state reading system over the course of those years? So if you go back all the way back to the 2003-2004 school year, you see Ohio is giving a particular test called the Ohio Achievement test, and you see as that's administered each year for six or seven or eight years, the results are sort of bouncing around this average, somewhere in the neighborhood of 77-78%. Then you have a change in about the 2011-12 school year. Now, we're given this test called the Ohio Achievement Assessment, but it's pretty similar, just the name has changed, the test itself is still the same, and you see basically these very similar results. And then all of a sudden, you sort of fast forward to the 14-15 school year. Anybody that's an educator from back in that time period, they'll sort of recognize that now we're getting these new common core standards, these more rigorous college and career-aligned standards, we start giving these new tests.

0:12:38.7 JD: So Ohio switches to the PARCC Test for the '14-15 school year for one year, and even then, the test itself changed pretty significantly in terms of format, but you still see pretty similar results that you've seen for the past 11, 12, 13 years. Then all of a sudden, that next school year, that 2015-16 school year, so that's the first year from that testing document, you see the results drop off a cliff and you start thinking, "Well, what happened to third graders?"

0:13:11.7 AS: Right. From, let's just say about 77 down to the next data point is 55.

0:13:18.6 JD: Yeah, just under 55% now. So you have this just about a 20, 22% drop in one school year. Now, the test did change again. Now it's called The Ohio State Test, it was called the PARCC Test, but the test itself, the format itself isn't probably what brought about that precipitous drop. Instead, what's happened is the legislature in Ohio has changed what it means to be proficient on the test. So basically, each sort of proficiency level has a cut score, and the cut score has increased for an individual child to be considered efficient. So the kids are no different in '14-15 than the new crop of third graders are in '15-16, but what has changed is what you need to do to be called proficient, and so because of that change, you see this huge drop in test scores along with this new test, and then over the course of the next three years, you sort of see an increased in test scores, and then a decrease in test scores, and then an increase in test scores, and then a decrease in test scores. And the Department of Education is claiming that there's improvement happening, but really what's happened is a whole new system has been created. You really change that third grade reading state testing system into this brand new system, whereas the average had been bouncing around 77% or so. Now you sort of have this new average bouncing around that 60% mark.

0:14:56.9 JD: And again, the kids are no different from those previous years, it's just the test and what you need to do to be considered proficient has changed. And the problem is, is that if you don't look at data like this, if you don't sort of...

0:15:11.5 AS: As a run chart or as a continuum of genuine information that's coming out of the system as measured by some measurement style.

0:15:21.0 JD: Yeah, and annotate it with point to the year that the new test goes into effect, point to the year that the definition of proficiency has changed, point to the year that schools had to switch from paper and pencil test to computer-based test because just a year or two or three after, those sort of memories become really fuzzy, that context becomes very fuzzy and you start to forget, "What year did we switch to computer test? What year did the standard switch? What year did the proficiency cut score switch?" And so if you don't have that sort of running record, that gets completely disconnected, the data gets disconnected from the context, and then you're likely not to make sound decisions because of that lack of context.

0:16:09.2 AS: And maybe I'll raise a few points here about the chart that we're looking at, and this chart is fascinating to me. The first thing that I think about, as a financial analyst in the stock market, basically, if anything is wrong in my chart and in my data and then I put my money down on that, it's gonna get taken from me in the stock market. And I have to really be very rigorous in how I'm looking at data.

0:16:39.1 AS: And when I look at this, I just think this is just so full of so many different ways that could go wrong in the way that things are measured, the way people are incentivized, those types of things. And the other thing that you realize is what you're showing here is that it's a description of the system. It's trying to describe things that are going on, and you're trying to describe certain points, which you can't do in charts that are... Bar charts and things like that. A line chart or a continuous point chart or a run chart really illustrates that. But also I think... I just realized that so much of almost every bit of charting is meaningless or just... Or is even giving you a wrong signal. There's so many things that I think about that and I'm just curious, 'cause you also said something before to me about how maybe people just don't pay much attention to it and then they just accept it for what it says and they don't go and look at the data, think about it and go into more detail. Those are some of the things that come out of my head as I'm looking at this, but what else do you want us to take away from this?

0:17:58.0 JD: Yeah, I think one thing, without the context and the annotations on a line chart or a run chart, data shown over time, you do forget. That's one thing. That's just human nature. You're gonna forget. I'm not gonna remember what happened 10 years ago in my testing system. I'm probably not gonna remember what happened five or even three years ago. The second thing I would say is that the vast majority of data that gets presented is in a table or a spreadsheet, and that data is usually what I would call limited comparison, so this year's data compared to last year's data or this month data compared to the same month last year. And so we're usually trying to draw conclusions with just two or maybe three data points, and that gets even worse when we sort of layer sort of a color-coded stoplight type system where we label certain data red and certain data yellow and certain data green and then we look for the red and the green data, even though the differences between those two, the scales that we use to to assign those colors is often arbitrary and meaningless.

0:19:11.0 AS: One last thing I would add to it, and I think you're gonna show us a good, an example of a good use of data, but also you have to ask the question, Are the people who are preparing this data incentivized to produce a particular outcome, and when you understand the incentives involved, it helps you also understand where it could go wrong.

0:19:33.2 JD: Well, I think that's exactly right. I think what happens oftentimes is the state testing data is a part of an a accountability system, and the point of an accountability system is to sort the good from the bad and to issue sanctions and rewards, and we sort of point to that data and say, Well, your scores are low, you need to improve. And so we sort of conflate this idea of accountability data or accountability goals and improvement goals, and those are really two different things, and so you brought up sort of this idea of CYA or cover your ass type stuff, and when we point towards accountability data, that's what people are gonna do because they are being held accountable for this data, they're gonna cover their ass. If we're truly using data for improvement, there's a completely different mindset. For one, the data tends to be local and well-known to the people that are using it, and if there's not sort of sanctions tied to it, then there is this ability to be more honest and candid about that data because we're using it for improvement purposes rather than using it for accountability purposes.

0:20:51.9 AS: Okay, that's great, great description. Alright, keep going. What do you wanna show us next?

0:20:56.8 JD: Yeah, I think this last chart. And so for the listeners, I've taken the five most recent years of third grade reading test data and put it in an actual process behavior chart, or some people call them control charts, and the advantage here is like the run chart, we're seeing data over time, we're seeing the variation, we're seeing the data move up and down over time, but with the process behavior chart, we're adding these upper and lower natural process limits or some people call them control limits and define, sort of, predict the future of what's gonna happen in this particular system, as long as things move along at the current steady state, and so remember, I was gonna say, just remember in that third grade reading data, and they sort of said, "Well, we improved, and then we did decline this most recent year, but if you look back two years, it's actually an improvement," but actually what you see is, if you play that out over five years, you see the data increase and then decrease, and then increase and then decrease, and that's a very sort of common occurrence with this type of data where there's this natural variation, it becomes obvious when you plot the dots over time, and you really see what is happening with this data is it's just sort of moving about an average, about a 60% proficiency rate.

0:22:35.1 JD: Some years it's a little lower than that, some years it's a little above that, but it's all within the limits of the system, so that tells us that all of that's present is common cause variation, just sort of this every day sort of expected up and down in the data, there's sort of nothing special that's happened to use Deming's terminology, there are no special causes present that would be... So there's these signals we can look for based on patterns in the data, but that's not to say that we're satisfied with this third grade Reading System. So to your point earlier, that average proficiency rate for the state, so we look at all of the third graders in the state of Ohio, and they took this test over the course of five years, about 60% of the kids were proficient in any given year. So that means 40%, two of the five kids that are taking this test are not proficient. So we have a stable but unsatisfactory system, but because there's no special causes, no special events to study or point to what we need to do is improve that third grade reading system across the state.

0:23:47.0 JD: And so that's a completely different mindset than pointing to a single data point saying, "Oh, we've gone down, what are you gonna do, or issue sanctions to this school or to this teacher", that's not the way to improve. What we need to do is improve the system of third grade reading instruction across the state, so a completely different mindset.

0:24:08.1 AS: That's a great explanation. The idea that I get from you is the idea of taking all of the emotion out of it, and let's say how do we use this to improve? And what you're describing here is, and what you've done is you've taken the most recent period of time, now, some people would say, "Oh well, you should look at it over a longer period of time", but what you've described is that the system has changed.

0:24:30.1 JD: That's right.

0:24:31.9 AS: There's been some significant change, and so it may not make sense to look at that prior period, so now you brought it down to the most recent period, what's operating under the same type of system, and what you find is that it's pretty much random variation, which I'm even surprised for 2020, 2021, given COVID and all that, I would have thought that instead of coming down to 53 or so, that that would have come down to 40 or something, just because now maybe it does in the next year, I don't know, but... Okay, that's a great illustration. Now, you had an example to try to show the good use of a chart.

0:25:11.2 JD: Yeah, I have a personal example. I can sort of talk through, this one is a little busier, but I think what I'm trying to illustrate is one, I think when I think of continual improvement, I think that is the same thing as what I would call intermediate statistical methods, that's equivalent to continual improvement. Those two things are the same thing. So what I mean is that in order to bring about improvement, it's very, very powerful to use one of these charts, whether it's a run chart or a process behavior chart, but the point is display your data over time and see how it's performing, and then what you can do then is run these systematic tests, this is sort of that theory of knowledge component of Deming System of Profound Knowledge, specifically the Plan-Do-Study-Act cycle. So you sort of run this structured test to try something within your system, in this case, if you can see the video of this, I'm displaying my weight over the course of three or four months, and you kind of see that over time, it's slowly shifting down, but there's a lot of ups and downs in this data as I'm trying various things, so I have PDSA 1 marked with a vertical dotted line, I gave PDSA two marked with a vertical dotted line and PDSA three marked with a vertical dotted line.

0:26:46.5 AS: And for the listeners that don't know what PDSA is, it's Plan-Do-Study-Act. It's that cycle.

0:26:53.0 JD: Right, Plan-Do-Study-Act cycle, these scientific tests where I'm trying something, maybe it's related to my eating habits, or maybe it's related to my workout habits, or maybe it's sort of a combination of those two, but I'm writing those things down in this Plan-Do-Study-Act cycle. And then the second thing, I'll describe for those that are only listening, I'm also annotating when special events have happened that then lead to signals in my data. So for one, I have in December, towards the end of December, it's probably not hard to guess I have these holiday cheat days marked because you see this jump in weight that goes above the sort of upper limit, which says to me, "Oh, wait, something so different has happened in my system, and that I really need to attend to that", right. Now, if I had waited until February 21st, the day we're recording this, to look back and see this highest data point in my system over the last three or four months, I probably would not remember what caused that. Because I annotate it as it happened, I have this picture, I have this narrative tied to my data that allows me to think back and reflect and figure out what happened to make the weight in this case jump off the page. Over time, what I'm trying to do is both shrink the limits, so lessen the variation around the average, as well as again, in this case, it's weight, so a decrease is good, so I'm also trying to bring that average data down over time and so the idea would be the same no matter what type of data, whether it was those state test scores, whether it's attendance rates, whatever it is, homework completion, whatever it is that you're trying to improve, this sort of same combination of understanding variation, combining it with these Plan-Do-Study-Act cycles. This is the method, This is continual improvement, I think in a nutshell.

0:29:00.2 AS: Fantastic. Alright, I think that illustrates it well, and maybe if you stop sharing that screen and then I'm gonna show you something, John, and for the viewers, they'll be able to see it, but for the listeners, I'll explain it. I'm gonna walk over to my other part of my room here for a second, I'm gonna grab the chart that I fill out each day.

0:29:26.9 JD: Oh my.

0:29:27.8 AS: And this is my chart, and for the listeners out there, I'm holding up a big chart paper, and it's related to my top three goals. I ripped it by... But my goals are related to sales, to health as in yoga and doing exercise every day and my sleep patterns. And I'm tracking how many hours I work on each one, or how many hours I slept, how much time I did on yoga, and I'm not even putting in any kind of limits into it. What I like to do is to track data and just observe, don't try to think about it, don't try to work towards it, just chart it and start observing, and one of my goals is to sleep more. I wanna sleep seven hours, and on average I sleep about six, and I don't have a solution for it, but I know that charting it and observing it and starting to think about it just raises the awareness and gets me thinking, "Okay, I'm far away from my goal, what do I need to do"? So charting is just fantastic, and I think that what you've described is a great way of understanding it.

0:30:34.0 JD: Yeah, I think when you read Deming stuff or listen to him talk, there's often these sort of short phrases that he'll refer to or say, and over time you start to understand what he was saying in just a few words, these powerful statements. When I think of looking at data in a chart over time, Deming said, "Knowledge has temporal spread", four words, knowledge has temporal spread, so what does that mean? So it's not until... Sorry, it's not until you understand or look at data unfolding over time and how it's moving about, how it's varying from point to point, it's not until you see that over the course of 20 or 25 or 30 points that you really start to know how your system is performing, and I think that's really what I was trying to show with the state testing data, with this personal example in a process behavior chart. I think that's the power of the Deming methods when you put all this together.

0:31:43.7 AS: Fantastic. Well, let me try to wrap up a couple of things, we start off with the title of our discussion, which is Data is Meaningless without Context, and you were asking the question like, Are we really improving or are we just writing fiction here? And I was thinking about a lot of cases, people are of massaging the meaning of it. And then another thing that you raised was the idea of what is improvement, do we have a definition? What does it mean? And then you reference the improvement guide book, which talked about the three things that are critical for being real improvement, first that it alters something, second that it produces visible results, and third, that it has a lasting impact. I wrote after that, I was taking notes and I thought, Is it repeatable? Was kind of what they're saying, but I think from a business perspective, and maybe from an education perspective, the better word is it replicable, can it be implemented at other places and brought the same type of improvement? And then finally, I'll wrap up my summary of what you said with your discussion about accountability data versus improvement data, and how improvement data, it's important not necessarily to tie it to incentives, that data is really for how do we understand the system and how do we think about improving that system through a PDSA and other things. Is there anything else you would add to that summary?

0:33:11.5 JD: Yeah, I think that this idea of what's the purpose of the data? Is it for accountability? Or is it for improvement? I think that it sort of gets at one of Deming's 14 points, which is drive out fear, he said, "Where there is fear, there will be wrong figures", and I think that really ties to that idea of Well, what's the purpose of this data? If there's fear and people are thinking that they're gonna be sanctioned in one way or another, then you're not gonna get correct figures, that's just sort of human nature, and I think that's why all this stuff sort of fits together, and you need the sort of full picture about the four components of the system of profound knowledge, the 14 points like drive out fear. And it's bringing all those things together at the leadership level to create the conditions for improvement to actually occur in an organization.

0:34:04.7 AS: Yeah, and I'd imagine as your organization really improves, you'll kinda laugh at all the charts and graphs you used to produce or you used to talk about, and now you're really making use and making data meaningful. So John, I think that's a great discussion. And on behalf of everyone at the Deming Institute, I wanna thank you again for it. And for listeners, remember to go to Deming.org to continue your journey. This is your host Andrew Stotz, and I'll leave you with one of my favorite quotes from Dr. Deming, "People are entitled to joy in work".

Now that we understand Operational Definitions (see Part 12), it's time to figure out how to use them to get the improvements and results you want. Andrew and David talk about examples of useful Operational Definitions and how they can impact all aspects of education (and beyond!)

TRANSCRIPT

0:00:00.0 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with David P. Langford, who has devoted his life to applying Dr. Deming's philosophy to education, and he offers us his practical advice for implementation. Today's topic is how to start setting operational definitions. David, take it away.

0:00:27.1 David Langford: So in a previous podcast, we talked a lot about the need for operational definitions, and how that improved systems, and why do you wanna do that. Well, that's part of what Deming talked about with profound knowledge and systems thinking, and it's really important. But the nuts and bolts about how do you begin doing that. Well, the first thing you need to do is to figure out what system am I working on, is the number one thing. What am I trying to improve or design? Am I trying to improve the system of behavior? Am I trying to improve the system of the learning in the classroom? Or whatever it might be. Or maybe you're a principal and all of a sudden you realize, "My teachers, they don't all show up on time to the staff meetings," Right? So staff meeting's supposed to start at 3:40, and we don't ever get a staff meeting going till four o'clock, so... I know when I go places and they're not getting started promptly, etcetera, I'll say things like, "What time do you usually start your eight o'clock meetings?"

[laughter]

0:01:42.3 DL: Yeah, it usually gets people to go, Oh, yeah... Sometimes they'll say, "Well, usually about nine o'clock, so."

0:01:47.9 AS: And, David, I have a story I wanna share that I think can kind of lead into this, is that I was involved with a master's in marketing program here, about 75 students every time. And then I'm also involved with a MBA, an executive MBA program with another university. And one of the things that's interesting is the master's in marketing program, 75 students, so these classes are big, pretty big, 75 students, not one of them was late, ever. All 75 were in the classroom, door closed, when it was time to start the class and I started. And the other one I was just meeting out there, and we were at an event where I was teaching, and they said, "Look, really sorry, we try to pull everybody together but they're always late," and all that.

0:02:31.4 AS: And I was just like, this is interesting, the difference here. 'Cause it's the same cohort of people, it's the same group of executives and smart people in Thailand that are pursuing a degree. And the guy asked me, and I told him the story about the other university, and he said, "How do they do it?" And I said, "Well, they set a pretty clear standard of, look, this is important to us that you're on time, and we're gonna lock the door, and if you're not there at the time that it starts, you can't go in until the break. And we're gonna get class leaders to support this, we're gonna get alumni to support this, to say, this is part of what makes us unique."

0:03:06.9 DL: There you go.

0:03:08.1 AS: And I saw a very different outcome.

0:03:10.7 DL: So there you go. That's an operational definition. And whether or not you agree with it or not, you can see by having that operational definition at the one university, you've got a level of function that you don't have at the other university, you got a level of dysfunction, because they haven't taken the time to really do that. Really define what does that mean? And so when that happens, then you're dealing with all this variability, variation from students, variation from professors, variation from everybody in the system, and the overall system is not optimized. So it just keeps coming back to what we talked about before, but in this session we wanted to get into a little bit about, how would you begin setting an operational definition? What does it look like?

0:04:06.1 DL: When I work with, say, elementary teachers, I say, start the very first day, the very first thing, so... And start operationally defining what kinds of standards and what kinds of things you wanna have happen. Something so simple about, "Every time you hand a paper in, we want you to put your name on the paper." Okay, well, let's have a discussion about, let's operationally define, what does it mean to put your name on a paper? And sometimes people look at you and say, "Hey, what are you talking about?" Well, do you want first and last name? You just want a first name? Do you want it in the upper left-hand corner? The upper right-hand corner? Do you want it just anyplace on the paper, you don't really care? Well, if it's just random, if it's just anyplace on the paper, but my name's on it, well, that means that you as the teacher, every time you get a paper you're gonna be searching, trying to find somebody's name, right?

0:04:58.9 AS: Does it need to be clearly written?

0:05:01.3 DL: Yeah. Yeah, and what is clearly? I have no idea what that means. So we might have to have a discussion as a class and start to talk about, what does clearly written mean? There are some things to that. Well, clearly written means all the lower case letters need to be the same height. Oh, okay. So I'm thinking about that and I say, "Is my name clear, all my lower case letters the same height? Well, no, they're not." Okay, well then I can fix that, can't I? Right? So you can get clarity around these things if you really are thinking like this from the very beginning of bringing people into a system. As things get more and more complicated, and let's say that you wanna have a whole group of people come to a common definition, or a common operational definition on something. I started a process years ago of, in my classes, working with students and staff too, but anytime we needed to define something everybody would write it down, and then we'd pass it around and start to share those definitions and begin to talk about it.

0:06:20.9 DL: But then over the years, that sort of evolved into a tool that we call... Nowadays we call P³T. P to the third power T. So what it actually stands for is, the P³ is the paper passing purpose tool. And that came from one of my students one time, he said, "Oh, this is P to the third power." And so we just named it that, and it's become a popular way to define things. But what you do with that... I've done this with school boards. They wanna define certain terms with the school board and everything. So let's do a P³T. So what you do is you take... You wanna get everybody's opinion without it being tainted by other people, you just start having a big discussion about how you should define something or you can take a vague word, like we talked about last time discovery, but you could take a word like behavior or discipline or anything you want and you realize that everybody's got their own definition of what that means, but to optimize the system, we all have to have a common definition of what that means.

0:07:33.6 DL: So you take all the people in a group, usually try to... If I've got more than about five or seven people in a group, then we'll break that up into multiple groups, so it might have... So let's say I'm gonna do this in a classroom, and I wanna get everybody in the classroom help contribute to an operational definition. We might just put everybody into groups of five to say eight people, and just start the process, and so then we state, "Okay, well, we wanna have a term on a quality work." There's a vague term, we want all the work...

0:08:14.1 AS: Good quality around here.

0:08:15.7 DL: Yeah, quality work, we want everything that comes in to be quality. So well, we better define what that is. So first thing I'm gonna have everybody do is write down their own personal definition of quality work, right, and they're gonna write it on this paper, and then very simply, everybody then just passes it to the right or the left, and when you get somebody's paper, then the first thing you're gonna do is read that person's definition of that term. Whatever it is you're trying to define, and as you're reading it, you're gonna automatically come to certain phrases or words where you have an affinity for that and you're gonna go, "Oh yeah, yeah, yeah, I agree with that." So if you agree with that, what you do is you just underline it, okay, and so when you get finished, that paper has a bunch of things underlined and some things not underlined and then when you're finished with that, you pass it to the right and everybody keeps passing your paper around until you get your paper back.

0:09:14.5 DL: And if something's already been underlined once, then when I get it, if I also agree with that then I'm gonna underline it again, or if there's not enough space for that, maybe I'll put a check mark by it or just something that identifies that, okay, I agree with that, or I think that's a good idea, right? So when I get my paper back, I actually have the feedback from five to seven other people about what they thought about my definition, which is pretty interesting, right? Did I have a lot of people agree with me on certain things or maybe things that I thought were really important, nobody agreed with me on that, or nobody underlined that. They didn't think that was important at all. So you got all these definitions and papers, but you've got a chance for people to see everybody else's definition. And now we wanna start combining that into an operational definition agreement with the group. If you try to...

0:10:16.4 AS: And before we get to that.

0:10:19.0 DL: Go ahead.

0:10:19.7 AS: Before we get to that step. Can I just highlight? You talked about this idea of each person writing down their opinion so that they're not tainted by the influence of others, and that really is such a powerful first step. Because you could imagine that somebody would write down, "We've gotta be on time. That's what makes quality work to me." And now you end up... You start to expose pet peeves, maybe you call them, and then once you start... That starts going around those pet peeves kind of all of a sudden you realize that nobody underlined that, and then you think, "Oh, okay, that's interesting, I guess that's really important to me, but maybe it isn't." So that first part of the process that you've just defined of passing that paper around, I think is really valuable. So now, let's imagine that that paper has now come back to you. You're going, "Holy crap. I see some things that people agree with, but nobody underlined some of the things that I thought was important." Now you go to that next step. Tell us about that.

0:11:21.5 DL: Yeah, well often when I start with groups, a lot of times they'll have somebody that says, "Well, can we just discuss this before we start?" No, no. Absolutely not, because I don't want to give you the chance to intimidate somebody else in the group. Well, everybody here just knows what on-time performance is, right? And everybody here knows that it's this, and everybody here agrees with me. No, so psychologically, you don't wanna give people that chance to dominate a group ahead of time, and a lot of times our meetings are like that. Just full of that stuff. And by the time you actually get around to doing something or doing some work, people are so jaded, so upset that they just don't say anything, they don't wanna participate.

0:12:14.3 AS: And that's because let's say one person is kind of... They're persuasive, they have strong opinions, they tend to dominate of what it is, and we can say... There's a common word I hear a lot in America is inclusive, and one of the objectives of those people maybe is not to be too inclusive, and what you're saying is that when you're passing around that paper, it's a raw experience, you are forced to be inclusive of all people's ideas. And then you start to...

0:12:44.6 DL: And opinions and you may even have it, this is common students, that kids blow off things right, they just... They don't do it, or they put down something frivolous or silly or whatever it might be. Well, when they get their paper back and nothing on there was underlined, they start to get the picture like, Oh, okay, well, that was kind of a waste of time, right? That was just silly. And so next time around, you're probably gonna see that person take things a little more serious, a little more focus, think about things themselves before they get started, and you haven't had to say anything. They got the picture. Alright, so you got this paper back and you got these certain things, so now how do we move from... So we started with the individual and then we went to the group, and then how can you move that to a whole, say a whole class or a whole system depending on the size of the group.

0:13:39.9 DL: So probably the simplest way I've ever done it is I'll just ask somebody to start and say, "Tell me one thing that is underlined on your paper." People say, "Underlined a lot or a little or?" It doesn't matter. You decide, what was underlined on your paper that you think is important? And they'll tell me something, so we'll write that on the flip chart or the board or whatever it might be. Then you go to the next person and you say, "Okay, what do you have that's different?" And then you go to the next person and you say, "Okay, what do you have to add that's different?" And what you're doing is you're removing redundancies, you're removing all kinds of things as you go through, and people are starting to think harder and harder and look at their own paper and start to say, "Okay, these three things have already been listed, so I guess I don't have anything else to add." So once I go all the way around a group like that and I've removed all the redundancies, now we've distilled this down into what this group thinks is really important.

0:14:50.4 AS: And when we list those down, we're now listing down everything that's different. So we could have seven different things on that list.

0:15:00.0 DL: Oh, yeah.

0:15:00.2 AS: Would that be correct?

0:15:00.3 DL: Oh yeah.

0:15:01.1 AS: Okay. So now we got a long laundry list kind of thing. What do we do next?

0:15:06.7 DL: It can be, or it actually usually comes out much more concise than you think it's gonna be.

0:15:15.6 AS: Okay, because they've already kind of brought it down by underlining...

0:15:19.0 DL: That's right.

0:15:19.6 AS: And not underlining. Okay.

0:15:21.2 DL: That's right. There's other prioritization tools you could do and all kinds of things, but it takes a lot more time and etcetera. So now I've got this list.

0:15:29.3 AS: So let's say what, three... Two to five things that people have said?

0:15:34.0 DL: Yeah, it could be more like nine, 10, 12 things on this list.

0:15:38.7 AS: So we've got a long list?

0:15:40.2 DL: Yeah. So now how to... Let's say that I've got six groups of people in one room, each group has 5-7 people, but I wanna end up with a common operational definition for the whole room, right? Then I simply go to one group and say, "Okay, what do you have on your list?" And basically, I'm doing the same process but with groups. And this group says, "Oh, well, we said this in our group." Okay, so we're gonna write that down. I go to the next group, "What do you guys have that's different?" Then I go to the next group, "What do you have that's different?" And you just keep going around until everybody's... There's nothing left. Nobody has anything left.

0:16:18.6 DL: You talked a little bit about standards-based learning, how ambiguous that is. Well, here's a great way to take a whole staff and say, "Okay, well, let's try to define what we think this is, what does standards-based learning mean?" So first, what does it mean to you as an individual? And then how does my opinion sort of... What's the juxtaposition of my opinion with a group and then the thinking overall with the bigger group? So if I do the exact same process now with a group of 30 people within 10-12, 15 minutes, we've distilled it down to all the kinds of things that we think are really super important of this concept.

0:17:04.6 AS: Can I just go back? Okay, so first thing we did, we had... We broke people into different groups. So let's say we have, I don't know, five groups of six. And each person wrote down what they said their definition of that particular thing is, quality work or whatever, and then we push it around in a circle and people underline the things that they agree with, then we have... We then go up to the board and we say, "Okay, let's just get a laundry list of the different things," and we may have five, we may have 10, we may have 12, whatever, we have our list. Now, all of a sudden, you got other groups that have their lists. Now, what I'm trying to understand is that the next step, when you bring the other groups lists of 5-10 different things, are you...

0:17:49.4 DL: So basically, I'm doing this exact same process. I'll go to one group and say, "Okay, tell me something that you have on your group list... "

0:17:56.8 AS: That's different from this.

0:17:58.0 DL: "That you thought was important." And they're gonna tell me one concept. And then I'm gonna go to the next group and I say, "Okay, what do you have that's different?" And they'll tell me something else. Then I go to the next group, "What do you have that's different?" So I'm doing the exact same process, only with groups. And so I'm limiting redundancies again.

0:18:14.6 AS: And let me ask you a question. If you ended up... When you did the first group, you ended up with let's say 10 things. Then you go out to a group of groups, then you're gonna add probably on another one or two because one group had something that was different. So now you've got a list of 12 things or what happens by the end of that process?

0:18:35.0 DL: Could be. It's gonna distill it down, and sometimes it's phrases or even sentences or things that you wanna have in this operational definition. So at the end of this, you've got this concise document. Now, it's not a flowery paragraph or a statement or anything like that yet, but it is a list of everything that everybody in this room said is very important with this operational definition. And everybody in the room should be able to see how my contribution was folded into the whole. Because I can look at that list and go, "Oh yeah, I was the one. I said that."

0:19:15.8 AS: Because we didn't eliminate... Well, we could have eliminated something. If you had an idea, for instance, about quality work, let's say that it's on time and nobody else underlined that, well, then you can say, "Well, the group really doesn't see that as valuable as I saw it. So, okay, that's off." So we've eliminated some maybe pet peeves or frivolous things, and now we've a solid list.

0:19:37.1 DL: Yeah, and that's exactly what happens.

0:19:38.2 AS: We've got a solid list.

0:19:38.5 DL: Yep, that's exactly what happens.

0:19:41.4 AS: And then once we've got that solid list is what we wanna do then is just say, this is a list of everything, or do we then prioritize it, reduce it down, tighten it? What do we do from that point?

0:19:53.2 DL: Yeah, the answer to those questions is, it depends. [chuckle] So it really depends on what it is you're trying to do at that point. I find that a lot of times we're trying to operationally define something that's been kind of vague in the past, once we get that list and get it to that point, that's about all we need to do right now. We could spend weeks or months arguing about commas and coming up with some kind of statement that brings it all together, but you don't really need to do that because we've all agreed that these are all the things that we think are really important about this concept, and so that is our operational definition. Now, when I used to do this with students in classrooms... Yeah. But I'm gonna define something like quality work or on-time performance or any of those kinds of things or tardiness or anything. I'm trying to get rid of problems, right?

0:20:52.0 AS: Right.

0:20:52.7 DL: And so I'm gonna do any of those kinds of things. At some point, I would stop and have everybody take that list and try to combine those things into a paragraph or a statement.

0:21:03.3 AS: Okay.

0:21:04.8 DL: And have great fun doing that, where everybody's creativity and taking that list of items and turning it into some kinda paragraph that incorporates it. And students are amazing at this stuff. They come up with the most interesting concepts and ways of phrasing things that you could put a group of adults in a room for a year and they'd never come up with something so interesting. So, usually, at that point, I just have people go around and read what they wrote, and maybe we'll take certain phrases, and we could. We could turn it into a paragraph or something that was... Combining all that. But we're using that as a learning experience about how to take concepts and create definitions and paragraphs out of it.

0:21:50.6 AS: So let me try to summarize what we talked about. First, you highlighted the idea of like, wait a minute, what system are we trying to improve? We need to understand that first. And then to optimize that particular system, we need some common definitions. Now, when we started the conversation, I thought we were gonna end up with some really narrow, tight definition. I kinda was interested about where you ended. But before we get to where you ended with this, you talked about doing what you call P³T, or one of your students called it. I think you said paper passing purpose tool.

0:22:24.8 DL: Yeah. P to the third power.

0:22:26.1 AS: Yes. P to the third power T. And basically what you said is, "Don't let that start off as a discussion, because maybe one person could dominate that or try to influence what other people think about it." Rather, get each person to write down their definition of, for instance, we used the idea of what is quality work. And that's a pretty vague thing, so that's a good one for people to write down what are their opinions on it. And that way, they're not tainted by the influence of others. Once they've written it down, then pass it to their right, and let the person on your right underline the items on there that they agree with, and then pass that around. And by the time it comes back to you, you'll find that some of the things that you highlighted are agreed with, and some may not be. Then you basically take that and you go up on the board and say, "Alright, let's start with you." Start with one person and say, "What's one thing on your card that you've written down," and you wrote that down, and then you go to the next person, say, "What's one new thing on there that was not... That's not that?"

0:23:26.3 DL: Something different. That's different.

0:23:28.8 AS: Something that's different. And then you come up with a little bit of a laundry list. It could be five, it could be 10, it could be 12 of different things from that particular group of people. And then you can take it out to a bigger group where you have a series of groups that are doing the same thing. You then go around, you may add some things onto it. And then where I thought it was interesting where you ended with this, David, you said... You were kinda like, "Sometimes you don't have to go further than that right now. Just that is valuable process." And I thought, yeah, that's interesting, because just doing that, you can say we never have to do... 'Cause remember, before I was talking about discovery, and you were like, "I don't know what discovery is. I don't know what you mean." Well, you just described a pretty good process of discovery of what everybody thinks. Now, we don't ever go through that again. Do we have to tightly define that beyond that right now? Maybe not. Maybe we revisit it six months from now and tighten it up.

0:24:24.1 DL: It depends. So let's put this into practice. This is gonna be our definition of quality work. And so now we're gonna put it into practice, and then maybe later on, we can come back and re-look at the list. I've found that when you just have things in a list like that, people are more apt to wanna change it later on than if you have this flowery, nice paragraph that somebody's really worked on everything, and then people are like, I don't really wanna do that. But a lot of times, later on, after it's in practice, people come back and say, "Oh, we said this, but really, that's not really even relevant anymore." We can actually cross that thing off the list. That's not the most important thing. Or you were asking about prioritization. You could do a follow-on, you could do an NGT prioritization, nominal group technique, or you could do... Use just sticky dots to prioritize. Or if you need to. If you need to. But sometimes, most of the learning is in the process. So since every single person was a part of the process, every single person at the end of the process knows the definition of something, because they were a part of it.

0:25:35.9 AS: Yeah, yeah. Well, for the listeners and the viewers out there, what a great step-by-step guide that we can all try to put into practice. But most importantly, it kinda took the intimidation of operational definitions, it took some of that away from me that we're not... It doesn't have to be some... We've worked for hours crafting this statement. No. Here's a list of what we think is important. And that's good enough for a first step. And that, ultimately, is what we're talking about in this particular...

0:26:09.1 DL: And it's fun. It's fun. [chuckle]

0:26:11.8 AS: Yeah. And it's inclusive. It's inclusive. Well, David, on behalf of everyone at the Deming Institute, I wanna thank you again for the discussion. For listeners, remember to go to deming.org to continue your journey. Listeners can also learn more about David at langfordlearning.com. This is your host, Andrew Stotz. And I will leave you with one of my favorite quotes from Dr. Deming. "People are entitled to joy in work."

Most people come into education familiar with classroom management and curriculum, but the concept of Profound Knowledge changes the way you view the entire field and your part in it. In the second episode of the Deming in Schools Case Study, Andrew and John talk about applying the System of Profound Knowledge to education. 

0:00:02.0 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with John Dues, who is part of the new generation of educators striving to apply Dr. Deming's principles to unleash student joy in learning. The topic for today is applying Deming's system of profound knowledge in education. John, take it away.

0:00:26.8 John Dues: Andrew, it's great to be back. And excited to talk about this. One of the things I was talking about after... Thinking about after our last conversation was a moment I had where I realized as I worked with some senior leaders here is we have these two buckets of knowledge, one bucket I would call subject matter knowledge, and we talked about this a little bit last time, by subject matter, I don't mean knowing, reading or social studies or writing, but I mean the things that you need to know in your field, so for us it's classroom management, how to deliver a lesson, how to design a curriculum, those types of things, and that's always sort of been a part of my work and gained proficiency in that bucket over time, but what I realized in studying Deming is there's this whole other bucket or type of knowledge, what Deming called Profound Knowledge and that was missing across most of my career, and it was a revelation to understand that, "Hey, we need both of these things together to have any chance at improving our schools."

0:01:35.4 AS: It's interesting because the whole focus in most of education is to become a subject matter expert, and that's what's rewarded, that's what we're doing. And this whole way of, how do we see the world? Is such a unique thing. Maybe you can just go through a little bit on the system of profound knowledge as when you first came to it, and what does it mean to you?

0:02:04.4 JD: Yeah, I've been studying it for a handful of years now. Increasingly, it became this sort of foundational philosophy, and it really changed how I view the world, honestly, it wasn't only sort of in my work, although that's sort of where I started thinking most about Deming's ideas. It changed also sort of how I thought about my personal life, family, my own kids in school and their experience in school, so I had a profound impact on just about everything I was doing in my life, that's pretty foundational to discover a philosophy like this...

0:02:51.3 AS: Yeah, that's... I remember when I first understand... For me, it was variation and randomness that really kind of hit me because I was also working in the stock market, and I could see that there was a lot of randomness in the movement of stock prices, and then it was like all of a sudden, what I learned from the randomness aspect and the variation aspect was just like, it's like there's carpeting that we're walking on that nobody even realizes it's underlying everything, and it is this randomness, and we are trained to reject randomness because we're rugged individualists who are setting our own path and it's up to us to make a difference. And that type of thinking basically has to reject the role of randomness, so I know what you're saying about... That started to change the way I viewed the world. Continue on.

0:03:54.2 JD: I think building off what you're saying, there's a variation component to that, and that was sort of an entry point for me too as I read Donald Wheeler's Understanding Variation, which is sort of completely changed how I looked at numbers and data in our work here in schools, but I also think of what I'm hearing in what you're saying is complex systems, and so I think there was sort of an appreciation for systems thinking prior to Deming, but not in the same way, but I think for a lot of folks it's if we do A to B then C is gonna happen. And that's just not how things sort of unfolded in a complex system, be it schools or a company or a society or whatever you may be looking at, if you do A, then that may impact B, C, D, E, F, G in a certain way, and the outcome is gonna be impacted by all of those things, all of those changes, and I think that's sort of... You can start to see that when you start to understand variation, and then that other component, or first component of Deming's Profound Knowledge is Appreciation for a System.

0:05:07.4 JD: And I think that's sort of what he's getting at, that it's really hard to find causal links between things and if we're gonna search for those, then we need to appreciate our organizations as a system, how all of the departments or all of the grade levels in the case of a school are working together or not, and how something you do in one part of that system can impact positively or negatively, other parts of the system, even if what you did in the part of the system was a positive for that part of the system, they can actually destroy the system, and so all of these things were revelations or at least confirmations of things that maybe were in the back of my mind, before I had this understanding in writing from studying Deming's philosophy.

0:06:00.7 AS: And for the listeners or the viewers who aren't familiar with the System of Profound Knowledge, maybe you can just review the four points of it or the four parts, a little bit more.

0:06:12.2 JD: Yeah, System of Profound Knowledge. So four components, Appreciation for a System, Knowledge about Variation, Theory of knowledge and Psychology, and he called them a System of Profound Knowledge because the four components work together, that's the system part. And Profound Knowledge, what I learned over time, is that, what he meant by that is just sort of the deep understanding that comes through viewing your organization through the lens of Profound Knowledge, so when you bring those four things together, you get a different view of your organization, than without Profound Knowledge. And without Profound Knowledge, you are often misled, you often don't know when to react or not to react to something that's going on in your organization or system, with Profound Knowledge you now have a management philosophy by which to interpret that data that comes streaming at you, no matter what industry you're in, and gives you a way to map out how to react or again, not to react to that data.

0:07:18.8 AS: It makes me think there's a saying in Thai language about a frog under a coconut, and when you lift up the coconut, the frog kind of wants the coconut back on because that's their world. And I think about when you really come across the System of Profound Knowledge and you understand it, it's like that coconut comes off and you realize, Oh my God, I am part of a much bigger system, and all of a sudden things just open up and what was your experience when you first kind of started really realizing how this all works together.

0:08:00.3 JD: Well, maybe unlike the frog, I didn't wanna unsee it or I didn't want to be recovered, however, there certainly was... Well one, it took time for me to sort of understand what exactly Dr. Deming was saying, and I'm still trying to understand that fully, but the hardest thing was probably talking to people, really smart people, about Profound Knowledge and maybe them not sort of seeing the importance of it or the same level of importance that I thought that they should see or where we'll talk about it, it would be well-received, but then people would turn around and sort of revert back to the old way of thinking. And for me, it was just realizing that this just takes repeated practice, because it is really a completely new way of thinking.

0:09:00.9 JD: It's a completely new way to look at data or your systems, it's a completely new way to think about how do you bring new ideas to your organization, how do you test those ideas, it's really getting away from simple things like setting a goal without a method, it's appreciating the psychology of introducing changes to your organization. I found people are generally very open to new things, what they're not open to is being sort of yanked about constantly when we try this thing and that thing, and education has the same sort of problem in this area that other sectors like healthcare do, where the frontline people, teachers in our case, nurses in the case of healthcare where they're often being pulled this way and that with new initiatives to the point they get this initiative fatigue will wear people out and burn people out and then they leave because each leader comes in with their own pet idea and it's not grounded in this sort of solid philosophical foundation.

0:10:13.3 AS: One of the things that's interesting about the system of profound knowledge is that it can be a bit overwhelming for someone who's first coming upon it because it's like, Oh my God, there's a much bigger aim, and one of the reasons why we don't think in a systems way and why we do think silos is because it's easier, and so for some people it can feel like, Oh God, this is just overwhelming, and I'm just curious what your perspectives are on that, either for yourself or the people that you're working with there, and how do we make sure that you don't get overwhelmed by it?

0:10:57.6 JD: Yeah, it's a challenge because I originally came to the Deming Institute website and the profound knowledge page and went away because it didn't make sense to me initially, and it was two years later when I came back, and not that it was sort of some divine revelation, but I slowly, over time, it started to sink in, something caught my attention that this was worthy of study. So one thing I read, Dr. Deming said, you don't need to be eminent in all four areas or even any one of the four areas, but it does require serious study, so you're not gonna understand it in a day or a week or a month. I would also say anybody that gets serious about studying this philosophy, I would highly recommend reaching out to somebody that is further along in their understanding, and that's sort of a turning point, I think I mentioned in the last episode. Reaching out to Kelly Allen, who turned me on to David Langford that accelerated my learning, 'cause I could ask specific questions, and David could give me specific applications of Deming's ideas in schools, and that certainly helped to clarify a lot of things for me.

0:12:08.3 JD: So that's something I would highly recommend, but I would read widely, watch the videos, you can go to a four-day or sorry, two and half day seminar that the Institute does, and then reaching out to someone that is further along is something I'd highly recommend.

0:12:27.1 AS: Yeah, great advice. And just this podcast already is a starting point for the listeners out there.

0:12:33.2 JD: Yep, absolutely.

0:12:34.8 AS: One of the things that I say to my students in my valuation master class, they come to my class because it's like, Andrew, you got 30 years of experience as a financial analyst, and you were voted number one and you... This and that, and I really wanna learn from you. And when I come into class, I announce a couple of the things... And one of the things is I say, You Are Always Wrong. And I call it YAAW. And I try to help the students understand it, in the world of finance, there is no precision, like in the world of physics or the law of gravity or something like that, that you're always going to be wrong and therefore don't freak out over that. Understand that it's a system. The second thing that I tell the students, and this one I think really gets them, they don't really figure it out until the end, and that is in my class and in the world of finance, what I teach is, if I'm successful as a teacher in this specific area that I'm teaching, if you feel less confident when you finish my course, I've succeeded.

0:13:48.7 AS: And I think that students freak out because of I'm here to be more confident Andrew, and what I'm exposing them to is that it's a constant... We're walking on quick sand. We're operating in a world where even in the world of finance, just observing the world of finance, observing market prices and stuff can influence actions that we're taking in the market... Can influence market prices. So the complexity level is so high.

0:14:27.1 JD: Yeah, yeah, one of the things that makes me think of is sort of a... I don't know if I'd call it paradox, but one of the early places that I went even prior to sort of coming across, Deming's work is the Carnegie Foundation for the Advancement of Teaching and they have it as their mission to bring the science of improvement to the education sector. And they have an annual Improvement Summit. The first time I went, I realized that they had this footer on all of their materials and it said, "Probably wrong, definitely incomplete." And that was a really great entry way into the science of improvement because that's the mentality you need when you start any type of improvement work, improvement project in your organization, and I sort of stole that idea and stuck it on all our materials.

0:15:27.8 JD: And I think the reaction from a lot of people first is similar to how you're describing the reaction of your students is that, wait a second, aren't you supposed to be an expert, don't you know what you're talking about? And I said, "No, that's not what this is about." This is about humbling yourself, realizing the complexity of the organizations that we're working in, and that at the outset of any improvement project, that there are gonna be things that you discover along the way that were completely unknown at the start, and so if you don't take that mindset and you rush in and you're sure of yourself, then you are set up for failure from the beginning, in my opinion.

0:16:09.7 AS: So if we go back to the title of this episode, Applying Deming's System of Profound Knowledge in Education, part of it is it starts to open you up beyond subject matter, and also it starts to help you understand that there's just a much more, a bigger world out there of influences that are driving us, and I think one of the things that's interesting about that is it... Young managers in the world of business are seeming to latch on to KPIs and feeling like it is a simple solution, we just define everybody's KPI, we nail them with it, we repeat it to them, we have them write it out in their goals and we measure it, and if they don't achieve it. Boom. And what Deming is teaching is just the opposite, that when you understand the system of profound knowledge, you understand that optimizing the output of any organization is a much more complex reality than just putting a KPI and a number on it.

0:17:18.8 JD: Yeah, I think of a colleague of a contemporary of Dr. Deming, who is still doing great work, Dr. Donald Wheeler said something to the effect of goal setting, KPI setting, goal setting is often an act of desperation, meaning like you don't know what else to do, so you set a goal, you don't have a method, you don't have a theory for how to improve, so you set this goal and then say something to the effect of, "I don't care how you get it done. Just get it done." Right, and then all hell breaks loose. And what do you think he's talking about is, if you don't understand the capability of your system, if you don't understand whatever area you're talking about, whatever area that KPI is in, if you don't understand how that data is varying over time, if you don't understand if there are just common causes, there are special causes in that data, you have no idea how to react nor do you know what your system was capable of the first place.

0:18:26.1 JD: That's sort of one of the sessions I led with leadership team here, and everybody kind of looks and says, Well, aren't we supposed to set goals? and there's really nothing wrong with setting goals in and of themselves, but we often set them in ways that are completely detached from reality, both in the magnitude of improvement that we're expecting and is a lack of understanding of how that same data has performed over time.

0:18:52.5 AS: Yeah, and it reminds me of Dr. Deming's statement of 'by what method?'

0:18:56.2 JD: By what method, yeah.

0:18:58.9 AS: So for, in wrapping up our discussion, I wanna go back and review some of what we've just talked about, so we're talking about applying the system of profound knowledge in education, and what you've talked about is the idea of coming into education, most people are very familiar with subject matter knowledge about classroom management and curriculum management and all that, but what was missing when you started your journey was this concept of Profound Knowledge, and once you started to understand it, it changed the way that you viewed the world, and then we just briefly talked about the idea, I wrote down something which was "probably wrong, definitely incomplete", and I would say that there are plenty of places where they think "definitely right. Probably complete."

[laughter]

0:19:47.3 AS: And then you just mentioned the idea of setting goals, and I think Deming is not against goals, it's that goal is just one measure, I would say, if you set goals for individuals that incentivize them individually, you've created a big problem of competition, but most importantly, I think what you're saying is the idea of just setting a goal like, We wanna increase test scores by X or in my business, I want revenue growth to be up by 20% next year, the question really becomes by what method is there anything else that you would add to wrap up our discussion?

0:20:28.2 JD: Yeah, I think goals or quotas, especially if you're optimizing one part of the system, very likely to destroy the system as a whole, or at least sub-optimize it make it worse. I think Deming said something to the fact of quotas can be a fortress against improvement. Right. I think he was exactly right, because people start to do all kinds of weird things when you start to set quotas or goals, especially again, if they're incentivized as an individual, whether that's an individual worker or an individual department, things start to sort of happen in the opposite of what you wanted to happen when you do things like set goals, without that appreciation for the capability of the system in the first place, or an understanding of the data or an idea for how to improve, because it's like, well, if our goal... If we're gonna set a goal to increase test scores, let's say by 10% next year, why don't we do it this year? If we knew how to do that, what were we waiting on, why do we think we can do it next year, if we couldn't do it this year...

0:21:33.8 AS: Great points. Well, John, on behalf of everyone at the Deming Institute, I wanna thank you again for this discussion and for listeners, remember to go to Deming.org to continue your journey. This is your host Andrew Stotz, and I'll leave you with one of my favorite quotes from Dr. Deming; people are entitled to joy in work.

Can a 4th grade class decide on an operational definition of "joy in learning"? In part 4 of this series, educator John Dues and host Andrew Stotz discuss a real-world example of applying Deming in a classroom. This episode covers the first part of the story, with more to come in future episodes!

0:00:02.3 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with John Dues, who is part of the new generation of educators striving to apply Dr. Deming's principles to unleash student joy in learning. This is episode four about goal setting through a Deming lens. John, take it away.

0:00:22.6 John Dues: Good to be back, Andrew. Yeah, we've been talking about organizational goal setting last few episodes. A couple episodes ago, we talked about those four conditions that organizations should understand prior to setting a goal. Then we sort of introduced this idea of trying to stay away from arbitrary and capricious education goals. And then we got into these 10 lessons for data analysis. And so what I thought we could do now is we've got that foundation in place is that we could take a look at an applied example in real classrooms of those 10 key lessons in action to kind of bring those alive. And I ran this project a few years ago with a teacher named Jessica Cutler. She's a fourth grade science teacher in our network. And she was going through something we call a Continual Improvement Fellowship. So we do this sort of internal fellowship where people can learn that sort of way of thinking, the tools, techniques, the theories related to the science of improvement. And then they actually take that right away and apply it to a problem in their classroom or their department or their school, depending on who it is.

0:01:55.0 JD: And so what Jessica was doing, what her project ended up being was she was trying to improve the joy in learning in her fourth grade science class. So it's interesting to see how that sort of project evolved. So I thought we could revisit each of the 10 lessons and how that lesson was applied in Jessica's improvement project. And we'll maybe get through three or four of the lessons today. And then over the course of the next few episodes, kind of get to all 10 lessons and think through how they were... How that went in her improvement project.

0:02:08.1 AS: Sounds like a good plan, practical application.

0:02:12.0 JD: Yeah. I mean, it was interesting too, because she didn't initially sort of consider joy as a possibility. She was thinking like, I'm gonna work on improving test scores or something like that was sort of her initial brainstorm. And then sort of pivoted to this when we kind of talked through what was possible from the Deming philosophy type of standpoint. So it's interesting to see how things evolve. But just to kind of revisit, so we talked through these 10 lessons. Lesson one was "data has no meaning apart from their context." So we talked about these questions that are important, like who collected the data? How was it collected? When was it collected? Where was the data collected? What are the values themselves represent? What's that operational definition for the concept under measurement? Have there been any changes to that operational definition as the project unfolds? And so even with a project with a teacher and her students, all of those questions are relevant. They're still important just because you're dealing with students that doesn't mean anything changes on that front. So it was important for her to sort of think through all of those things as she thought through the start of her project.

0:03:28.9 JD: And what her and her students came up with after they sort of decided that they were gonna focus on joy, they focused on this problem statement. And they were like, well, what do we want science class to look like? 'Cause that was sort of their starting point. And what her and her students...Oh sorry go ahead.

0:03:45.9 AS: One thing you started off talking about her, now you're talking about her students. So she got her students involved in this process. Is that what you're saying?

0:03:56.2 JD: Yeah. So they were working together from the very outset even...

0:04:02.0 AS: As opposed to a teacher talking through this with a principal or something in a faculty room and then thinking of how do I... Okay.

0:04:09.2 JD: Yep. That's right. Yeah. And so what they came up with is the sort of desired future state of science classes. "We are able to stay focused through science, enjoy science class and remain engaged." And so to give some context, what was happening is that she taught science and social studies and it was sort of like a back-to-back class period. And they would do science second. And so by the time they were doing science, sometimes the students were getting off task, disengaged. They weren't as engaged as either the students wanted to be or the teacher wanted them to be in that second lesson. So they, they came up with that as the thing they were gonna focus on. And then because they were gonna focus on joy in learning, they had to define what that meant. So what did joy in learning mean to that fourth grade science class? And what they came up with as a definition, which I really like, is "we wanna have fun learning, finding things we like to learn and have fun completing classwork and activities." So they came up with this operational definition. And keep in mind, these are fourth graders and Jessica's having these conversations like, what's the operational definition? That's not probably typical language you're gonna use with fourth graders. But if you walk them through these things, they actually pick up on it pretty quickly.

0:05:26.1 JD: It's actually pretty cool to see.

0:05:28.1 AS: And to them, a more simpler word sounds like was fun.

0:05:35.0 JD: Yeah, right. They wanted that to be a part of the science learning process. So basically, once they had the operational definition, they had to think through, well, how are we going to measure that concept that we've defined? And what they did was they just developed a simple survey. Jessica did it in Google Forms. just had, really just had two questions. The first question was, on a scale of 1 to 10, how much did you enjoy science class today? And then there was a second open-ended question that said, what made you enjoy or not enjoy class today? So it was fresh in the kids' minds. So basically, at the end, each kid has a Chromebook in Jessica's science class. She would just sort of share the link to the survey, and the kids would complete that as the closing activity for the lesson. So she would get two things out of it. So 1 to 10, just a real quick sort of numerical quantified value, how much the kids enjoyed science class that day. And then, because it had just happened, the students could say what they did and didn't like about the lesson. Oh, we haven't used computers in a few days. Or it'd be nice if I had a video to help bring this concept alive. Or there's a few words that you use that I don't know the definitions to. Could you add those definitions to the glossary? So just things like that, simple things like that.

0:06:55.9 JD: Right away. And then what Jessica could then do is take that information and actually adjust her lessons as she planned maybe for the next week, she could make those adjustments based on this feedback she was getting from the students. So that's sort of the application of lesson number one. So what are we measuring? How are we gonna measure it? When are we collecting this data? That type of thing. Lesson two, if you remember back from when we covered the lessons was "we don't manage or control the data. The data is the voice of the process," right?

0:07:28.9 JD: So we talked about this ideas that while we don't control the data, we do manage the system and the processes from which the data come, right? So, and this is really key conception of the system's view. You, you say you're going to improve this particular classroom. So that's the system. So you're not necessarily controlling the data. You're not controlling how the kids are evaluating, the numbers that they're putting one through 10 to assess joy in learning, but what the teacher and then the students, because of this project do have control over are the learning processes that are happening throughout science class, right? And so back to your point about you switch from talking about Jessica, the teacher to the students. And then you said "we" that's also a key conception of taking this approach, right?

0:08:24.4 JD: So what I think Deming would say is that when you're going to improve an organization, you have to sort of combine sort of three critical pieces. One thing is you need someone from the outside, from outside the system that has Profound Knowledge. And then that person or persons has to be collaborating with the people working in the system. So those are the students, they're working in the science class system. And, then you that third group or that third person is the manager or managers have that have the authority to work on the system. So in this case, Jessica has the authority to change what's happening in her science class.

0:09:10.2 JD: The students are the workers working in that science system. And then that third part is that person that has the sort of understanding of the System of Profound Knowledge and it's sort of bringing all of these parts together that really is how you begin to transition sort of conventional classrooms to those guided by the Deming quality learning principles, right?

0:09:33.1 JD: So in in the case of Jessica's project, that person that was, that had a System of Profound Knowledge lens was me. So I was sort of acting as an, the outsider, 'cause I'm outside of the science system. But I have this understanding of the System of Profound Knowledge. And I'm working with Jessica as she's working with her students, to sort of bring that lens to the projects.

0:10:00.4 AS: And what's the point of doing all that if she doesn't have the ability to make the changes necessary to test, if you're gonna if we change this, it's gonna result in something why go and do all this if you're just stuck in a system that you simply cannot change because of government regulation or whatever, maybe.

0:10:17.5 JD: Right. Yeah. So it's bringing all those pieces together. But what I found thinking about the three parts of a team that's working toward organizational improvement, what I've found in the past is, in my experience, whether it's a school improvement team or a district based improvement team, most of them are devoid of at least one parts of one of those components, usually two of those components, 'cause usually students aren't involved.

0:10:45.9 JD: And then in most school systems, there's no one with this outside knowledge, the System of Profound Knowledge lens, right. And I think it's what we're really doing is the students can identify the waste, the inefficiency, the things that aren't going well from their perspective, but we don't often ask them. Or if we do, we do it in a way where it's an end of year survey or an end of semester survey, but this is collecting that feedback in real time and then acting on it. We're not planning to do something next year with this feedback, we're actually planning to do something the next day, or maybe the next week, to adjust the science lessons.

0:11:24.8 AS: And it's one of those two things that come into my mind, what, how do you handle the idea that what's causing the impact on joy in learning could be that the student had a bad night, the night before. And I guess by doing many samples that starts to kind of wash out. And then the other question is since the students know that the teacher could likely make an adjustment, is there any possibility that they could be gaming or playing the system.

0:11:57.1 JD: Well, that's interesting, because I think, well on the first point. I think pretty quickly, my experience with this and David Langford I know you've talked to has echoed this sentiment is you know, he was working with high school students, this is an elementary project but either way. You may get some students that don't take this seriously. At first. And you may get some kind of crazy answers crazy brainstorms or crazy survey submissions, although I don't think Jessica got much of that.

0:12:30.2 JD: But in other projects I've gotten some stuff at the outset that was a little bit off the wall. But like David said to me when I first started this and then it's been my experience since is that kids, once they realize that you're actually gonna act on the feedback, as long as the feedback is in good faith. They actually start to take it seriously, pretty, pretty quickly. And so I think pretty quickly, those sort of types of worries go by the wayside. Now, I will say I did say that the...

0:13:01.1 JD: One of the components that has to be on this improvement team is the person that has the authority to change the system. So at the end of the day, even though we're gathering this input, Jessica's really the person as the teacher of that classroom that has the authority to make the changes to the system based on her judgment or, her professional judgment as a science teacher of what should happen. And so the students certainly offer feedback and inform that process, but ultimately it's Jessica that's gonna determine the changes to the system.

0:13:34.0 AS: I hear David in my ears saying, you know what, Andrew? You don't trust the students? They probably have a more honest, view of what's going on than most adults do. So yes, I hear the voice of David Langford.

0:13:49.2 JD: Yeah. Well, and interestingly, and we'll get into this towards the end, not today, but when we get to some of the other lessons, interestingly, not to give away the story, but, one of the things that was getting kids off track was a lot of noise during class, kids making noises. And they actually came up with this system where they were kind of penalizing each other. This was their own idea. And so, kids know exactly what's going on in class. And so it was interesting to see how they came up with some ideas to rectify that. But yeah, so it was really just bringing together, these three groups or, the group of students and then Jessica and then myself. It's that combination that's really where the power for improvement lies. And again, I, that type of partnership is just not typical in school improvement situations.

0:14:45.7 JD: So that's lesson two, applied. Lesson number three is "plot the dots for any data that incurs in time order." Right? So we've talked about this a lot. The idea behind the primary point of "plot the dots" is that plotting data over time helps us understand variation, and that in turn leads us to take more appropriate action. I think that what we decided to do with Jessica's project is, start plotting the points on a run chart and connect those points with a line, and then it becomes pretty intuitive as we're looking at that data, what joy in learning looks like in this science class. And then once we have enough data, we can turn that run part chart into a process behavior chart and actually add the limits.

0:15:40.2 JD: So, like I said, Jessica, once her and the class determined that what they were going to improve was join in learning, and they defined that concept operationally and created the survey, right away they started gathering this survey data as a part of the project, and usually they would gather the data maybe, two or three times a week across the course of this particular improvement project. So maybe I'll share my screen just so you can see what that initial run chart looked like. So, you have this run chart, and I left this in the spreadsheet so you could see the actual data. So as she began administering these surveys, she would send me the data and then I would create it the run chart for her, start plotting that data so that both of us could sort of see the variation in that survey data over time. And then she could actually take this, she would put this run chart on a slide, and every week or so she would actually show the students what the data looked like.

0:16:49.7 AS: And just to be clear, we've got a chart for those that are listening, we've got a chart that has a blue line and it's going up and down kind of around the level of about 79. So they've got points that are based, that are days. Some days are below that 79 some days are above. But also I'm assuming that those points are the output of all the surveys. So the average answer on that day from the survey as different from the average or median of all the day's output, correct?

0:17:31.1 JD: Yeah, that's right. So this is, the run chart from Jessica's class that's displaying the survey results. And what they're measuring is joy in science class as assessed by the students.

0:17:44.3 AS: On the first day, the students basically said, 75% of the respondents said that they had joy in science.

0:17:51.9 JD: That's right. So in this particular school year, which was two years ago, so we had done some of the project planning before kids went on winter break, and then when they came back from winter break, they were ready to start administering the survey. And we started plotting the dots, charting the data over time. So the X axis for those who are listening are the dates.

0:18:16.2 JD: The, Y axis is the joy in learning, percent of kids that the rating of the kids from one to 10. And then I just turn it into a percent. And so you have the green line, the central line running through is the median. We're using the median 'cause that's fairly typical for a run chart because typically run charts don't have as much data as a process behavior chart. And so, outliers can have a greater impact. So we're using the median to sort of control for that. Although this data's fairly tight. So on day one, like you said on January 4th of this school year 75, the kids sort of rated the joy in learning of that particular lesson as a 75% of 100. And then you sort of see it bounce around.

0:19:04.7 JD: That median of 79. And so what I'm showing is the data from the first 10 surveys that Jessica administered at the end of class. So over the course of 20 days from January 4th through January 24th, she administered that this survey 10 different times. So about two to three times a week. And so we see a high of about 83% joy in learning and a low of 67% joy in learning. And you have about half the points above the median, about half the points below the median. So even though it's only 10 data points, Jessica and her class, and then myself, we were starting to learn about what did joy in learning, joy in science class actually look like? Now that we have this definition and we're measuring it with these surveys and then plotting these data points. So again, she's actually putting this up on, on the, up on the screen so kids can actually see this. And what she said was after the 5th or 6th survey, and she's plotted this and put this up on a screen a few times, the kids are actually getting excited. And they're wanting to see their data. They're wanting to see what the results look like for each survey as she started plotting this.

0:20:30.6 AS: It's funny because I, when I was a loading supervisor at Pepsi, I started putting up the percent correct for each of the loaders in the warehouse. And I didn't make any comment or anything, I just put it up there. And yeah, people are interested when they start seeing numbers, they start thinking, they start asking questions.

0:20:54.3 JD: Yeah, and you can see too at a school, in a fourth grade science classroom, you can see all types of lessons, you can sort of build up this reading graphs, calculating percentages, using when do you use line graphs for some other type of graph?

0:21:10.2 AS: And why use median versus mean? Because a small amount of data could be distorted if you have a huge outlier.

0:21:18.8 JD: Yep, all kinds of practical lessons. So this brings us to sort of the last lesson for this particular episode. I think lesson four is two or three data points are not a trend, right? So, we've said that you should start plotting the dots as soon as you've decided to collect some type of data that occurs over time. And really when people ask me what type of data can you put on a run chart or a process behavior chart, there's almost any data that you're interested in improving in schools unfolds over time, almost all of it. Whether that's a daily cadence, a weekly cadence, monthly, quarterly, yearly, whatever it is, right? But the problem is the vast majority of data that we look at as educators and really probably most people, it's typically two or maybe three data points. But that doesn't tell you anything about how the data is varying naturally. So when we start thinking about this particular data, we start learning quite a bit. For one, as a teacher, I would have no idea how my kids would evaluate their joy in my classroom.

0:22:29.9 JD: And so I think if I was Jessica, I'd be pretty happy off of that, that the sort of average or the median rating is close to 80%, basically the rating each lesson has an eight out of 10. Right. I think a second thing is let's say we were a school district and we did systematically give our kids some type of survey that assess their satisfaction with the school. Right. Maybe they do it twice a year or annually. Right. And so after at the end of the year, you have two data points, but you don't really have any idea for what to do with that data. You have no idea if you collected three or four or five data points, what that would look like. And here she is in just 20 calendar days and a couple of school weeks. She's got 10 data points to work with already. So she's building that baseline of data. So I think what this is to me is just a very different approach to school improvement.

0:23:39.4 JD: And the tools are relatively simple. The ideas are relatively simple. But I think overall this really, the takeaway I want for folks is that this project really illustrates a very different approach to school improvement, guided by these sound sort of Deming principles for how to use data, to how to understand variation, to how to include the people working in the system, right?. We've talked about these arbitrary targets throughout this series, and you could see that when Jessica and her class would go to maybe set a goal for joy after collecting some of this data, that goal would be tied to something real. It's tied to actual data from the classroom. And you can sort of avoid goal setting as an act of desperation when you take this type of approach.

0:24:38.4 AS: Joy in the joy of bringing joy in science.

0:24:44.2 JD: Yeah, it's really all about this process, right? It's the kids getting into this process, that's the psychological part. They're involved in their educational process. And so that is completely different than what's happening in the typical classroom, I think, in the United States.

0:25:00.5 AS: You can imagine somebody not wanting to do this because they're afraid of what they're going to see.

0:25:07.0 JD: Certainly [laughter]

0:25:08.3 AS: Yeah.

0:25:08.7 JD: Certainly. Yeah. Hopefully they would be open to sort of collecting the data and being reflective as a professional. But I could see, maybe that's not, tha's not always the case. And another question, I kind of shared this project with some folks, in different settings, and one of the questions I typically get is, well, what about the science test scores? Like, this is great if kids have joy, I guess is kind of the reaction. But what... How does that impact the academics?

0:25:44.0 JD: And my response is, well if kids don't find joy in their learning and they're not engaged, what kind of results are you gonna get? [laughter] To me this is sort of like a part of the process that leads to academic outcomes, when you enjoy the things that you're doing, when you feel like you have some control over a process, maybe not the full control, but when you have some control, when you have input into something that you're doing all day long, you're gonna have more investment because, you know, because you're seeing that your input has meaning. That's really that psychological component.

0:26:18.2 AS: It's obvious, but maybe not proven.

0:26:21.9 JD: Yeah, I think so. I think so.

0:26:28.4 AS: Okay.

[SILENCE]

0:26:30.9 JD: Yeah. I think that's a pretty good spot to wrap up this opener with the... We covered those first four lessons and started to look at how this project unfolded in, Jessica's classroom. And I think, next we can kind of see as she gathered more data, what this looked like over time. And then as she sort of had that baseline in place, then the next thing we'll look at is: what did she do as a change idea or an intervention to try to make these rates go higher in her classroom?

0:27:08.4 AS: That's interesting. I mean, in my wrap up of this, I think how lucky, is Jessica to have someone from the outside? I think a lot of teachers and a lot of people in business, they don't really have anybody to go to. And the company's not providing that type of stuff or the school is not providing that. And so you just kind of make it up as you go along. And I think that's, that's one of the things, 'cause I'm, I think like probably other listeners and viewers who are, listening to this, they're thinking, I wonder if John could help me do that in my area? The idea of, we all know there's places that we could improve that we may not be. And if a school system can provide that, wow, that's a big... That's exciting.

0:27:56.6 JD: Yeah. I'd be happy to. And it was like a, it was definitely a mutual effort. Jessica put a lot of work into sort of, 'cause she has gone through that fellowship, she had to sort of learn all of these tools and then actually, turn around and put them into practice in her classroom. And she found ways to do this in a way where, she could still do the things she was required to do, like delivering the lessons that she was required to deliver and those types of things. But then she found ways to sort of incorporate what she learned in the fellowship to make her classroom better. Seeing that, seeing her openness to feedback that really made this like a, I think a, mutually beneficial experience. And I think the kids enjoyed it too.

0:28:39.2 AS: And the purpose of this series too is, the idea of how can you do this at home and how can you start doing it in your own school, in your own classroom, in your own life? And so I think I'm looking forward to the next session where we're gonna go deeper into... I've already got, a series of questions and things that I'm wondering, and then I saw some tabs in your, in your worksheet that I thought, okay, there's gonna be some more interesting stuff. So I think we're all gonna see you in that next section.

0:29:09.9 AS: And on behalf of everyone at the Deming Institute, I want to thank you again for this discussion and, taking the time to go through these steps with us. And for listeners, remember to go to deming.org to continue your journey. You can find John's book Win-Win, W Edwards Deming, the System of Profound Knowledge and the Science of Improving Schools on amazon.com. This is your host, Andrew Stotz. And I'll leave you with one of my favorite quotes from Dr. Deming, and it's particularly apropos, people are entitled to joy in work.

In this series, John Dues and host Andrew Stotz discuss principles that educational systems leaders can use to guide their transformation work. This episode covers principles 4 and 5: maximize high-quality learning and work continually on the system.

TRANSCRIPT

0:00:02.5 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today I'm continuing my discussion with John Dues, who is part of the new generation of educators striving to apply Dr. Deming's principles to unleash student joy in learning. Today is episode 12, and we're continuing our discussion about the shift from management myths to principles for the transformation of schools' systems. John, take it away.

0:00:34.4 John Dues: Andrew, it's good to be back. Yeah, like you said, we've sort of turned to this set of principles that can be used by educational systems leaders to guide their transformation work. Two episodes ago, we sort of kicked off the principles, gave a little bit of an introduction. We talked about principle one, which is create constancy of purpose. And then the last time we talked, we kind of broke down two principles. Principle two was adopt the new philosophy, and principle three was, cease dependence on inspection to achieve quality. So in this episode, I was gonna sort of take on the next two, the fourth and fifth principles. So the fourth principle is, maximize high quality learning. And the fifth principle is, work continually on the system.

0:01:28.6 JD: So I thought we'd sort of kick things off with principle four, that idea around maximize high quality learning. And I think sort of... If I was gonna capture that principle in just a couple sentences, I would say, you wanna maximize high quality learning and minimize total cost of education by improving the relationship with educational institutions from which students come and to which they matriculate. So, we're thinking about a single source of students coming into a system, such as an elementary school student moving into a middle school, and seeing that as an opportunity to build a long term relationship of loyalty and trust. So that's sort of the overarching idea. And I think if you sort of look at this principle through the lens of United Schools Network, where I work in Columbus, Ohio, I think that's sort of a helpful lens. And when you think about our origin story, we started as a single middle school serving a few east side neighborhoods, near downtown Columbus. And I was the founding principal, school director of that particular campus.

0:02:55.3 JD: And at the time, we decided we were gonna open a middle school, 'cause this is the point often in a student's educational career where they fall so far behind, they often then drop out of school altogether just a few years later. So we wanted to get them in middle school. So, before we were this sort of network of schools in the school system, we were this one school that grew from serving just sixth grade over the first few years to sixth through eighth grade, right. And when you looked at these east side neighborhoods where we were located, there were 15 or so elementary schools from the city school system that formed this sort of de facto feeder pattern into our middle school. Most of those schools were performing in the bottom 5% of schools in the state. Which means when those students then matriculated to our middle school, they typically did so in... The typical kid was at least two, but more often three and even four grade levels below where they should be when they enrolled with us in 6th grade.

0:04:18.1 JD: And, while I didn't have this Deming lens at the time, I did sort of approach things from a process standpoint, from a system standpoint. But, as the middle school principal, I'm thinking about sort of all that entails to run a school and a new school at that, so we're doing all the things that come with a startup. There was no way for me to run around and form relationships with the 15 principals leading those elementary schools from which our students were primarily coming from.

0:04:54.0 JD: And so when we had this opportunity to grow from one school into a network that's now four schools, we elected to grow down into elementary schools. The point in doing so was to move towards this sort of single supplier relationship, that Dr. Deming outlined in his point four. And so now, we have two middle school principals, two elementary schools in our network, and they can work together on a whole host of sort of quality characteristics, like vertically planning curriculum across that K to eight pipeline. And, we were middle schools first and then elementary schools, so while we're getting some of our students from our own elementary schools we're also still getting students from other non-USN schools, non-USN elementary schools, but we're sort of increasingly moving toward that single supplier model. And I think that coordination is one of the ways that we can then maximize high quality learning, and the great thing about this is that we then minimize the total cost of education.

0:06:14.6 JD: And I think this is one of the important paradoxes of Dr. Deming's work, in that, as quality goes up, price goes down. Which that's sort of the opposite of what a lot of people think. In the case of schools, what we're talking about in terms of minimizing cost, a lot of that has to do with less remediation of students as they sort of increasingly come from those USN elementary schools and they're not as typically far behind when they arrive to our middle schools as they were previously.

0:06:54.1 AS: And for our international listeners, and also just for a refresher for myself. Is middle school what we... I used to call it junior high, I think I called it. But what is middle school and elementary as far as your grades and ages?

0:07:09.7 JD: Yeah, that's a good question. Middle school is six through eight for us. So sixth, seventh, and eighth grade. And then our elementary schools are kindergarten through fifth grade.

0:07:19.4 AS: Got it.

0:07:23.1 JD: There's also this sort of... I think when Deming wrote his point four, his version said, "End the practice of awarding business on the basis of price tag. Instead, minimize total cost, move toward a single supplier for any one item on a long-term relationship of loyalty and trust." So I sort of translated Deming's framing to one that applies directly to students as they move through that K-12 pipeline. However, there's also this second component to this principle that's more sort of directly analogous to Deming's point, and it's definitely applicable to the business side of running schools. And this is the idea of ceasing dependence on price tag alone when we're selecting curriculum or technology or supplies or any number of goods and services that school systems regularly buy. I think the main ideas here, is to understand that difference between the lowest bidder and the lowest qualified bidder. And I think one of the things that Deming pointed out on this side of things was that basically price has no meaning without a measure of quality being purchased, including that after sale service. So I think that's a key point as well.

0:08:44.7 AS: When did you guys open the elementary schools?

0:08:48.6 JD: Yeah, so it sort of unfolded over time. So the first middle school opened in 2008.

0:08:55.2 AS: Right.

0:08:55.3 JD: Second middle school 2012. And then we moved toward elementaries in 2014 and 2017. But a key thing here is, when we open new schools, we sort of have a slow growth model where we typically open with just a single grade level. So they can sort of put systems and processes in place, hire staff, recruit students, that type of thing. And so it took about five years before those elementary schools were mature enough that they were actually feeding to the middle schools.

0:09:32.1 AS: So let's say 2020, 2019-'20 and then onwards, you're starting to get the students from the elementary schools, was there a significant difference? How would you describe the difference in what you received, from your elementary school versus... In other words, did it deliver on what you had hoped?

0:09:56.8 JD: Yeah, I think we have work to do there. But for the typical student that's coming from our elementary schools, one, they're very familiar with our routines, our procedures, our sort of school culture, the way that the school's run. A lot of those students often have older siblings that are either in our middle school or had been in our middle school and are now alumni. And then academically we see a difference as well, especially for those students that started early in elementary, like in K-1, 'cause we take kids at all grade levels. But for those kids that started K-1 and went all the way through our system and are enrolling now six years later or seven years later in sixth grade with us, the difference is stark. Both from a sort of student traits and responsibilities and sort of student academic side of things.

0:10:52.0 AS: And how does that changing... Ultimately what I think about... Toyota is a good example. And in Thailand here, Toyota has a huge manufacturing base. And part of what's so critical to that manufacturing base is all the supplier relationships that come with that. So they're surrounded by their suppliers and they've built great relationships with those suppliers. In a sense, you just happen to own that supplier in this case, but whether you're owning the supplier or whether a listener or a viewer is saying, "Okay, I need to build a better relationship with the suppliers that I have." The question I have in your case is, how did that change the final result at the end of middle school? 'Cause ultimately what you're trying to do is get your final output of your system to be better over time. I'm just curious, how has that reflected in what comes out?

0:11:48.8 JD: Yeah, I think it has a dramatic impact because so much of education and what a student is ultimately gonna do, is sort of... I don't wanna say determined, maybe a little bit too strong of a word, but maybe not too far off, by that sort of early education foundation. Specifically, did you learn to read proficiently. And when students were coming to us in middle school without that foundation in reading, it makes it really, really hard now that when you get to a point in your schooling career where things have shifted from being sort of learning how to read to, you are reading as a part of the learning process. And we did some intensive interventions before we had elementary schools to try to catch kids up, especially on that reading front. And those are really hard sort of interventions to sort of put in place when a kid is 12 or 13-years-old when they're getting those interventions. Not to say that they can't help, but the older the student is, the farther they've gone in their educational career, the harder that is.

0:13:02.5 AS: And I guess the majority of public educators are dealing with that all the time. People popping into their district and all of a sudden... Coming from many different sources and all of that.

0:13:16.1 JD: Yeah. Yep. And in some places that's more than others. That sort of coming and going tends to be associated with certain conditions in which the school sits and the community in which the school sits, where there's higher poverty rates, there's more movement. So one stat that jumps to mind on this front, in Columbus City schools, which is where our kids would have gone had they not come to us, were geographically within that district's boundaries. In any given year, 30%, nearly one out of three kids changes school buildings during the year, which is just an overwhelming number, an overwhelming amount of transition. That's just within a year, that's not even across multiple years. And so that's why this sort of single supplier [laughter] relationship is so important, because we're trying to push back in an opposite direction.

0:14:23.1 AS: And is there ever a chance that you could have all of your students come from your elementary program? Or is that unrealistic or is that happening or can happen?

0:14:35.5 JD: Well, right now it really can't happen, and that's mostly due to the size of our building. So in our elementary schools, there is basically two homerooms per grade level. So there is two fifth grade classrooms, let's say. But in our middle schools, there is at least typically three homerooms in 6th grade. So no matter what, right now, about a third of the kids would be new in a typical school year.

0:15:07.2 AS: So capacity matching?

0:15:09.2 JD: Yep, capacity matching. Yep.

0:15:11.6 AS: Okay.

0:15:12.1 JD: That's right. That's right.

0:15:13.2 AS: That's a great explanation of the methodology you're using. There's people who are public school teachers that may be listening to this and going, "Oh come on, I can't do that." Well, yeah, you're gonna have different challenges and limits, but you can start to build those relationships with the schools that are bringing students to you and trying to do the best that you can with that. Because we know that... What Dr. Deming taught was that fixing things at the beginning of the process is the way to do it. Because if you're trying to solve the problem at the middle or the end of the process, it just grows exponentially more complex, difficult, more costly. And that's the reason why a high quality means low cost. Wait, what? Yep.

0:16:01.0 JD: Yeah. And some public schools do this really well, and they, for all intents and purposes, already have this set up. But sometimes I've seen even in places like a smaller school district that maybe just has one elementary and one middle - high school building. I've been to a place where I have heard people say, "I never even thought about leaving our building and going to see what they're doing in the high school." And part of it I get, you're a teacher, you're kind of stuck in your classroom, it has to be facilitated for you to have a sub or whatever, but it's not an overwhelming barrier. And I think it's a very valuable exercise to have some of that cross movement between buildings. And I don't think it's actually that hard to do. And the good thing is, in most school districts there's geographic proximity, so that's not a barrier. But someone has to say, "This is important and we are gonna do this."

0:16:58.1 AS: I think it reminds me of my discussions with Bill Bellows, where we were talking about... Also on the podcast, and trying to talk about the idea of thinking beyond specification and thinking beyond... And asking the question, "How is this product or service being used by the next part of the process?"

0:17:18.4 JD: Yeah. Right.

0:17:19.0 AS: And looking forward, you find that even if you think that you're doing really well, you all of a sudden find that there is a huge amount of opportunity to improve in just that one step forward in the process. All right. Well, does that bring us to work continuously on the system?

0:17:39.0 JD: Yeah, I would just say, the takeaway here for me is developing those partnerships with suppliers. Whether it's on that sort of K-12 pipeline side, or if it's more like Deming's version of point four, where you're actually making purchases for the school system. And I think... A change in thinking for me was that the suppliers are a part of your system. Whether they're internal or external to the governance structure of your school system or your business, the suppliers are actually a part of the system. And thinking about them that way is really important. And I think both those approaches are keys to helping maximize high quality learning and then minimizing that total cost. And when I actually started to think about that, even though we didn't, again, think about it through this Deming lens early on, we have a number of vendors that sort of operate like that. Our IT vendor, our food services vendor, have been with us since day one in 2008 when we started.

0:18:42.0 JD: And you'll see their employees doing things here almost like they work here. They almost feel like an employee. So at least in certain cases, we've been able to develop those types of relationships on sort of more on the Deming business side of things as well, and I think that's just as important.

0:19:00.8 AS: There is an interesting business in the US that is a model for that. And that is... So, to talk about business aspect, a company called Fastenal, that makes fasteners and many different things that companies need. But they changed their business model many years ago to basically, rather than having a warehouse and distribution, and you order from the warehouse and all that, they actually set... They go into your factory, and they take over your whole inventory, and they run your whole inventory department.

0:19:30.6 JD: Interesting.

0:19:30.7 AS: And the benefit for you is that you don't own the inventory anymore. So you could have a million dollars in inventory in your factory, and all of a sudden that all goes onto their books.

0:19:39.4 JD: Wow.

0:19:40.2 AS: And the second benefit is that, you only have the cost of that inventory at the moment that you take it out of their system, and then put it into the operation that you're doing.

0:19:50.8 JD: Interesting.

0:19:51.2 AS: And that is this relationship, this super close relationship of that supplier actually working at your facility. And it's amazing.

0:20:05.0 JD: Yeah. This shift a little bit from antagonistic. "I'm trying to get the lowest price out of my suppliers" to, "Wait a second, I need to get the highest quality at a fair price, and I'm gonna work with you on an ongoing basis to make sure whatever I'm buying from you on an ongoing basis is high quality as it comes into my system." That's a much better way to operate than the sort of the antagonistic feel.

0:20:31.3 JD: Yeah, so I think that's a good transition point from principle four to five. So principle five is, work continually on the system. So as I was gonna sort of sum up this principle in just a couple of sentences, I'd say this one is improve constantly and forever the system of planning, teaching, learning and service to improve every process and activity in the organization, and to improve quality and productivity. It is management's obligation to work continually on the system, whether that's school design, curriculum, incoming supplies and materials, technology, supervision, training, retraining, whatever that thing is.

0:21:13.0 JD: And if you think back to when we talked about principle one, principle one and principle five are very similar, and that they both talk about improvement of the system and processes over the long-term. The distinction would be that, principle one is talking about constancy of purpose, the aim of the organization, and this in turn facilitates this principle, principle five, continual improvement of systems and processes. Sort of a key idea that you mentioned I think even in this talk is that, we have to keep in front of mind that quality must be built in at that planning and design stage of work. And I think that a lot of times in the education sector, we see teachers blamed for a lot of things that they have very little control over often.

0:22:10.1 JD: And I think one example as I was thinking of examples was when a school system selects a curriculum, they often select a curriculum for the entire system, but we don't often consider the downstream effects on teacher lessons and in turn student learning. How many teachers have had the opportunity to select their district's curriculum? That's a number probably close to zero. But there are sort of many I think components of the education system that are analogous. And I think the same is true in other sectors as well, and I think that's why Deming really harped on this idea that it's management's obligation to continually improve the system, because they're making many of these decisions that then have these downstream effects on the frontline workers, be it teachers in a school or nurses in a hospital or line workers in a production facility. And this... Oh, sorry, go ahead.

0:23:27.7 AS: I was just gonna say that I was recently teaching an ethics class at a university in Cambodia called CamED, run by a guy named Casey Barnett. And he is an American guy who started it on his own, funded it on his own, and for decades now has built this university, and he's built it around his principles and he sources his students his way. He has great relationships with... He's teaching accounting, finance, business, which is the practical things needed in a developing economy or economy that's really growing like Cambodia. But it's just that what I saw was the constancy of purpose when I went through the whole university, and then I got to know more of the students and they've attended some of my valuation masterclass course and stuff online. And then I'm just like, "Ah, that constancy of purpose, and the constancy of management gives the ability to continually improve." And that without that, with constant turnover in leadership, it's so hard.

0:24:40.3 JD: Yeah, and management is hard, leadership is hard. I think schools are facing some challenging times right now, because... And this is true in any sector, but if you're a leader or you're in management, you have to deal with these day-to-day issues of the organization, then also sort of keep your organization moving towards continual improvement. You have to put out these fires, like Dr. Deming would often say, putting out fires does nothing to actually improve your system. I think sort of the way he would frame it is that, you know detection and removal of a special cause does not improve a process at best. Fighting fires, i.e., detecting special causes, just... It's important, 'cause it does return that process back to its previous state, but that state is not where you want it to be necessarily.

0:25:48.8 AS: Smoldering.

0:25:49.9 JD: Smoldering, yeah. And where I heard this, it was sort of stated in a great book on Deming's work called The Deming Dimension by Henry Neve, who I'm sure a lot of listeners know. He said, "This means that systems leaders must strive to make unstable processes stable, and to make stable but incapable processes capable, and to make capable processes ever more capable." So you sort of start to break that down, you can start to see why being in management, why being a leader is not an easy task.

0:26:27.4 AS: One of the questions I...

0:26:30.2 JD: Oh yeah, sorry, go ahead.

0:26:31.4 AS: Go ahead. Go ahead.

0:26:32.0 JD: No, I was just gonna say this idea of never ending improvement, depending on what your mindset is around that type of thing is, it can be daunting, even for the most stalwart of sort of continual improvers.

0:26:46.0 AS: Yeah. And that may determine where you position yourself within an organization, because if you're at the top, it's your responsibility to be focused on that and building the system, which can be a bit overwhelming for some people, and they say, "Look, I'm okay being in this spot, and I'll try to improve what I'm doing in the classroom, but I may not be able to be involved in how we're improving all the systems." I wanted to end this discussion on principle five with a little bit of hope and vision of what is potential. I think about my little case. I have my valuation masterclass bootcamp online. And I'm going into the eleventh one. Right now, we're in the 10th one. And I'm just doing it every 8 to 10 weeks and it's a six week program.

0:27:34.2 AS: I want repetition, I want to practice, I want to see how I can improve. And I've seen enormous improvements by just looking at the problems, solving them, going to the next level. And in bootcamp number 10, basically, the students are valuing the same companies over the last couple of bootcamps. A company called Taiwan Semiconductor Manufacturing Company, and then in Toyota. And so they're in groups, and they're valuing those two companies. And I was really hesitant to show them the progress of the prior students, 'cause I didn't want them to copy from there. But I've now incorporated that in the bootcamp, halfway through to say, "Alright, here's the bar. This is the minimum. This is what the last group did using all the tools that we gave them. Now, your job is to take this to the next level." And yesterday, a student posted something on LinkedIn, and that was an absolutely comprehensive takeaways of the stuff that he's been learning and applying. And it's like, it worked. It inspired them to say, we gotta go to the next level. And I just want to hear from you about when you work continually on the system, what are some of the transformations and other things that you've seen, and what's some hope for the people who are struggling in a system that needs help?

0:28:57.5 JD: Yeah, that's a really good frame. I don't know if it'll get to that level, but I think, you know, as I've sort of built my sort of Deming knowledge base and spread that here internally where I work, I think I would go back to those two tools that I talked about repeatedly. The run chart or process behavior chart, and the Plan-Do-Study-Act cycle. And why I'm saying that is because right now, internally, we are running one, two, three, four, at least four PDSAs concurrently right now with different teams. And people are starting to see the power of this, especially in areas where performance was struggling a bit. We put PDSAs in action just to take small steps to try to improve our system. And what's happening, whether we're running that PDSA, some of these are running for a week at a time. Some of them are running for up to three weeks at a time, depending on which area you're talking about.

0:30:02.0 JD: But what's happening is we get to that Act to decide what we're gonna do next. For example, we had to make a purchasing decision where we have, talent is a struggle right now in education. We had a platform that we were trialing for 10 days, the free version. And then we have to decide, are we gonna pay for this? And with the PDSA, you get to that Act, you looked at what happened over the weeks, you did the measures of the things that you thought were important, and that decision just jumps off the page. And so these things that people used to go back and forth about, do we do this, do we not? How do we know if this is effective?

0:30:44.4 JD: Now we have this structure that makes this decision, just like I said, leap off the page in terms of its obviousness, and the direction that we're gonna go. What are we gonna do? Are we gonna buy this thing? Are we gonna spend the money? Are we gonna put resources towards this? Both in terms of the money it costs to purchase in this case, plus the human resources that it's gonna take to manage this platform? And in this case, the answer was yes. And that's all because of the power of this way of thinking. It wasn't about holding people accountable, it was about designing a good PDSA, running it, gathering the data that was important to us, and then evaluating that together and then making the decision. And so I think once people try that a few times, they'll both sort of see how clear the decision making process can come.

0:31:36.2 JD: It doesn't mean all the decisions are gonna be easy, but it clarifies decisions. It gets you working together, and planning something that's important to you as an organization and as a team, you get to see how people think things are gonna end up 'cause they predict as a part of that Plan section. And then once people get comfortable with that tool, they start owning it, they start running their own PDSAs, and they come to you and they say, "Oh my gosh, look at this, look what happened, look what I discovered. I didn't know this was gonna happen. I'm gonna keep doing this. Can I go do this over here?" "Yeah, let's set up a plan for that." And so people start to get excited, because they build this momentum with this tool. And then you pair that with a way of thinking that Deming's philosophy gives you, and your organization just starts to operate in a completely new way. And it's this sort of combination of the tools which are important, but most importantly, this way of thinking that goes with the tools.

0:32:39.2 AS: Well, let me wrap up our discussion. We're talking about principles for transformation of school systems. And today, we talked about principle four and principle five, and that is principle four, maximize high quality learning, minimize total costs. And we spent a lot of time talking about the importance of working with your suppliers, the inputs into your system. And the deeper you can build those relationships and connections with them, the better opportunities you have to improve the quality of what you're doing, and to reduce the cost of what you're doing. And principle number five, the second thing we talked about was the idea of work continually on the system. You are operating within a system, we can see there's suppliers, there's also customers that you're supplying. Ultimately, what we're talking about is planning, teaching, learning, service, those types of things are all defined as the system of what you're doing.

0:33:43.3 AS: And I think that you made the point that ultimately, that's management's job, and it has to be done by management because it has a lot of downstream effects, as Deming has taught us that ultimately the output, the majority of the output of any system is really based on what the system's capabilities are. And so your job in management is to try to improve those system capability. And maybe a teacher may find that a bit overwhelming, but that's okay, that can be brought down to a small scale maybe in a classroom. Is there anything else you'd add to that?

0:34:16.4 JD: Yeah, I think just overarching is that we're replacing those management myths with these sound guiding principles. And that, we're kind of going through 'em, either one or two at a time, these episodes, but they are sort of a mutually supporting network of principles. And so, while we may learn these piecemeal, we wanna put 'em all together, 'cause it's really that's where the power comes from is when all of these principles are working together rather than in isolation.

0:34:45.5 AS: Well, John, on behalf of everyone at the Deming Institute, I wanna thank you again for this discussion. For listeners, remember to go to deming.org to continue your journey. You can find John's book Win-Win, Dr. W Edwards Deming, the System of Profound Knowledge and the Science of Improving Schools on amazon.com. This is your host, Andrew Stotz, and I'll leave you with one of my favorite quotes from Dr. Deming. "People are entitled to joy in work."

In our July 2018 interview podcast, his 7th session with Tripp, Superintendent David Langford reflects on the efforts of the entire staff of Ingenium Charter Schools to move from “theory to practice” in their understanding and application of the Deming philosophy.

Highlights include:

• David’s (new) role as superintendent
• Ingenium operates with 6 schools across Los Angeles, CA
• Restoring joy and meaning to learning as Ingenium’s constancy of purpose
• Meaningful and relevant learning
• Moving from theory into practice
• 5 areas of practice (focus): SoPK, intrinsic motivation, continual improvement, neuroscience, and (project-based) quality learning experiences
• Student involvement
• Dashboards for monitoring joy in work
• Students learning about common and special causes of variation
• Student feedback on their experiences within Ingenium schools
• Neuroscience research

For more information about David's current work with Ingenium Schools, please visit ingeniumfoundation.org

In our October 2017 podcast, his first session with Tripp, Joshua Macht, Executive Vice President, Product Innovation, and Group Publisher of the Harvard Business Review (HBR) Group, shares his goal of how to recast management ideas to those new to management, with a focus on innovation, strategy, and core principles of leadership.   

Long before he traveled to Gothenberg, Sweden in 2016 to attend an international healthcare conference, Josh was aware of Dr. Deming as an "old friend" of management, much the same as he assessed Peter Drucker.   Yet, upon witnessing Dr. Don Berwick conduct the classic "red bead experiment," he quickly joined the ranks of those deeply struck by the revelation that the performance of willing workers in any organization is largely governed by the system itself, far more than the performance of the workers taken separately.   So began his desire to review a series of videos and books about Dr. Deming, leading to his HBR article in 2016, a 6-page tribute to Dr. Deming, "The management thinker we should never have forgotten."

In parallel, he also wrote about Dr. Deming in a 2016 article for the Boston Globe.

Interview highlights include: 

• What’s happening at the HBR – expansion, podcasts, innovation, new and expanded audience
• Thinking systemically
• Needs of young professionals
• New HBR product launched in India, ASCEND
• Lasting impressions of the red bead experiment, including whimsical measures of quality
• Now, more than ever, the need for a refresher on Dr. Deming
• Layoffs and the erosion of trust
• How good people fall prey to a bad system
• Dr. Deming’s world of human nature
• Efforts that obliterate trust
• Barriers to success
• How workers treat each other in ways that are counter-productive
• Taylorism vs. Deming management
• HBR and the Watertown (Massachusetts) Arsenal, an early site of Taylorism
• Organizational undercurrents of “Us” vs “Them”
• Passion for innovation and a role as a digital renegade
• The need to be useful and feel valued
• The joy of learning

Their passion for continual learning continues to this day as they write, speak and contribute to the Deming message.  Their journey is a fascinating one of great significance and it looks to continue in 2015 with a new book from Clare titled, “The New Wisdom”.

In this episode, David and Andrew discuss going beyond solving problems in schools to preventing them from happening. David also shares a tool for finding the area where optimization of the system would have the greatest impact.

In the episode, David shares his screen with Andrew and fills in a diagram. The beginning version has post-it note images around the sides, and the final version has lines drawn between all the post-it notes. See below:

TRANSCRIPT

about trying harder. You also talked about the idea of copying can lead to disaster as Dr. Deming had said, you know that you could... You're bringing something that works for one system into another, and no systems are identical or even close maybe in some cases. The next thing you mentioned about was best efforts, which Dr. Deming said, "We're being killed by best efforts, and it's not enough. It's the right effort put to the right problem," which then brought us to your discussion about viewing problems in a positive light and seeing them as opportunities. And finally, you went through the interrelationship diagram to help us identify what particular problem of many is having the biggest impact or the most detrimental impact on the organization, and a

tool to identify that, and then to identify that: "Okay, that's where we're gonna focus." Anything else you would add to that?

Langford: That's well done, Andrew, you were paying attention.

Stotz: Yes, I sometimes have a blank stare, ladies and gentleman, but actually I am trying my best to listen and learn, and in fact I...

Langford: No, that was an excellent wrap up.

Stotz: Yes. Fantastic. Well...

Langford: So, I would say, yeah, just to wrap it up, the optimization of a system, in Deming's Profound Knowledge he also talks about, you have to have a theory. What's your theory, theory of knowledge? Well, is your theory optimization of a system? So you kind of see how all these things start to work together to make things happen, and so if I have that constantly in the back of my head, "How am I gonna optimize the system?" So you and I have been working on trying to optimize the podcast system, and we've gotten better microphones and better cameras, and better lighting, and we just keep working because it's a continual improvement, right? As soon as we think we've got it better, then there's probably gonna be a better camera that comes out, or something better, and you have to think about...

Stotz: David, I got a little depressed when you said that trial and error can be really expensive, I think we definitely got some trial and error going on here.

Stotz: Well, let's wrap it up. On behalf of everyone at the Deming Institute, David, I wanna thank you again for this discussion, and for listeners: remember to go to deming.org to continue your journey. Now, this is your host, Andrew Stotz, and I wanna leave you with one of my favorite quotes from Dr. Deming, "People are entitled to joy in work."

This week's podcast features the first episode of our "Knowledge In Variation Series" with Lynda Finn, President of Statistical Insight, LLC and facilitator of The Deming Institute's 2.5 Day Seminar.  Lynda discusses the importance of moving from spreadsheets to plotting data, and the common mistakes that organizations make if they aren't charting their data.

Lynda's Deming journey began when, shortly out of graduate school, she met Dr. Deming at one of his public seminars.  From that point she has been helping spread his ideas through her own consulting company and her work with The Deming Institute.

She starts by sharing some of the hardest things for people to grasp about the Deming philosophy.  Though it varies, Lynda finds it's most difficult when Deming's ideas don't align with the practices people feel have contributed their success.

The episode centers on why organizations should be plotting their data on charts rather than just using spreadsheets.  She feels that if the number is important enough to have on a table, then it should be important enough to see it in its proper context. 

Lynda outlines the mistakes people make if they aren't charting their data, starting with not caring enough to see what the data is telling them. The most important reason for charting data is so that everyone sees the same thing and can come to a common conclusion about what's happening and how to improve.  How can you "see" what the data's telling you if you don't make a picture of it?

What happens if you transform HOW you think? In this episode, Bill Bellows and host Andrew Stotz discuss the problem of thinking in one dimension at a time (as we were taught in school) and its impact on our ability to solve problems. BONUS: Book recommendations to broaden your understanding of Deming and more.

TRANSCRIPT

0:00:02.1 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with Bill Bellows, who has spent 30 years helping people apply Dr. Deming's ideas to become aware of how their thinking is holding them back from their biggest opportunities. The topic for today is, well, episode 19, Transforming How we Think. Bill, take it away.

0:00:29.9 Bill Bellows: And good evening, Andrew.

0:00:35.8 AS: Good evening.

0:00:36.2 BB: And, but just as a point of clarity, I view it as transforming how we think about our thinking. And that's what I've been focusing on for the, since the mid, the early '90s is not how we think, but what is our awareness of our thinking, and I think that ties in well with SoPK. So first in late breaking news, I am seeing with new eyes, Andrew. Literally, I've got new monofocal lenses in both eyes. The left eye three weeks ago, the right eye, a week ago. I was told about five years ago, eventually I'll have to have cataract surgery. And I spoke with a few friends who had it done, and they said, oh, it's easy. And what was so amazing was it was easier than they said. It was.

0:01:41.0 BB: But one neighbor who's had it done, and kind of a sad note is he claims, and I've not double checked this, he's a sharp guy. He claims 80% of the world's population would benefit from cataract surgery that they don't have access to and eventually go blind. And I don't know, I can believe, and he is in fact he's quoted me twice on that. But I am literally seeing with new eyes. The grays are now, shades of gray, are now shades of blue. When I look at the sky. My depth perception's a whole lot better. And so it ties in well with all this vision therapy stuff. So.

0:02:36.8 AS: Aren't you glad that those machines are high quality and the operations that they do are high quality?

0:02:41.6 BB: Oh, yeah.

0:02:42.4 AS: Just one little mistake on that one. And, that's...

0:02:46.2 BB: Well, and I'm signing the documents and there's a little bit of a flutter when I'm signing, in terms of the liability. And one friend's mom had a bad cataract procedure, so it doesn't always go. And I shared this with Kevin. Kevin's had the same, as likewise had the procedure done. And we shared the anxieties and then it worked out well. But yeah when I signed that form that there was in the event, and I thought, whoa, that'd be, anyway, it worked. All right, so where I want to pick up in episode 19 is where we left off with episode 18. And there near the end, I referenced from Dr. Deming. He says Dr. Deming says in chapter three of The New Economics, and he says, "we saw in the last chapter that we're living under the tyranny of the prevailing style of management. Most people imagine this style has always existed. It is a fixture. Actually," he said, "it's a modern invention, a trap that has led us into decline. Transformation..."

0:04:03.0 BB: You remember that word from last time? Okay. "Transformation is required. Education and government, along with industry are also in need of transformation. The System of Profound Knowledge will be introduced in the next chapter. To be introduced in the next chapter is a theory for transformation." So I've got some bullet points and I want to get into the additional chapters and references from The New Economics on Dr. Deming's use of the term transformation. 'Cause I think what he's talking about... SoPK is a theory for transformation. So I think it's just not enough to talk about SoPK without understanding how does that fit in with what Dr. Deming's talking about?

0:04:49.0 AS: And for the listeners who come out of the blue here, SoPK stands for the System of Profound Knowledge.

0:04:56.1 BB: Yes. And system then gets into elements and the four elements that Dr. Deming proposed in The New Economics, going back to the late '80s when he started to put these thoughts together. We need to think about the elements of Profound Knowledge are looking at things as a system and understanding of variation and appreciation of psychology. That's the people aspect. And then theory of knowledge, which gets into what he would explain as how do we know that what we know is so. So the one thing I wanted to bring up on the System of Profound Knowledge is conversations with Dick Steele. And a neat way of looking at the System of Profound Knowledge is to say, well, what if we were to look at some data points, one element, we look at variation, and we see some data the output of a process.

0:06:00.0 BB: We see it go up and down. Well, if that's the only element we have, then we can't ask what caused that, 'cause that's the upstream system. Well, that's the system piece. We cannot talk about what does this variation do downstream? That's the system piece. We cannot talk about how might we change that. That might get into the theory of knowledge or would get into the aspect of the theory of knowledge and some theories as to how we can go about changing the average, changing the amount of variation. And then what that leads us immediately to is, where do those ideas come from but people.

0:06:44.7 BB: So it's kind of, I think it's interesting. So Dr. Deming says the elements, but it's as connected to each other. So what I explain to the students in my courses is, in the beginning, and I remember when I'm looking at this, I'm looking at the elements. I'm thinking, okay, that variation, that's the Control Chart stuff. Common causes, special causes, well, it also includes variation in people. Oh, now we're talking about the people stuff. And then, so I find it interesting is it is easy to look at them as separate, but then in time they meld together really well. So it's not to say that we shouldn't start out looking at things as the elements 'cause I think that's what our education system does. In fact, there's a great documentary I watched a few years ago with Gregory Bateson, who was born in 1900 or so, passed away in the 1980s.

0:07:52.6 BB: And when I ask people have you ever heard of Gregory Bateson? They say, no. I say, well, have you heard of Margaret Mead? Yeah. Well, they were married once upon a time. That was her, he was her first husband. And so Bateson gives a lecture in this documentary that his daughter produced. And he says, and he is at a podium. You don't see the audience. You just see he's at a lectern. And he says, you may think that there's such a thing as psychology, which is separate from anthropology, which is separate from English, which is separate from... And he goes on to imply that they really aren't separate. But then he says, "Well, think what you want."

0:08:38.1 AS: Think what you want.

0:08:39.7 AS: And I thought that's what the education system does. It has us believe that these things are all separate. And so that's what's kind of neat. Yeah. And, but again, I think when you go to school, you're learning about history, then you learn about math. But one thing I noticed later on, many years later was the history people never talked about, if they talked about the philosopher who was well known in mathematics, we didn't hear that mathematics piece, nor in the math class did we hear about this person as a historical figure. We just learned about... And so the education system kind of blocks all that out. And then years later when we're outta school, we can read and see how all this stuff comes together and it does come together. So the one big thing I wanna say is that, is I think it's neat to look at something with just one of those elements and then say, how far does it go before you need the others to really start to do something?

0:09:47.0 BB: And that gets into the interactions. And by interactions, I mean that when you're talking about variation and you're thinking about people are different, how they feel is different, how they respond is different. Now you're talking about the interaction between psychology, at least that's one explanation of the interaction between people amd psychology. I wanna share next an anecdote. I was at a UCLA presentation. A friend of mine turned me on to these maybe once a month kind of deal to be an invited speaker. 70 people in the room. And these were typically professors from other universities, authors, and there is one story I wanna share is a woman who had written a book on why really smart kids don't test well in secondary schools. And there were a good number of people there.

0:10:45.6 BB: And I'm listening to all this through my Deming lens, and she's talking about how kids do on the exams. That goes back to an earlier podcast. How did you do on the exam? And so I'm listening to all this and she's drawing conclusions that these students are really smart, but they freak out. And then how might they individually perform better? As if the greatest cause by them all by themselves. And so afterwards, I went up and stood in line and I had a question for her that I deliberately did not want to ask in front of the entire room. 'Cause I wanted her undivided attention, and I really wanted to see where she'd come with this. 'Cause perhaps it could lead to an ongoing discussion. So I went up and introduced myself and I think I said something like, are you familiar with W. Edwards Deming? And I believe she said she was. I think she was a psychologist by background. And then I moved into the... Essentially the essence of what if the grades are caused by the system and not the student taken separately, which she acknowledged. She's like, yeah, that makes sense. And I remember saying to her, "Well then how might that change your conclusions?"

0:12:11.2 BB: And so I throw that as an example of... Deming's saying you could be an expert in, you know, you just look at something. Actually, when that comes to mind is Deming is saying something like shouldn't a psychologist know something about variation? Well, shouldn't a psychologist know something about systems? And I didn't maintain a relationship with her, but it was just other things to do. Next I wanna share a story. And I wrote this up in an article. Then when this is posted...

0:12:49.0 BB: Typically these are posted on LinkedIn. Then I'll put a link into the article. And it's a classic story that Russ Ackoff was very fond of saying, and I heard the story told quite a few times before I started to think about it a little bit differently. So the story is he was working for General Electric back in the 1960s. He is in a very high level meeting. And in the room is this, the then CEO of GE, Reginald Jones and all of the senior VPs of General Electric are in the room. And Russ... I'm guessing he was doing, I know Russ did a lot of work with Anheuser-Busch, and he did a lot of work with GE. So Russ says he is in the room. There's maybe a dozen of these senior VPs of plastics of all the different GE divisions.

0:13:41.2 BB: And there's, Russ said there's one of them that was relatively new in a senior VP position, now over plastics or over lighting or whatever it was. And at one point he gets up. And one by one he raises a question with each of his peers. Something like, "Andrew, I noticed last year you installed a new software system." And you would say, "yeah, yep, yep." And I said, "I noticed you went with..." Let's say Apple, "you went with Apple Software", and you're like, "yeah," "that's what I thought. Yeah, you went with Apple." And then you might say something like, "why do you ask?" And he says, "well, the rest of us use Microsoft products. And it just seems kind of odd that you would go off and buy something different."

0:14:41.0 BB: And the point, and Russ didn't get into these details, the essence was every single one of them he'd figured out over the last year had made a decision, pretty high level decision that that senior VP felt was good for that division, but not good for General Electric. And Russ said what got his attention was, he wasn't sitting in that room hearing those conversations and he hears one decision then another, now he's got a whole list. So Russ says, he goes around the room and calls out every single one of his peers. So, and Russ shared this in one phone call, the Ongoing Discussions that I've mentioned. And people said, Russ, do you have that documented? And he is like, well, I don't think I have that any anymore. But somebody else asking.

0:15:35.3 BB: And then no sooner was the call over I had some friends call me up, said, "Bill, can you ask Russ if you have that, if he can get a copy of that? It's probably on his shelf. You're in his office". I said to one friend. I said, "so you'd be surprised that a member of Parliament does what's best for his district and not what's best for the United Kingdom. You think, you'd be surprised that a congressman from Los Angeles is gonna do what's best for Los Angeles, not what's best for the country.

0:16:07.2 BB: So you're telling me you're surprised by that?" Well, "no, no, no." I said, "well then why do you have to have the documentation?" So that's one aspect of it. So I heard that story again and again. And so finally it, I said, wait a minute, wait a minute. So I said, "Russ, on that story, you being in the room with GE?" He says, yeah. He says, I know you don't have the documentation, I said, "but what happened after this guy called them all out? How did that go down?" He says, "one of the peers looks at this guy and says, so what's your point?"

0:16:42.3 BB: And the meeting moved on. And I wrote that for an article for the Lean Management Journal called, "You Laugh, It Happens". And when I look at that through the lens of the System of Profound Knowledge, is that surprising that that goes on? No, not at all. I wanna reference a couple books that I don't think I've mentioned at all. And I share these because for the Deming enthusiasts, these books have some brilliant examples of in different arenas that I think you absolutely love and you can use in your classes, use in your education, whatever. All fairly recent. The first one is "The Tyranny of Metrics" written by a historian. He is an American University historian, Jerry Mueller, and he has, I mean, Dr. Deming would just love this. Oh, bingo! Bingo! Bingo! Thank you.

0:17:48.4 AS: Yep. There it is. "The Tyranny of Metrics".

0:17:50.1 BB: Right?

0:17:50.7 AS: Yep.

0:17:51.3 BB: Right. Is that a great one?

0:17:53.2 AS: That's a great book. And you can follow him on Twitter also. He does do a lot of posts there.

0:18:00.4 BB: Now I reached out to him 'cause I relished the book 'cause the stories were just, you just can't make up all those stories. I mean the story that I shared with Russ is nothing in comparison to what Muller has in the book. I just don't believe that Muller has a solution that can... I don't think, I think the only thing missing from the book is if he had an understanding of the System of Profound Knowledge, he'd have a far better proposal as to what to do.

0:18:31.8 AS: Yeah. I read that and I felt similar that there was something that was missing there. It was, it was great stories as you say, but how do we connect that? How do we apply that? And what's the root cause here? And how do we, this, there was just... That was missing from it. And maybe that should be his next book.

0:18:53.9 BB: Oh, enormously. But it's worth reading regardless.

0:18:57.3 AS: Yeah. Agreed.

0:19:00.1 BB: But I was, I was, I wasn't surprised. I'd say this. He honestly tried to offer a proposal, but I just looked at it and said, Professor Muller, you would just love it. In fact, I believe I reached out to him. I don't know that I heard from him. Alright, that's one book.

0:19:17.1 AS: That reminds me of what Dr. Deming said. "How would they know?"

0:19:21.3 BB: Exactly. Exactly.

0:19:22.4 AS: So if he hadn't been exposed to the System of Profound Knowledge...

0:19:25.3 BB: Oh, no. No, no, no.

0:19:25.7 AS: Then it would be hard to pull it all together. Yep. Okay.

0:19:28.8 BB: Yeah. So the next book, which is somewhere behind you in your bookshelf, is "The End of Average" by Todd...

0:19:36.8 AS: Actually, I don't think I have that one.

0:19:39.4 BB: By Todd Rose, who's a research fellow at Harvard. It's a riveting book. Oh, Andrew, you would absolutely love it. Just, he goes back ages. I mean, hundreds of hundreds of years and looks at how lost we became... How lost civilizations were dealing with trying to make, deal with averages. And the book opens with the most riveting story. And I started reading this and immediately I started thinking, "Okay, okay, okay, okay." And I figured it out. So in the opening paragraph, he says, In one day in 1949, there were 17 military planes crashed. In one day. 17 military planes crashed in one day. And this was... It would have been after the Air Force separated from the Army Air Corps. And so I started thinking, okay, late '40s, planes are going faster. The US industry has German technology, and... Because the Germans had jet engines in the late '40s. So I'm thinking it's about speed. It's about something about speed, something about speed. And there's more and more planes flying.

0:21:06.6 BB: So they grounded the fleet. They had a major investigation, brought in this young guy as a data researcher. And he passed away a few years ago, I did some research with him recently. And what he found was the cockpits were designed, you're writing, Andrew, for the average size pilots. Everything in the cockpit was fixed for the average arm length, the average hand length, the average finger length, the average height, the... Everything about... All these measurements on the torso, the cockpit had, everything was fixed. And that's exactly what I thought was going on. As the planes are going faster and faster, reaction times need to be faster and faster. And they're not. So his research was, they went off and measured thousands of pilots and found out that there was no pilot met the average.

0:22:11.2 AS: Oh, God.

0:22:11.3 BB: And the conclusion was... And again, until the plane started flying faster, that was not an issue. And that's what I was thinking with all my training in problem solving, decision making, what is going on there? What is going on there? And that's what changes the... I mean, the speed was accelerating, but compounded by the fixed geometry. So the solution by the government Pentagon, to the contractors was, add flexibility to the cockpit, allow the seat to move up and down, and then the auto industry picked up on that evidently. And so this is one example of how a fixation on average and a number of other stories outside of engineering it's just fascinating.

0:23:01.4 AS: Let me just summarize. The End of Average by Todd Rose. And it was published in about 2016. It's got a 4.5 out of 5 review on Amazon with 1,000 ratings and has a very high for Goodreads review of about 4.1. So I'm definitely getting that one. I don't have it and I'm buying it.

0:23:22.1 BB: Yeah. And it's again, he, I believe in there he offers what we should do instead, which again, I think would be, benefit from an understanding of SoPK. And so, again, for the Deming enthusiast, there is stuff in those two books, which you'll just love. And the third book came out at, I think, 2020 during the pandemic, The Tyranny of Merit, that tyranny word again, by Michael Sandel from Harvard. And I believe we've spoken about him before. And it's the tyranny of meritocracy, which is the belief that I achieved my success all by myself. I earned the grade all by myself. Everything I've done, I've done all by myself. There is no greater system. And I've written... In fact I sent an email to Michael Sandel complimenting him for the book and trying to point out that everything he's talking about fits in very well with Deming's work and that the issues are bigger than that.

0:24:34.4 BB: And I have not yet heard back, but he's a busy guy. But those three books are I would say, must reads. Then I go on to say that, because I used earlier that Dr. Deming talked about we are living under the tyranny of the prevailing style of management. So then I looked. I wanted to, so what exactly is this tyranny stuff? I mean, I'm so used to the word, so I wanted to go back and get a definition. "Tyranny is often synonymous with cruelty and oppression." And I said, that's... Yeah. Yeah. Oh, absolutely. All right.

0:25:26.4 BB: So, next, I wanna talk about... In previous podcasts I talked about work at Rocketdyne, what we called an... In the beginning it was called A Thinking Roadmap. And then as we got turned on to thinking about thinking, we changed that to An InThinking Roadmap. And that constituted roughly 220 hours of training over a dozen or so courses. So we had a one day class in Edward de Bono's Six Thinking Hats, a one day class in his, in other, actually two days in some of his other. So anyways, we had a number of courses on de Bono's work. I had a 40-hour intro course to Taguchi methods and a 40-hour advanced class in Dr. Taguchi's work. We had a 9-hour session called Understanding Variation. We had a things we were trained in that were developed by others, and then things we designed ourselves.

0:26:36.6 BB: And in the courses are tools and techniques. So tools are a cell phone, a slide rule, a computer. And the technique is how do we use it? And they provide what Ackoff would call efficiency, but also a number of these courses were inspired by Dr. Deming and Russ Ackoff were about improving effectiveness. And I got into concepts and strategies. And then what I wanted to mention that I don't think I've mentioned before is the whole concept of an InThinking Roadmap, and in this thinking about our thinking, which is a big part of the theme for tonight is, as that was inspired by, in the early '90s, Rockwell, Rocketdyne was then part of Rockwell, every division of Rockwell had a technology roadmap. And that had to be presented to higher and higher levels.

0:27:33.3 BB: What technologies are developing? What's the roadmap? And so more and more and more I heard this tech roadmap, tech roadmap. And then with colleagues, we started thinking about thinking, we thought, we need to have a thinking roadmap to combine with the technology roadmap. So the technology roadmap is gonna be helping us enormously in terms of efficiency, but not effectiveness. And I thought to integrate those two is quite powerful, which is, again another reminder of why Dr. Deming's work is a brilliant foundation for the use of technology. Otherwise, what you end up doing in a non-Deming company is with a cell phone you can increase the speed of blame.

0:28:21.4 BB: All right. So then I went back since last time I did some more research into transformation and came up with some great thoughts from Russ Ackoff. Again, our dear friend Russ Ackoff. And this is from an article that Russ wrote on transformations. And he says, "transformation is not only require recognition of the difference between what is practiced and what is preached. He says a transformation called four years ago by Donald Schön in his book Beyond the Stable State," and this is a 1991 book, he said, "it requires a transformation in the way we think.”  “Einstein," Russ says "put it powerfully and succinctly." He says, "without changing our patterns of thought, we'll not be able to solve the problems we created with our current pattern of thought."

0:29:08.2 BB: Russ continues. "I believe the pattern of thought that is required is systemic. It is difficult if at all possible to reduce the meaning of systemic thinking to a brief definition. Nevertheless, I try. Systemic thinking," again from Russ, "is holistic versus reductionist, synthetic versus analytic. Reductionist and analytic thinking derived properties from the whole, from the parts, from the properties of their parts. Holistic and synthetic thinking derived properties of parts, from the property of the whole that contains them." So I thought it was neat to go back and look at that. And then I want, more from Russ. "A problem never exists in isolation. It's surrounded by other problems in space and time. The more of a context of a problem that a scientist can comprehend, the greater are his chances of truly finding an adequate solution."

0:30:11.4 BB: And then, and so when I was going through this over the last few days, thinking, boy, I wish Dr. Deming defined transformation, it would've been, if he had an operational definition. But I thought, but wait a minute. 'Cause part of what I'm finding is, in my research, an article I came across years ago, Leading Change in the Harvard Business Review, a very popular article, 1995, by John Kotter, Why Transformations Fail. So Kotter uses that word and the title is Leading Change: Why Transformations Fail. And he is got establishing... Eight steps of transformation. "Establishing a sense of urgency, forming a powerful guiding coalition, creating a vision, communicating the vision, empowering others to act on the vision, planning for, and creating short-term wins." And under that step, Andrew, he's got a couple of steps, I'd like to get your thoughts on. One is "recognizing and rewarding employees involved in the improvements." So I thought, but of course this is transformation in the realm of the prevailing system of management. And so what that got me... Tossed around on it. I thought, well, wait a minute. There's a bunch of words that Dr. Deming uses that others use, but we know they mean something different. So Dr. Deming...

0:31:56.6 AS: Like I'm thinking, improvement is what he may be talking about.

0:32:02.4 BB: Well, but Dr. Deming talks about teamwork and the need to work together. Everybody talks about that.

0:32:08.1 AS: Yep.

0:32:09.2 BB: But just that we know, in a non-Deming environment, it's about managing actions, completing those tasks in isolation. I can meet requirements minimally, hand off to you, and that in a non-Deming environment, we call teamwork. So what I was thinking is, well, it's not that we need a new, 'cause I was even thinking, maybe we need a new word. Maybe in the Deming community, we should stop using the word transformation and come up with another word. Well, the trouble is, there's a whole bunch of other words that we use from teamwork to work together, to leader, quality. We talk about performance. We talk about root cause versus root causes. We talk about system. And so it's not that we need a new word, we need a new foundation. And that goes back to this notion as you read The New Economics or Out of the Crisis, you're hearing words that Dr. Deming uses that others use like John Kotter, but they're not used in the same context.

0:33:26.2 AS: How would you wrap up the main points you want people to take away from this discussion about transformation?

0:33:38.1 BB: Big thing is, we are talking about transformation. We are talking about seeing with new eyes, hearing with new ears. So the seeing, we talked about last time, is it's not just the systems. We're seeing systems differently. We're seeing variation differently. We're thinking differently about people and what motivates them and inspires them. The psychology piece, the theory of knowledge piece, we're challenging what we know. And then we have to think about all those interactions between two of them, between three of them, between four of them. And so I'd say that it's, the essence is transformation is essential. It is about rethinking our thinking. And I just wanna leave with two quotes. One fairly recent, one a little older. And the first quote, the more recent one from Tom Johnson, "How the world we perceive works depends upon how we think. The world we perceive," Andrew "is a world we bring forth through our thinking."

0:34:44.9 BB: That's H. Thomas Johnson, a dear friend in his 1999 book, Profit Beyond Measure. And my advice to people in reading that book is, do not attempt to read it laying down in bed. It's just, now you can read those other books we talked earlier. I think you can read those lying in bed. But Tom is very pithy. You wanna be wide awake. The last quote I wanna leave is from William James, born in 1842, died in 1910. He was an American philosopher, psychologist, and the first educator to offer a psychology course in the US. He is considered to be a leading thinker of the late 19th century, the father of American psychology, one of the elements of Profound Knowledge. And his quote that I wanna leave you with, Andrew is, "The greatest discovery of my generation is that human beings can alter their lives by altering their attitudes of mind."

0:35:45.2 AS: Whoa. Well, Bill, what an ending. On behalf of everyone at The Deming Institute, I want to thank you again for the discussion. For listeners, remember to go to deming.org to continue your journey. And if you want to keep in touch with Bill, just find him on LinkedIn. This is your host, Andrew Stotz, and I'll leave you with my favorite quote from Dr. Deming. "People are entitled to joy in work."

How do you know that the learning you and your colleagues are doing is leading to changes in behavior? In this episode, Bill and Andrew discuss little tests you can do to see if the transformation you're working toward is really happening. 

0:00:02.0 Andrew Stotz: My name is Andrew Stotz and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with Bill Bellows, who has spent 30 years helping people apply Dr. Deming's ideas to become aware of how their thinking is holding them back from their biggest opportunity. Today is episode 22, and the title is, Test for Understanding Transformation. Bill, take it away.

0:00:30.7 Bill Bellows: Hey, we've been at this podcast for about a year now, right?

0:00:36.6 AS: It's incredible how long it's been.

0:00:39.8 BB: And in the beginning you said, I've been at this for 30 years, right?

0:00:43.7 AS: Yeah.

[laughter]

0:00:46.7 BB: Maybe we should change that to 31.

0:00:48.3 AS: Oh, man, there you go.

0:00:51.2 BB: All right.

0:00:53.0 AS: That reminds me of the joke of the janitor at the exhibition of the dinosaurs and the group of kids was being led through the museum and their guide had to run to the bathroom. And so they were looking at this dinosaur and they asked the janitor, "How old is that dinosaur?" And he said, "Well, that dinosaur is 300,032 years old." "Oh, how do they know it so exactly?" He said, "Well, it was 300,000 when I started working here 30 years ago."

[laughter]

0:01:28.8 AS: So there we are.

0:01:31.4 BB: That's great.

0:01:33.3 AS: Thirty-one years.

0:01:34.0 BB: All right, all right, all right. So first thing I wanna say is, as you know and our listeners know, I go back and listen to this podcast and I interact with people that are listening too, and I get some feedback. And in episode 19, I said the Germans were developing jet engines in the late 1940s. No, it turns out the Germans were developing jet engines in the late 1930s and they had a fighter plane with a turbine engine, a developmental engine in the late '30s. They didn't get into full-scale development and production. Production didn't start till the tail end of the war. But anyway, but I was off by a decade. In episode 21, I mentioned that checks were awarded within Rocketdyne for improvement suggestions and individuals who submitted this and it could be for an individual, maybe it was done for two people, three people, I don't know, but they got 10% of the annual savings on a suggestion that was implemented in a one-time lump sum payment.

0:02:36.1 BB: So you got 10% of the savings for one year and I thought, imagine going to the president of the company and let's say I walk into the president's office and you're my attorney. And I walk in and I say, "Hey, Mr. President, I've got a suggestion. You know that suggestion program?" He says, "Yeah, yeah, yeah. Come on in, come on in. And who's this guy with you?" "Well that's Andrew Stotz." "And who's Andrew?" "He's my attorney, and he and I have been thinking about what this is worth." "Well, tell me about it." "No, well, before we get into it, we've got this form to sign here."

0:03:10.9 AS: Andrew.

0:03:11.1 BB: "Right? And you wanna see the idea or not? But we don't have to share it." But I thought, imagine people going to great length and really taking advantage of it. Well, a few of us that were involved in our InThinking Roadmap training, what we started to propose is we want a piece of the action, Andrew. So the proposal we had is that, Andrew, if you come to one of our classes, a study session on The New Economics or Managing Variation of a System, we'll have you sign a roster, right? And so if you are ever given a check for big numbers, Andrew, then we're gonna claim that our training contributed to your idea and all we ask is 10%, right?

0:03:58.1 AS: Of your 10%.

0:04:00.9 BB: I mean, I think that's fair, right? But imagine everybody in the organization becoming a profit center.

0:04:08.7 AS: Crazy.

0:04:10.4 BB: That's what you get. All right.

0:04:14.5 AS: And the lesson from that is focus on intrinsic motivation. People wanna make improvements, they wanna contribute.

0:04:23.8 BB: You start... You go down the slippery slope of incentives, which will be part of what we look at later. There's just no end to that. All right?

0:04:31.4 AS: Yeah.

0:04:32.2 BB: So I mentioned in a previous podcast that I had an interaction, met the army's first woman four-star general, and I just wanna give you some more background and interesting things that happened with her relative to this test for understanding transformation. I don't know April, May, 2008, someone on her staff reached out to me and when they first... When the guy got a hold of me, I said... From the Pentagon, he called me, I think it was like 8:00 or 9:00 o'clock at night here. Whatever it was, it was after hours in LA so it was after hours in DC. I remember saying to the guy, "How did you find me?" He says, "There's a lot of stuff on the internet." So he says, "I came across a presentation you did for Goodwill Industries." And he says, "In there you talk about... " He says, "There's some really good stuff in there."

0:05:29.0 BB: And I said, "Like what?" He said, "You have a slide in there about you can minimize loss to society by picking up nails in a parking lot." And that was an example of what I used Dr. Taguchi's work, minimizing loss to society. I said, "Yeah, I remember that slide." He says, "We don't do enough of that in the Army." And he says, "Hey, we've got a conference next week, late notice. The keynote speaker bailed out." And he's calling me on a Monday. The presentation's a week from Wednesday and he says... And also he said that the Army had an initiative called Enterprise Thinking and Enterprise Thinking was part of what we called our effort within Rocketdyne. We used the terms Enterprise Thinking, organizational awareness, and that InThinking personal awareness. We were using those two terms. So he did a search on that, found my name, and he says, "What do you think?" And he says, "We're gonna... "

0:06:24.3 BB: If I agree, we'll have a follow-up vetting call the next day. So he calls me up the next day and it's him and a two-star general. There are three people in the room, all senior officers, and he says, "Okay, so, but tell us what you do." So I shared the last... It sounds funny, is what seems to have been the last straw in their interest was having me speak, was my last straw story. Remember the executive from the European airline and... Right? So I tell that story about my efforts within Rocketdyne and Boeing about this airline executive and how this deeply resonated with this executive of this customer of this company that buys a lot of Boeing airplanes that we focused on the one cause, not the greater system.

0:07:13.2 BB: And within minutes of sharing that story, they started laughing, leading to it a few minutes later to them saying, "you're the one."

0:07:19.2 AS: [laughter] That's very interesting.

0:07:21.3 BB: You're the one. So for our listeners, I'd say, let this be a reminder of how a personal story guided by insights on how Dr. Deming's System of Profound Knowledge can open doors for you. And you can use that story, come up with your own stories, but you just never know when you're gonna be in a situation where you need a really simple story. So as an aside, they contact me, like I mentioned, 10 years later, and I think I shared with you offline that the speaker I was replacing was the great Richard Rumelt, the strategy professor from UCLA, who for whatever reason needed to bail out. And then when this podcast is posted, I'll put a link to the slides of the presentation.

0:08:05.7 BB: It's about 45 minutes long. What was not covered... I went back and looked at it earlier to say, what did I share with them that got them so excited? All I know is it fit into 45 minutes to an hour. What was not covered was the trip reports, whether Red Pen or Blue Pen, Last Straw/All Straw, Me/We organizations. But after it was done, as I'm coming off the stage, General Dunwoody in uniform comes up to me. She was thrilled. Her exact words were, "You hit it." She says, "Bill, you hit it out of the park." And I thought, well, I had help from a lot of people. She then says something to me that I'll never forget. So we're face-to-face, right? Let me just... Right?

0:08:45.1 BB: And she says to me, "Bill, you've got a real challenge on your hands. Bill, you've got a real challenge on your hands." So prompted by that, I held my hand out, my right hand, which is what you do to initiate a handshake, and then she reaches out to shakes my hand and I said, "General Dunwoody, we have a challenge on our hands." [laughter] And she erupted in laughter. And my only regret, even though we went out for drinks for the next couple of hours, but my regret was not having a photo of her and I doing a double high five as she laughed. So then I remained in touch with her for the next six to eight months when she was promoted to four-star and she looked for opportunities to get me to the Pentagon, which she did. And I was trying to get her or somebody on her staff to come to Rocketdyne to learn more about what we're doing.

0:09:38.1 BB: But I say I share this anecdote as an example of a Test for Understanding of a transformation. So what is a TFU, test for understanding? This is something I got exposed to in my Kepner-Tregoe Problem Solving and Decision Making training, which I talked about in one of the first episodes. And in our training to deliver what was then a five-day course, we were coached on how to interact with seminar attendees, including how to answer questions and how to ask questions. And one of the things we got our knuckles wrapped for was saying, are there any questions? Because no one answers that. There is... And if I had said that when I was being certified, I'd have failed. So instead we're coached on how to ask questions or make comments, which serve as a test for someone's understanding of what I presented.

0:10:27.9 BB: For example, for me to reply to General Dunwoody with we have a challenge on our hands was to test her understanding of what I said and her laughter is a response that I could be expecting with something short. As an aside, an appreciation, we've talked about Ackoff's D-I-K-U-W model data, raw data information. You turn that into what, where, when, extent, knowledge. If we convert that to how does something operate looking inside of an automobile, how do the pieces work together? Remember he said understanding is when you look outward 'cause knowledge looking inward, Russ would say, doesn't tell you why the car is designed for four passengers. That comes from looking outward. And then wisdom is what do we do with all this? Well, the Kepner-Tregoe training was Test for Understanding and now that I'm inspired by Ackoff, well in my university classes, I ask "Test for Information" classes. I have them watch videos and say, what company was Russ working for?

0:11:31.1 BB: This anecdote, that's information. Nothing wrong with those questions. I can ask for "Test for Knowledge" questions asking how something operates. So what I don't know is like, why are they called Test for Understanding? They could be Test for Knowledge, Test for Information, Test for Wisdom. And obviously TFI test for information could be true, false, multiple choice and test for knowledge and understanding could be short, but then I want to go deeper. And so what I wanna share is in one of my university courses, I share the following, true, you can't make it up news stories. It says, once upon a time a national airline came in dead last on on-time performance one month even though it had offered its employees everything from cash to pizza to finish first in the US Department of Transportation's monthly rankings. Does that sound like incentives, Andrew?

0:12:33.0 AS: It's all there.

0:12:33.8 BB: If we finish first, pizza parties. Now if they got exposed to Rocketdyne, they'd be handing out checks for $10,000. So in one of the research essays, for a number of the courses, every week, every module, I give them a research essay very similarly, giving them a situation and then what's going on with the questions is having them think about what they've been exposed to so far. And so question one in this assignment is given this account, list five assumptions that were made by the management team of this airline? And so I just wanna share one student's response. He says, "assumption one..." And also let me say this comes from the second of two Deming courses I do. So these students have been exposed to a one, one-semester course prior to this. So this is not intro stuff. This is getting deep into it.

0:13:34.3 BB: And so anyway he says, "assumption one, offering incentives like cash and pizza would motivate employees to prioritize on-time performance." Okay? That's an assumption. "Assumption two, employee morale and satisfaction directly correlate with on-time performance. Assumption three, the issue of on-time performance primarily stems from..." Are you ready? "Employee motivation or effort. The incentives provided were perceived as valuable by employees." And you're gonna love where this goes. "Assumption five, employees have significant control over factors that influence on-time performance such as aircraft maintenance, air traffic control and weather conditions."

0:14:20.2 AS: Good answers.

0:14:23.0 BB: Again, what I think is cool and for our listeners is what you're gonna get in question two, three, four, and five is builds upon a foundation where these students have, for one and a half semesters been exposed to Deming, Taguchi, Ackoff, Gipsie Ranney, Tom Johnson, the System of Profound Knowledge, hours and hours of videos. And so this is my way of Testing their Understanding. And so if you're a university professor, you might find interest in this. If you're within an organization, this could be a sense of how do you know what people are hearing in your explanations of Deming's work or whatever you're trying to bring to your organization? So anyway, I then have them read a blog at a Deming Institute link, and I'll add this blog when this is posted but it's deming.org/the insanity of extrinsic motivation. All right. And they've been exposed to these concepts but I just said, "Hey, go off and read this blog." And it was likely a blog by John Hunter.

0:15:32.0 AS: Yep.

0:15:32.2 BB: All right, question two. All right. Now it gets interesting, is that "in appreciation of Edward de Bono's, "Six Thinking Hats"," which they've been exposed to, "and the Yellow Hat, which is the logical positive, why is this such a great idea? Listen, explain five potential logical, positive benefits of incentives, which would explain why they would be implemented in a ME Organization." And so what's seen is I have them put themselves in a ME Organization, put on the Yellow Hat and think about what would be so exciting about this. And so logical, positive number one. "Incentives can serve as a powerful motivator for individuals within the organization, driving them to achieve higher levels of performance and productivity. When employees are offered rewards for their efforts, they're more likely to be motivated to excel in their roles," Andrew. Logical positive number two, enhanced performance. Explanation, "by tying incentives to specific goals or targets, organizations can encourage employees to focus their efforts on key priorities and objectives.

0:16:46.9 BB: This can lead to improved performance across various aspects of the business, ultimately driving better results." Number three, attraction and retention of talent. Oh, yeah. Explanation, "offering attractive incentives can help organizations attract top talent and retain existing employees. Attractive incentives can serve as a key differentiator for organizations seeking to attract and retain skilled professionals." Now, let me also say, this is an undergraduate class. As I mentioned, this is the second of two that I offer. Many of these students are working full-time or part-time. So this is coming from someone who is working full-time, probably mid to late 20s. So these are not... They're undergraduates but lifewise, they've got a lot of real-world experience.

0:17:44.0 BB: All right. Logical positive four, promotion of innovation and creativity. Explanation, "incentives can encourage employees to think creatively and innovative in their roles. By rewarding innovative ideas and contributions, organizations can foster..." Ready, Andrew? "A culture of creativity and continuous improvement, driving long-term success and competitive advantage." And the last one, positive organizational culture. "Implementing incentives can contribute to a positive organizational culture characterized by recognition, reward and appreciation. When employees feel valued and rewarded for their contributions, they're more likely to feel engaged, satisfied, and committed to the organization." But here's what's really cool about this test for understanding, I get to position them in the framework of a ME Organization with the Yellow Hat.

0:18:40.9 BB: Now question three, in appreciation of Edward de Bono's, "Six Thinking Hats" and the Black Hat, what Edward calls a logical negative, list and explain five potential aspects of incentives, which would explain why they would not be implemented in a WE Organization. And this is coming from the same person. This is why I think it's so, so cool that I wanna share with our listeners. The same person's being forced to look at it both ways. Negative number one, potential for... Ready, Andrew? "Unintended consequences." Oh my God. "Incentives can sometime lead to unintended consequences such as employees focusing solely on tasks that are incentivized while neglecting other important aspects of their roles. This tunnel vision can result in suboptimal outcomes for the organization as a whole."

0:19:30.7 BB: "Number two, risk of eroding intrinsic motivation. Explanation, offering external rewards like incentives can undermine intrinsic motivation leading employees to become less interested in the work and more focused on earning rewards. Number three, creation of unhealthy competition. Explanation, incentives can foster a competitive culture within the organization where employees may prioritize individual success over collaboration and teamwork. This competitive atmosphere can breed..." Ready? "Resentment and distrust among employees." Can you imagine that, Andrew? Resentment and distrust? That seems like it would clash with my previous positive thought, but it really just points out how careful management needs to be.

0:20:19.0 AS: Yes.

0:20:19.2 BB: All right. Cost considerations. "Implementing incentive programs can be costly for organizations, particularly if the rewards offered are substantial or if the program is not carefully managed. Organizations may be hesitant to invest resources and incentives, especially if they're uncertain about the return on investment if budget is of concern." And then number five, "short-term focus over our long-term goals." Explanation, "incentives often improve short-term gains rather than long-term strategic objectives. Employees may prioritize activities that yield immediate results, even if they're not aligned with the organization's broader goals or values."

0:21:02.7 BB: And then question four, here's the kicker. "In appreciation of your evolving understanding of the use of incentives, share, if you would, a personal account of a memorable attempt by someone to use incentives to motivate you, so that so many pizza parties or bringing a small box of donuts or coffee in for working a weekend I was supposed to have off." And then question five, "in appreciation of your answer to question four, why is this use of incentives so memorable to you? They were very ineffective. I often felt insulted that my boss thought that $20 worth of pizza or donuts made up for asking me to give 50% of my days off that week."

0:21:55.5 AS: Here's a donut for you.

0:22:00.6 BB: Here's a doggy bone, here's a doggy bone. I just wanted to share that this time. Next time we'll look at more.

0:22:09.3 AS: One of the things that...

0:22:10.6 BB: There are other examples of Test for Understanding. Go ahead, Andrew.

0:22:12.3 AS: One of the things that I wanted to... What you made me think about is that you and I can talk here about the downside of incentives but we have to accept the world is absolutely sold on the topic of incentives.

0:22:27.2 BB: Absolutely.

0:22:27.8 AS: A 100, I mean, 99.999% and if you're not sold on it, you're still gonna be forced to do it.

0:22:34.5 BB: Well, you know why they're sold on them, 'cause they work.

0:22:39.7 AS: It's like a shotgun. One of those pellets is gonna hit the target but...

0:22:47.7 BB: That's right.

0:22:48.4 AS: A lot of other pellets are gonna hit...

0:22:50.6 BB: And that's all that matters. And then what you get into is, you know what, Andrew, that that one person walks away excited, right? And that's the pellet that I look at. And I say, yep, and what about those others? You know what I say to that, Andrew? Those others, you know what, Andrew, you can't please everybody.

0:23:07.8 AS: Yeah.

0:23:07.9 BB: So this is so reinforcing. There's one person that gets all wrapped up based on my theory that this is a great thing to do and I hone in on that. And everything else I dismiss as, "ah, what are you gonna do? You can't please everybody." But what's missing is, what is that doing to destroy their willingness to collaborate with the one I gave the award to?

0:23:33.1 AS: Yeah, I'm picturing a bunch of people and laying on the ground injured by the pellets but that one black, or that one... Let's say the one target that we were going after, that target is down but there's 50 other people down also.

0:23:50.6 BB: No, but then this is where I get into the white bead variation we talked about early, early on, is that if all I'm doing is measuring, have you completed the task and we're looking at it from a black and white perspective and you leave the bowling ball in the doorway for the next person, meaning that you complete a task with the absolute minimum requirements for it to be deemed complete. Does the car have gas? Yes. You didn't say how much but when people then... When those people that were summarily dismissed didn't receive the award, when they go out and don't share an idea, don't give somebody a warning of something or not even maliciously leave the bowling ball in the doorway but believe that the way to get ahead is to do everything as fast as possible, but in doing so, what you're doing is creating a lot of extra work for others, and then you get promoted based on that. Now you get into... In episode 22 we talked about, as long as there's no transparency, you get away with that. And then the person at the end of the line gets buried with all that stuff and everybody else says, well, my part was good and my part was good. How come Andrew can't put these together?

0:25:26.8 AS: In wrapping this up, I want to think just briefly about how somebody... So we're talking about understanding transformation, but we're also talking about incentives.

0:25:39.8 BB: Yes.

0:25:40.5 AS: And I would like to get a takeaway from you about how somebody who lives in a world of incentives, how do they, after listening to this, go back to their office and how should they exist? It's not like they can run away from a structure of incentives. Maybe when they become CEO, they decide, I'm not gonna do it that way, but they're gonna go back to their office and they're gonna be subjected to the incentive system. Obviously, the first thing is we wanna open up their mind to think, oh, there's more to it than just, these darned employees aren't doing what I'm telling them, even when I'm giving them incentives. But what would you give them as far as a takeaway?

0:26:27.1 BB: Well, I'll give you some examples of what some brilliant colleagues did at Rocketdyne, as they became transformed, as they became aware, and one is politely decline. Say, I don't, I don't need that. Just again you have to be careful there. There could be some misinterpretations of that. So you have to be...

0:27:03.2 AS: What if you're required to put an incentive system on top of your employees?

0:27:09.5 BB: Well, first, if it's coming down to you to go off and implement this, then one thing you could do is create a system which is based on chance. Everyone who contributed an idea, their name goes into a lottery for free lunch the first Wednesday of the month, and everybody knows. So then we're using the incentive money but using it in a way that everyone deems as fair. So that's one thing. And you just say, I'll... So then if your boss asks, have you distributed the incentive money? You say, yes, but you're distributing it based on a system of chance of which everyone realize they stand an equal chance of winning.

0:27:56.9 AS: Okay. So let's address that for a second. So your boss believes in incentives. They ask you to implement this system. Now you proposed one option, which is to do something based upon chance, but now let's look at your employees under you that have been indoctrinated their whole life on the concept of incentives. And you give them a system of chance and they're gonna come back and say, wait a minute, you're not rewarding the person who's contributing the most here? Now obviously you have a teaching moment and you can do all that, but is there any other way that you can deal with this?

0:28:33.7 BB: No, it could be tough. You've got to... You may have to go along until you can create a teaching moment. And what I did with the colleagues, when there are these a "great minds doing great things" events, and an announcement would go out as to who are the privileged few that got invited to these events, and I would tell people that if you go to the event, then that's what I would say. You can decline, you can politely decline. There's some things you can decline.

0:29:17.4 AS: I guess the other thing you could do, you could also... When you have to, when you're forced to reward, you can celebrate everybody's contribution while you're also being forced to give that incentive to that one person that has been deemed as the one that contributed the most.

0:29:36.9 BB: Well, I'll give you another example that a colleague did, a work colleague. He didn't do it in a work setting. Not that it couldn't be done in a work setting, but he signed up to be as a judge in a science fair in a nearby school. It was a work-related thing. And as it got closer, he realized... It was a... It would involve... What is a science fair without the number one science experiment? And my theory is you can't get a bunch of adults and a bunch of kids together in any organized way without giving out an award that just, it's like, oh, we got everybody together. We got to find a way to single somebody out. So when he realized what was going on, instead of not going, what he did, he took it upon himself to interact with every kid whose science experiment he watched and asked them lots of questions about it, about what inspired them? What did they learn?

0:30:30.6 BB: So what he wanted by the end of the day was that they were more intrigued that someone came and really wanted to know what they learned and less inclined to listen to who won the award. And I've seen that in a work setting, again, where we had events and the next thing you know there's an award and I thought, well, what can we do? Well, we can go around and really engage in the people who's got tables set up for the share fair knowing at the end of the day, we have this. We just can't break this, we just can't break this.

0:31:08.2 AS: Yeah. All right. So...

0:31:10.3 BB: But the other thing I've seen, I've seen people who received rewards, use that money. Literally, one guy in the quality organization at Rocketdyne received an award. It might have been for a $1000. He used the money, Andrew, to buy copies of The New Economics for everyone in the organization.

[laughter]

0:31:31.7 AS: Well, that brings us to another possibility, is that you convince your boss that you at least want to give... You want to reward the whole department.

0:31:40.5 BB: Yes.

0:31:40.9 AS: Any reward that you do, you want to reward your whole department. And so that could be something that your boss would say, "Okay, go ahead and do that." And they're not gonna go against it as opposed to trying to, say, no, I won't do it this way, but...

0:32:02.1 BB: Well, towards that end, I've seen people that are rewards crazy. At Rocketdyne, there's one guy in particular in a machine shop manufacturing environment and some big program wanted to thank five out of the 50 people in his organization with t-shirts. And he said, "You either give me 50 t-shirts or no t-shirts."

0:32:27.6 AS: Yeah.

0:32:28.8 BB: And I thought that was really cool 'cause this... And I don't know to what degree his exposure to what we were doing, but I thought that's what we need more of. Come back with 50 shirts and we'll take them.

0:32:44.1 AS: Okay. Let's wrap this up by doing a brief wrap-up of why you're saying... Why you've titled this Test for Understanding and what can the listeners take away.

0:32:56.6 BB: The idea is again, if in a seminar learning event situation is one thing, but if you're involved in leading in a transformation within your respective organizations, what I'm suggesting is that you think about how to Test the Understanding of that transformation's progress with your audience. And we talked in the past about leaving a coffee cup in the hallway, see if it's still there. That's a Test for Understanding of the culture of the organization. And that's what I'm suggesting here, is there are simple things you can do such when somebody says, come see what my son did. You can say, your son? Or is it, was there a spouse involved? And just as you become aware of the nuances of this transformation, you could be looking at somebody look at two data points and draw a conclusion and they're just a day out of some seminar with you about understanding variation and they're looking for a cause of one data point shift.

0:34:13.0 BB: So it's just, what can you do day in and day out, just your little things to test the organization or test an individual's understanding of this transformation process that we're talking about, which is, how are you seeing things differently? Are you becoming more aware of incentives and their destruction, more aware of theories? That's all. What just came to mind is... And the other aspect of it was this idea that very deliberately with the foundation of ME and WE, Red Pen/Blue Pen, then you can build upon that by saying to somebody, how might a Blue Pen Company go off and do this? How might a red pen company go off and do that? And that's not a guarantee that either one of them is right, but I find it becomes a really neat way on an individual basis to say, as you just pointed out, Andrew, so how would I as a manager in a Blue Pen Company deal with that awkward situation?

0:35:19.2 BB: Well, if I was in a red pen, this is what I would do. And so it's not only testing for understanding, but also the power of this contrast. And that's what I found with a group recently, especially the students. If I give them the contrast, I think it's easier for them to see one's about managing things in isolation and all that beckon such as belief in addition and root cause analysis, and one's about looking at things as a system. So it's not just Test for Understanding, but a test of both foundations is what I wanted to get across.

0:35:57.0 AS: Okay, great. Bill, on behalf of everyone at The Deming Institute, I wanna thank you again for this discussion. And for listeners, remember to go to deming.org to continue your journey. If you wanna keep in touch with Bill, hey, you can find him on LinkedIn and he listens. This is your host, Andrew Stotz, and I'll leave you with one of my favorite quotes from Dr. Deming. I mean, I say this quote every time until I will be bored stiff of it, but "people are entitled to joy in work."

Dr. Deming was a professor for nearly 5 decades, and while most of his examples and writing discussed manufacturing, he applied all the same ideas to teaching. In this episode, John Dues and host Andrew Stotz discuss points 2 and 3 of Dr. Deming's 14 Points for Management - translated for people in education: adopt the new philosophy and cease dependence on inspection to achieve quality. 

TRANSCRIPT

0:00:00.0 Andrew Stotz: My name is Andrew Stotz and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today I'm continuing my discussion with John Dues who is part of the new generation of educators striving to apply Dr. Deming's principles to unleash student joy in learning. Today we're continuing our discussion about the shift from management myths to principles for the transformation of school systems. John take it away.

0:00:29.4 John Dues: Andrew. It's good to be back. I thought since we've done a number of episodes now just to do a quick recap of where we're at folks that are following along on the Deming Institute website. We're on episode 11. In episodes seven through nine I outlined those six common management myths and you just talked about the point of those three episodes was to help the education systems leaders see what not to do. We've now turned to a set of principles that can be used by these same leaders to guide their transformation work. And in the last episode, episode 10, I introduced the 14 Principles for educational systems transformation. We talked about Principle 1 which was called Create Constancy of Purpose. In this episode I'll describe the second principle which I call Adopt The New Philosophy and the third principle which I call Cease Dependence on Inspection to Achieve Quality. And I mean I think a really important point to make that I got from Dr. Deming when I think about these 14 principles is a preemptive strike. Over the course of 60 years or so of continual improvement work Dr. Deming worked with Japanese industrial leaders, governments, top companies in the United States. Maybe a little bit lesser known was that he was a professor of statistics at New York University for nearly 50 years.

0:02:06.1 JD: And in his books he not only taught the 14 Points to the leaders with which he worked but they also guided his own teaching practices as a professor. And so there was a, sort of, a short Deming quote that stuck out in regards to the 14 Points and who they apply to. He said the 14 Points apply anywhere to small organizations as to large ones to the service industry as well to manufacturing. So I think it's sort of a preemptive strike of sorts, in case people in schools would think that maybe these 14 principles only apply to industry or only apply to healthcare and other sector but they really do apply to the education sector and in fact that was, sort of, a sector close to Deming's heart since he spent like I said five decades or so in academia.

0:03:00.3 AS: Yeah I mean so it's a good point that I think when you read Deming's material or if you watch his videos there's an overwhelming amount of information about factories and businesses and all that. And there's less about service sector. There is talk in there about service sector. But so I think a lot of people that first stumble upon it start to think, "Oh, this is just for factory quality control", or something like that. And that's been proven wrong particularly the LEAN startup in the world of startups really applied Deming's PDSA cycle as an example in very much service industries so it's a good point that this applies everywhere.

0:03:42.3 JD: Yeah. And basically what I tried to do with the 14 Principles in my 'Win-Win' book was just basically just translate the language from, sort of, manufacturing or sort of, industrial language to education sector language. So I actually literally created a crosswalk where I said here's Demings Point 1 and here's how I'd frame that for school people. And so that's, sort of, what I'm taking folks through in this most recent set of episodes. So thinking about diving in here. Principle 2, sort of, the short name is Adopt the New Philosophy. The descriptor, sort of, is Adopt the New Philosophy: Systems leaders must awaken to the fact that education reform movements often lack a sound philosophical foundation, must learn their new responsibilities and take on leadership for improvement. So this, sort of, goes back to this idea of what came out of A Nation At Risk. What was the next steps? What was, sort of, the response? And what I'm saying is that was probably the wrong response and instead we need to Adopt This New Philosophy. That's what Dr. Deming is calling us to do. And that's his point too and I've translated that for education folks.

0:05:01.8 AS: And just for clarity purposes. This principle number two and, you know, what Deming's talking about Adopt the New Philosophy is a very kind of a general statement yet it's maybe a specific statement. Is he telling us to adopt this new philosophy, like generally or is he saying the philosophy of such and such, the philosophy of quality, the philosophy of constancy and purpose, the philosophy of being a learning organization? I'm just curious how you're interpreting that.

0:05:38.7 JD: Yeah I think the 14 Principles are a part of the philosophy. Really, the philosophy is the System of Profound Knowledge though. And if I could, sort of, frame the Deming Philosophy for education what I would, how I would put that is that it's really about studying and applying the System of Profound Knowledge to do two things basically. The first thing is we wanna view teaching and learning as dynamic processes that occur within a system. That's, sort of, the first frame. The second frame is understand the nature of variation of those teaching and learning processes so that we can take the appropriate action within our systems and then we're doing that so we can accomplish improvement on this continual basis. So that's the, sort of, frame I would give the application of Deming's Philosophy to the education system.

0:06:40.9 AS: So is the goal improvement, and understanding the process and understanding variation are steps we get to, of how we improve better, faster, more sustainably or how do you see that?

0:06:56.4 JD: Yeah I think that's exactly right. I think it's all of those things. It gives us the information that we need the knowledge that we need within our systems to make the changes that need to be changed on a, sort of, continual basis. And, you know, it's something that never ends. It's a process that really never ends. It's, you know, not a recipe it's not a program to be implemented but instead it's a method it's a way of thinking that allows to, sort of, continually improve our organization.

0:07:29.1 AS: One other thing I would just mention about this is that if you take away one thing... One thing we could take away is to become a learning organization. I didn't really understand that for many years, but now I really understand that in order to truly learn you have to understand variation in the System of Profound Knowledge and all of the systems stuff in order to truly learn. And then you start to realize that if you're on a mission to truly learn the amount of improvements that you're gonna be able to do is way beyond most other people most other companies competitors most other schools. Because you have... That is part of the Constancy of Purpose is learning and that, I didn't really understand that when I first got into the Deming stuff but now I see just become a learning machine.

0:08:28.3 JD: Yeah. That's what you sort of have to commit to. And I think really what the 14 Principles do is serve as this practical guide by which, you know, systems leaders can lead. It's really that guide. So those management myths avoid those things and then here are these 14 Principles that we can, sort of, follow and some of those principles like Principle 1, Create Constancy of Purpose really tell us what to do and then, sort of, other principles in the list instruct us on how to, sort of, remove barriers in creating this environment the very environment that you were, you know, talking about just now in terms of an environment that's conducive establishing a new philosophy, establishing a learning organization, avoiding barriers to those things like management by objectives. One of the points that we'll get to is "abolish management by objective". That's something we want to get rid of. And really the backbone of the philosophy is transformation from this culture of competition where I win you lose or I lose you win. And really what we want the dominant paradigm in order to, sort of, have the environment that we need to be that learning organization is to create this, sort of, win-win paradigm based on this culture of cooperation.

0:10:00.1 JD: I think, you know, especially when Deming was speaking 45 years ago, 50 years ago when he became really popular in the United States, we had a long way to go. And I think there's still a long way to go but you can almost see, well, you can see a lot of the Deming philosophy in companies today. It is just most companies aren't anywhere close to all the way there, right? And that same thing goes for school systems. I think, sort of, that this idea of win-win philosophy it is a new way of thinking for a lot of leaders. I think one of the, sort of, primary concerns which once you've adopted, sort of, this new approach is that we want to develop joy in work and learning among students, for us as staff as well, as a prerequisite to achieving the core purpose of the organization. Because when people are joyful in their work or joyful in their learning you know you've already created this, sort of, environment that you're referring to where people can learn and improve and people are gonna use data in a way that drives towards that instead of, sort of, guarding their corner of the system like we've talked about before. And I think, you know, I think when you read Deming and I think when you think about transformation of an organization from one philosophy to another philosophy that can certainly be daunting.

0:11:39.0 JD: I think I've said it on this podcast episode, one of these episodes before but this transition is not gonna happen overnight. And I think Deming said something to the effect of when it comes to transformation there's no instant pudding. This doesn't just happen instantly. I think a more realistic goal is this constant consistent movement towards the new philosophy where you're moving towards total involvement of the entire organization everybody from top to bottom and then you're getting everybody working on this continual improvement activity of all systems processes and activities, you know, within the school system. Now it doesn't mean you're necessarily, sort of, attacking every single system or every process at the same time. It just means that you're sort of equipping everybody across the organization with knowledge of the philosophy, knowledge of the methods, and then the tools that go along with those methods like the Plan-Do-Study-Act cycle, like the Process Behavior Chart. And you're getting everybody, sort of, working towards this common aim. And again this is, this is a process and it takes, it takes time for sure.

0:12:51.9 AS: And that's why you need Constancy of Purpose too. Because if you don't have Constancy of Purpose and you have constant change, you know, change in leadership and direction, you know, you're never gonna get there. And I think about the...so many companies that we looked at when I was first studying Deming and listening and learning, many of those companies went through a 5 year phase of implementing the Deming teachings and then they got a new CEO and he says I'm not up for that. I like this. I'm, you know, I'm up for measuring everybody's KPIs and kicking ass and holding people accountable around here. Enough of this cooperation. [laughter]

0:13:36.1 JD: Yeah I think that's a common occurrence and I think, you know, in addition to the 14 Principles there's also the five... I forget what he exactly called them Deadly sins or something like that.

0:13:52.4 AS: Six Deadly Diseases I think it was.

0:13:55.0 JD: I think it was started as five and maybe it grew to six or seven but definitely one of them was the transition of senior leaders on a frequent basis because that makes this virtually impossible to, you know, to change to a New Philosophy.

0:14:08.5 AS: So that really ties together the Constancy of Purpose and Adopting the New Philosophy because then you really see that this is a real commitment. This isn't a fad, this isn't some new tool or something like that. It's a new way of thinking that's gonna require work to get there.

0:14:28.3 JD: Yeah that's exactly right and a lot of people, sort of, associate Deming with Control Charts or something like that, which obviously again he was a statistician. He used Control Charts frequently. I think the Control Charts and Process Behavior Charts are an important tool but what's more important is this way of thinking this is really what Deming was focused on more than anything else is this way of thinking that went with understanding your organization through the lens of the System of Profound Knowledge. It's really this philosophical change adopting this new philosophy that's really what he was most focused on when he worked with governments or schools or corporations, organizations. But that was Principle 2. That's Adopt the New Philosophy. It's not easy. Takes commitment, takes Constancy of Purpose. You've got to stick with it.

0:15:21.8 JD: I think Principle 3, sort of, transitioning to that, I talked about ceasing dependence on inspection to achieve quality. And when I'm talking about Principle 3 in education I'm talking about two specific types of inspection. So I'll just, sort of, read the whole principle and then we can, sort of, unpack it a little bit. So Principle 3: "cease dependence on standardized testing to achieve quality and work to abolish grading and the harmful effects of rating people eliminate the need for inspection on a mass basis. For example standardized testing by building quality into the product in the first place. The product in education systems is high quality learning." That's, sort of, Principle 3 in a nutshell. There are two, sort of, different concepts to deal with in Principle 3 and this will be probably fairly controversial for a lot of, sort of, educators but those two concepts are...

0:16:28.9 AS: Bring it on John.

0:16:30.4 JD: Standardized testing and grading. And the prescription is actually different for each of those things if you're following W. Edwards Deming's teachings. And I think that calls to attention an important point with all of this stuff this principle for sure. But all the principles. You really have to do close reading of the 14 Principles because Dr. Deming chose his words very carefully. And I think, you know, when you say, you know, stop over-reliance on standardized testing or abolish grading. A lot of people's initial reactions is probably going to be to scoff or laugh. And I think, you know, I think that's really just a demonstration of how far away they are from the standards that he demanded.

0:17:22.3 JD: So a lot of people might hear this and say oh this is fluffy stuff or something like that. He must not want real quality to exist and he was actually saying the exact opposite. So if we start with the standardized testing part, you know, when I think of... Is Deming saying that we should abolish inspection in the form of standardized tests or assessments in general? And I would say no. Of course not. And I think without assessment we are not able to answer the critical question, how are we doing? So assessments in and of themselves are useful I think. But I think we're overly reliant specifically on, sort of, mass inspection style standardized testing like in the form of state testing as the, sort of, key way that we're trying to ensure that there's quality throughout the education system.

0:18:26.0 AS: It's interesting because I'm thinking about in the case of a business, inspection is an internal activity that has happened in the past, and our objective is to get rid of that and build quality into the process and the system. But as a business, you're ultimately judged by the quality and you know, value that your product provides. And you'll instantly get the customer feedback by looking at the revenue that you're getting or not getting when you bring that product to market. Whereas in the case of education, what my question to you is, is the signal that we get from business, from the customer. Like, it's just so in your face you go start up a company, you put a million dollars in it, and you don't get any revenue. You think, oh my God, I really messed up. Or you've got a defect in something and it causes a recall and a big cost and, you know, a lot of damage to your reputation. It's just right there in the revenue numbers. But is there a disconnect in that for education? Or is there something that I'm missing in education?

0:19:42.8 JD: I don't, I don't think there's a disconnect there. One, every day a student, let's say a 10 year old student goes home and their parent says, how was school today? Do you like your teacher? Those may be a little more qualitative but they're pretty powerful, you know, 'cause you're getting this report back, every single day. In our case in our specific case where I work at United Schools Network in Columbus, we're a public charter network, and so there are no kids that are assigned to us by geographic boundaries. So we have to go out and recruit every student, sort of, in a grassroots way, knock on doors, make calls, send mail, do tours and open houses, those types of things. And so if people aren't satisfied with our school program, they literally walk out the door to another school. They have other schools they can go to. That's pretty powerful as well, that enrollment factor, that would be a little bit different in a traditional public school. But they... People do... When you think about going and buying a house, for example, one of the first things most people do is check out the school system. Or...

0:20:54.4 AS: My parents specifically, you know, looked at that when we moved to the town that we moved to in Ohio. And my dad's work was not in Ohio, it was in Detroit and other areas, but he ended up, you know, he was traveling as a salesman, but he ended up choosing, my mom and dad chose that town because of the reputation of that school. And so, yeah.

0:21:15.4 JD: Yeah, yeah. And really when you think about Principle 3 too, and specific to standardized testing, it, you know, the way I'm interpreting Deming's Principle 3 and then applying for education - it's not, it's calling for the elimination of the dependence on standardized and other types of tests as the sole measure of quality, not necessarily for their elimination altogether.

0:21:42.4 AS: What damage does...I mean, for those, there's a lot of people that may be listening or viewing that think, wait a minute, I mean, standardized testing is what it's all about. I mean, I want everybody in the school system to be tested on the same thing so I can figure out, you know, which one's doing a good job, which one's not, which students, you know, blah, blah, blah, blah, blah. So just for a moment, if you could just explain why standardized testing, what are the flaws with standardized testing?

0:22:07.0 JD: Well... Well a big thing is I think there's a big difference between mass testing as an attempt to provide, you know, sort of the customer or the student or the family with something they won't complain about, and the use of assessments to provide guidance toward improvement of, you know, a learning process. And I think, you know, too often or not, we're focused on the former and not the latter, right? So I think standardized testing, let's say state testing I think can provide some useful data hypothetically, but what often happens is it gets used in all these other ways.

0:22:53.8 JD: It's sort of this mass inspection through testing, it's costly. A lot of times, you know, it's unproductive. It basically sort of sorts out sort of good from bad, but doesn't really contribute to progress, right? Just , sort of,year after year low score or the low scoring schools, sort of, score low and the high scoring schools score high, right. I think another thing, another problem with, sort of, mass standardized testing at the population level is that it sort of introduces this idea that there's an acceptable level of defectives, right? Because in most states, there's, sort of,some goal for the percent of students that are gonna be proficient on state tests. In Ohio for grades three through eight, that goal is 80% of the kids will be proficient, and that's acceptable. But then that also means that one in five students, 20% aren't meeting that standard. And that sort of, you sort of lose sight that there's [laughter] this whole bucket of kids over here that you know, you can meet the goal, but you're really leaving behind a whole sort of a significant minority of the students taking the test.

0:24:21.9 JD: I think there's also this, sort of,direct contradiction to the philosophy of continual improvement. You know, the Deming philosophy is to build quality into the process in the first place. And that quality doesn't come from this inspection mechanism. You have to go upstream to improve the teaching and learning processes. And I think something like classroom assessments are a much better tool for identifying these upstream processes. And that's kind of a cool analogous to what you were talking about. You know, in businesses where there is inspection that is happening sort of at the local level, and there's not, sort of,like a regulatory or government agency doing that work for a private business.

0:25:07.4 AS: It's interesting that you highlight the word dependence and when you talked about it earlier, and if you think about what we're being told by Dr. Deming is to focus, shift our focus from the end of the, or the output of the system to the input and the processes of the system. And I think that that, you know, helps us to frame, it doesn't necessarily mean that we absolutely no longer do any inspection and there's no more testing. But what the important thing is, is we've got to shift our focus to the beginning of the process rather than the end. And I suspect most, you know, senior politicians and government officials are just focused on the end, just get the result. Come on.

0:25:52.7 JD: Right. Right Yeah. I think, sort of, to capture this, you know, Deming said, this system of sort of make and inspect, if it's sort of applied to toast, it would be expressed sort of, you burn I'll scrape, right? So that's, we've sort of already burnt the toast, so to say, and we're scraping it by sort of saying, "Oh, well we have the state testing system, that's got how we're gonna improve things." And really alls we're doing is scraping the toast.

0:26:21.2 AS: So let's talk...

0:26:23.1 JD: Oh, sorry, go ahead.

0:26:23.5 AS: I was gonna say, I wanna hear your thoughts on grading next, but good.

0:26:28.2 JD: Yeah this is where things...

0:26:29.4 AS: You got more on standardized testing, feel free.

0:26:29.8 JD: No, no, No. This is a good segue. You know, I think in that turn to grading, it gets a little even more controversial probably because Deming didn't suggest that we merely cease dependence on grades. He said we should abolish them. And again, this is where in, sort of, credibility as a practitioner, those 50 years as a professor, he did this, he did not, he did not issue grades to his students.

0:27:00.7 JD: I think it's really worth noting here, this has nothing to do with making things easier for students. It doesn't have anything to do with low-scoring students' self-esteem. Has nothing to do with that. Instead, it's, this idea is based on this more sort of fundamental premise. And this is really key. We want students to experience success and failure on schoolwork as information rather than reward and punishment. And grades themselves are inherently about experience things as reward and punishment. And that really comes... Those ideas come from author and, sort of, social science researcher, Alfie Kohn, who many Deming practitioners and followers would be aware of Alfie's work as it relates to education and parenting and cooperation and competition and those types of things. And I think one of the things that, sort of, pulled me into this way of thinking when... I think it's in this book called Punished by Rewards. He did this... Alfie Kohn did this comprehensive review of the research literature on grades. And it really compared students who got grades to those who didn't. And he found these pretty robust differences. Three of them. So the first one is that kids who are graded tend to become less interested in the topic they're studying. I think that's really important. This includes, actually, the specific topic, as well as the, sort of, subject area more generally, such as math or writing compared you know, to students who got the identical assignment but with no grades involved.

0:29:00.1 JD: Second thing is that kids who are graded, when they have a choice to pick, they pick the easiest possible task. Because if the point is to get a high grade, it's only rational to pick the easiest book to read or the easiest assignment to do. So what that tells us is that grades, sort of, inherently lead to kids avoiding intellectual risk taking. That's problematic. And then the final thing, the third thing is that kids who are graded are more likely to think in a superficial or, sort of, shallow fashion. So they're more likely to ask questions like, "Do we have to know this?" as opposed to more thoughtful questions about the content itself. So...

0:29:41.7 AS: And just to highlight, is that book called Ungrading: Why Rating Students Undermines Learning, and What to Do Instead?

0:29:50.3 JD: No, this is Alfie Kohn's "Punished by Rewards."

0:29:52.9 AS: "Punished by Rewards." Okay, that's another book that he did a forward to. Okay, I see.

0:29:57.7 JD: Yeah.

0:29:57.9 AS: Okay, "Punished by Rewards." I'm looking for it. And I know everybody could search for that too. So, keep going.

0:30:03.5 JD: Yeah. And it's got a longer subtitle about gold stars and things like that. But I think fundamentally, it's this displacement of the, sort of, core priority from learning to the grade that's at a heart, that's at the heart of both Deming and Alfie Kohn's philosophy in this area. I think Deming went as far as to say that the specific losses from grading practices are "unknown and unknowable, but likely catastrophic." [chuckle] So he didn't mince words there. So just sort of recapping that one, it's you know cease dependence on standardized testing to get to quality. And then he is saying abolish grading, because it does so much to put kids on the path to, sort of, gaming the system, shifting the focus from the learning itself to trying to get the reward that comes with a high grade or this thing or that thing that's handed out as a reward for high grades.

0:31:15.0 AS: Got it. "Punished by Rewards."

0:31:16.6 JD: "Punished by Rewards."

0:31:16.7 AS: It's the 25th edition that's come out, "The Trouble with Gold Stars, Incentive Plans, A's, Praise, and Other Bribes."

[laughter]

0:31:24.0 JD: Yep, that's the one. That's the one. It's a heavy read. It's worthwhile. It's a good read. It's... Yeah.

0:31:30.2 AS: It comes as an audio book too, so that could be, read by the author. So, interesting one.

0:31:35.3 JD: Absolutely.

0:31:35.8 AS: I'm gonna check that out. All right.

0:31:37.3 JD: That's a good one. It's a commitment.

0:31:40.1 AS: So how do we wrap this up?

0:31:43.2 JD: Yeah, that's a good question. I mean, I think again, I think a key thing to, sort of, understand is, sort of, we're studying these 14 Principles, one or two at a time. But anybody listening to this, I think it's really important not to lose sight that these things are mutually supportive. It's a System of Principles, and you have to have all 14 connected together in addition to the System of Profound Knowledge. That's why this gets so hard. You have to understand all of this. And you can't just put it together like a recipe or, you know, pick this one. I can get behind ceasing dependence on standardized testing, but I can't get behind abolishing grading, right? You can't do it like that. You can't disconnect these things. They're all sort of tied back to the underlying philosophy.

0:32:38.3 JD: So I think that's a really important thing. And, you know, because it's not a program or, you know, a project to be implemented, it really requires a, sort of, neverending commitment to both learning and quality. But it is discontinuous. You don't have to do everything at once. You can't do everything at once. Instead, what this allows you to do when you start to understand some of the methods is you start to understand, okay, what is our system capable of on any number of fronts? And then we can set more realistic goals together to, sort of, step towards improvement, real quality. So that's, sort of, what I would take from this entire distillation of the 14 Principles.

0:33:27.2 AS: And I would wrap up by saying, you know, there's a pot of gold at the end of the rainbow that most people don't see. [laughter] There's... We see what's in front of us, but the truth is, by starting to adopt the principles, what's happening is you're just trying to make a transformation. And part of that transformation is that you're seeing the opportunities in the world that you didn't see in the past. And conventional thinking, what we've been taught in the past has given us our perspective. But when you start to remove the blinders and say, "what would happen if we remove grading? What would happen if we ceased dependence on standardized tests?" And we said, "We are gonna look at other ways of doing this."

0:34:09.6 AS: What would happen if we really started to adopt this philosophy and the System of Profound Knowledge to really set a long-term direction? What you are gonna find is so much unfolds. And so today's discussion, just to kind of wrap up, adopting, Principle 2, adopting the new philosophy, talking about the teaching process, understanding variation with the ultimate goal of improving, and improving the outcome for students. And ultimately that's a transformation that your organization can go through. The other one is Principle 3, which is ceasing dependence on inspection to achieve quality.

0:34:51.2 AS: And you really focused in on: hey, standardized tests and grading, which I think is a challenge for everybody to think about. If you are saying that so strongly, and Deming was saying that also there's gotta be something there, right? And ultimately, as you said, the product of education is high quality learning and, it doesn't say, completely get rid of any kind of tests or any kind of assessment. But I think that what you are also trying to get us to do is look at the beginning of the process and then use feedback that we are getting through tests and assessments to go back and improve the beginning of the process. And ultimately, I think, I would end my summary of what you said with, of this discussion with what you said about, that you want students to experience success and failure as information, not reward and punishment. Anything you would add to that summary?

0:35:49.0 JD: Yeah, the only thing I would say is, a disclaimer. I certainly have not figured this all out, and I work in a system and we have not abolished grading, for example. Because you, another thing you have to do is you have to design a replacement that has to be a part of the process. So in the book, I suggest some questions. I don't suggest necessarily an alternative system. I haven't got to that point with grading, but I have a series of questions people can ask to start to think about what their grading policy is. So it's a process, I'm not, I definitely don't have it all figured out. I'm still working on it.

0:36:26.4 AS: Yeah. And, I'll just wrap up that last bit right there and say that if you were in your own environment where you weren't under government regulation or you weren't required to do this or that, you don't have to have a replacement. So for instance, in my case, in my coffee business, we just heard so much negative about the performance appraisal system that eventually we just, like, we are gonna stop and people ask, "well, what are we gonna do instead?" And I said, "I don't care what we are gonna do instead." This is, we've already evaluated that this is bad. Everybody's saying it, we know it, we've learned that, we've seen it internally. So our first job is to stop what is not working. Now, it would be a dream if I could replace it with something amazing that is working, but wouldn't we all already have that? So sometimes we are caught into this system that this thinking that we have to have a substitute or new way. And that's not always the case. But when you are under a lot of constraints, then, you are kind of forced to that. So I just wanted to open people's minds to that. And, anything you would add to that before I close?

0:37:38.4 JD: No, that's really interesting. I... I'd love to hear more about how that's gone since you guys did that.

0:37:44.1 AS: Yeah, it's okay. We never really done a replacement. We did it a long time ago and we never really...

[overlapping conversation]

0:37:48.6 JD: That's cool.

0:37:49.5 AS: So our, I mean our replacement is feedback, coaching, sitting down, having meetings and, but we don't, and when it comes to compensation, we came to some, different conclusions that we wouldn't compensate people for their individual performance. The compensation would be related to the performance of the company with a very clear system of how the success of the company comes up in additional profit and how that's allocated to each person based upon, first their salary. So there's a market component, the market rate component, then based upon their years of service, which we want to reward, and then based on a fixed amount so that people who aren't making the biggest salaries in the place still always get something, that's meaningful to them. So there's lots of alternatives and, let's keep thinking about it. And that's, I think what you bring to the whole Deming sphere is to start thinking about that in education.

0:38:48.6 AS: So John, on behalf of everyone at the Deming Institute, I want to thank you again for this discussion. For listeners, remember to go to deming.org to continue your journey. Also, you can find John's book Win-Win, Dr. W Edward Deming, the system of Profound Knowledge and the Science of Improving Schools on Amazon. This is your host, Andrew Stotz, and I'll leave you with one of my favorite quotes from Dr. Deming. "People are entitled to joy in work" and that counts in education.

David and Andrew's discussion of how using Deming in the classroom not only inspires achievement it also creates collaboration among excited students.

TRANSCRIPT

0:00:01.9 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, we continue our series of Deming in Education with David P. Langford where we explore Deming's thinking to create joy in learning. David Langford has devoted his life to applying Dr. Deming's philosophy to help everyone get the most out of learning. Today's topic is "By what method?" David, take it away.

0:00:28.9 David Langford: Great. So in previous broadcasts, we've talked a lot about deadlines and processes, and operational definitions and quality standards and all kinds of things like that. So today I wanted to talk about, "By what method?" Dr. Deming tattooed that on my forehead, because so many times people would propose things to him and he would say, "By what method?" in his Deming voice. It's all about the method of what it is you're going to do. So what I learned to do is, instead of trying to calculate, "Is this a 92 or an 88 or 88.1?" and then I got the student upset with me, and then because I gave them an 89, I messed up their GPA, and now, so now they're not gonna get a scholarship, and now Mom and Dad is mad at me and it just goes on and on and on. And so, instead of trying to improve that process, I started working on a method to completely get out of it, and especially today, especially in K-12, lots of schools are trying to go to what they call standards-based grading, where they want all students to achieve, but unless... If you start applying a new theory like that, but you keep it in the old system for the last several hundred years, you're gonna have problems.

0:02:08.0 DL: So I had to figure out how can I do that? What can I do? Well, over time it slowly evolved into a process where if somebody turned in an assignment and it met or exceeded the standard for the assignment, then I started to say, "Well, you got that one", to kids and students. Well, that finally, I started to realize, well, why can't that just be my grade book? Either you got a one, which signifies that on this assignment, you did it to standard and you did everything required and you got a one, or it's just blank. If it's just blank, it means you still have to keep working on it to get a one.

0:02:57.9 AS: Just to clarify that. When you say met or exceeded, that's one statement, that's not saying met is one thing and exceeded is another. Is that correct?

0:03:06.3 DL: That's right.

0:03:07.2 AS: Okay.

0:03:07.3 DL: Because yes, we have a quality standard with this assignment, but I may be really interested in this, and so I did a whole bunch more than was required. Right? And so, I still wanna recognize that with students, "Look at, look at this, look what this. You did this and you went above and beyond the standard." Right?

0:03:27.8 AS: Right.

0:03:28.3 DL: So you still get a one for doing that, and I'm not gonna take away your desire to go above the standard by giving you A+++ or all kinds of games that teachers play. You got that one, which is awesome, and the rest is just joy and learning for you. Or if you went above the standard, okay, I might give you a chance to share what you did with the rest of class.

0:03:58.6 AS: That's what I was just thinking about. Yeah.

0:04:01.8 DL: Yeah, yeah. And I'm gonna ask you, I'm gonna ask you, "Would you be willing to share this?" I'd say, 99% of the time, kids said, "Yeah, yeah, I'd be glad to share this." And I would say the same thing to them. "Okay, but when you share what you did and the level you took this to, I want you to describe by what method did you do that."

0:04:23.2 DL: And it was so fascinating because students would say, "You know, this is what I did, and this is my project, and this how it turned out, and I'm really proud of it and everything... " Okay, by what method did you do that? "Well, I set aside 10 minutes every day just to work on this project." And amazingly, you'd see other students in the class go, "Oh, that's how they did that. They weren't just smart." Right? Because the traditional system pegs people like that. You got smart kids and the not so smart kids, right? And kids start to learn, "Well, she's just a lot smarter. So that's why she could do that." No, she had a method. Right? She may be smart too, she may have a preponderance of neurons in that part of her brain that just helps her be really good in that area. I also bet that person had a method that got him to that level, and if I give them a chance to share that method, other people can learn from that.

0:05:29.5 AS: Can I go back? Just take a step back and talk about when Dr. Deming said, "By what method?" Let's just talk briefly about what he meant by that, because sometimes, you know, we have scrutiny, let's say in management, in companies, by saying, "I don't want you to hit your goal by doing something unethical. You've gotta live up to our values. So if that's your method, don't do it. But any other method, I don't care." Right? So we oftentimes think "by what method" only applied maybe to the ethical behavior of an employee, but why is Deming saying, "By what method?"

0:06:05.6 DL: Well, you have the same thing in education. Why do we have cheating in education? And then, teachers start spending all their time trying to catch the cheaters, right? So they come up with all tricks and even when taking SAT tests and national tests, right, "We have to space them four feet apart and we have to do this, and we have to have it timed, and you have to have to work this, because we have to catch the cheaters, and that's our job because we think are our job's inspectors", right? Well, when you start to take all of that out and saying, "Well, no, that's not my job. My job is to set up the environment and the system in such a way that you can achieve, and if you don't get it to the level I want you to get to, what's gonna happen, well you're gonna get help". Novel idea. And in some cases, you're gonna get a lot of help and it's gonna be pretty intense feedback that it turns out, in neuroscience, that in order for you to switch on basic, your learning genes, you need intense and immediate feedback on stuff. So the quicker I can get you feedback on stuff, the more likely are, you're gonna change it and you're gonna make it.

0:07:25.3 DL: I never forget, my son was in high school in an honors English class, and he worked at the beginning of the school year to write this really difficult 15, 20 page paper that they were required to do and everything else. Well, he didn't get it back 'til the following February, after he'd written it in September. And to the teacher's credit, she had 130, 15, 20 page papers to get through, but by the time he got his paper back, I remember him bringing it home and he said, "Yeah, I don't even know what we were doing or why we even wrote this thing." So the feedback really wasn't useful because it wasn't immediate and it wasn't intense, and getting into that point. So, I wanna get back to "by what method are you gonna track this performance" because as you work through, and that's where the idea about the ones emerged, and it emerged with students where they said, "Oh, that's an easy one," they had lots of good metaphors like, "Did you get that one?" And, "Oh, that's an easy one." And "What happens if you didn't get that one?" Well, you can go to somebody who did get their one. Maybe somebody turned theirs in early, and they got a one that met or exceeded the standard... This would be an awesome person for you to go to and get feedback from them.

0:08:52.0 DL: So all of a sudden I was doubling and tripling and quadrupling the number of teachers in the classrooms, because all of these students could help other students if they want to. You don't have to, but if you want to share, share your information. Now why can't can you share your information about how you mastered something or achieved at a high level? Because it's not working to your detriment. See? And the fact that I got my one, and then you work to get your one, is not hurting me at all. I am still, I still aced this, I still got it all correct, whereas...

0:09:34.2 AS: So you're taking a competition that people are, and the ranking and the striving, and the idea that there's only gonna be five As in this class type of thing, and trying to make it more cooperative. Let me ask you a question about the zeroes and one. For the typical teacher or professor out there, are they able to use zeroes and one? Or are they forced to do A, B, C, D, F?

0:10:02.7 DL: Well, some of that goes into what kind of learning management systems do they have in place and does that fit? Does a round peg fit in a square hole? And how could you do that? And lots of methods to make it happen, if you wanna do that.

0:10:21.8 AS: You get a lot of objections, I'm sure, from people saying, "No, you have to have that competition or else people are just gonna, the students are just gonna be lazy and they're not gonna be excited, and you gotta motivate them through this competition and internal competition in the classroom" and all that, whereas when you...

0:10:38.1 DL: Creating that artificial competition just causes more students to quit, give up, do poor quality work because they already know they can't compete with these top level kids that are in the class, so why would I even try?

0:10:53.2 AS: I'm just thinking, I'm just writing down the idea of we want to inspire them to learn, not pound them or rank them into learning.

0:11:05.0 DL: Or do things to try to motivate them to get it to that level. All true motivation is internal, and unless you're creating systems that enable the individuals to tap into that, you're not gonna motivate people. And students are gonna get away... You could punish them. You could do all kinds of things. I read an article just recently, teacher was pontificating, "Should I finally get rid of depriving students of recess to get them to do work?"

0:11:42.8 DL: I think Dagwood in the cartoons one time said, "That's a great idea 'til you think about it." That, here you have, especially at an elementary level, kids that desperately need to get out and run around and get the cerebral fluids going up and down their spinal column, and come back with a renewed sense of energy. Right? And to attack stuff.

0:12:10.1 AS: It's exactly what they need.

0:12:13.2 DL: Right. Exactly what we need, but no, I'm gonna deprive you of that and force you to stay in during recess and now you're gonna be tired and upset, etcetera. And now I got that to deal with on the other side. You just compound your problems over and over, and probably 94% of the reason that they didn't get the work done is the fault of the teacher and the system to begin with.

0:12:37.4 AS: And coming back to the idea of the teacher that goes, "Oh, David, so what now, I have to inspire my students?"

0:12:46.2 DL: Well, that's what... Books have been written on that, and that's been going on for years and years and years. But the thing is, students are already inspired. So, the only thing you can do by trying inspirational methods is de-motivate them to give up. Right? And even... I remember having students come into my class on the first day of school, and just three or four of them just put their heads in their desk and not even look up, and it was hard for me to start to believe, "Oh yeah, these guys are inspired." But if you go back in their history, and these were high school kids, well, for the last 10 years, what, they've been beaten down by grading systems and told they can't do stuff and punished into compliance and rewarded and punished and over and over and over... "It's just a whole lot better just to put my head down and pretend to go to sleep and endure this rather than actually try to participate." So when you get to that kind of a situation, you have to think about, "Alright, I have to change this situation," and watch how behavior changes, rather than what most educators even today are taught. They basically leave the situation alone and try to punish people into compliance with that.

0:14:10.1 AS: Yeah, so for the listeners out there, think about it. Where in your life are you trying to punish or browbeat compliance, versus inspiring excellence? And I'm thinking myself, David, about my challenge I faced with my mother and trying to figure out how to keep her healthy at 84. And, yeah, recently it's been a bit of browbeating, and you've made me think. And I think that this discussion helps all the listeners think about that. I want to just go back to the topic and I wanna try to summarize and see if you can bring what you want the takeaways to be. The topic of today's discussion is, "By What Method?" What are the key takeaways that you want the audience to get as we wrap up?

0:14:56.5 DL: Well, if I think about Deming talking about the evils of grading systems, so if I'm not gonna do that by what method am I gonna do? As a teacher I do have to track progress and I do have to know that people are achieving, etcetera. So by what method am I gonna do that? And what I'm describing is not necessarily the only method, it's the method that I came up with the help of my students over many, many years. And that enabled for almost every student to get an A. And as a high school teacher I saw about 135 kids a day in about six different class periods. And before I met Deming, when I looked back at the grades that I had, the highest number of As I ever got was about 10-15% of students in that process. And when I went to this method I was getting, out of 135 kids, one year I got 133 kids that all had As. And I didn't, it wasn't like we got smarter kids. [chuckle] I got a new method by which students could get there. And change the method, you get a different behavior, and you get a different result.

0:16:14.6 AS: Great. So David, thanks for your contributions and on behalf of everyone at the Deming Institute, I wanna thank you and our listeners for striving to bring joy in learning.

Scott's story starts in 1986, as a graduate walking in the doors of P&G to be a new engineer and shift manager. He was soon perplexed by how he could contribute to solving issues associated with production and quality. During this time, P&G introduced the Deming Philosophy to the organization; a decision that would have a profound impact on Scott's professional and personal life. Scott eagerly applied what he learned, despite facing resistance to change and improvements. After three years, he decided to move to a smaller company where the Deming principles were readily embraced. Listen as Scott discusses how he leads a highly inventive engineering organization whose focus is on innovation and the advantage gained through the embrace of Deming's continual improvement philosophy. Hear his fascinating approach to hiring employees without factoring in schooling and GPA, and a discussion between Tripp and Scott on the challenge presented by ISO 9000.

In this episode, John Dues and Andrew Stotz discuss the first part of John's path for improvement model - setting the challenge. Using an example from United Schools Network, John explains their aspirations for cutting chronic absenteeism rates.

TRANSCRIPT

0:00:02.4 Andrew Stotz: My name is Andrew Stotz. And I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with John Dues, who is part of the new generation of educators striving to apply Dr. Deming's principles to unleash student joy in learning. And the topic for today is "set the challenge." John, take it away.

0:00:24.6 John Dues: It's good to be back, Andrew. Yeah. Last episode, we kicked off this new series. I introduced this improvement model that we can use to help us set ambitious goals backed with a sound methodology. I think I made this disclaimer last time. I'll make it again that this is sort of like showing listeners a peek behind the curtain because we're sort of talking about this as this model is being built and used for the first time in my network of schools here in Columbus in United Schools. So I think that caveat's important, and I think maybe starting with just a quick review of the model we looked at last time would be a good refresher for this episode for those that are reviewing and I'll talk through it for those that are only listening. I'll go ahead and share my screen quick. You see that all right?

0:01:17.1 AS: Yep.

0:01:18.4 JD: All right. Yeah, so this is the model we kind of stepped through kind of an overview last time. I think it's important to remember a few things. One, basically the core idea of the improvement model is it gives us the scientific way of thinking so that we can work in a way that makes sense to close the gap between our sort of current conditions in our organization and sort of our aspirations. So we frame those two things as the voice of the process, as current conditions, what's happening right now. And then the future aspirations, that's the voice of the customer. That's sort of what we or someone else wants those conditions to be. And what we're doing throughout this process is stepping through the four steps that you can see displayed in the model. So kind of just stepping through those quick.

0:02:06.5 JD: The first thing is that we set the challenge or the direction, and that's gonna be... We're gonna dive deeper into that step today. Then the second step over on the left hand side of the model, for those that are viewing, you work to grasp the current condition, so what's going on currently in your organization. And then the third step is we establish the next target condition. So think of that as like the intermediate goal that we're working towards sort of on a more proximate timeline. And then fourth, what we're doing is once we understand those things, then we're experimenting to overcome obstacles or impediments. And so all of those things we talked about, doing that with a team that includes someone or people working in the system, in our case students, a lot of the time, those with the authority to work on the system like the teacher in a classroom or the principal of the school building. And then that System of Profound Knowledge coach that has that awareness of the System of Profound Knowledge and sort of brings that lens to the improvement efforts. So that's sort of a quick rehash of the model that we went over in episode one. And then I'll stop. Well, you want me to leave that up or I can stop sharing?

0:03:29.9 AS: Either way. I don't mind.

0:03:31.0 JD: Okay. Well I'll stop sharing for now and then we can always pull it back up if we want to. Yeah. So with that sort of in mind, what I thought would be helpful is then do this deep dive into step one. And so kind of what we'll do through the next several episodes is focus on each of the steps. So we'll take this deeper dive into step one. Set the challenge or direction. So last time I mentioned that in step one of the model we asked this primary question, where do we want to be in the long run? And this is... Think about this as a overall challenge or direction that's set by organizational leadership typically. So senior leaders, the CEO, typically the board, they're gonna be the ones framing this challenge, setting the direction for the organization.

0:04:27.2 JD: And we can also think about it as a sort of a longer range goal that if we accomplish it, it will differentiate us in our case from other schools or if you're in the business community, it would differentiate you from competitors in some way. But even though it's something that we're striving toward currently we're setting this in a way that it's gonna stretch us and right now it almost seems impossible to accomplish this thing far out into the future. And this direction or challenge, I think it's fairly typical. Sort of set this on a six month to three year timeframe. So that kind of gives you a sense of sort of how far out we're looking and the timeframe we're looking to sort of achieve this challenge is. And last time I shared an example from our most recent strategic planning where we're trying to reduce our chronic absenteeism from the current state, which is 52% chronic absenteeism. We're trying to take that down to something closer to 5% chronic absenteeism.

0:05:44.4 AS: Seems nearly impossible.

0:05:44.5 JD: It does if you're on the ground in schools right now, especially schools like ours, it really does seem nearly impossible to sort of cut it at that large of a rate. So.

0:05:55.6 AS: I have an ethics class that I teach here, an ethics and finance class here in Bangkok. And I tell the students it's not mandatory to attend class from my perspective. School may require you, but it doesn't matter to me. My job is to make it so exciting and interesting that you wanna be here. That's hard.

0:06:16.7 JD: Yeah. That's a good frame. That's a really good frame. We have, unfortunately we have so many obstacles that our kids are going through to get to school. Even something as simple as consistent transportation from yellow school buses is a major impediment to school attendance here in Columbus. So there's all kinds of obstacles that... Challenges in front of us that we're gonna have to improve and solve to get down to that 5% rate.

0:06:43.0 AS: When I was growing up in Ohio, in Hudson, outside of Cleveland, the farm that I worked on in the summer, Barlow's farm. Mr. Barlow was our bus driver because there wasn't much going on in the wintertime. And so, yeah, he never missed [laughter] I don't ever remember a bus not arriving in my whole youth.

0:07:07.6 JD: Yeah, yeah. It's something in many places you take for granted. And then in a number of other places, it is a major, major challenge for sure.

0:07:13.0 AS: Interesting.

0:07:14.8 JD: That's certainly the case in Columbus where we are, for sure. So when we think about this challenge it's this... I kind of think about it and this is why it needs to a lot of times be set at the leadership level or the senior leader level is it's this new future condition and it serves as a sort of compass for us to follow. And that's important 'cause we don't have an exact roadmap for how to get there. So it's sort of like a general direction, but the specifics are what we're gonna have to be filling in as we go through some of those other steps. Some of those intermediate goal setting, some of the experimentation that I talked about. But think about this direction or challenge is it's really the purpose behind our efforts. And then when you sort of put together the tough challenge and then the scientific thinking, that's really powerful. And those two things together can really sort of move you into this new territory. I think that you're looking to... I think this map territory compass metaphor is really sort of spot on for this particular model. Oh, go ahead.

0:08:29.8 AS: I had a question because I have a client of mine and one of their objectives is to list their company on the stock market here in Thailand. Like many companies, but in some ways that's kind of an owner's goal. Like we've talked about some of their other goals, like being the leading company in their field in asia, Southeast Asia or something like that, and/or maybe to have a happy workforce or whatever. And I'm just curious, like how do people think about goals? What is a good way to think about it? Is there such a thing as like an internal or a higher level goal versus a goal for the company versus an external goal? How do you guys think about those types of things and target conditions?

0:09:17.2 JD: Yeah, I mean, I think... I don't know the exact answer. I mean, I think when you set a goal at the leadership level, then you're gonna... Well, one, you're gonna have to explain it throughout the organization, whether it's a 100 people or a 1000 people or 10,000 people. And then depending on the size, there's probably gonna be different types of goals that are in different business units, I'm guessing by business type. We're a pretty small organization and so we're pretty close to the... In fact, our office... My office, it is on the ground floor of one of our middle schools, so we're very proximate compared to like a bigger company. So I think this can look different in different places. I think the consistent thing is it's gotta be clear, it's gotta be spelled out, it's gotta be clearly communicated. It has to be something that you're talking about frequently. Otherwise you're obviously not gonna move in this direction.

0:10:11.2 AS: Yeah, I mean, that kind of answers it too. 'cause I thought... When you said that, I also thought about how people care about with them, what's in it for me. And so, as you said, you gotta explain it and you're gonna have to do a lot of talking about it. So people need to see that that goal is something that's gonna bring them value, otherwise they're not gonna be excited to go do the hard work that it takes to get there.

0:10:37.0 JD: Yeah. Maybe in that respect, like sometimes in education is... Some of the goals that we have set are so self apparent that there's just sort of immediate buy-in 'cause like who's against kids coming to school? Almost nobody. So that's I think a fairly easy one to get buy in. And maybe in other settings more time needs to be spent on the buy-in part, the explanation part. Maybe... This can be kind of hard, but who's involved in setting the goals in the first place? Maybe there's ways to get more people involved in that process.

0:11:10.6 AS: Well, and maybe the kids aren't involved in the buy-in.

0:11:13.8 JD: Yeah, that's true. That's true. Although, yeah, like the yellow bus thing that's out of their control. And I'd say that's actually a major obstacle. But I think...

0:11:26.5 AS: That's true. Nowadays, I'm sure there's plenty of kids that wanna be there.

0:11:29.5 JD: Oh yes for sure.

0:11:30.9 AS: But there's obstacles all over the place for them.

0:11:34.3 JD: The vast majority wanna be there, actually, I think. But your point is good, and that goes back to that team they're the ones working in the system and so they're gonna be the best at identifying the obstacles. So to stay in our setting, they certainly need to be a part of the experimentation that happens to improve the chronic absenteeism rate. One other important caveat to point out at this step in the process, and we've talked about this a little bit but I got this little chart that I think will help sort of explain when we were setting this direction or challenge, it's what I would call like an improvement goal. And it's not an accountability goal. And I think it's really important to be explicit about the difference between those two things.

0:12:24.4 JD: 'cause they often get conflated. And so I had built this chart for another improvement project, but I think it does a really good job. So I'll share my screen again. I think it does a really good job of sort of outlining the difference. And it's not that one is necessarily better than the other, it is just really important to know what's the purpose of this particular type of goal and what's it used for. And so I was just gonna take a moment to kind of run through this. So on the left you have sort of some key questions that are answered either by... And here it says measurement for accountability, but you can sort of replace that with an accountability goal and improvement goal over there on the right. So you have measurement for accountability or accountability goal, and then improvement goals or measurements for improvement.

0:13:20.7 JD: And you have some questions that that particular type of goal or measure will answer. Then you have in the next row their specific uses. And then why quality measurement matters. So just starting with accountability goals or measurement for accountability what those types of goals are gonna do is answer questions about merit or status or accomplishment of someone or something. Who's performing well, who isn't, who should be considered knowledgeable enough to do X. We're talking about end of line outcomes, like end of year outcomes. They're often... Goals for accountability often happen once a year. So I've talked about this repeatedly, but state tests would be a very good example of an accountability goal. The point of doing that is to separate the good from the bad basically, when you look at state test. Down there in the use sell for those that are viewing, it says the purpose of, or the use for accountability goals is to determine the applications of rewards or sanctions. Right? And so it's none of this really has to do with improvement.

0:14:38.8 AS: Sanctions, what a word, [laughter]

0:14:40.4 JD: Sanctions, right? Yeah. I mean, this happens in schools all the time. Schools can be sanctioned depending on what the law is at the time as it relates to state testing and accountability system.

0:14:50.9 AS: I thought we only sanctioned Russia [laughter] Okay. So there's even sanctions in schools. Okay, got it.

0:14:58.0 JD: Definitely sanctions in schools. And then we can juxtapose the accountability measures with the improvement measures over there on the right or improvement goals. When we're talking about improvement goals or setting the challenge, we're really talking about questions about specific changes as potential improvements to systems like our systems. So we're thinking about questions like, are the changes I'm making leading to improvement? How are my changes affecting other parts of my system? And what's measured is outcomes and processes relevant to the object of change. You know and how often are we doing this? Frequently. Much more than once a year, like the state test. And the whole point is to learn our way to a better system, right. And so with chronic absenteeism this could be both a measure for accountability and a measure for improvement, depending on how it's framed.

0:15:57.8 JD: Chronic absenteeism is actually reported on state report cards, but in this case, I'm talking about an internally created goal that we have for ourself that we've created for ourself that our organization is gonna work towards. And there's gonna be various things that we do to see if things that we're trying as interventions, experiments work in improving those rates, basically. So I think it's really important to call this out that when we are talking about this particular improvement model and the four steps, we are not talking about accountability goals at all. We're talking about improvement goals, two very different things.

0:16:37.6 AS: Interesting. And the improvement goals is the type of thing that it seems like is not as common as the accountability. Like everybody's trying to, you do this, you've gotta achieve this, that type of thing. Whereas this is such a bigger picture.

0:16:51.3 JD: Yeah. I mean, I think the key difference is because you could actually have an internal accountability goal. You could set up a similar system internally as what the state does when they're looking at schools. And if our mindset was, we're gonna set this goal and you people over here go do this, figure out how to do it, that would be much more like an accountability goal. But our mindset is like hey, this is something we all gotta take a look at. This has to get better. This isn't working for kids, so what are we gonna do? How are we gonna figure this out? That's really the key difference, you know? You're not doing this for some other group of people. You're a part of that group that's trying to make this thing better.

0:17:36.5 AS: So I'm just curious too, as I think about the listener or the viewer out here is how do they get started in this concept of setting the challenge or direction and maybe there's people at the top of the company. I mean, the first thing that I thought when you started talking about it is Oh, there's so many target conditions, there's so many challenges. Like there should be this one and that one. And all of a sudden I started coming up with like three to five challenges. And then I thought, oh no. Now this is overwhelming.

0:18:11.8 JD: Yeah. So in our strategic plan, we have 13 of these key metrics. And each of one of those could be its own challenge or direction, but they are divided up sort of roughly in like different department areas. And so some of 'em have to do with our fiscal responsibility raising funds and stuff like that. And there's a specific team that does that. And that would be different from like an academic team or a school-based team that was working on something like chronic absenteeism. So there is sort of a divide and conquer. The CEO maybe our superintendent are focused on all 13, but there are different teams that are actually running the experiments and working towards improving these things. And then there's someone like me that's sort of serving as the System of Profound Knowledge coach across multiple teams that are working on each of these key metrics basically. But in terms of where to start, I think that's a good segue. I mean, I think we've answered the question or we've said that basically that this strategic challenge answers the question, where's our organization going next? And I think one good... One simple way to start is to think of completing this sentence: Wouldn't it be great if we could dot, dot, dot.

0:19:37.0 JD: What is that thing or what are those things in your organization? It's, again, going back to it seeming nearly impossible, it's something we can't achieve with our current systems and processes. It's not easy, but not impossible. We think it's achievable even if we're not quite sure how we're gonna get there. It's something that's gonna be measurable. So we know if and when we get there. And another thing is that, especially when you're talking about, you were talking about like communication of these challenges across the organization, these challenges or directions are often expressed as some type of catchy statement. So just a quick statement that brings to mind this entire sort of area of work. And so I was kind of brainstorming because we've been talking about this chronic absenteeism example and I think we can just kind of keep that going throughout these episodes. So I was thinking of something like, every student every day, and then everybody knows that we think it's important for every student to be at school every day. And we're sort of working to get back to that post pandemic.

0:20:52.3 AS: Yeah. I was thinking, wouldn't it be great if every parent was fired up.

0:21:00.1 JD: Yes, absolutely.

0:21:01.2 AS: About every student every day. Like, that's the way I was just thinking about it 'cause I think that, and I just like the kids. I'm sure there's plenty of parents that say, I want my kids to get a good education and I want them to get more than what I got, but I can't reach it or I can't do it. I got too much on my plate. But if somehow they were a party to this.

0:21:26.1 JD: Yep. I think, similar to the students, I mean, I think parents absolutely can be a part of an effort where you work. And in fact almost have to be, especially 'cause we're a K-8 system and certainly at the very least at the K-5 level, kids are almost entirely dependent in most cases on parents getting them to school. So, certainly parents...

0:21:49.2 AS: What is the catchment area of your schools? Like what's the farthest?

0:21:57.8 JD: Yeah, we have pretty, because we don't have a specific geographic assigned area assigned to our school buildings, like a traditional public school district would typically. So we have much wider areas. So let's say, a 15 mile radius around a building would catch the vast majority of the kids that attend. So, yeah. Yep. Well, I think, let's look at an example. Let's look at chronic absenteeism as our focus here. So, I've mentioned, we've just updated our strategic plan it includes these 13 metrics, and there's this one focused on chronic absenteeism. And when we sort of outline the key metrics in the strategic plan, each metric has four pieces of information that we're listing explicitly right in the strategic plan. The voice of the process, the voice of the customer, the operational definition, and then some type of visualization of the data, basically.

0:23:04.4 JD: So those four things go with each of the metrics. So just as a refresher, a lot of people know this, and we've talked about this, but I think it's good to refresh. The voice of the process is the metric that tells us how we're currently performing. The voice of the customer is the direction or challenge we have set, so that's the step one. The operational definition for the metric puts communicable meaning into the concept and includes a method of measurement or test, as well as a set of criteria for judgment. So basically we wanna make it clear to anybody that's looking at chronic absenteeism, that they know exactly what it is we're measuring, and they could come up with that same measurement independently. And then the fourth thing is this visualization that illustrates the performance of the metric over time, because that time factor is really, really important. So I'll share my screen one last time so that people that are viewing this can see what this actually looks like in our strategic plan.

0:24:07.4 JD: And I'll kind of walk people through this visualization for those that are just listening. So you sort of see this chart over on the left or on top of the chart it says key metric three student success, chronic absenteeism rate. So that's the metric. The voice of the process is 52%. So that means that 52% of our kids are chronically absent and the voice of the customer is 5%. So that's that far off thing. That's six months or probably more like three years off that we're working towards. And we're not quite sure how we're gonna get there right now. And then we have the operational definition of the concept of chronic absenteeism. So this says "a student is considered chronically absent if they miss at least 10% of instructional time for any reason. Our chronic absenteeism rate is the percentage of students at United Schools who are considered chronically absent."

0:25:08.9 JD: Now, this particular definition was fairly simple because there's already a sort of a federal and state definition of chronic absenteeism. And then down below the operational definition, you have the data that we have thus far charted over time. So in this case, we only have three years of this particular type of data 'cause that's when it sort of started getting measured at the state level. And so the y axis is the chronic absenteeism rate, the x axis is the school year. So this chart has 2021/2022, 2022/2023, and 2023/2024 school year data. And you can see the data is fairly similar across those three years. Not too unexpected, but it's right around, 53%, 54% in the '21/'22 school year, maybe 52% in the '22/'23 school year. And then slightly less than 50%, let's say 48% of kids were chronically absent.

0:26:11.5 AS: Just outta curiosity, where was that before covid? Let's say 2018/2019.

0:26:17.9 JD: Yeah. Lower. Definitely lower. I think going back historically, if we had that data, I would guess, and I'm sort of guessing based on overall attendance rates compared to what overall attendance rates are and like what chronic absenteeism probably was, it was down probably closer to like high 20s, low 30s, that type of thing. And obviously a chronic absenteeism rate of 52% is very high. But when you look at even the school district buildings that are sort of around these schools, generally speaking, their chronic absenteeism rates are even higher. They're in the 60, even into the 70% range. And so not that this is like a comparison, but you can kind of get some context there that these rates are even higher in the neighborhood schools that are closest to our campuses.

0:27:16.7 AS: It would be a bit shocking for someone in Asia, like myself in Korea, Japan, China, Thailand, who's, it's a much different view of education. But just for the purposes, for someone who doesn't know much about what's happening in the US, what are these kids doing? Are they out working or are they at home?

0:27:40.6 JD: It's hard to know exactly. I think one thing is, is that in some cases, older siblings, like in our middle schools, are often taking care of younger siblings for various reasons. I think that can be a common way, but I think it's hard to just pin on one or two things. I think this is a very complex problem with lots of causal things, causal variables that are going into this. So I think that's why it's so important to study it in our context and try to figure out besides the things that we already know, like busing being inconsistent, those types of things. What else is it that's contributing to this? And so that's sort of what the process that we're starting now is trying to figure this out.

0:28:32.3 AS: And would you equate the voice, is voice of the customer equate it to target condition? Or is there a difference between that?

0:28:42.1 JD: Well, in this case, the way I'm framing it is like the voice of the customer is that direction or challenge, that's step one. So we had to, because this is an internal improvement goal, we decided for ourselves, like what do we think that vision, that purpose, that challenge is out there on the horizon that we're not sure how to get to, but we want to get to in the next two or three years. So I would equate those two things in this case.

0:29:07.1 AS: And who is the customer in the case of a school, how would you view that?

0:29:15.0 JD: Well, so that can be a little tricky based on how you're asking the question. Just from the point of who's the customer and the voice of the customer. Well, it's the leadership that set this like a customer with a capital C, that's the voice of the customer in terms of who's the customer of the school system it depends on exactly what aspect of the school system that you're talking about. But in general, our families and our students, are customers of the school system. But then so are the high schools that we feed our eighth graders into. Those are also customers of the system. But in terms of who the customer was that set this challenger direction, that was our senior sort of leadership team.

0:30:00.7 AS: Okay. And the voice of the process where we're looking at the 52% absenteeism rate, would you call that the current condition?

0:30:11.5 JD: Yes. Yes.

0:30:14.0 AS: So voice of the process, current condition, then you have to have some operational definitions so that we know what we're really talking about. And then a visualization that helps people see kind of where things are at.

0:30:28.3 JD: Yeah. And ideally we would have more data than this, but this is the data that we have. And you can actually see there's this note here 'cause right now it's just a run chart. It's just the data points with a central line running through. But there's this note that says the natural process limits are not included until we have at least five data points. And so we won't include the control limits until we have more data, basically.

0:30:50.4 AS: And for the person looking at this from outside, they're like, so wait a minute. You gotta wait a full year before you get that. But I guess there's a lot of data underneath this that is input data that will eventually drive this output.

0:31:07.8 JD: Yeah, I mean, I think what we do with any data like this that comes once a year, you have to find some proxies. So some proxy outcome data that maybe you're measuring on a every other week or maybe on a monthly basis. And then you have some process data that you're measuring, here's the things that we think will move the outcome needle, and are we doing those things? So you set up different types of measures, sort of intermediate outcome measures, process measures that are sort of measuring the different things that you're trying. And then usually a sort of a third component to that measurement system is a balancing measure where you're making sure that other things in your system aren't, [laughter] going astray because you're putting all your focus on this chronic absenteeism concept. So it's complicated. It can be complicated.

0:31:54.2 AS: It is. And in the area of education, you're under so many different constraints set by government. I was having fun in my mind imagining like when we were young, the Keystone cops, and they were kind of funny, crazy cops. But I was imagining getting an old ambulance with a flashing light and arriving at student's homes and saying, we gotta get you to school urgently. [laughter] And all the fun things that you probably can't do.

0:32:27.4 JD: Yeah. Yeah. Well, that as a brainstorm is not too far off from some of the things that we're thinking about as possibilities in terms of different forms of transportation, taking more control over the transportation where we can 'cause this is a service that's provided by the school district.

0:32:51.0 AS: One thing I did with Google Maps many years ago is I uploaded the zip code or address of my students, and so that I could see clusters of where they were. And then from those clusters, I started recommending, Hey, why don't the five of you guys form a group here and you're in the same area? And then that would help them to make a connection that they may not have made themselves.

0:33:24.9 JD: Yeah, that's a great idea. We have the geo mapping already. Yeah. We.

0:33:29.1 AS: And there's pods basically. So pods are out there of 50 students in this area. So when one has a problem you've got 20 of them that got a problem. If a bus doesn't arrive, is there a way we can get those 20 students communicating with each other and say, we want to get to school, how do we do?

0:33:50.0 JD: Yeah. We said we have some beginning of the year challenges right now with busing and we were making some calls to some of the families, and one really awesome grandma actually said, I'm gonna look into how much it costs to rent a bus and I'm gonna go round. And so that type of problem solving is certainly happening on the ground. It's how to sort of make that systematic and consistent. That's the tougher thing.

0:34:12.5 AS: Yeah. Exciting. Great one, and I look forward to the next one. I'm learning a lot and I know the listeners and viewers are learning a lot. Is there anything you would just add to wrap this one up?

0:34:25.6 JD: Yeah, I mean, I just a couple points maybe to bring it home on set the challenge, I think, one thing is we have to have this model to bridge a gap between current conditions and future aspirations. So that's this improvement model as a whole. There's always gonna be this gap between current conditions and our aspirations. And I mentioned this improvement model has this combination of scientific way of thinking and working to close the gap. And what we did in step one was ask where do we want to be in the long run? And this overall challenge that we set is really set at the sort of senior leader level, becomes a key priority. And I'm really thinking about this. If we can figure this out and some of the other key metrics, it's gonna really differentiate us from other schools. And so I think that's sort of those four or five things are the key frames for "set the challenge."

0:35:19.9 AS: Exciting. Well, I'm looking forward to the next one. Well, on behalf of everyone at the Deming Institute, I want to thank you again for this fun and interesting discussion and really opening up what you guys are doing there and the challenges that you're facing makes it even more real for the listeners and the viewers, and for the listeners and viewers, remember to go to deming.org to continue your journey. You can find John's book Win-Win W. Edwards Deming, the System of Profound Knowledge and the Science of Improving Schools on amazon.com. This is your host, Andrew Stotz, and I'm gonna leave you with one of my favorite quotes from Dr. Deming. People are entitled to joy in wo

What does it mean to "commit" to transformation? What does "transformation" mean? In this episode, John Dues and host Andrew Stotz discuss Point 14 of Dr. Deming's 14 Points for Management - with John's interpretations for educators.

TRANSCRIPT

0:00:02.2 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W Edwards Deming. Today I'm continuing my discussion with John Dues, who is part of the new generation of educators striving to apply Dr. Deming's principles to unleash student joy in learning. This is episode 20, and we are continuing our discussion about the shift from management myths to principles for transformation of school systems. John, take it away.

0:00:31.1 John Dues: Hey, Andrew. It's good to be back. Yeah, we're on principle 14 today, which is Commit to Transformation. So I'll just start by outlining the principle itself. So Commit to Transformation - "clearly define top management's commitment to continual improvement of quality and its obligation to implement the 14 principles, plan and take action to put everyone in the organization to work to accomplish the transformation. Transformation is everyone's job. Start with education for all and positions of leadership." So, basically, we've been through these 14 principles, and the final one is, put it into action, basically. So I think a good place to start is just remembering or recalling what does Deming mean by transformation? And he's saying transformation is a change in state from one thing to another. So we're going from one thing to something completely new, and there's these 14 principles that help us get us there.

0:01:34.9 JD: And of course, when Deming was talking, he was talking about the prevailing system of management and changing into this new system of management and about this sort of, older version, this prevailing style from 30 years ago, which still is the prevailing style today. He said something that was really interesting. He said, it's a modern invention that cedes competition between people, teams, departments, students, schools, universities. And so when... What he is really saying is that when you transform your organization, you work together as a system. And he is advocating for cooperation and transformation. And I think of course, people are gonna say, yes, absolutely, we need to cooperate. And that's, that's the way that everybody wins. But in reality, I think that's not always what's happening in organizations because I think what you need in order to go about this switch is what Deming called Profound Knowledge.

0:02:41.5 JD: And most people don't have an understanding of, of what that is. So what happens I think is that the prevailing style of management, it's rooted in those management myths we've talked about before we started the principles. And it's sort of this false foundation for your organization. But that's where I think most people, people are. And so part of this commitment is then if we're gonna commit to transformation, there's some things that leaders have to realize, and then there's some steps you have to take if you're gonna sort of go down this path. I think the things that you have to realize as a leader, and these are things that are true for me as I continue this process and my organization is number one, there's gonna be a struggle. There's gonna be this struggle over every one of the 14 principles because it's so different from what we're doing today.

0:03:39.1 JD: I think another thing we're gonna have to realize is that this can't be one or two people at your organization. The entire leadership structure at your organization, it's gonna have to be educated in this new way of thinking, and then you're gonna have to bring along the entire organization. And this can be a challenge because if you are the person doing this at your organization, you very well may be fairly new to this new way of thinking, this new philosophy yourself, unless you've brought in someone externally to help you through this. And even if you do that probably for a good portion of the time, you're gonna have to be leading this before you may be feeling like an expert yourself. And that was definitely true in my case. But I think the emphasis in this initial introduction is that you gotta get that system's view and you have to help people understand the theory of variation.

0:04:43.0 JD: So that has to be sort of initial part of that introduction. And then of course, you have to take your organizational context into account and so how this sort of rolls out or plays out, it's certainly gonna vary by size of organization, by organizational type. But the good thing is, is regardless of size or type of organization, industry, sector, whatever, Dr. Deming offered several steps to get started in this process. So I think maybe as a start to how you commit to the transformation, if you wanna go down this route, it might be helpful to sort of outline those steps first.

0:05:24.8 AS: Definitely. And it just, the idea of everybody, being committed to the transformation, like this isn't something where you can say, well, maintenance department doesn't wanna do it. [chuckle]

0:05:36.4 JD: Right.

0:05:38.3 AS: Or the third grade teachers don't wanna do it, but the sixth grade do. So that's... Of course things can start in kind of piecemeal as they they go, but it is a true transformation. The other thing that's interesting is if you have a situation where you have been through a transformation as a unit at a school or as a company, it's also possible that a new person could come in and destroy that transformation real fast. And I have an example of a company that I've experience with where they had implemented the Deming principles to an extreme level, and the CEO resigned eventually. He was older, a new one came in and he said, I'm not in that school, I'm not in that camp. I got a new idea. I got a different idea. And it went right back to the prevailing system of management.

0:06:35.9 JD: Wow. That's really interesting. On the first point, I think, you're not necessarily gonna get all the departments or everybody at once. Obviously it's gonna be a process. On the second point, I think that actually is a good segue into step one because basically what he says, and I've translate this for education environment or education audience, but he basically says the school board and the superintendent have to study the 14 principles. Understand them, agree on a strategic direction, and then make a deliberate decision to adopt and implement the new philosophy, so why bring this up now? As I follow on to your comment there is that it seems to me that well, assuming that this was a company that had a board, then what that board should have done is include something about the System of Profound Knowledge and the job description for the new CEO. That's interesting that they didn't make that a point of emphasis.

0:07:41.5 AS: I think what's fascinating to me about it is that I think on the one hand, cooperation and working together and not living in an environment of fear is kind of our normal state, I would argue, but society just pushes us in so many different ways, that all of a sudden you find yourself in a very different state. And another example of that is how KPIs have taken Thailand in particular by storm, and now all of a sudden you have people who have been very cooperative in the way that they work together, all of a sudden pitted against each other, and it's so painful for them, because it's not the way that they naturally operate.

0:08:33.5 JD: Interesting.

0:08:35.3 AS: And so yeah, it's just... I think you gotta work. And I guess the thing you're saying about the board is that you really gotta work to make sure that this is something precious, and you could lose it in a blink of an eye if you don't...

0:08:52.4 JD: Yeah, yeah, and I'm not hiring a CEO obviously, but I have started including... I don't use System of Profound Knowledge, I don't use that terminology when I write job descriptions for people on my team, but what I do say is, what we're looking for is someone that can think in systems, understand variation and data, run small experiments to find out what works and do that with sort of like while working with people in a cooperative fashion, so I've sort of incorporated the four elements of the System of Profound Knowledge in the job descriptions for people that I'm hiring on my team, so then when I actually do use System of Profound Knowledge, describe the elements once they're on board, it's not a surprise 'cause it was a part of that hiring process. And part of that, even the job description itself, but step one basically is so that, you know, if you do have it at your organization, it includes both board and sort of the senior leadership being bought into that philosophy and that's not a guarantee, but at least if both components have that then if that CEO moves on, maybe it's more likely to continue on in your organization.

0:10:10.4 JD: That's step one. Step two is interesting, Deming basically said that the board and the senior leader or the school board and the superintendent in my case, must feel he said a "burning satisfaction", sorry, "burning dissatisfaction" with past procedures and a strong desire to transform their management approach, so it's almost like you almost have to be hitting your head against the wall, you have to be looking for something, because what he goes on to say is that you have to have the courage to break with tradition, even to the point of exile among peers, as you're going through this transformation process, because from an outsider looking in, if you're adopting the Deming philosophy, much of the stuff is gonna look so different that people are gonna be asking you, what exactly are you doing? And this has happened repeatedly. Not, not, I don't think that to that extent that I've been exiled, but for sure people will be like, well, I don't understand why you're just not setting a goal, just tell people what the goal is and then let them get out of the way and let them achieve it. That's not the approach with the Deming philosophy. So you have to...

0:11:33.2 JD: Again, for me, it wasn't exile, but constant pushback, questioning, why are you saying this, why are you operating in this way? I don't get it, why don't we just tell departments what their goals are and let them all meet them, those types of things, the typical way of operating, and it does take a lot of time and energy to explain that, but that's a part of the process.

0:11:55.1 AS: It reminds me of working with alcoholics and drug addicts, generally, they don't turn around until they've hit a bottom.

0:12:04.8 JD: Yeah. Yeah.

[overlapping conversation]

0:12:05.4 AS: And they have a burning desire.

0:12:05.6 JD: Learning to satisfaction. I think that's right, and I think from the standpoint of someone that's really motivated to look for something new, look for a different way of doing things, that's not all together a bad thing, that they've sort of hit rock bottom. Step three is, again, it seems common-sensical. But even here, even as I was going through this, it was sort of a reminder of a number of things that I need to do on a regular basis, and one of the things he said in step three is that once that sort of senior leadership team, the board, the superintendent, whatever that make up is that your organization is that then you have to go out and explain, whether it's through community meetings or seminars or whatever to sort of a critical mass school system staff, he said, students, parents, why you're going on this transformation, why you're... This change is necessary. And then actually educating your people across the organization, what is this philosophy, what is the System of Profound Knowledge? What are the 14 principles? What are the typical ways that we work? Why are those management myths don't work.

0:13:36.4 JD: You gotta go out and do all of these things. It's gonna be a completely new language, a completely new operating for most people, and it has to be a part of the process, bringing people along and this... I think this isn't an overnight process, obviously. Deming said no instant pudding. He generally said, I think transformation was a five to 10 year process, depending on the size of your organization, but I've definitely found that to be true. There's fits and starts, there are some things that you seem to be able to sort of put in place pretty quickly, and then there's other things where there's a couple steps forward, a couple steps back, and you gotta bring people along, people turn over, you gotta re-educate those types of things. So it's a process. It's definitely a process.

0:14:27.4 AS: I was thinking about. I can't remember whether I heard Dr. Deming said that or whether it's somebody, or I read it or somebody told me, but that somebody asked him, "How long has this transformation take?" And he said, "Well, it can take as long as 10 years or as short as 10 years."

0:14:49.8 JD: [laughter] Yeah, so no matter what. It's a significant amount of time. There's no doubt about it. Step four, he basically says that every job and every activity within the school system or your organization is a part of this process that can be improved. And he talks about using flow diagrams for important processes within your organization so that people can see that this is about optimizing that whole system, and not the individual stages. But he really wanted people to see visually, even if it's just a simple sort of flow diagram, how one stage connects to other stages for us, maybe it's the teaching and learning process going from kindergarten to first to second to third grade.

0:15:37.3 JD: That again, seems obvious that that should be how the system works, what I think is less typical and common is actually doing activities from a systems thinking lens, where you are making sure people understand that the kindergarten teacher is also serving the first grade teaching team in addition to the students and families in their classroom and simple things like we have two elementary schools, two middle schools, do the middle school principals leave their school at some point and go to the elementary schools on their side of town and introduce themselves to the fifth graders, so things as simple as that is what I'm talking about.

0:16:28.8 JD: There are lots of other things. For sure. But how often does that happen? In some places, it may be fairly typical, in other places, it's not happening at all, but in the case, even where it's happening, do you explain why it is that you're doing this activity. Are people making that connection that they're part of a bigger system. I once consulted at a very small rural school district here in Ohio, and when we talked about systems, they just had two buildings, they had a sort of an elementary building and then a seven through twelve building. And talking to people, they said, I've never been to the high school - an elementary teacher, I've never been to the high school. And so people may say, Well, that seems strange. But when you were in the school system, it is very difficult sometimes to get out, so you actually have to make it... The leader has, or the leaders have to facilitate this, bring this about... There has to be some coordination of efforts, so that's step four. I think step five is you have to teach and then utilize the Plan-Do-Study Act cycle. You have to use it as a procedure to learn how to improve the organization's processes.

0:17:48.1 JD: I think that we've talked to your... And the Deming community is familiar with the Plan-Do-Study Act cycle, PDSA cycle, but most people aren't. Most people don't have this... Some people might call it sort of like a scientific thinking approach to testing ideas and see if they work, but most people don't approach change like that. They just try something, there's no system for collecting data, a lot of times it's just sort of a mass implementation, there's no process for testing on a small scale, seeing if it works, getting feedback on a short time frame, like a week or two weeks or three weeks, and then trying that next test. So that's, that's in terms of putting the Deming philosophy into action, I think that's a critical part using the PDSA cycle.

0:18:44.0 AS: Yeah, I'm just thinking about my Valuation Masterclass Bootcamp, and we're just about to start our round 13. And so having taught it 12 times before, but part of our PDSA, part of our process of understanding the cycle is that, at the end of every bootcamp, every single student gives us their recommendations for improvement. And we do it through a survey where they're all excited at that moment in time, because they're at the end of the process, but they've gotta go through the survey. And they give some great ideas, and then we capture all that into a document, and then we go through it and we see there's some ideas that just seem like obvious we should have implemented that a long time ago, or we knew. And then, so we say, okay, how do we implement this? But then there's others that are also a question. Right now, one of the ideas is to do one of our class sessions per week as a live session.

0:19:52.4 AS: And it's the feedback session where students get feedback, and in that case, people from outside can watch it. And it has some benefits. There's a marketing angle to it for us, but also, there is the excitement of showcasing your work and all that. But on the other hand, it could be terrifying and it could be that it doesn't do what we think. So in the end, we asked what is it that we think we would want from this as an outcome? And then we said, why don't we just try it one night in week four? And so we've set up that we're gonna do it on one night, we're gonna prep them ahead of time, and we're gonna see how it goes. And if it produces the effect that we want, which is, we think it's gonna up the intensity in, all of that, that it's gonna work. But if not, then we'll abandon it. And so that's a little bit of our little PDSA thinking on how do we test out an idea and see the result of it?

0:21:00.5 JD: Yeah, I love that. I love that because it's not... We're gonna just do this new thing in our course. We got this feedback, we're gonna just do it. We're gonna actually test it on a very short cycle, one session and get the feedback back right away to see if this works. And if it does, we're gonna do more of it. And what's likely gonna happen is you're probably gonna learn something, and you're probably gonna have to sort of change the approach a little bit, and you're gonna do it again and again and again until this is... Assuming the feedback is positive, then you'll do more and more of it. And, you know, if it doesn't work, then you'll learn that in a very quick, easy fashion and you'll know not to do, you know, more of that thing in your course.

0:21:44.2 JD: So I think that's the exact type of thinking that Deming was trying to get us to do, to improve our organizations, versus this sort of plan, plan, plan. We're planning these grand changes, then we put them in place, and then they don't work out like we thought, and then all of a sudden, we've had this significant investment in time and/or resources and sunk costs. And maybe we even keep doing it because we feel like we can't make a change at that point. So that sounds...

0:22:12.1 AS: Iterate, iterate.

0:22:12.2 JD: Iterate. Yep. Small, small, small test of change. So that was step five is use the PDSA cycle. Step six I really love, he says, Deming says, "Transformation is everyone's job." So no matter who you are in the school system, student, staff member, parent, you have to play a role in this transformation. And one of the ways that this can be set up is that you have these cross-functional teams on which parents, students staff members from various departments can be set up to work together on a problem. And one thing that we're doing right now, we have a new position in our network called Network Medical Coordinator. We're very fortunate. We actually have a pediatrician that's on staff, and one of the projects she's working on is critical care. So basically, when students require some type of critical care at school for something like, let's say diabetes, that's not something schools are used to sort of dealing with or maybe don't typically have the internal expertise to deal with. And in this case, there's a team of people figuring out the best approaches for various critical care areas.

0:23:35.3 JD: And this includes the Network Medical Coordinator. It includes one of the operations managers at one of the schools. It includes a parent and some outside partners, a pediatrician from a local hospital, for example. So you have this cross-functional team that's coming together in a way that's not super typical in a school system, but for a very important reason, it includes these various functional areas. And I think the outcome, what comes out of this project is gonna be better because it's not just the doctor saying, this is what we're gonna do. There's the parent, there's the ops manager that understands like how the office works, and how kids come to the office to get this care and things of that nature. And so you have this sort of cross-functional team working in a way that's gonna improve our system. So transformation is everyone's job, putting everybody to work for the transformation is step six. And there's various ways to do that a cross-functional team is one of those areas or one of those ways of bringing that to fruition.

0:24:37.1 JD: And then step seven is interesting. He basically said to deliberately construct your system for quality with certain percentages of staff understanding continual improvement at different levels. And sort of the way we've characterized that is sort of everybody, the goal is to have everybody have sort of like a basic level understanding of continual improvement. And by basic level, everybody knows what a run chart is in our network. The goal was, so everybody can sort of put one of those together. That's a pretty simple chart. Everybody could put together a process map to understand how do we map out, how a process unfolds at one of our schools. So everybody sort of gets that basic level of understanding.

0:25:28.8 JD: And then there's this sort of next level, we call it intermediate level understanding. And basically, this centerpiece of this level of understanding is, this is maybe 25% or 30% of the people really understand the process behavior chart. They really understand how to construct a chart, interpret a chart, and understand data over time and how to use that as an improvement tool. And then at the advanced level, that's something we're still working toward. Maybe you have one or two people. We have about 120 staff members. We have one or two people that have an advanced level of understanding. And so an example there would be, someone knows how to run design of experiments, basically something you may use on a limited basis outside of like an engineering sort of setting. But it would be good to have some advanced understanding. But I think the biggest bang for the buck is at those first two, that everybody has a basic level understanding of certain tools and techniques. And then you have this intermediate group that really has an understanding of how to use the process behavior chart to drive change and bring about improvement in your organization. Those are sort of the seven steps. So sort of concrete advice on how to bring the 14 principles to life.

0:26:53.1 AS: How would you... We've gone through so much stuff in this series. How would you wrap it up? How would you... I guess the first thing is like, what is the core takeaways? And the second thing is like, what would be your advice to the people who've made it to the end of this, who are by this time in their own process of transformation at various stages. So maybe the sum up of kind of what's the core concepts you want people to know? And then the second thing is, how would you advise people to continue their journey?

0:27:29.4 JD: Yeah. I mean, I think, just like, I think step one was this does require study. But what I found is, reading the 14 principles is really helpful after you read about the System of Profound Knowledge, because the 14 principles are sort of a logical extension of the System of Profound Knowledge, and give you a little bit more sort of concrete sort of...it's not a list of do's and don'ts, it's not a recipe, but it's some concrete stuff that you can start to understand, okay, and this is how you actually put the System of Profound Knowledge into action. I think it also again, not a recipe, but the 14 principles do paint a picture for what a healthy work environment looks like. So I think that's really helpful to understand those things. They're not a checklist, they're not... The 14 principles aren't completed in sequence. Rather, they're this interdependent mutually supporting sort of set of guiding principles for system leaders that do help make that transition to the Deming philosophy a bit more concrete.

0:28:52.5 AS: And so for someone who's on their journey, they've been following this. What words of encouragement or words of wisdom would you provide for them?

0:29:11.4 JD: Yeah. It's like a two-parter. There's like, I just sort of reiterated, the study is important. This takes study. You're gonna have to dedicate time to this. You're gonna have to commit to understanding this first yourself, and then starting to sort of dip your toes in the water in terms of talking about this approach with other systems leaders in your organization. And that's sort of the long term play. On the short term, there are things you can do just to start to put the System of Profound Knowledge into action. And I think to me, that's also a good way to learn that doesn't take years and years. And I've said it before, but I think pick one thing that you wanna improve, let's say that thing is attendance rates in your classroom. And just start plotting those rates on a line chart over time. Just see what happens. Plot it over two weeks.

0:30:13.3 JD: So two school weeks is 10 days. Look at those points over the course of two weeks, and start thinking about what you learn when you see that pattern of your data, the ups and downs. Anybody can do that. Anybody can make a simple line chart. And for two weeks, just jot down, okay, on day one, 94% of the kids in my class came to class that day. On day two, it was 91%. On day three, it was 95%. I can start looking at that data over time. And then at the point where you've gathered that baseline, simply draw a vertical line and say, I'm gonna try something to improve this problem. I'm gonna plan it, I'm gonna do it. I'm gonna study what happens when I try this one small change, and then I'm gonna decide on the next thing to do, and I'm gonna do this with the students in my class. I think that's a way to put, basically combining that data over time with this small change, what I call a PDSA cycle, basically an experiment, that's the System of Profound Knowledge in a nutshell. And I think anybody can do that. And I think that both the long-term study and putting some of this into action right away are both sort of important ways that people can continue on this journey.

0:31:40.3 AS: I'll, I'll end on with little story. When I was 20 something, maybe 23, my grandfather passed away and my father and I, and the family went to the funeral, and it was my father's father. And we were in the car driving there, and I was sitting in the front seat with my father. By this time, my father and I had had, begun to have a really good relationship, a deep relationship. And I asked my father, "Dad, why is it that I haven't seen you cry when your dad died?" And he said, "I cried 30, 40 years ago when I lost him." And what he was explaining to me was something he never told me. And that was, that his father treated him in a lesser way. He just didn't pay attention to him. He didn't give him time. My grandfather was kind of a famous guy in the world of architecture and history, and I don't think that he disliked my father, his son. I think he just was so busy, he just didn't give time to him and he didn't really show that he cared.

0:32:56.1 JD: Interesting.

0:32:57.5 AS: And what I respect the most about my father was that, he made a conscious decision not to treat his children that way. He married a woman who believed that you don't treat people that way, but he also made a conscious decision, and it took effort. And it wasn't until as we started getting older that the fruits of that effort started to pay off. But I can say that my dad created a trusting environment. And when my dad was close to his death, I asked him, what was your biggest proudest moment in life? And he could have said my best golf game I ever did which he was, he was almost a professional golfer or the great accomplishments, he had in work and life and whatever. And he just looked at me and said, "I created a trusting family."

0:34:00.4 AS: And I think about when you're going into this world of Deming, you're going into a world of chaos, of grading and scoring people, and blaming and all of this crap that goes on in schools and in businesses. And Deming is providing us a way to think differently and provide a more of an environment that drives out fear and sees the potential of humans. And funny enough, you're gonna have to work hard to create that environment. And you're also gonna have to work hard to protect that environment.

0:34:37.5 JD: Yeah.

0:34:39.4 AS: And my dad was an example of somebody where I learned that you can do it, and you can change. And so that's my words of inspiration for everybody listening. You can make a major change and make it a lasting change.

0:34:54.5 JD: Yeah, that sounds like transformation. It sounds like he had the psychology component down too. He sounds like an incredible guy.

0:35:00.9 AS: Yeah. So, John, on behalf of everyone at the Deming Institute, I wanna thank you for taking this time to go through all of the stuff that we've been through over this time that comes from your book and your work, and your experience. It's very valuable. And for listeners, remember to go to deming.org to continue your journey, and you can find John's book Win-Win, W Edwards Deming, the System of Profound Knowledge and the Science of Improving Schools on amazon.com. This is your host, Andrew Stotz, and I'll leave you with one of my favorite quotes from Dr. Deming. People are entitled to joy in work.

Dr. Deming railed against performance appraisals, listing them 3rd in his Seven Deadly Diseases of Management and calling them "Destroyer of People." In this discussion, John Dues explains our cultural attachment to appraising workers and why it is a myth to assume that appraisals have any impact on performance at all.

TRANSCRIPT

0:00:02.3 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with John Dues, who is part of the new generation of educators striving to apply Dr. Deming's principles to unleash student joy in learning. The topic for today is a continuation of our discussion about management myths that keep fooling us, and we are gonna be talking about performance appraisals. John, take it away.

0:00:32.1 John Dues: It's good to be back Andrew. I thought it'd be helpful first to connect back to what we've done, because it'll help listeners connect the dots between the various episodes that we've done together. I think this is the eighth episode, so episode one and two were all about the System of Profound Knowledge as a theory, and then episode three, we started working on understanding the concept of variation, special causes, common causes, that type of thing, and then four and five, we switched gears and talked about how to then apply the System of Profound Knowledge in our organizations. And so we talked about two powerful tools, process behavior charts, and then the PDSA cycles.

0:01:21.9 JD: Episode six, we started talking about A Nation at Risk and the Sandia report and how calls for education reform haven't always been built on a solid philosophical foundation. And then last time I introduced this idea of living in an age of mythology, and we talked about two myths. The myth about best practices and the myth of the hero educator. And so today, like you said, I thought we continue that discussion of the myths with a focus on performance appraisals, which is something that is a little bit hard to understand, I think it was hard for me to understand initially, but it's something that I thought was important because it's something when I listen to Dr. Deming's recorded seminars, it's something that he railed upon often.

0:02:14.9 JD: And I think tying all of the myths to a couple of key ideas is helpful. So I think that first idea is that when we see outcomes in a system, they're more than the skills and efforts of the individuals that work within the system. So those results come from more than just how the individuals within that system are working. The outcomes, that second idea is that the outcomes are mostly attributable to the system itself, and workers are only one part of that system. I think that's really important. That underlies all these myths and certainly underlies this idea of the myth of the performance appraisal.

0:03:00.8 JD: And I think that when we're talking about these myths, so we've covered the theory, we've talked about some ways to apply that theory, that System of Profound Knowledge in actual organizations. When we're thinking about the myths, what I'm thinking about is, dos and don'ts. And so the myths are the don'ts. There are specific prescriptions following the Deming philosophy that leaders should learn to stay away from and why to do so. And then of course, the do's would be a set of guiding principles to follow, and I thought, right now, we're focused on the myths and as we get through this episode and maybe one more on the myths, then we would then focus on the "what do you do?" That's where the guiding principles would come in, and so Deming outlined all of this for us. The theory, the application, the Do's and the Don'ts, and so that's where I thought we would start today.

0:03:55.6 AS: That's great. And we were talking before we turned on the recorder about how performance appraisals are such a fascinating area, and I know for a lot of people, there's nothing else. That that is the key of how you manage people. Like, you're talking about the core. Without performance appraisals, people are gonna be lazy. Without performance appraisals, people are gonna get distracted. Without performance appraisals people aren't gonna work hard because they're not gonna get compensated. Without performance appraisals, we can't get this organization to work and everybody to work together and this is the ultimate incentive that we need to motivate humans. So boy, you're taking on quite a tough topic here, John. Tell us a little bit more.

0:04:45.6 JD: We'll see how we do. And one thing to clarify when I say performance appraisal, in my world, in schools, this is typically called the Teacher Evaluation. So it has different names, but, an evaluation, an appraisal, some type of rating and ranking of employees basically. So I think one thing that, and you kinda just brought this up, is "if I don't do a performance appraisal, how am I gonna give feedback to team members?" And I think that's a good place to start is that, of course, I think that leaders and managers should, as a part of their job, provide direction and give feedback to team members.

0:05:33.9 JD: But I think it's a far cry to make the leap that giving direction and feedback is synonymous with administering performance appraisals. And I actually think that performance appraisals can actually work against giving good feedback. But like as a starting point, what makes up the typical performance appraisal? Thinking about four parts, just so we are all starting from the same place.

0:06:06.7 JD: First there's standards that are set. "Here's the standards that are gonna be outlined in this performance appraisal." Then there's a time limit set to meet those standards, then the manager makes observations and judgments, and then finally, the evaluation is given to the individuals by the person sort of in the organizational hierarchy. I think a key thing that I've learned in studying the Deming philosophy when it comes to performance appraisals is that they fail to consider the role of the system on individual performance. So that's one problem.

0:06:50.2 JD: They also fail to appreciate the variation in performance attributable to common causes. So that's why I was connecting our earlier episodes on theory and the applications to performance appraisal, 'cause you have to understand that to understand why Dr. Deming was railing against performance appraisals in the way that he did, and those are two of the key reasons.

0:07:20.2 AS: Right. So a person being evaluated or being talked to with a performance appraisal, a common thing is, they could say, "wait a minute, you're saying I didn't do this, but I couldn't do this because the system has this whatever." Or you get a boss that's focused on common cause variation going, well, "you did this, and then that, and this guy did that, and this is and then all..." What they're really doing is chasing their tail on all of these common cause variation, which is not going to improve the system and it's just rewarding and punishing what is just a natural outcome of the system.

0:08:01.1 JD: Yeah, that's a big part of it. So if I'm a teacher and part of my evaluation is something like outcomes of students and how well I deliver the curriculum, the effectiveness of the curriculum, those types of things. Well, the vast majority of teachers didn't select the curriculum. So that's a good example of something that's a part of the system that a teacher has no control over typically, but that it could play a role in an evaluation, and there's all kinds of examples like that. That second idea in terms of the appreciation of where the person is falling performance-wise within that common cause system, what that means is that, sure, people could be performing at different levels, and there could be slight variations in that, but it's very possible that those ups and downs, just like any other ups and downs that we study are just common cause. And so it's not one person different from another within the rating system?

0:09:06.6 JD: Are they far enough outside that they show up as a special cause. That their performance shows up as a special cause. Because if it does in the case of a teacher or maybe a student that is outside of the system in terms of performance, then there may be special help or special support that's needed. But I think many, many times that's not the case, and that the ups and downs don't represent anything meaningful. And I think one of the things that helps bring this into view for people is to say, "well, how did you experience teacher evaluations or performance appraisal or whatever you call it in your system, how did you experience as...

0:09:50.6 JD: How did you experience that practice as a receiver of those things?" Because that puts you in a different mindset. For me, performance appraisals, when I've been evaluated, have largely been positive in terms of the overall rating, but they've also, a lot of times not made a lot of sense on any number of fronts. And so I think of, as a teacher in Atlanta, and Atlanta Public Schools had a teacher evaluation system, the principal would come in for one hour across the school year and observe me and write it up and formally evaluate me, sit down with me and go over that evaluation. Well, if you think about that, one hour of observation, the typical 180-day school year, seven hours a day, that's about 0.08% of the school year that the principal observed. So that's a big problem.

0:10:52.1 JD: So we're saying that that represents the entire...my entire time teaching across the school year. That one hour observation. So that's a major problem. Another issue is, what is it that I'm being evaluated on? One that stands out for me, and granted we were in a different time, 23 years ago, 22 years ago when I first was evaluated, but they're still a technology category in the evaluation. And so part of the evaluation was to "use technology effectively in a lesson." And so one of my first questions would be, well, "do you have to use technology in a lesson for it to be effective?"

0:11:40.4 JD: I think that would be questionable at best. But what if I use technology in some lessons and not in others, and the one you happened to observe, I didn't use it, right? You didn't see the ones where I did. I was working in a large urban school system, I had seven computers in my room and five of them didn't work on a regular basis. So that's another obstacle, right? And so I get this rating, I take it, I don't really say anything about the computers not working, or what about my other lessons where I did use computers, I just listen to this, but...

0:12:13.3 AS: Otherwise you're gonna be labeled as argumentative.

0:12:15.4 JD: I'm gonna be labelled as argumentative and the rating was fine as it was, although I lost some points for those things. It's probably not worth...it's not.... You kind of pick your battles. But the point is, what does that leave me with in terms of the taste in my mouth about my school, about this evaluation system, granted it's one part of the system and maybe I didn't care about it too much as long as the rating without a satisfactory level, but the point is, it didn't seem fair, it didn't seem to make sense, it didn't seem to line up with what you would need to look at in terms of what you need to make an effective lesson.

0:12:55.0 JD: And how many people are experiencing evaluations in those same ways, whether it's ridiculous and being evaluated for something that doesn't work in your room, like the computer's not working, or a smaller like, do you need computers to be a part of the lesson in the first place. And so there's all kinds of things like that that I think are part of a typical evaluation system.

0:13:22.0 AS: So to summarize what you're saying is one way to think about performance and appraisal is to think about your personal feeling when you're receiving your evaluation, and I would argue that most people don't feel great, it's not something they're really looking forward to.

0:13:36.2 AS: And the second way you can look at this is look at the person who's delivering it. If you're having to deliver performance appraisals, is that like your favorite day of the year that you're working with that person? Yeah, so that's a good way to look at it so that you kind of understand that there's just something that doesn't feel right here, but continue on.

0:13:56.6 JD: Yeah, it takes a tremendous amount of time and effort. No one actually likes the process, generally speaking, and I think the thing that I wanted people would hold on to was that they don't get magically better when you're on the other side and being the evaluator. So my feeling wouldn't change whether I'm on the receiving or the giving side of the evaluation system now, I think for some leaders, unfortunately, I think that changes as long as they're on the other side, it's fine, but I think that's why I think putting yourself back in the shoes of the person receiving the evaluation is a good thing to hold on to. "I'm not special, there's not something about my personal characteristics that make evaluation unnecessary for me, but everybody else needs those things."

0:14:43.6 JD: So I think holding on to that as you move, especially if you move into a leadership role is a really important mental model. I think another key thing is after the evaluation, all of these people for the most part, are gonna still be working together, and so another key question that I learned from a Deming student named Peter Scholtes in a book called, The Leader's Handbook, a great book.

0:15:15.8 JD: He said, "what are the factors that differentiate highly effective versus lower rated people?" He outlined these five factors, so there's A, would be native ability and your early education, the second factor would be, B, your individual effort, how much work am I putting in as a teacher, as an employee. C, would be training, an orientation that I get as a part of the onboarding process or the ongoing professional development that I get as a part of the job. D would be variability of the processes and systems that are going on within my job, and E would be the system evaluation itself to some of those things that we just talked about, is it fair? Is it well constructed? Is it representative of my total work, that little sample that's seen by the manager.

0:16:17.0 JD: And if you look closely at those five items, really only one of them, that being, I think I call it D, that individual effort is under the control of the individual person working in the system. The other four factors really don't have anything do with individual performance, but what the performance appraisal system attempts to do is solve that equation, A plus B plus C plus D plus E equals my rating, let's call it 100.

0:16:54.5 JD: But if you can't solve that equation, if you don't know already what the variables A, C, D and E account for in terms of its contributions to the rating, the only thing you know as an individual effort, right?

0:17:11.2 AS: And you don't really know that either.

0:17:17.0 JD: Yeah, fair enough, fair enough.

0:17:20.1 AS: So it's a shifting sand that you're working on, which is what probably one of the counter-arguments to performance appraisals is that there's just... It's so subjective and difficult, particularly, okay, if you're a narrow-minded person and you've never thought about the fact that there is variable B, C, D and E as an example, then...but once you start to think about those things, you realize that not only is it difficult to quantify and all that what a person's doing, and how do you factor in the fact that that person just went through the loss of a parent over the period of time that you appraise them. How does that impact performance?

0:18:02.5 JD: Any number of things. Any number of things. Yeah, I can think of a lot of examples when you start to unpack those various factors, like when you're talking to the manager, "oh, well, we didn't quite onboard them like we typically do now, no one acclimated them to our curriculum system" or whatever it is.

0:18:27.3 AS: But they're still responsible for delivery.

0:18:29.8 JD: Yeah, they still move forward with that response. And again, it's not that there's not gonna be variation in performance amongst employees, it's just, are we getting what we think we are from this rating and ranking system. I think what we're doing basically is disregarding the contributions of the system on the performance of individuals that are working within that system.

0:18:57.0 AS: And I guess if you talk about that to people, they're gonna be like, "Now you're unleashing something that's just unmanageable." Okay, yeah, fine. We're gonna start talking about the system and the impact and that everybody's just gonna blame the system! John, don't you know people are just gonna blame the system, then if we start talking about why it's not your responsibility.

0:19:23.2 JD: Yeah, I think, yeah, we'll kinda get into what's the prescription in terms of...what would of the prescription be from the System of Profound Knowledge in terms of what to do instead, but one thing to do, if you did have some type of evaluation system, you could just remove the numbers and have a narrative feedback on characteristics or competencies or capacities that are important for your particular organization. I think that that would be one way to handle it.

0:20:00.4 JD: Another great tool that I learned from David Langford is a tool called the capacity matrix, where you outline what are the capacities that are important for a given role that you want to see develop. You define a series of dimensions of growing from more basic to more proficient in a particular capacity, and then you ask the person to track their own learning in those areas, and as they self-evaluate, they have to provide evidence, be it - maybe they give a presentation or incorporated a technique into their lessons on a regular basis, or maybe they presented at a staff meeting, something like that, but they have to link the capacity development to some evidence that it's been put into place.

0:20:51.0 JD: That's another way to handle... The point is to develop the person and build capacity, that's a much more powerful way to do it, and I think the goal of starting to use the Deming philosophy is transformation, and I think what Deming was talking about when he talked about transformation is this process from going from - starting to understand these assumptions and these myths and then working to move away from them. So one of the things...one of the lenses I have just in studying the Deming philosophy is to ask questions because so many of the practices like the performance appraisal, prior to studying Deming, I never even stopped and said, "well, what is the theory behind the performance appraisal? Where did it come from? Why do people think it isn't an effective practice? Are there practices that would be more effective?"

0:21:52.3 JD: So just as a starting place, you can start to ask questions about some of these things that you probably never even stopped to think about. I think that was true for me, whether we're talking about these myths or any other number of things that are common in organizations, work settings, and we have this...

0:22:14.0 AS: And for performance appraisals: what is the theory behind them?

0:22:20.0 JD: That's a good question. That is a good question. Where did they come from? Well, I don't know for sure, but I know that...a lot of corporate practices can be traced back to things like the military and early railroads, which were some of the first organizations to have a larger staff that had to be organized in a way, and I know that in terms of the rail companies that you know, when there was a crash, there did need to be somebody blamed. And so you had to nail down who in the hierarchy... Where did things break down? It had to be an individual to blame when two trains ran into each other or the train ran off the tracks. And I think what Deming is saying it is what was actually the system that led to that crash, that's what we needed to study in a lot of cases, and almost in all cases, whether it's the train running off the tracks or the Challenger space shuttle disaster, almost all of them were of system problems and it wasn't one single individual that you could pin those problems on.

0:23:37.2 AS: And you could argue that performance appraisals are not really there in that case, like what you're talking about let's say is a train crash, it's not really there to some extent to blame... To improve the system, it's there to blame someone and then, "okay, we got our scapegoat, now let's move on."

0:23:54.4 JD: That's right, yep. Yeah, so with performance appraisal, it's not quite as dramatic as the train crash, but what's happening is that it leads to this rating and ranking of teachers, we do the same things with students, students have their own form of performance appraisals, even schools within state accountability systems have their own rating and ranking systems. So they reward at the top and punishment at the bottom, that's the typical present practice. And I think the better practice, what we're trying to move towards when you're managing through the Deming philosophy is: abolish the ranking in favor of managing the whole organization as a system, and what you wanna do is study and understand how every part of that system, every component whether it's grade levels or departments, whatever, how do they contribute to the optimization of the system.

0:24:57.8 JD: And so that's... What's the aim of your system, how do you optimize that? And I think a big part of this performance appraisal thing is that that practice is running in the other direction from optimization. You are incentivizing individuals to look out for themselves versus contributing to the aim of the organization.

0:25:26.7 AS: One of the things that people say is like, "What do I replace it with?" Well, in a lot of cases in education, you may not even have that choice, but in private business, you do, and I always say that...I always say "imagine that you're lost deep in the woods, and after hours of walking in one direction, you realized that you're walking in the wrong direction. However, you're unsure of the right direction, but you've received enough information to know that you're walking in the wrong direction. What would you do?"

0:26:05.7 JD: Perhaps stop going in the wrong direction as a starting point.

0:26:12.3 AS: And the point is, is that you don't have to know the right direction if you've identified the wrong direction. And so that's one of the challenges that we often get with performance appraisal is, "what are we supposed to do if we don't do that?"

0:26:28.8 JD: Yep, yep. And I think... And that's - when you start to understand the System of Profound Knowledge, you start thinking about ways that it can offer you guidance on a practice like the performance appraisal. And so what I tried to think through is, in terms of performance appraisal, what do each of the components of the System of Profound Knowledge contribute in terms of learning about the way...in terms of your analogy: the way to move...start to move in the right direction.

0:27:08.5 JD: And so there's the four components of the System of Profound Knowledge, we have Appreciation for a System, Knowledge of Variation, Theory of Knowledge and Psychology. And so each of those components has contributions to make in terms of rethinking the performance appraisal. So I was gonna break those down as a way to round down out our talk today. Some of this is a recap, but when I think about Appreciation for a System, we've talked about this, but that system is responsible for most of the observed variation between the performance of the individuals. It's most...Deming said up to 94%, depending on the situation, even up to 97% of the results that come out of the system can be traced back to the system itself, and only 3% to 6% were attributable to the individuals.

0:28:08.0 JD: So the system is the overwhelming contributor to that ranking within that, doesn't help anyone, nor the system improve. Giving somebody a rank, sorting people into good and better and best does not point the way towards improvement for the organization. So that's the Appreciation for a System contribution.

0:28:34.1 AS: Yep. We could say changing seats on the Titanic.

0:28:37.2 JD: Yeah, exactly. Exactly. Then we have understanding variation or Knowledge about Variation. So we've talked about this a little bit, but ranking people, especially when we're ranking within a common cause system, is misleading. 'Cause remember, even if there's ups and downs in terms of the data, the question isn't: is it different? It's: is it meaningfully different? And in a common cause system, even though there are some ups and downs, there's no difference. It's not of a magnitude that you can say, "yep, that's significantly different from one point to the next." And another thing to consider is there will always be variation. [chuckle] There's always gonna be variation between students, between teachers, between schools, between school systems, between states, whatever that thing is, there is variation in a natural state of affairs. So we have to come to grips with that.

0:29:40.9 JD: In terms of Theory of Knowledge, when we rate and rank people, it's a snapshot. Kind of like what I alluded to my observation in Atlanta being less than 1% of the total time that I was with my students. So that ranking doesn't take into account and any performance appraisal system I've ever been aware of that temporal spread. So in other words, I'm really more interested in what's the performance over an extended time period. And so when people would ask Deming, okay, you're saying, the performance appraisal is something we should abolish. Well, how much data would you need on an individual worker before you could rate them? And what he would say is 15 or 16 years. [chuckle]

0:30:32.1 JD: And basically what he's saying is, I think, is that, that's the amount of performance data you would need to plot. If you're doing it once a year, once you have 15 or 16 years, you can kind of get a sense of how that data is performing over time. That last component, maybe the most important is Psychology. I think one big problem is that those performance appraisals at their worst are debilitating to people, at their best, they're perceived to be arbitrary, like what I talked about. Certainly wasn't debilitating to get my rating, my rank and my rating in Atlanta, but it did...I did see the rating and the points I lost as arbitrary and meaningless, to be candid.

0:31:23.1 JD: And then another big part of that psychological component, especially when it becomes to rating and ranking students, is that this thing called the Pygmalion effect begins and it can really start to destroy cooperation. Whether that's students or teachers, but you this is basically this idea that once, let's say a teacher has a set of expectations about students, they start to take on those characteristics, whether it's in a positive or negative direction.

0:31:57.2 JD: And they've done some pretty fascinating studies on this Pygmalion effect in classrooms. There's one where it's like in the late sixties, basically a teacher was told that a set of students had performed really well on a standardized test. In reality, there was no difference between this group of students and the rest of the students. But because the teachers thought that, over time what the researchers found is that they started treating the students differently and it actually resulted in those students scoring higher on the standardized tests at the end of the year just based on those teacher expectations. And so, talk about a powerful, powerful set of effects within a rating and ranking system. And I think that's something we really need to consider in any type of institution, but especially a school system. So, yeah.

0:32:55.0 AS: I was just reminded of a quote that Dr. Deming said, which is, and I'm gonna, I'm gonna read it for for a minute here. I'm gonna read it in my Dr. Deming voice. "So evaluation of performance, merit review, or annual review. The idea of merit rating is alluring the sound of the words, captivate the imagination, pay for what you get, get what you pay for, motivate people to do their best for their own good. The effect is exactly the opposite of what the words promise." [chuckle]

0:33:32.1 JD: Yeah. I think that's what I found in practice, before I discovered the stuff I tried to improve our teacher evaluation system. And in reality that's just an effort that's not worth my time.

0:33:47.9 AS: He also said, "Annihilates teamwork, and it's purely a lottery."

0:33:53.3 JD: Yep.

0:33:57.7 AS: I wrote a blog post on this many years ago entitled, Why We Stopped Performance Appraisals at Coffee Works, my company. And this was... I published in 2016, and I just would... Maybe I'll just read a little excerpt here. What I said is, "The system was an annual review during which bosses in our companies met employees and scored them as A, B or C. I read Jack Welch's book and I thought, yeah, kick out the C players, this has made sense in the days when I was buying into that. We would use this to allocate bonus mainly to pay, A's and B's. A's a lot, B's a little bit, and C's nothing. And for years we've been seeing the weaknesses of this system, but didn't have the guts to abandon it, because we didn't have something to replace it.

0:34:50.5 AS: And so before you ask what we did to replace it, let's consider what we didn't like about it. Number one, it was unfair. Number two, it was subjective. Number three, it fostered favoritism. We saw that certain employees were continually getting positive ratings from their bosses. Number four, it failed to recognize what quality godfather Dr. W. Edwards Deming taught was that the majority of the output of any one employee is attributable to the system. And number five, it was time consuming and costly. Number six, it did not enhance employee performance. Number seven, it increased fear and caused suspicion. Number eight, it caused employees and departments to compete against each other rather than compete against our competitors or just take care of the customer.

0:35:34.2 AS: Number nine, it was completely inward focusing, encouraging employees to shift their focus from the customer during the time of performance appraisals. It's like you can't take care of the customer 'cause you gotta get all these performance appraisals done." Is there anything that you would add to that list of what you see in the education environment?

0:35:51.3 JD: No, I mean that's spot on. I mean, I think the key summary or takeaway is for any of these practices, be it performance appraisal or otherwise, is that thing optimizing the system? Is it making your organization better at achieving its aim? And you just named a whole lineup of things that said, "no, this is why in this particular practice performance appraisals, this is why Dr. Deming railed against them." So I think that, yeah, I think that was a great synopsis of many of the things that Dr. Deming talked about in his seminars when he railed on performance appraisals.

0:36:33.4 AS: So, as we wrap up, the purpose of today's discussion is to open up people's minds to understand what are performance appraisals, what are the myths behind it? What are the weaknesses of it? We also kind of said, even if you don't have a substitute, you could argue that you don't have to keep doing something that's damaging if you know that it's damaging. But we also know in an education environment, you may not have the power to make that decision. Like we had in our coffee business, it was like, "this isn't working, we're stopping. No more resources to this." We have that flexibility. So, we haven't spent any time talking about ways to do things and the positive aspect. But let's just wrap up this whole conversation. How would you kind of wrap up the message that you want the listeners and the viewers to get from this specific discussion?

0:37:29.4 JD: Yeah, I think because a lot of this, a lot of Deming's ideas were targeted at leaders and leaders at all different levels. And I think, what constantly happened to me was someone would say "what's your leadership style?" And I would typically cobble together some type of jargon in response to that question. But what Dr. Deming offers is a management philosophy: the groundwork, the framework, the foundation, the philosophical foundation, the myths to stay away from, a set of guiding principles that actually, when you dig deep and you study these things, they offer a way forward, a lens through which to make better decisions for your organization. And that's really what I take from this.

0:38:22.3 JD: There are many better ways to run our organizations. Performance appraisals are just one component of this, but hopefully what people are taking is that, hey, at the very least, the next time I have a leadership team meeting, I'm gonna bring this up and say, Hey, why do we do this? Is it leading to the type of results - like what you're alluding to with your business - that we think it is. And if it's not, what else could we do? How can we replace this, make it better? How can we at least begin to ask these questions instead of just carrying on? Because it's the way that we've always done things. So, yep.

0:39:00.6 AS: John, on behalf of everyone at the Deming Institute, I want to thank you again for this discussion. For listeners, remember, go to deming.org to continue your journey. This is your host, Andrew Stotz. I'm gonna leave you with one of my favorite quotes from Dr. Deming. "People are entitled to joy in work."

This week's Deming Podcast features Keith Sparkjoy, Cofounder and Culture Coach of Pluralsight, a leader in professional training for developers through an online learning experience.

Keith discusses his "awakening" on their journey to keep Pluralsight's healthy culture as they rapidly expanded. The Deming philosophies provided hope and as he came to understand variation and a new way to look at leadership, the transition moved very quickly. From creating a system that focused on customer - eliminating incentive pay for managers, commissions for salespeople, and paid time off policies - to establishing only two rules to guide the company.

Listen as Keith explains their journey to "seek the truth", how they have been able to burst the bubble of management, build trust, drive out fear and get people to work together as Pluralsight "grows up."

In our November 2017 podcast, Ravi Roy, Professor of Public Administration for Southern Utah University (SUU) in Cedar City, Utah, reveals the status of evolving efforts to share his appreciation of Dr. Deming’s System of Profound Knowledge® with his Public Administration students, strongly aligned with his role as the inaugural Research Fellow of The Deming Institute.

Beginning in the 1920s, with his employment by the U.S. Department of Agriculture, Dr. Deming worked closely with students to share his research into statistical theory.  Along the way, he was introduced to Professor Harold Hotelling, who Deming would later reference with the following comment, “As Harold Hotelling once said, “He who does no research has nothing to teach.””  Inspired by Dr. Deming’s passion for research, The Deming Institute recently unveiled a fellowship program to engage researchers who share a desire to both expand and deepen the understanding and application of Dr. Deming’s management philosophy among a new generation of students and scholars.  Link here to learn more about this Research Fellow program.

In this month's episode, Ravi shares reflections from his Deming research journey and his passion for guiding his student’s understanding and application of Dr. Deming’s management method. As the former director of SUU’s Masters in Public Administration program, Ravi is progressing to a role as director of the Deming Incubator for Public Affairs for Southern Utah University, a new partnership with The Deming Institute.    Under Ravi’s leadership, SUU students will soon have the opportunity to engage him in applying Dr. Deming’s “new economics for industry, government, education,” with an emphasis on government.

In this episode, David and Andrew talk about Common Cause Variation vs Special Cause Variation, and the problem of confusing the two. Using the example of transgender students, David describes how a system's capability should be expanded rather than using that special cause situation as a weapon to destroy the entire system. 

TRANSCRIPT

Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W Edwards Deming. Today, I am continuing my discussion with David P. Langford, who has devoted his life to applying Dr. Deming's philosophy to education, and he offers us his practical advice for implementation. Today's topic is weaponizing special causes. David take it away.

Langford: It sounds very dangerous, and it is. So I wanted to get into a little bit about special and common causes about what Deming talked about. So once again, we'll go back to Deming's system of profound knowledge. And as part of that he talked a lot about understanding variation in systems and without getting too statistical about things, he basically got people to identify two different types of variation. So there's common cause variation, which typically makes up anywhere from oh 94% to 98, 99% of what goes on in any system or any process. And then there's special cause variation, which is generally less than 2% or less than 1% of what goes on. So that sounds pretty innocuous until you actually start thinking about how that works out in society and systems and classrooms, especially in education in schools and Deming said over and over and over that there are basically two problems with special and common cause. So people treat special cause as if it's common, okay. Which is, and he called these deadly diseases, or they treat common cause variation as if it's special.

Langford: So sometimes it's difficult to sort of understand what is, what does that mean? So let's take an example like in a, in a school common cause variation would be say the, the performance of a whole school or a state or a nation or whatever it might be. You can chart that out over a long period of time and start to see a certain level of predictability of performance on anything you wanna look at, whether you're talking about behavior or you're talking about test scores or grades or kids showing up for school every day. Doesn't really matter what system you wanna look at. When you start looking at it from a systems perspective, you wanna look at as much data as you can.So at least six or seven data points, but preferably 12 and some, a lot of statisticians will say up to 20 data points.

Langford: So if you're just looking at, say test scores over a long period of time, well, you'd wanna actually look at average test scores over a 20 year period. So that, that could take a really long time to see data systems like that emerge, especially in education where we have what I call slow data that emerges. You’re familiar with like manufacturing environments and business, where you have a lot of fast data. So you may be making something and you're collecting a hundred thousand data points in a single day or a month or a week where in education, it, it really doesn't really work like that.

Stotz: I have an example that may be helpful for those people that aren't familiar with the topic. And that is in my coffee factory, we fill bags of coffee with, let's say a hundred grams of coffee. If we fill it with 101, well, we're giving away. If we fill it with 99, we're not delivering what we say. And what first lesson that we learned is that nobody's perfect. No, there is no way to consistently hit 100 is always gonna be some variation. Now that variation may be 100.0 1, 4 7, but ultimately variation around that is bad. And what you find is that maybe when the system is not that strong, you could be putting in 95 grams on sometimes and you could be putting in 105 on sometimes and something in between those. But those are all kind of common causes.

Stotz: There's just there's variation about that average, let's say. And then the only way to improve that would to be say, ‘oh, well, we need to have a more precise piece of equipment.’ It’s not that the workers weren't working hard enough or something, but we just didn't have, so we replace a piece of equipment that's measuring and all of a sudden we weigh more consistently the old clunky one didn't work that well, and now we're getting more and more narrow. And then one day the electricity goes off or we have a, a problem with the electricity and all of a sudden it's throwing the whole system off. Well, that would be some special cause as opposed to this common variation around the 100 that we're aiming for, would I be describing it? Right or how would you add to that?

Langford: Yeah, that, that that's exactly right. And so if we charted out filling your coffee bean bags over a long period of time, we'd probably find out that you'r, you probably have a really good system, right? So let's put it in terms of like grams or something. So you might find out that your variation is anywhere from 98 grams to 101 or a hundred, two grams. Right. And this also ties in with the last podcast we did about loss function. Because if you say, well, we're selling hundred gram bags, well, the further we move away from optimization or the optimum of a hundred grams, like what you were saying, if we're filling it too much, we're losing money. And if you're filling it too little, well, there might be a customer out there that feels cheated and might not ever buy your coffee ever again, because they, they weighed it and said, oh, this is only 99 grams.

Langford: Right? So there, and if you, the further that you would go away from that optimum 100 grams, and let's say that all of a sudden, you sent out a coffee bag that only had 90 grams in it. Now somebody could get really upset, right? Because that's a long way from the optimum of a, of a hundred grams or the opposite, right? If, if you're all of a sudden, randomly filling bags at 111 grams, well, now you take that 11 grams times the price of coffee beans. And like you said, you're losing a lot of money a lot of time.

Stotz: So it's one, one thing I would add to it is that now imagine that we’re measuring it very well, and we're getting a little variation. We're getting 101 sometimes. And 99, occasionally we get 102, occasionally we get 98, but it's in a relatively tight range. Now imagine that I start rewarding the employees when it goes, you know to a certain level and I start to identify if you hit this, that you're gonna get a bonus, I'm gonna dock your pay. Well, I would just be messing around with what are really just common causes of variation that have nothing to do with the employees. They have to do what that system can do.

Langford: That's what Deming called tampering. You're tampering with the system and you're, and you're making false assumptions, cuz you’re assuming that, oh, by holding somebody up as employee of the month that'll make everybody else work harder. So your assumption is that everybody else is not working harder. And the only way to get 'em to work harder is for me to manipulate 'em in some way. And Deming said that you you're now tampering with the system. You're making things worse, not better because pretty soon you have employees that say, well I'm not gonna do a really good job this month because you're offering that bonus you know, for most improved employee. Well, I can't be most improved if I'm always great, right? So one month I'm gonna look bad so I can look really good the next month.

Langford: So I can win that trip to Aruba, right? And now your coffee, the grams per sack are going down. And so everything's going haywire and everything else. And then, then you wanna blame the people in the system and not understanding that as management, you did this. You caused this to happen. And it's exactly the same way in a school classroom for education. If you start tampering with learning systems in the classroom. So most of the variation or performance of a system is built into the system. And that's what Deming talked about. Statistically like in 98, 98% of the result is coming from the system itself.

Stotz: Right. So don't like the results? Don’t blame the people, blame the system. So are, are there people problems and systems that are special causes? Absolutely. And what do you do when that happens?

Langford: So like in your example, with your coffee company once in a while, maybe you just, you hire someone that hates coffee, really shouldn't be there, they're there for the wrong reasons. They don't really love what's going on, you know? So what do you do? Well, instead of like changing the whole system based on that special cause person, right? Now, everybody has to do something different because we have this one person who's got defective behavior, so to speak, you just, you deal with the one person. Maybe they're just in the wrong job. I mean, they, they should be answering the phone in the company, not actually dealing with products or, or vice versa. Maybe they just can't deal with people. So maybe they should be in a position. So you're gonna make an adjustment. You're gonna shift that one person. And ultimately, maybe they're just in the wrong profession and maybe you need to help them find another job.

Stotz: And I just, I just wanna go back because it's such a common thing that people talk about about what Deming says about the output of the system is coming from a certain amount and the output the impact that a worker has for instance. And one of the sources of that is looking at the standard deviations. From the average, if you look at one standard deviation plus and minus you come up with 68% are within that range. If you go two standard deviations, now you're at 95%. And I believe it was that two standard deviation where he's saying, look, if something's happening within these two standard deviation, it's just common cause variation. No. He was actually talking about three standard deviations.

Stotz: Yeah. So three standard deviations would be what? 99.7%

Langford: Yeah. St yeah. Statistically it's like 99.9999998%. Right. Of something. And you know, why three standard deviations away from the, the mean, or the average? Well, because when you get to that point, if something is falling in that less than 1%, you could be pretty sure that's, that's, that's a special cause. Right? This doesn't normally happen in our, in our system. Well, the same thing in a classroom, if, if a teacher's teaching a lesson and every year when they, he or she teaches this lesson, everybody in the class scores, like, let's say 95 to a hundred. Right, right. And every year I get better and better. And my variations shrinks. And pretty soon I've got, now I'm getting an average about 98 percentile of people when they go through this lesson, right? Well, that's telling you that most of the variation is good within that system. So when people are randomly thrown into that classroom, that teacher is so good they can get that same result with almost anybody thrown it into that classroom.

Stotz: And then now.

Langford: What happens, that system is like that it becomes predictable. Now I can predict that next year. I'm probably gonna get an average somewhere between 95 and a hundred percent, if I keep doing what I've been doing.

Stotz: And what happens to that teacher when they see, oh, wait a minute, we've got this one kid who's getting a 62.

Langford: Then obviously, because you understand systems performance and you understand a little bit about special and common cause data, obviously this is a special cause there's okay. So it could be a learning difficulty. It, it could be home situation. It could be something psychological, it could be, could be a lot of things. Right. And so what do you do with a special cause? Well, typically like in the education system, we basically tried to get rid of 'em for years and we get, we would get rid of them in many different ways. Like, I'll, I'll just give them a failing grade and that that'll get rid of 'em eventually. I’ll send 'em out in the hallway, isolate them. I'll, we'll send them to special education classes. We don't we don't wanna have a mainstream in the class because it's a special cause.

Langford: And it's gonna take special effort to do, to work with that special cause and work through that. So veteran teachers that are really super good at dealing with students with special causes are amazing. Just amazing how no matter what the difficulty is or what the special cause that child starts to feel like they're part of the system, part of what's going on. Now, they may never get the same data as 98% of the rest of the students that come through that system, but they can also get better and better and better with, within that same system. And you that’s the exciting thing about education is to think about how special causes can be transformed.

Stotz: You remind me when I was in living in West Hartford, Connecticut, when I was just a little kid, I was all kinds of trouble in the classroom. And I was just, I just was all kinds of trouble. And they sent me to some special class to get some special help. And I ended up reentering the normal class and coming back kind of into a normal behavior, cuz they helped me kind of work on some of the things that were issues for me. And I ended up becoming a good student. But imagine...

Langford: You had, you had shock shock therapy or something.

Stotz: Yeah. They, they got me, they just a minor lobotomy this, but so now let's think about this cuz the, the title of today is weaponizing special causes. We've had a great discussion now about what are common, what are special? And I'm just imagining, like, let's just say that a teacher's doing really well, but they have this one student doing poorly and we know it's identified as a special cause. And then all of a sudden they decide, wow, I've gotta redo my whole way that I'm educating because of this particular unique situation. Would that be wise?

Langford: Well, it be insanity is what it would be. And we don't have to go very far, especially in the United States right now to see this happening. So there are transgendered children that that's, that's a fact, everybody knows this is happening, etcetera. But because I have one transgender child in my classroom or my school does not mean I changed the entire system based on a special cause. And now I'm disrupting 99.8% of all, all the students and parents and everybody else that comes through the system because I'm making this system twist to accommodate only a special cause. So and Deming said, this is one of the deadly diseases. So I'm gonna, I'm gonna change the whole bathroom structure into building. I'm gonna change the whole, how PE is run. I'm gonna, we're gonna change. We're gonna change everything because we have two children out of 1400 that may be transgender.

Langford: So I don't want to, I don't wanna offend anybody by this or anything else, but I just wanna point out that you can spend literally millions of not billions of dollars. go weaponizing special causes. And this is, this is just one example and PE uh districts are now building schools., where's, they're changing the bathrooms and getting rid of gender and all kinds of things based on only a few special causes. Whereas what should be happening is what do special causes needing these special, special help? So if they need a special bathroom, that's, that's fine. And there's a transition or gender bathroom for those two students out of 1400. Yeah. But just suddenly you start making rules, regulations policy I've seen district policy. That's just crazy based on maybe one instant instance every 10 years or so. And you're, you're changing an entire system based on that. is it that maybe gonna help that one individual? Yeah. But it's the same example as, as you gave, right? instead of changing the whole school because you were having difficulty in a classroom, what did we do? Well, we got you some help, right? Yeah. And basically you need discipline and people don't, people don't understand what discipline means. The first definition of discipline and the dictionary is training.

Langford: So you needed some training, right? This is what you do and this is what you can't do and in a classroom and everything else. And when you got that kind of training and it was better for you because you felt like you were belonging and you didn't have to be disruptive anymore. And it was better for everybody else because they could accept you. Right. They didn't, they weren't all of a sudden afraid that you were gonna fly out the handle or go crazy.

Stotz: Yeah. It's, it's interesting about the transgender stuff because in Thailand Thai people are just really accommodating to transgender. It's not a big deal. I mean, and in fact, the transgender people here are people who really speak up for kind of their rights. They're more outspoken. Whereas other people kind of go along more than let's say we're used to in the west. so they're there, it's just been fascinating to watch. And I think that the point is, and it's a little bit like handicap as an example we did decide to put in ramps to, to locations. And that was an adaptation to the system to accommodate the needs of that small group, but we didn't reshape a huge amount of things and other people in...

Langford: That. Well, what you're trying to do is well we see it now in medicating children with drugs and all kinds of stuff to help them learn better. And and in some cases, some schools and places you're, you're talking about 20, 25% of the population is now being medicated. Well, that's the, that's the opposite of what Deming talked about is treating special causes as if they're common that this is a common thing. So we're gonna do this with everybody. But these special causes are very, very rare, whether it's some kind of a mental thing or transgender thing or whatever it might be, you're talking about less than 1% of the population generally. And when you start to transfer a special cause to a whole population, that's what I'm talking about, about weapon weaponizing a special cause. And then ultimately you can do that with anything, but what you're really trying to do, and you comment about the, the handicap access, etcetera. What you're really trying to do is expand the capability of a system so that there are fewer and fewer and fewer special causes, not going the opposite direction, where the system becomes less and less and less and less capable. And so pretty soon everybody starts looking like a special cause.

Langford: And and that becomes hugely expensive and not very productive when you're treating everybody like their special cause.

Stotz: So let me try to summarize a little bit about what we've talked about. First of all, we talked about the importance of understanding variation. And we talked about the idea that 94 to 99% of variation is actually common cause, and only maybe one or 2% is special cause, and you, you mentioned about treating special causes as common was what Dr. Deming calls deadly diseases. You also talked about tampering, which is when you're chasing around common cause variation and either rewarding it or punishing it or highlighting it as success when in fact you really are having false assumptions. And the best way to think about that is that you walk into McDonald's and it's got a picture of the employee of the month and it's just a rotation. And then you talked about identifying the special cause, let's say it's a poor performing student.

Stotz: And then thinking about how do we how do we deal with this special cause? And it doesn't make sense necessarily to change the whole system because of what we're seeing with the special cause. And finally, I'm gonna add in my last little bit I wrote down when you were speaking is let variation run! Allow variation. It is the beauty of nature. It is the beauty of human. It is the beauty of system. Stop trying to attack every variation through medicine or through all these different things. Let variation free. Let variation run. Anything you'd add to that.

Langford: No, it's no, that's, that's good. It's a good summary. Yeah. It's in some ways it's very, very simple to think about. But in other ways, it's, it's very complex and in many ways, very contrary to the common society and businesses and schools and the way they’re run today.

Stotz: It's simple. But not always easy.

Langford: Yeah. And I think that's why Deming calls it profound knowledge. You have to have profound knowledge and profound means deep. You have to have a deep knowledge of something if you're gonna manage properly.

Stotz: Fantastic. Well, David, on behalf of everyone at Deming Institute, I want to thank you again for the discussion for listeners. Remember to go to deming.org to continue your journey. David, what's the best way that people can contact you if they wanna learn more?

Langford: You could go to our website, which is LangfordLearning.com, and there you can find out resources and support material etcetera.

Stotz: Fantastic. Well, this is your host, Andrew Stotz, and I'll leave you with one of my favorite quotes from Dr. Deming. People are entitled to joy in work.

In this episode, Bill Bellows and host Andrew Stotz talk about resource management in a non-traditional sense. Bill explains how managing the variation and integration in your product or service is just as important as increasing consistency and removing waste. 

TRANSCRIPT

0:00:02.3 Andrew Stotz: My name is Andrew Stotz and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with Bill Bellows, who has spent 30 years helping people apply Dr. Deming's ideas to become aware of how their thinking is holding them back from their biggest opportunities. The topic for today is episode nine, Resource Management. Bill, take it away.

0:00:28.9 Bill Bellows: Thank you, Andrew. And thanks for our audience and thanks for joining in again. So we're picking up following episode nine, which was, I called it the Paradigms of Variation. It was, I think the title on the podcast may be a little bit different, but what we've been building up to from the beginning is, parallel tracks. But one aspect that I've been trying to bring forward is this idea of variation in the white beads. We talked about the white bead experiment and the idea that the red beads are not caused by the workers, they're caused by the system.

0:01:13.5 BB: And then what if we got to the point that there were no more red beads? Yes, we can make the red beads faster, we can make the red beads cheaper, but could we make, I'm sorry, we can make the white beads faster. We can make the white beads cheaper with the elimination of the red beads, but if we're dealing with nothing but white beads that are cheaper and made faster, can we improve the quality of the beads? And what I found is, when I press on people, they'll say, "Yes, everything can be improved. Everything can be improved. When I press, press, press, they'll say faster. They'll say cheaper. I said, "Yeah, we said that." I said, "But can they be better?"

0:01:53.4 BB: Is that what Dr. Deming's trying to say with continuous improvement that we stop it a 100% white beads? Or can we go further? And I find people get stuck. And I think it's very easy to get stuck, because that's the world we live in of good parts and bad parts. We focus on the bad to make them good. And what do they do when they're good? Well, they met requirements. But what's missing is this key word called variation. And yes, there's variation in the red beads and Dr. Deming would plot that on a control chart. But Dr. Deming also discovered in, definitely in 1960, from Dr. Taguchi who he met a few years earlier, this notion of variation in the white beads and that the, so I talked earlier also about question number one and quality management.

0:02:44.0 BB: Does this quality characteristic meet requirements? There's only two answers, remember Andrew, yes or no. But then question number two is how many ways are there to meet requirements? And I'd say there's an infinite number if you take into account, how many decimal places you can go. And that, the idea that you can have anywhere from the absolute minimum to the absolute maximum of the requirements is there's all those places be in between. That's called variation. And does it matter where you are within spec? Within spec? And again, by spec I mean specification. You've met the requirements for the activity. And so what we did in episode nine, I'm sorry, episode eight is look at what I call the Two Distribution exercise. And you may have caught me saying there are four suppliers.

0:03:41.7 BB: And at the end I said, forget about the four. There's actually two. I've done it with four, I've done it with two but the important thing is when I show people a number of distributions within requirements, and one of them will be, we'll go from the minimum to the maximum with near zero and frequency at either end to then high in the middle. And I'll say, "The middle is the ideal value." And then I'll say, let's say you also have a really narrow distribution consuming, and I said, last time, 10% of the variation, what I meant to say, and I said at least once, is 10% of the tolerance that, so you're using a very small portion of the tolerance, but you're far away from the ideal value.

0:04:27.0 BB: You're shifted to the right. And so when I give people the choice of buying from one of those two suppliers under the idealized situation, you may recall, Andrew, of same price, same schedule, everything's guaranteed to meet requirements. We've got histograms, we've got control charts. The processes are in control with all those, what Ackoff would call idealized situations. Make it really, really simple. Do I go with the wide one centered on the ideal value or the narrow one over to the right? And time again, people take the really narrow one, which we said was about, why do you like the really narrow one? Because they're more consistent. Then I explained that that's precision. And that's the most popular answer. And I'm reminded of that every time I use the exercise. Within the last few days, I've used it again.

0:05:19.6 BB: And that narrow one gets people's attention. What I find really fascinating is if the goal is to meet requirements, then why is the answer not, I'll take either one of them, which was one of the choices. You could take the wide one in the middle that covers the entire, or the narrow one. Why does it matter? Why not say in the world of meeting requirements, what's the driver behind the narrow one? Why don't people say it doesn't matter anymore? And I think because there's something about variation and consistency. I was talking with somebody the other day and they said, "Being consistent is, that's everything in terms of quality." And I said, "Not quite. Not quite." What... And this will become the focus of a later episode, that you could, ideally you could put the variation where you want it to be along the ideal and end up with improved what?

0:06:18.4 BB: The answer is improved integration. Because the very simple model we use in organizations is that if the parts are good, whether it's two parts, three parts, four parts, number of parts going together, you have to have at least two. And I say if the parts are good, then they fit. That's the model. If the parts are good, then they fit, then is there anything wrong with that model? And people are like, "No, that's the model we use." If the parts are good, then they fit. Now, if you're developing an airplane or a rocket engine, you've got a wing and a fuselage, then you've got all the parts to make the wing, all the parts to make the fuselage, all the parts that do these separate components, you could say the same thing for a play. You have all the elements of the first act, all the elements of the second act, and then you put them together for the entire play. So the point is that what I'm talking about is that integration is not black and white.

[overlapping conversation]

0:07:23.2 AS: What... Just... Can you define integration just so we can make sure we understand it?

0:07:27.5 BB: Yeah. Integration is when I'm going to put the cap onto the bottle of water. That's integration. The cap is good, the bottle is good. Now I'm trying to put the cap, which is good, and the bottle, which is good, and I'm trying to put the cap onto the bottle.

0:07:46.0 AS: Okay.

0:07:46.5 BB: Yeah. That's integration. Or I'm trying to put the, I'm trying to put two parts of something together. I'm trying to put the cap on top of the pen. What I love about water bottles as a prop is wherever I'm presenting, someone in your room will have a water bottle. And I'll say, can I use this as a prop? Sure. And I say, if all the requirements for the cap are met, what do we say about the cap? It's good. And if all the requirements for the bottle are met, what do we say about the bottle? It's good. Then I'll say, see what we're doing? We're managing parts in isolation. We're saying the cap is good, the body is good. Then I say, why don't we focus on how well the cap mates with the bottle? And I had a co-worker once said, well, if the cap is good and the bottle is good, then won't it fit. Fit as in absolute fit, right?

0:08:39.7 BB: Not relative fit ‘cause remember in early episodes we talked about black and white thinking versus shades of gray thinking. Good versus bad is black and white. Fit is black and white. It fits or it doesn't. What I'm talking about Andrew, is the idea that there's variation in good and the variation in good cap, and the variation in the good bottle show up when I go to put the cap onto the bottle. Because if the, if the outer diameter of the bottle is on the high side and the cap, inner diameter is on the low side, then I'm gonna have trouble putting the cap onto the bottle, ‘cause one's too small, one's too large. Boom. And, so what I'm trying to imply, [chuckle] not what I'm trying to imply. What I'm stating is fit is not absolute.  It's relative. Integration, which is about fit, is relative. And I don't, did we talk Andrew about a hundred percent…?

0:09:41.1 AS: Wait a minute. You gotta say that again. I didn't catch that. I know many of our listeners are a little faster than me. But say that again about relative versus...

0:09:56.6 BB: Okay, so what I'm saying is the fundamental model we're using is if the cap is good of the water bottle and the bottle is good, then the cap will fit onto the bottle. It'll fit when you go to...

0:10:05.7 AS: Yep.

0:10:07.8 BB: Put the, put it on it fits just like that. What I'm talking about…

0:10:12.1 AS: And when you say fit, are you using that as a general term in a system or are you just talking specifically about the cap?

0:10:17.8 BB: No, no, I'm really, I'm glad you brought this up. What the suggestion is that fit, there's only one degree of fit. It goes together you know with a, technically what we're talking about is how much torque is required to screw it on, how much force is required. And so fit is about how much force is required to screw it on. And the implication behind them being good and fit is that they always fit the same. So the model is that parts that are good fit together the same way each time. And that's not the case. So there's a... And I, one of my first exposures to this was reading a book by David Kearns and I mentioned this, I don't know which episode. And I said that Frank Pipp, an assembly plant manager at this Ford factory had his assembly team routinely buy competitor's cars and put them together.

0:11:19.4 BB: Because at the Ford plant, most of the time when they're putting parts together, they needed rubber mallets to bang them together because they didn't quite fit. And, so they needed help. And the help was the hammers to bang them together and out. Every now and then two parts went together without a hammer. That means fit is easy as opposed to hammers, which means fit is difficult. So imagine you've got everything between I can put them together, with little effort at all to I need a hammer to bang them together. That's degrees of fit, which I'm saying Andrew is degrees of integration.

0:12:00.4 AS: Okay.

0:12:01.2 BB: And, so the point I was trying to, what got me excited about Taguchi's work and then really excited when I saw Dr. Deming realizing it, is that when I came across this a hundred percent snap fit Toyota pickup truck story account, I thought, well, holy cow. And I found in listening to these podcasts that I use a expression quite a bit.

0:12:24.1 AS: Holy cow cow, holy spicoli.

0:12:26.3 BB: Holy... Holy cow, Andrew [laughter] But what was cool is this Ford plant has discovered that Toyota, where I know Dr. Deming had some influence, but some influence, okay, what influence? that's a whole ‘nother topic, but I know Taguchi had an influence there. So I'm looking at that with my understanding of variation and thinking, that's incredible. And brought that awareness to my coworkers at Rocketdyne. And we developed, with, I provided the education, they provided the hands-on go make it work. They developed hardware that went together beautifully. And why is this important, Andrew? And this is one of the things we got to in the end of the last podcast is if you would like your customers to have products that go together easily if they're assembling it or going together means that it, this product fits well with how they use it.

0:13:22.7 BB: That the car starts each time or the stopwatch, whatever they're using, works really well, which means there's degrees of performance. That's what excites me about the idea that if we can pay attention to the variation, we can either have designs that require hammers to assemble or we can design them to go together well. And, and all of this is to say that's what prompted me to get people excited by the paradigms of variation to get them to better understand that a mindset of meeting requirements is different from a mindset of precision, which is different from a mindset of accuracy. And what I've just repeated is Paradigm A is meet requirements. Get the darts somewhere on the dartboard. Meet requirements be anywhere within the requirements. Paradigm B is this idea that we're striving for consistency, incredible uniformity, otherwise known as, as precision.

0:14:30.7 BB: And, and there may be a place for that. But what Dr. Taguchi's talking about is different than that, that's precision is Paradigm B. Paradigm C is trying to be close to target. So that's taken the distribution, which is precise, and then finding a way to adjust it to be on the bullseye. And what does that gain us, Andrew? That, well, first of all, I would say when we're working at home looking for, working on the recipe, trying to get exactly one cup of flour, exactly 350 degrees, exactly one hour in the oven.  As we pay attention to how close we are to those values, chances are we're gonna end up with an incredible product. And that's, we're trusting that the person who developed the recipe has done that.

0:15:23.2 BB: But so whether it is woodworking or working on any project, it could be making things out of cloth where you're, you’re putting together some outfit out of cloth that my father used to do for my sister when he was in the textile business. That is about the idea that things come together well is about accuracy in improving integration. And that's what I find the Deming philosophy offers an understanding of what does it take to inspire an organization where, where it takes the people working on their different elements, not to meet the requirements any way they choose, but to meet requirements in a - ready Andrew - synchronous way. So you and I are on the soccer pitch, and it's not about your position, it's about my position and your position on defense that we're trying to win the World Cup.

0:16:25.2 AS: Yeah.

0:16:26.4 BB: And so all of that is about the Paradigms of Variation. Go ahead, Andrew. You were gonna say.

0:16:29.0 AS: You referenced sports and I was just thinking about how easily we work together in team activities, team sports that are just, clearly great teams are the ones that integrate each individual's doing their own personal work and they're doing training and they're improving themselves, and then they're practicing together. How do we bring this together into an integrated system that then wins?

0:16:54.9 BB: That's right. And so when you say bring together, that's what integration is. It's bring together, right? And we're looking, we we're screened a bunch of candidates on the phone, now we bring them in for face-to-face interviews. What are we looking for? Why isn't it enough that they meet the requirements that are on the website? We wanna know which of these potential employees is the best fit with our team, whether it's to play first base, or play senior researcher. Are they a fit? They may be very consistent in what they do, but is that consistency...I mean, they have to be, their consistency has to mesh what we want. So they may be consistently tardy, they may be consistently dominating the meeting, but what we want them to do is fit into the meeting.

0:17:50.0 AS: And the other thing that I always think about when I hear you talking about this stuff is, I think about when I was younger, when Lexus came out, if you remember Lexus, when they first...

0:18:01.8 BB: Absolutely.

0:18:02.5 AS: Launched...

0:18:02.5 BB: Oh yeah.

0:18:03.7 AS: Their great video or the great advertising was stacked up champagne glasses...

0:18:09.5 BB: Yes, yes.

0:18:11.6 AS: Onto the hood of this car. And then they lifted the wheels off the ground and then, or not off the ground, but like they had a roller that they were rolling it on, and then they revved that car up to as fast as it could possibly go, and those glasses did not fall. And you know the only way you can get that is by improving not only each individual part, but how those parts work together with the end result being less vibration, less friction.

0:18:39.9 BB: Yes.

0:18:41.1 AS: All of those things.

0:18:42.0 BB: Yes. Exactly.

0:18:42.5 AS: And you couldn't do it by just improving one part.

0:18:45.6 BB: That's right. And that's a great example because together you've got minimum vibration. That's not an accident. That's they have figured out how those things come together to have an incredible product, which is consistently, it works consistently. But the consistency, there's nothing wrong with consistency. Consistency is not the issue. But it, the issue is is the consistency we're talking about striving for precision or accuracy. So a car that consistently doesn't start is consistent, but that's not helpful. I want a car that consistently starts, right? I wanna be consistent around... I want you to bring your consistency in concert with others' consistency where those consistencies matter, you know? And if we don't need you to be consistent, then that's okay. Then we save money by having lack of consistency because why have consistency if you don't need it? But all of that's about...

0:19:50.6 AS: It's hard. It's hard. Consistency is hard and fit is hard.

0:19:55.4 BB: Yes. And, and, and, to build upon what you just said, consistency is about managing variation as a system. And so, another thing I wanna point out, and I got some comments from some friends about, you know, the last podcast.  The Paradigms of Variation are about the paradigms of white bead variation. So, so, Paradigm A is we've got variation within the requirements and, and is that okay? Is it enough to have variation in requirement? It doesn't matter where we are? That's Paradigm A. Paradigm B is precision. We're consistent, but we're not around the ideal. That's accuracy. And then paradigm D is....and I was searching for the word, the expression Dr. Taguchi used. He calls that Technology Development, that we're developing an advanced technology for use in... And I, the example I used last time is, let's say we're fac…we’re developing a new way of making tubes for plumbers to use.

0:21:07.6 BB: And I said in the beginning let's say we just have one inch outer diameter tubes, and that's Paradigm C because everything we make is one inch outer diameter tubes. And then somebody comes along in our research labs and comes up with a novel way to make tubes of different sizes. That's variety. So they can make them down to quarter of an inch, half an inch outer diameter. And then what we're doing with what Paradigm D is about is developing the technology that allows us to be really accurate around all these different values. That's what Dr. Taguchi calls Technology Development. I called it Paradigm D, he called it Technology Development. And in the world of sports, we talk about sports. That's the ability of the soccer player to kick the ball, or I should say a football player. [laughter] To put the ball anywhere in the net during at any time. Whether it's...

0:22:03.6 AS: That's within spec.

0:22:05.4 BB: Yeah, it's so the goalkeeper goes one way and they can hit any point in there. Because if you come up and the goalkeeper knows, oh, here comes Andrew, Andrew's gonna go to the lower left 'cause that's all he knows how to do. But you don't think I know that as your opposing goalkeeper. I know Andrew, Andrew's gonna fake, but I know what Andrew's gonna do. So the Paradigm D is in sports is the ability to move the ball around. If you're the pitcher, if you're the tennis player, and that's how you become a professional athlete, is that ability to move it around. That's Paradigm D. So, years ago, and this, I was developing this and sharing this, refining it with co-workers.

0:22:44.4 BB: And I was at a Deming Institute conference. True story, in Washington DC with Tim Higgins, a co-worker, and got a call from a really good friend, Jim. So Jim calls up and Jim was in this professional development program within Boeing doing a lot of travel. Every time he called, he was somewhere different in the country doing some really cool stuff in this incredible program to develop next generation leaders. And he definitely fit the mold. So he calls me up and he says, so he says, Dr. Bellows, have you discovered Paradigm E yet?

[laughter]

0:23:17.9 BB: I said, Jim, there is no E. He said, yeah, there's letter A, there's letter B, there's letter C, there's letter D. Oh, so there's also E. I said, Jim, A meets requirements, B is consistency anywhere, C is being on target, D is being on any target. I said, there's nowhere else to go. I said that we've run out. He said, we haven't run out of letters. [laughter] So I said, so he pushed on me and I pushed back. He pushed on me. We literally pushed on each other because I kept saying, Jim, you're you... Let's find another topic. No, no, no, no. I wanna hear about Paradigm E. And then it dawned on me, and I can remember it like it happened yesterday.

0:23:58.8 BB: And every time I have lunch with him, I say, Jim, I give him a big hug because I could not explain with the Paradigms of Variation, why would I pick up a nail in the parking lot, right? Why would I pick up a piece of glass in a parking lot? '‘Cause I viewed that as minimizing loss to society, that if I pick up the nail, prevent the flat tire, pick up the piece of glass, prevent the flat tire. I am, to quote Dr. Taguchi, "minimizing loss to society." But I don't know how to put that into his loss function, which is a subject of an of a future episode. And the idea of the loss function is there's an ideal value somewhere within the requirements. And the closer we are to the ideal value, the better the integration, and therefore the easier the effort.

0:24:55.2 BB: And, so now I'm stuck trying to say, so Jim's poking me, and I'm thinking, I'm stuck trying to explain everything through Dr. Taguchi's loss function, which is looking at the impact of variation relative to meeting requirements. And it dawns on me, and what Jim is saying is, I'm stuck in the world of variation. And, so when he mentioned...as, as he pushed and pushed and pushed, and it dawned on me that there's another whole world called managing, not... There's managing resources. I'm sorry, managing variation is Paradigms A, B, C, and D. What Jim got me to do that he called Paradigm E, and later we called it Resource Management, he realizes variation is a resource. Variation is a result of how we define our processes. There's managing cost.

0:25:52.3 BB: What is the cost of what we're doing? How much time is required? So, I look at resources as all the things we have in our organization from people to equipment to software to hardware and tools and techniques. Those are all resources. And picking up a piece of glass in the parking lot is a way of managing resources to improve the system, just as being on target is a way to improve how resources are managed. I started, I just jumped back and thought, holy cow, it's bigger than variation. And I think Dr. Deming really had this in mind. It's not just about variation, it's about the system includes variation, but it also has resources. Again, people, time, ideas, money. How do we use our money? That's a resource.

0:26:39.4 BB: Are we using, 'cause the other thing that was bugging me was are we using our money to improve things that are good? No, we're using our money and our time and our resources to focus on what is bad to make it good. And so that's what started off as Paradigm E then became Resource Management. So that's the genesis for Paradigm E. Managing resources is, should I get a college education, right? Should I exercise? How often should I go to the doctor, right? How often should I go shopping for groceries? Should I go shopping every day on my way home or should I go once a week? Those are resource management questions. Should I have a garden in my backyard? Should I buy the groceries? What's a better use of my time when I'm running errands?

0:27:33.2 BB: So on Saturday morning, I'm gonna run out and I'm gonna pick up the dry cleaning, go to the drug store, go to the veterinarian, pick up something for the cats. Do I do each of those randomly, come home and I say, what do I do next? Or Andrew, do I line up the errands and figure out what time the store opens? When do the lines occur? What time does traffic start to pick up? Am I making right-hand turns or left-hand turns? And I find what I do is I'm trying to figure out how do I get all these things done as fast as possible? And that directs my route. What I'm I doing, Andrew? I'm managing resources.

0:28:11.7 AS: And you remind me of the book I'm reading right now, Steve Jobs by Walter Isaacson.

0:28:16.8 BB: Yes, I listened to it, it's fantastic.

0:28:18.9 AS: Yeah, and there's just these times that Steve Jobs would just go into an absolute focus into some minute detail that all the people around were thinking that, and rightly so in some cases, that he was wasting resources, the resource of time. But there was another component that I think they couldn't see maybe was the passion that he was conveying to people around them that this matters.

0:28:48.0 BB: Yes, well, I don't know if this story shows up on that book, but that book was a fantastic read, oh I just loved it. Do you know the subject of Walter Isaacson's next biography? I don't know when it's due, but the very next auto, biography that Walter Isaacson is doing, take a guess who it is?

0:29:07.7 AS: No idea.

0:29:08.4 BB: Elon Musk.

0:29:10.9 AS: Oh, great.

0:29:12.7 BB: Yeah, yeah. So I think Fortune Magazine had an article that Jobs, well, first of all, let's go back, let's say 15, 20 years when I would go into work with others and we'd turn on our computers and then go get a cup of coffee. You know what I'm talking about, Andrew? You know where I'm coming from?

0:29:35.4 AS: I remember that very well.

0:29:37.8 BB: And why are we going to get our coffee, Andrew?

0:29:41.1 AS: Man, it takes minutes to boot up.

0:29:43.1 BB: Yes, so because we're going to go, we gotta turn on the computer and it's going to take minutes, five, 10 minutes. And for those of you that are, I mean, really, now we're so used to turning on the iPhone and it comes right up. Yeah if you shut off the iPhone, it may take 30 seconds to turn on, but you start your computer and it, from scratch and it's within 30 seconds, your computer's up and running. No, what we're talking about, Andrew, is you go into the office, turn on the computer, go get a cup of coffee, talk with some friends, you come back in 10 minutes, your computer's up.

0:30:18.9 BB: So Jobs supposedly went to people that were working on that boot-up system and told them that if we could shave a few seconds off of the boot-up time, multiplied by the million or so users around the world, we can save society big numbers. And the person that went off and did this, or the team that went off and did it, went way beyond what he was talking about, but he's the one, he Andrew, saw that as a loss. All right, so when you're banging things together at the Ford plant and I come in on day one and, Andrew, what are you doing? You're like, and you're banging things together. I said, "Andrew, why are you doing that?" And you say, "Bill, this is how we assemble cars here." I said, "Andrew, look at those calluses on your hand." You're thinking, "Bill, you'll get used to it, but this is how we put things together." In the world of automobiles, this is how you do it, Bill." And I think, "Geez, I don't think it needs to be done that way." And what's fundamental here is, and again, the whole idea of the loss function, the integration loss function, we'll look at in a future episode, but what I want to point out here, Andrew, is if I believe you that banging it together with hammers is as good as it gets, then there is no loss.

0:31:51.6 BB: Meaning that as soon as I say that's as good as it gets and I stop, then I'm saying that this is how we do things here. But if I come in and look at that with an understanding of Taguchi's work and how to manage variation as a system or manage resources as a system, I have the capacity to look at that and say, as Jobs did, and say, "I think it can be better." And the difference between what it is and what it could be is loss. But as long as I look at what we do and say, "That's it, let's stop right here." Then what I'm saying is... What I'm acknowledging is that, that's okay. And so what I was looking for within Rocketdyne and got the president of the company to agree to this is finding some people that I was mentoring for several years and their role was to go around the organization and look for loss.

0:32:54.8 BB: And, loss is the ability…Ready Andrew, to look at what is in terms of integration and wonder what could be. And then look at the components and then ask, "Can we change the variation of the components to improve integration?" And of course, the big question is, is it worth the effort? But it's having the vision that the integration and I think that's a great example. The integration is all that time we're spending waiting is not only is it lost, but that's integration time. [laughter] Bingo. So, the next thing I wanna point out before we close is... So this conversation with my friend Jim got me out of being stuck on the loss function and then stepping back and saying that's... There's... It's a global thing. It's all about managing resources, which also means it's more than quality. It's not managing quality, it's managing resources.

0:33:51.8 BB: And if we improve how we manage resources, quality goes up, integration improves, all these things improve. Well, the next thing I wanna point out is, I started thinking in terms of a model that says, how do we allocate our resources? Again, resources are time, energy, equipment, software, ideas. How are we using them? And the first model I had in mind was, are we applying... Are we allocating the resources proactively or reactively? Are we applying the resources to go to the doctor for annual checkups just to see how we're doing. We're going to the dentist for an annual checkup. Are we having somebody come by and look at our plumbing system and getting a feeling for how is it running? Are we taking the car in for routine things. Or are we reactive? We call the plumber when it breaks, we go to the doctor when we're sick. We bring the car in when it's broken. And, so what I started focusing on is what is our preference? How are the resources being allocated?

0:34:55.6 BB: And, without a doubt, what I found is the majority of the resources, time, energy, equipment are being used reactively. Focusing on things that are broken, not good. And, and I would go into big production meetings and say, "How much time are we... How much time do you ladies and gentlemen spend every day discussing parts which are good that arrive on time?" And, no matter where I went, the answer was “little to none.” And, so what I found is the resources were being used reactively, reactively. Now, let me also throw in that if the company's doing research and developing, developing next generation products, that is proactive use of resources. But what I also found is for the products that are in production, rarely did anybody ever come to me for something in production and say, "This could be better."

0:35:52.0 AS: Mm-hmm.

0:35:53.1 BB: That's rare. So the other dimension of this model. So the first dimension... I was just... In fact... It wasn't till I discovered Taguchi, Deming's work that got me to realize this is focusing on things that are broken is the norm. It wasn't just where I work. I started to see that pattern play out elsewhere. Well, the other axis of this resource management model, so the vertical axis is... Are the resources being applied proactively or reactively? So that's let's say the vertical axis going up. Top versus bottom. The horizontal axis are, is are the resources mine or are they ours? Is it my equipment, my people, my department? Or is it ours, Andrew? And so on the horizontal axis, the left hand side is the resources are mine, my department, my, my, my... And the other side of the horizontal axis is ours.

0:36:53.1 BB: And so in this two dimensional model, the vertical axis is, are the resources applied proactively, that's the top. Reactively, that's the bottom. If you think of a two by two matrix, the top row is proactive, the bottom row is reactive. And then when it comes to columns, so the left hand column is the resources are mine. The right hand column is the resources are ours. So we've got a two by two matrix. And I say to people, so given your understanding of Red Pen and Blue Pen companies, me and we organizations, last straw, all straw. I say, according to that matrix, how do you see resources managed in a Red Pen Company, a non-Deming company? And people will say the lower left quadrant, which is what, which is my resources applied reactively. Right?

0:37:43.4 AS: Yep.

0:37:44.9 BB: And then I'll say, "Okay." [laughter] And the name for that is... And it took a while to come up with a name and you're gonna love this. We started calling that at Rocketdyne, Reflexive Resource Management. Reflexive Resource Management. Because a wise man, born in Iowa in 1900, Andrew [laughter], by the name of W. Edwards Deming, once said, pulling your hand off of a hot stove requires no thought. It's all reflex action. When I saw him and that, I don't know where it was, I said, but I know he said that. And I thought, that's it. It's all reflexes. There's no thought involved. Why are we reactive? Because! I mean, why would I be proactive? I mean, why would I work? So when I started realizing is there's no thought involved in being reactive in a Red Pen Company. It's just that's what we do. So then the question is, well, how are resources managed in a Blue Pen Company? A We Organization, a Deming organization. And, what people will say is the upper right quadrant, which is proactive ours, the resources are ours.

0:38:56.1 BB: We're gonna be proactive. And wherever I go, that's people's answers. And I say, you, are you ready? And okay, what? I say, the entire right hand side is a Deming organization. What does that mean? It means I'm smart enough to know when to be proactive, and I'm smart enough to know when to be reactive. I choose, I choose to replace the light bulb when it goes out, it's a choice. Or I choose to replace the battery in the smoke alarm when it goes out. I, being reactive in a Deming organization is a choice. Being proactive is a choice. And so the right hand side, it's about choice. And it took some time to figure this out. What do we call that? What do we call this? So we call it the left hand side, the left lower left quadrant, Reflexive Resource Management. So it took a while to find out what's the adjective for the right hand side.

0:39:55.6 BB: And I come up with an adjective, find out that it's an acronym used by somebody for something else. No, can't use that. Try it again. Try it again. Try it again. Try it again. Try it again. It took about an hour to, at least an hour and finally came up with a term used by the Bureau of Land Management in the late 1800s. And it, and it's, it was known as Purposeful Resource Management. And I thought, bingo! One is nobody's got a trademark on it, [laughter] And so we started calling the deliberate use of resources to be deliberately proactive, or we choose to be proactive, or we choose to be reactive. We started calling that purposeful, thoughtful resource management.

0:40:45.5 AS: Yeah, that choice. It made me think about there's a lot of things in business that you just, your choice is to be reactive. When that breaks, we're gonna fix that because it's not so critical, whereas we cannot have a situation where we're reacting to this particular process. Like, think about my coffee business as an example. We cannot be reactive to downtime on the roasting machines. Well, we're not just waiting for that. We're doing preventive maintenance. We've got stocks.

0:41:17.7 BB: That's right.

0:41:18.5 AS: Stock of parts. We've got, so we make a deliberate effort and resource allocation to make sure we never in that situation, but there's other parts. Let's say we have a few grinders and something like that, we'll fix those when they break. [laughter]

0:41:35.0 BB: Yeah. Well, I've shared this with a woman who, the hairstylist I go to. My kids used to go there and I've been going there ever since. And she is awesome. Just awesome. So I, these are the things I discussed with her, all kinds of things. And so I have a photograph of her, Andrew, holding a hairdryer in her hair salon. And the hair salon is called Kids Cuts because a good part of her business is kids. And then people like me bring the kids in there and next thing you know, I'm a customer, too. Well, so I'm explaining this to me and she says, "Bill, every 6 months I get rid of all the hair dryers". I said, why? She says, "I cannot afford to burn somebody's hair". And so, so I've got a photo of her holding it, so she doesn't monitor how it's performing.

0:42:24.1 BB: She just knows 6 months, get rid of it now. You know, does she donate it? I don't know where it goes. And I don't wanna get into recycling, but she deliberately, she's not gonna burn somebody's hair.

0:42:35.0 AS: Right.

0:42:38.1 BB: Alright. And, what else? Oh, but you and I talked earlier in one of the episodes, this idea of choice, that instead of following the domain that says you can't have inventory, we gotta have blah, blah, blah, you realize this? No, we can choose to have inventory, or we can choose not to have inventory. And so what we're talking about in resource management is, which gets into all those things we talked about earlier, is it's about choices. And so I would say to people, I've got a slide, then I say, it's like you get to the end of the road and you turn right and turning right is being reactive.

0:43:21.3 BB: And I say, Andrew, I've been patterning you, and you get to the end of the road and you turn right, you're always reactive. Why do you turn right? And you say, "Bill, there's only a right-hand turn". And I said, "No, Andrew, there's a left-hand turn, but you can't see it. It's in your blind spot". So the right hand turn is to focus on what's bad, to make it good, what Ackoff would also call managing actions. And that's the road that's well traveled, [laughter], the road less traveled is the left-hand turn, which is to be proactive, again, when it makes sense. I'm not saying being proactive all the time, I'm saying there's a place for it. Consider being proactive, consider being reactive.

0:44:04.0 AS: So, on that note, I think we ought to leave. Why don't you leave the listeners and the viewers with a concise statement of what you want them to take away from this discussion. We went through a lot of different things, but if you wanna bring it down to something clear and concise, how would you describe that?

0:44:24.5 BB: I'd say the, um…I'd like, I'd encourage our listeners, viewers, students of the Deming philosophy, those new to it, to expand their appreciation of quality management and realize that to managing resources period. And the better we manage our resources in our organization, knowing when to collect data, when not to collect data, when to meet requirements, when to be on target with minimum variation, when having lots of variation. Should we be proactive or re…. These are all choices. And they're, and I think the better we understand those choices about how we manage variation as a system in concert, I think the better the performance of the organization and improving productivity, improving quality, improving profit. So I think all those things we're striving for come from a better understanding of how to manage resources. And so instead of just being narrowly focused on the quality dimension, I think if we step back and realize that that's one aspect of how an organization operates.

0:45:42.4 AS: Bill, on behalf of everyone at the Deming Institute, I want to thank you again for this discussion. And for listeners, remember to go to Deming.org to continue your journey. If you want to keep in touch with Bill, just find him on LinkedIn. This is your host, Andrew Stotz. And I'm gonna leave you with one of my favorite quotes from Dr. Deming, "People are entitled to Joy in work."

This week's Podcast features Dr. Lisa Snyder, Superintendent of the Lakeville Public Schools. Lisa shares how the work of Dr. Deming is influencing her as a superintendent and the rewards and challenges of adopting his philosophies. 

Lisa's Deming journey began 23 years ago, when in a new job, she was sent to listen to Dr. Deming via satellite. The experience had a huge impact on Lisa as she connected Deming's philosophy to her own belief systems. She thought - this is the framework that public schools are desperately lacking. It was then that she became a Deming follower. 

What resonated for Lisa, was the idea of systems thinking rather than evaluating and blaming people. When she started to think about abandoning the "blame game" and looking instead at flaws in the system, it was very powerful.

Listen as Lisa talks about shifting the "mindset" in public schools from working in silos to working in collaboration through systems thinking. And how, as a district seeking to create meaningful change in the public school system, they adopted a policy to lead their organization through a continuous improvement philosophy.  

Lisa explains that it was both exciting and challenging to find where schools should have high levels of autonomy and where there should be more systems alignment for efficiency and effectiveness. But the process brought more people to the leadership table and broader sense of empowerment to those who would help change the philosophy of the district.

In part 3 of this series, John Dues and host Andrew Stotz talk about the final 5 lessons for data analysis in education. Dive into this discussion to learn more about why data analysis is essential and how to do it right.

TRANSCRIPT

0:00:02.4 Andrew Stotz: My name is Andrew Stotz and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today I'm continuing my discussion with John Dues who is part of the new generation of educators striving to apply Dr. Deming's principles to unleash student joy in learning. This is episode 23 and we're talking about goal setting through a Deming lens. John, take it away. 

0:00:30.8 John Dues: It's good to be back, Andrew. Yeah, in this first episode of this four-part series, we talked about why goal setting is often an act of desperation. And if you remember early on, I sort of proposed those four conditions that organizations should understand about their systems prior to ever setting a goal. Those four were capability, variation, stability, and then by what method are you going to improve your system? And then in the last episode, I introduced the first five lessons of the 10 key lessons for data analysis. And remember, these lessons were set up to avoid what I call these arbitrary and capricious education goals, which are basically unreasonable goals without consideration of those four things, the system capability, variation, and stability, and then not having a method. So, it might be helpful just to recap those first five lessons. I'll just list them out and folks that want to hear the details can listen to the last episode.

0:01:31.8 JD: But lesson one was data have no meaning apart from their context. So, we've got to contextualize the data. Lesson two was we don't manage or control the data. The data is the voice of the process. So, it's sort of, you know, the data over time shows us what's happening and we don't really have control over that data. We do have control under that underlying process. Lesson three was plot the dots for any data that occurs in time order. So, take it out of a two-point comparison or take it out of a spreadsheet and put it on a line chart that shows the data over time. Lesson four was two or three data points are not a trend. So again, get beyond the typical two-point limited comparison this month and last month, this year and last year, this same month, last year, those types of things, this week, last week.

0:02:25.6 JD: And then lesson five was, show enough data in your baseline to illustrate the previous level of variation. So, we want to get a sense of how the data is changing over time and we need a baseline amount of data, whether that's 12 points, 15 points, 20 points, there's sort of different takes on that. But somewhere in that 12-to-20-point range is really the amount of data we want to have in our baseline. So, we understand how it's moving up and down over time sort of naturally. Sort of at the outset of those two episodes, we also talked about centering the process behavior charts, like the ones we viewed in many of our episodes. And we put those in the center because it's a great tool for looking at data over time, just like we've been talking about.

0:03:11.4 JD: And I think when we use this methodology, and when you start to fully grasp the methodology, you start to be able to understand messages that are actually contained in the data. You can differentiate between those actual special events, those special causes, and just those everyday up and downs, what we've called common causes. And in so doing, we can understand the difference between reacting to noise and understanding actual signals of significance in that data. And so, I think that's a sort of a good primer to then get into lessons six through 10.

0:03:51.2 AS: Can't wait.

0:03:53.3 JD: Cool. We'll jump in then.

0:03:56.1 AS: Yeah. I'm just thinking about my goal setting and how much this helps me think about how to improve my goal setting. And I think one of the biggest ones that's missing that we talked about before is by what method. And many people think that they're setting strategy, when in fact, they're just setting stretch targets with nothing under it. And they achieve it by luck or are baffled why they don't achieve it. And then they lash out at their employees.

0:04:31.4 JD: Yeah, there was really... I mean, that goes back to one of those four conditions of setting goal capability. You have to understand how capable your system is before you can set, it's fine to set a stretch goal, but it has to be within the bounds of the system. Otherwise, it's just maybe not an uncertainty, but a mathematical improbability. That's not good. Like you're saying, it's not a good way to operate if you're a worker in that system. So, lesson six then, to continue the lessons.

0:05:06.8 JD: So, lesson six is "the goal of data analysis in schools is not just to look at past results, but also, and perhaps more importantly, to look forward and predict what is likely to occur in the future," right? So that's why centering the process behavior charts is so important, because they allow you to interpret data that takes variation into account, allows you to classify the data into the routine or common cause variation or the exceptional, that's the special cause variation, and allows us to turn our focus to that underlying or the behavior of the underlying system that produced the results. And it's this focus on the system and its processes that's then the basis for working towards continual improvement.

0:06:00.6 AS: And I was just thinking about number six, the goal is to predict what is likely to occur in the future. And I was just thinking, and what's likely to occur in the future is exactly what's happening now, or the trend that's happening, unless we change something in the system, I guess.

0:06:16.4 JD: Yeah. And that's why just setting the stretch goal is often disconnected from any type of reality, because we have this idea that somehow something magical is going to happen in the future that didn't happen in the past. And nothing magical is going to happen unless we are intentional about doing something differently to bring about that change.

0:06:39.5 AS: And that's a great lesson for the listeners and the viewers. It's like, have you been just setting stretch targets and pushing people to achieve these stretch targets? And not really understanding that your role is to understand that you're going to get the same result unless you start to look at how do we improve the method, the system, that type of thing.

0:07:05.0 JD: Yeah. And usually when you have those stretch goals, you've looked at what happened last year, and then you base the stretch goal on last year. But perhaps, you're seeing, for the last three or four years, the data has been steadily decreasing, right? And you can't realize that if you haven't charted that over the last three or four years, hopefully beyond that. So, you have no idea or it could have been trending positively, and you may under shoot your stretch goal because you missed a trend that was already in motion because of something that happened in the past.

0:07:44.8 AS: You made a chart for me, a run chart on my intake for my Valuation Masterclass Bootcamp. And we've been working on our marketing, and I presented it to the team and we talked about that's the capability of our system based upon for me to say, I want 500 students when we've been only getting 50 is just ridiculous. And that helped us all to see that if we are going to go to the next level of where we want to be, we've got to change what we're doing, the method that we're getting there, the system that we're running and what we're operating to get there or else we're going to continue to get this output. And so if the goal is to predict what is likely to occur in the future, if we don't make any changes, it's probably going to continue to be like it is in that control chart.

0:08:42.8 JD: Yeah. And that example is, in a nutshell, the System of Profound Knowledge in action in an organization where you're understanding variation in something that's important to you, enrollment in your course. You're doing that analysis with the team. So, there's the psychological component and you're saying, well, what's our theory of knowledge? So, what's our theory for how we're going to bring about some type of improvement? And so, now you're going to run probably something like a PDSA. And so now you have all those lenses of the System of Profound Knowledge that you're bringing together to work on that problem. And that's all it is really in a nutshell.

0:09:22.2 AS: Yeah. And the solution's not necessarily right there. Sometimes it is, but sometimes it's not. And we've got to iterate. Okay. Should we be doing marketing in-house or should we be doing it out using an outsourced service? What if we improve and increase the volume of our marketing? What effect would that have? What if we decrease the... What if we change to this method or that method? Those are all things that we are in the process of testing. I think the hardest thing in business, in my opinion, with this is to test one thing at a time.

0:09:58.5 JD: Yeah.

0:09:58.7 AS: I just, we I want to test everything.

0:10:00.4 JD: Yeah. Yeah. I read in the Toyota Kata that I think we've talked about before here, which talks about Toyota's improvement process. I read this in the book, I don't know if this is totally always true, but basically they focus on single factor experiments for that reason, even in a place as complex and as full of engineers as Toyota, they largely focus on single factor experiments. They can actually tell what it is that brought about the change. I mean, I'm sure they do other more complicated things. They would have to write a design of experiments and those types of things, but by and large, their improvement process, the Toyota Kata, is focused on single factor experiments for that reason.

0:10:48.1 AS: And what's that movie, the sniper movie where they say, slow is smooth and smooth is fast or something like that, like slow down to speed up. I want to go fast and do all of these tests, but the fact is I'm not learning as much from that. And by slowing down and doing single factor experiment to try to think, how do we influence the future is fascinating.

0:11:20.9 JD: Yeah, absolutely.

0:11:22.4 AS: All right. What about seven?

0:11:23.2 JD: Lesson seven. So "the improvement approach depends on the stability of the system under study," and there's really two parts to this. But what approach am I going to take if the system is producing predictable results and it's performing pretty consistently, it's stable, there's only common cause variation. And then what happens if you have an unpredictable system? So two different approaches, depending on what type of system you're looking at in terms of stability. So you know the one thing to recognize in thinking about something like single factor experiments, it's a waste of time to explain noise or explain common cause variation in this stable system, because there's no simple single root cause for that type of variation. There's thousands or tens of thousands of variables that are impacting almost any metric. And you can't really isolate that down to a single cause.

0:12:17.5 JD: So instead we don't, we don't try to do that in a common cause system that needs improvement. Instead, if the results are unsatisfactory, what we do is work on improvements and changes to the system, right? We don't try to identify a single factor that's the problem. So what we do then is we work to improve a common cause processor system by working on the design of that actual system including inputs, throughputs that are a part of that. And to your point, you sort of have to, based on your content knowledge of that area, or maybe you have to bring in a subject matter expert and you sort of start to think about what's going to make the biggest difference. And then you start testing those things one at a time, basically. That's sort of the approach. And then if you're working in an unpredictable system and that unpredictable system is unpredictable because it has special causes in your data, then it's really a waste of time to try to improve that particular system until it's stable again. And so the way you do that is at that point, there is something so different about the special cause data that you try to identify that single cause or two of those data points. And then when you've identified, you study it, and then you try to remove that specific special cause. And if you've identified the right thing, what happens then is it becomes a stable system at that point, right?

0:13:51.9 AS: I was thinking that it's no sense in trying to race your boat if you've got a hole in it. You got to fix the special cause, the hole, and then focus on, okay, how do we improve the speed of this boat?

0:14:06.5 JD: And the key is recognizing the difference between these two roadmaps towards improvement. And I think in education for sure, there's a lot of confusion, a lot of wasted effort, because there's really no knowledge of this approach to data analysis. And so people do their own things. There's a mismatch between the type of variation that's present and the type of improvement effort that's trying to be undertaken. I think the most typical thing is there's a common cause system, and people think they can identify a single thing to improve. And then they spend a lot of time and money on that thing. And then it doesn't get better over time because it was the wrong approach in the first place.

0:14:55.9 AS: Number eight.

0:14:57.6 JD: Number eight. So, number eight is, "more timely data is better for improvement purposes." So we've talked about state testing data a lot. It's only available once per year. Results often come after students have gone on summer vacation. So, it's not super helpful. So, we really want more frequent data so that we can understand if some type of intervention that we're putting in place has an effect. I think what the most important thing is, the frequency of the data collection needs to be in sync with the improvement context. So, it's not always that you need daily data or weekly data or monthly data, or quarterly data, whatever it is. It's just it has to be in sync with the type of improvement context you're trying to bring about. And no matter what that frequency of collection, the other big thing to keep in mind is don't overreact to any single data point, which is, again, I see that over and over again in my work. I think ultimately the data allows us to understand the variation and the trends within our system, whether that system is stable or unstable, and then what type of improvement effort would be most effective. And, again, in my experience, just those simple things are almost never happening in schools. Probably in most sectors.

0:16:25.9 AS: Can you explain a little bit more about in sync with the improvement process? Like, maybe you have an example of that so people can understand.

0:16:34.2 JD: Well, yeah. So, you mean the frequency of data collection?

0:16:39.0 AS: Yeah. And you're saying, yeah, this idea of like, what would be out of sync?

0:16:44.7 JD: Well, one, you need to... A lot of times what happens is there might be a system in place for collecting some type of data. Let's say, like, attendance. They report attendance, student attendance on the annual school report card. So, you get that attendance rate, but that's like the state test scores. Like, it's not that helpful to get that on the report card after the year has concluded. But the data is actually available to us in our student information system. And so, we could actually pull that in a different frequency and chart it ourselves and not wait on the state testing date or the state attendance report card has attendance...

0:17:27.5 AS: Because attendance is happening on a daily basis.

0:17:31.0 JD: Happening on a daily basis. So, if we wanted to, daily would be pretty frequent, but if we did collect the data daily, we certainly can do that. We could see, that could help us see patterns in data on certain days of the week. That could be something that goes into our theory for why our attendance is lower than we'd want it to. You could do it weekly if the daily collection is too onerous on whoever's being tasked with doing that. I think weekly data pretty quickly, would take you 12 weeks. But in 12 weeks, you have a pretty good baseline of what attendance is looking like across this particular school year. So I think when you're talking about improvement efforts, I think something daily, something weekly, I think that's the target so that you can actually try some interventions along the way. And...

0:18:29.3 AS: And get feedback.

0:18:31.1 JD: And get feedback. Yeah, yeah. And you could also peg it to something that's further out. And you could see over time if those interventions that are impacting more short-term data collection are actually impacting stuff on the longer term as well.

0:18:49.1 AS: And I guess it depends also on what is the priority of this. Let's say that attendance is not a big issue at your particular school. Therefore, we look at it on a monthly basis and we look to see if something's significance happening. But otherwise, we've got to focus over on another idea. And if, if, if attendance becomes an issue, we may go back to daily and say, is it a particular day of the week? Or is it something, what can we learn from that data?

0:19:20.0 JD: Yep, that's exactly right. And then the next step would be in lesson nine, you then, and this is why the charts are so important, then you can clearly label the start date for an intervention directly on the chart. So, what you want to do is, once you've chosen an intervention or a change idea, you clearly mark that in your process behavior chart. I just use a dashed vertical line on the date the intervention is started and also put a simple label that captures the essence of that intervention. So, that's right on the chart. So, I can remember what I tried or started on that particular day. And then that allows the team to easily see, because you're going to continue adding your data points, the stuff that comes after the dotted line, it becomes pretty apparent based on the trends you're seeing in the data, if that intervention is then working, right?

0:20:21.2 JD: If it's attendance, I may try, I do a weekly call to parents to tell them what their individual child's attendance rate is. And then we can see once we started making those weekly calls over the next few weeks, does that seem to be having an impact on attendance rates? And then I can actually see too, we've talked about the patterns in the data, there's certain patterns I'm looking for to see if there's a significant enough change in that pattern to say, yeah, this is a signal that this thing is actually working. So, it's not just because it increased, that attendance rate could go up, but that in and of itself isn't enough. I want to see a signal. And by signal, I mean a specific pattern in the data, a point outside the limits.

0:21:17.3 JD: I want to see eight points in a row in the case of attendance above the central line or I want to see three out of four that are closer to a limit, the upper limit, than they are to that central line. And again, we've talked about this before, those patterns are so mathematically improbable that I can be pretty reasonably assured if you see them that an actual change has occurred in my data. And because I've drawn this dotted line, I can tie the time period of the change back within that dataset to determine if something positive happened after I tried that intervention.

0:21:56.7 AS: It's just, you just think about how many times, how many cycles of improvement and interventions that you can do in a system and how far you will be a year later.

0:22:12.3 JD: Yes, yeah. And "cycles" is exactly the right word because really what you're doing, I didn't mention it here, but really what you were doing at the point you draw that vertical line when you're going to run an intervention, you're going to do that through the PDSA cycle, the Plan-Do-Study-Act cycle. So that's your experiment where you're testing one thing to see what impact it has on the data. So if I was going to boil continual improvement per Dr. Deming down to two things is, put your data on a process behavior chart, combine it with a PDSA to see how to improve that data. And that's continual improvement in a nutshell, basically, those two tools.

0:22:51.7 AS: Gold, that's gold. All right. Number 10.

0:22:55.3 JD: Last one, lesson 10, "the purpose of data analysis is insight." So this comes from Dr. Donald Wheeler, but he basically just teaches us that the best analysis is the simplest analysis, which provides the needed insight. But what he would say is plot the dots first on a run chart. Once you have enough data, turn it into a process behavior chart. And that's the most straightforward method for understanding how our data is performing over time. And so this approach, I think it's much more intuitive than if we store the data in tables and then the patterns become much more apparent because we're using these time sequence charts. And again, I know I've said this before, but I keep repeating it because I think it's the essence of continual improvement to do those two things. Yeah.

0:23:47.1 AS: And what's the promise of this? If we can implement these 10 points that you've highlighted in relation to goal setting, what do you think is going to change for me? I mean, sometimes I look at what you've outlined and I feel a little bit overwhelmed, like, God, that's a lot of work. I mean, can I just set the freaking goal and people just do it?

0:24:13.2 JD: Yeah. Well, I think, this is, in essence, a better way. I mean, this is really the wrap up here is that, well, one, when you understand the variation in your chart, you actually understand the story, the true story that's being told by your data. And so many people don't understand the true story. They sort of make up, that's too strong, but they don't have the tools to see what's actually happening in their system. So if you really want to see what's happening in your system, this is the way to do it. That's one thing. I think it also... I tried many, many things before I discovered this approach, but I didn't have any way to determine if something I was trying was working or not.

0:25:07.1 JD: I didn't have any way to tie the intervention back to my data. So what most people then do is tell the story that this thing is working if you like it. And if you don't want to do it anymore, you tell the story that it's not working, but none of its actually tied to like scientific thinking where I tie the specific point I try something to my data. So that's another thing. I can actually tell if interventions are working or not or can have a... I always try to use, not use definitive language. Scientifically, I have a much better likelihood of knowing that an intervention is working or not.

0:25:47.7 JD: So I think especially the process behavior chart, I think, and the way of thinking that goes with the chart is probably the single most powerful tool that we can utilize to improve schools. And we can teach this to teachers. We can teach this to administrators. We can teach this to students, can learn how to do this.

0:26:07.1 AS: Yeah. And I think one of the things I was thinking about is start where you have data.

0:26:12.3 JD: Yeah. Start where you have data.

0:26:14.2 AS: Don't feel like you've got to go out there and go through a whole process of collecting all this data and all that. Start where you have data. And even if attendance is not your major issue, let's say, but you had good attendance data, it's a good way to start to learn. And I suspect that you're going to learn a lot as you start to dig deeper into that. And then that feeds into, I wonder if we could get data on this and that to understand better what's happening.

0:26:41.4 JD: There are so many applications, so many applications. I mean, even just today, we were talking about, we get a hundred percent of our students qualify for free and reduced lunch because we have a school-wide lunch or breakfast and lunch program. And so we get reimbursed for the number of meals that are distributed. And sometimes there's a mismatch between the number that are distributed and the number we order just because of attendance and transportation issues and things like that. But the federal government only reimburses us for the meals we actually distribute to kids. And so if we over order, we have to pay out of our general fund for those meals that we don't get reimbursed for. And so, I'm just bringing this up because we were looking at some of that data just today, that mismatch, and even an area as simple as that is ripe for an improvement project.

0:27:40.7 JD: Why is there a mismatch? What is happening? And prior, I would just say, prior to having this mindset, this philosophy, I would say, well, they just need to figure out how to get the numbers closer together. But you actually have to go there, watch what's happening, come up with a theory for why we're ordering more breakfasts and lunches than we're passing out. It could be super, super simple. No one ever told the person distributing the lunches that we get reimbursed this way. And so they didn't know it was a big deal. I don't know that that's the case or not right, that's purely speculation. Or it could be, oh, we want to make sure every kid eats so we significantly over order each day. Well, that's a good mindset, but maybe we could back that off to make sure we never... We're always going to have enough food for kids to eat, but we're also not going to spend lots of extra money paying for lunches that don't get eaten. So there's all different things, even something like that operationally is ripe for improvement project. And the great thing is, is if you can study that problem and figure out how to save that money, which could by the end of the year, you know, be thousands of dollars, you could reallocate that to field trips or class supplies or to books for the library or art supplies, whatever, you know? So that's why I think this methodology is so powerful.

0:29:02.1 AS: Fantastic. That's a great breakdown of these 10 points. So John, on behalf of everyone at the Deming Institute, I want to thank you again for this discussion and for listeners, remember to go to deming.org to continue your journey. And you can find John's book, Win-Win, W. Edwards Deming, The System of Profound Knowledge and the Science of Improving Schools on Amazon.com. This is your host, Andrew Stotz. And I'll leave you with one of my favorite quotes from Dr. Deming, "People are entitled to joy in work."

How can you make lasting change at your organization? Recruit your friends! In this discussion, Bill Bellows lays out his experience recruiting and working with a small group to make big changes in a large company. 

0:00:02.5 Andrew Stotz: My name is Andrew Stotz and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today I'm continuing my discussion with Bill Bellows, who has spent 30 years helping people apply Dr. Deming's ideas to become aware of how their thinking is holding them back from their biggest opportunity. Today is episode 21, and the topic is Transparency. Bill, take it away.

0:00:27.1 Bill Bellows: Thank you, Andrew, and welcome to our audience. And I wanna thank a handful of people who have reached out to me on LinkedIn and elsewhere to talk about the podcast, what they're getting out of it, and which has been very interesting meeting people from around the world. And that's led me to a couple opening remarks for clarity on some of the things we've discussed in the past. And then we'll get into our feature topic. And so I say, [chuckle] is that in my early years at Rocketdyne, the Rocket Factory, a few of us started to see the synergy of what we were absorbing and integrating from, primarily from Dr. Deming and Taguchi, not just them, there were others. And we're 10 years away from really beginning to see what Russ Ackoff was able to offer us. At one point, there were eight of us. It started off with one, then another, then another. Next thing you know there's eight of us. We were what Barry Bebb and his cloud model would call advocates. Advocates of a change, of a transformation. We've been using that word. And I started to refer to us as the Gang of Eight 'cause this is the early '90's. And I think in China there was a group known as the Gang of Eight. Maybe that was the '80's. And I remember thinking, "Oh, we're like the Gang of Eight."

0:01:54.7 AS: I thought that was a Gang of Four in China, is that the Gang of Four.

0:01:58.9 BB: Well, there was a Gang of Four, then there was a Gang of Eight. There were both.

0:02:02.4 AS: Okay.

0:02:03.1 BB: But anyway, but I remember hearing that word, and then I thought, "Well, so okay, a gang of eight." We started to meet regularly, perhaps every other week, sharing ideas on how to initiate a transformation and how we operated, again, inspired by Deming. So at first we met quietly, we would meet in another building, not wanting to call attention to our efforts, not wanting to be visible for those who might have been adversaries again to borrow from Barry's model. 'Cause Barry's model was, there's, for every advocate there's a few more adversaries. So we were keeping our heads down. And this is before I knew anything about Barry, but I, we were just kind, a little bit paranoid that people would see what we're doing. And so who were the ones that were the adversary? Well, those were promoting rewards and recognition. Those were promoting individual cash incentives for suggestion programs including, as I mentioned a previous podcast, an individual could submit a suggestion award, get up to 10% of the annual savings in a onetime lump sum. They were giving out checks for $10,000, Andrew. And I would kid people, if the company's giving out checks for $10,000, do you think we've got photographs of me receiving a check for 10,000? You betcha.

0:02:03.5 BB: And there it is in the newspaper, me receiving a check, not that me, [chuckle] but somebody receiving a check for $10,000, a big smile with the President. And it's in the newspaper and did that cause issues? Yes. But anyway, it wasn't obvious for some of us that we might have been, sorry, it wasn't obvious for some time that those we might have considered the adversary to our efforts were very likely not meeting to plan how to stall our efforts. [chuckle] Right. And, but it took a while to realize this, so here we are trying to be very discreet, meeting discreetly. And then it, at some time it dawned on me and some of the others that, those of us that were inspired to learn, think, and work together on transformation efforts as we've been exploring these podcasts, we have the benefits of positive synergy. And the adversaries at best operate without synergy as they're not likely to be inclined to do much more than participate in what some at Rocketdyne called, you ready, "Bill Bellows’ Bitch Sessions." [laughter] And they come back from a class with me and they start bitching about me. And then the local people in that area would come by and tell me, and they said, "Anything we can do?" I said, "Yeah," I said, "Ask them what part of Rocketdyne moving in the direction of a Blue Pen Company do they not like." Right? It's just arrrgggggh.

0:02:04.2 BB: And I say, anyway. But once we had more and more results from our efforts, results from applying these ideas with very visible improvements in quality and costs leading to improved profits, it was all the harder for the adversaries to slow our efforts. Again, we were most fortunate to be working on challenges, we had challenges in fighting fires, but we also had challenges in designing hardware that achieved "Snap Fit" status, which translates to dramatically easier to integrate higher performing as well, as we shifted from parts to systems, challenges that required, guess what? A different lens inspired by Dr. Deming. That's, [chuckle] again, listening to the previous podcast, 'cause I thought, "Well, I wanna clarify a few things." Did we have ups and downs, Andrew? Yes, we did. We had days when we're excited, we had days when we were down. But what really worked out well, [chuckle] and the running joke was, there was variation in our excitement.

0:02:04.7 BB: So I may have been down, you'd be up, so you'd lift me up and then when you're down, I lift you up. And so the running joke we had amongst us was, thank God for variation in our moods. Because if we were all depressed at the same time, we'd go off the cliff. [chuckle] But we just took turns as to the ups and the downs. And we're very fortunate to have weekends 'cause that gave us time to not wanna choke some people. So, [chuckle] but come Monday we're relaxed. And then, but another thing that I wanted to point out from things we talked about previous podcasts, years ago, 30, nearly 30 years ago, I met a senior structural analyst from Boeing, Al Viswanathan, who was on the Boeing Commercial side. And he somehow got involved in the commercial side.

0:06:52.1 BB: Well, I don't know if it was the commercial side or military side. Anyway, Boeing had, there were both sides and one side was pro-Deming and the other side was anti-Deming. So he must have been on the defense side. And why would the defense side be pro-Deming? Because the Pentagon was pro-Deming. And so the defense side people would have been watching that. Anyway, Al somehow got involved in studying Deming's work and being a mentor within the organization. And I met him, I know when he worked there, when he retired. Anyway, Al, coming from Al, what I want to share is something he would say relative to Dr. Deming's funnel experiment. There's rule one of the funnel, rule two, rule three, and rule four. So rule one is you have a funnel and you drop marbles from the funnel onto the floor, and you get a pattern of where the marbles lay.

0:07:49.1 BB: And that's called variation. You're holding the funnel, you drop the marble, it lands in a different spot each time. And then rule two is you, if the marble is off a little bit to the right of the target that you're trying to hit, then you move the funnel the other direction. So two and three have to do with compensating. If it doesn't go where you want, then you shift it accordingly. Rule four, remember rule four of the funnel?

0:08:17.4 AS: I don't remember that.

0:08:18.9 BB: And this is... I think it's chapter eight. I know it's in The New Economics. Chapter 8, I'm sorry, rule four of the funnel is wherever the marble lands, position the funnel for the next drop. So in rule one, you keep it where it is and you get a pattern. Rules two and three, you compensate for where it lands. You either go left if it goes right and you compensate. And in compensating, it becomes worse. But what becomes really bad is when you put the funnel in rule four over where the last marble landed, and you end up getting farther and farther from the target leading to, remember the expression Dr. Deming used for that?

0:09:00.9 AS: Well, I remember the word tampering. But it meant when you get way off the target. What was that?

0:09:06.6 BB: He called it going off to the Milky Way. [laughter] And there are computer simulations where if, some people have done, you know, created.

0:09:16.0 AS: You do it in California and you end up in New York.

0:09:17.8 BB: Yep. And you, and you, and you keep getting further and further. Well, so in conversations with Al, and it could have been me and him and Dave Nave, Dick Steele and others, and at some point, Al would say, "How do we know we're not going off to the Milky Way?" Which translates to, how do we know that what we're interpreting from Deming is not getting further and further and further and further away from what he was trying to say? How do we know that we aren't wacky? How do we know? Because we think, "Oh, we're getting, we're understanding this better and better." And what I would say is, how do we know we're not going off to the Milky Way? “Actually,” I say, "We don't know." But part of having a community of people that work closely with Deming, people that know more than me about Dr. Deming's work is you can tap into that community and maybe lessen the chance that we go off to the Milky Way. Now, again, is that a guarantee? No, it's not a guarantee.

0:10:25.9 BB: But I would say, what I appreciate about Al saying that is, it's just a reminder that how do we know that what we're interpreting is true? So we're here, you and I are having these conversations, we're sharing interpretations, lessons learned, are we, is what Dr. Deming would say, "Is this worker training worker?" So, each of us are ignorant, and we think we understand Deming, and we're sharing it with others "well, I know, I know." Now, we can all be right, we can all be going off to the Milky Way. So I just wanted to say that, when I'm talking about diffusion from a point source and getting smarter and smarter and having these conversations within our organization. How do we know we aren't fooling each other? We don't know.

0:11:18.7 AS: I have a couple follow ups here. First of all, the 1991 Washington Post called it the Gang of Eight, as opposed to the Gang of Four, which was before that time, during the Cultural Revolution. And the Gang of Eight included seven men and one woman. And the Gang of Four, of course, included Mao's wife. So there's a little clarification.

0:11:44.6 BB: I wasn't sure if she was part of the four or part of the eight. I knew her name was in there somewhere.

0:11:49.0 AS: And the second thing you talked about the volatility of your feelings, your moods, right. And I just wanted to introduce the concept of volatility in finance, which is that volatility in itself is not bad. What's bad is correlation of volatility. So if all of you are upset on the same day, then it's just an absolute crash. But if one's upset on Monday and another one's happy and productive on Monday, then it starts to balance. And that's what we do in the world of finance is we combine correlation with volatility. And Harry Markowitz got a Nobel Prize in economics for coming up with the concept that risk can be reduced by understanding the correlation between assets and adding a highly risky asset to a Portfolio could, in fact, reduce the risk of the Portfolio overall, if the correlation between that asset and the Portfolio was, let's say negative or very low.

0:12:55.5 BB: Wow what you're talking about is the benefit of not being synchronous, being asynchronous.

0:13:04.2 AS: Correct.

0:13:05.1 BB: So you're up, I'm down, and I'm up, you're down, and then we can get through these periods. And yeah, and that's exactly what we're talking about. But you're right, I'm glad you brought that up because I've heard people talk about that as well. But that's exactly the point we're trying to make is, so for all those who think we ought to shrink variation to zero, I'd say, well, maybe there's value in variation, value in diversity of opinions. And also I have had people in the past say, "Well, so a Blue Pen Company is a bunch of people that go along to go along." I said, "No, it's a bunch of people that have strong disagreements on things and they share those disagreements."

0:13:49.5 BB: Now, at the end of the day by Friday, we've got to make a decision as to releasing this album whatever it is, because we've gotta ship. And we may arm wrestle, we may vote however we're gonna do it. So there can be disagreement. We have the ability to articulate where we're coming from. Borrowed from Edward de Bono, we can use a black hat and I can give you reasons why you don't think it'll work. You can call me on it and say, "Bill, how do I know it's your black hat and not what de Bono would call your red hat, which is my intuition."

0:14:26.4 AS: So if I say it doesn't work, you could say, "Bill, is that you don't feel it'll work or you know it won't work?" And I say, "Andrew, you're right. I have a bad feeling about it." I say, "Well, let's just be honest about it." But again, at the end of the day, we may vote. But we're gonna move forward. And what's not gonna happen is if you decide to take however we decide to make that decision, what there won't be a lot of room for is a bunch of "I told you so."

0:14:58.8 AS: Right.

0:15:00.4 BB: And we just we just dispense with that and just say this time, maybe the idea I had, we'll just have to wait till later and we're just gonna move on. So it's not to say it's a bunch of happiness and we're always in agreement. No, very strong relationships can have very strong disagreements. They just don't result in a civil war. Years ago, when my wife and I got married, she said I was just, it was lucky for me that she liked cats. I said that was non-starters. I said liking cats was a requirement. [laughter]

0:15:44.3 BB: So there's a few things that were non-starters. And if she didn't like cats, I'd have had a hard time with that. But on everything else, there's things we can disagree with. That's okay. All right. So given that I wanna talk about tonight is something that's come up in some other conversations recently. And it's about transparency. And then I have a quote that I've used in the past. I've once in a while attributed to Peter Senge, because I can't remember is actually Robert Fritz, a close associate of Peter Senge. And Fritz's comment is, “It's not what the vision is that is important. It's what the vision does.” And what I like about that is if you have a shared mental model of a Blue Pen Company. And I just began to appreciate how powerful it is that we have a shared vision. And relative to transparency, what I was sharing with some people is the transparency that exists in a Blue Pen Company, a Deming organization, a WE organization, an All-Straw organization and the transparency that which is as simple as me saying to you.

0:17:05.5 BB: Well, I say let's talk about the lack of transparency. I can meet a requirement, as we've talked about, an infinite number of ways to meet any set of requirements. And the letter grade is not A plus. It is not 100. It could be a D minus. I could leave for you the bowling ball on the doorway. And in a non-Deming Organization. I could meet any requirement you give me, Andrew, with the minimal amount of effort. Because all that we're measuring is that it met requirements. And so I give it to you and, and all you do is you look at the measurement and it says, "Yep, the car has gas." You're like, "Hey, I'm excited."

0:17:45.2 BB: Well, the black and white thinking allows me to hide a whole bunch of things. So if I said the car has gas. And you complain because it only has a quarter of a tank, I said, "Andrew. It has gas." But I thought in a Deming organization, I don't think we're gonna play those games. I think we're gonna have a lot more transparency relative to when I meet a set of requirements. Am I gonna leave the bowling ball on the doorway for you unilaterally? I don't think so. Maybe once I learn my lesson because I'm a new hire. I'm bringing something from where I used to work. But I think in a Deming environment, I think the transparency is gonna bring out the best in us.

0:18:33.8 BB: So I just want to throw that, that's part of where I'm coming from with transparency. You know, we don't have this murkiness as to, you know, where are they coming from? And. also we're going to be, you know, as Ackoff was, we're going to go to great lengths to be precise with language, and understand that efficiency is not effectiveness, that management is not leadership. And I think the better we have that clarity, I think that's a trademark of what that environment is about.

0:19:02.2 AS: It's interesting because, you know, the ultimate clarity is doing a run chart or a control chart on a process and seeing the outcome. And that's transparent and clear. And I've done a lot in my own management career by just getting data into a format that people can, you know, go back to and look at and think about. And just the transparency of that data can make a huge difference to the way people interpret what's going on in that unit.

0:19:38.9 BB: You're right. As opposed to the transparency of two data points, quality, I'm sorry, I think I've used this example. You can remind me of, you know, when I was at Rocketdyne once upon a time, and there was a meeting where the safety metrics, number of accidents, per employee in the first quarter was a certain level. Then in the second quarter, it went down. And I mean, the number of accidents per employee went down. Safety got better. And as you know, in this meeting with a bunch of directors and the VP and somebody says to the VP, why is safety improved? And their response was, because “We've let them know safety is important.” Well, who's the we? Who's the they? So, and, but imagine the transparency for somebody hearing that we've let them know. That's a way of saying, so you're, you're believing that because it went down, it's because of things we said, and they're not interested in safety.

0:20:45.3 BB: And then if it goes the other way, we're going to claim what? That they're not listening? So you're right. I mean, the ability, the transparency of looking at a set of data on a control chart and the realization that the process is in control. Then we look at the ups and downs and say, no reason for alarm here.

0:21:12.2 AS: The other thing that I thought relates to transparency is fear. In the sense that what is fear? Fear is, you know, a concern that something is going to happen is about to happen is in the process of happening, or, you know, something's happening to you and you're not being able to see, you know, what's going on. So I was just thinking, you know, another angle on transparency is, you know, reducing fear in an organization by being, you know, let more transparent.

0:21:41.5 BB: Yes. And, and I can even imagine, what's funny is that, a co-worker in my office, once upon a time. And. And she was upset with a decision made by the president at that time was my boss. And so she, so for about two years or so, she reported to me, lovely lady, lovely friend, great friend. So anyway, she was upset. She comes in. Did you hear the decision made? And I said, no, I didn't know. And she says, and she was really upset. And I don't know what it was that she was upset. And at some point she said something like, “I don't know what I'm going to do. I just don't know what I'm going to do.”  I turned to her and I said, if I were you, I would take this personally. Which caused her to laugh. And when I told her, again I get back to transparency, I said, "I may not agree with a decision, but I may never know the choices he had." And so in that situation, Andrew, there may be situations in a Deming company where for whatever reason, there is no transparency, we don't know the options, we don't know what was on the table, all we know is the outcome, and it could be because of, you know, Security and Exchange issues relative to, you know, stock prices, there's, there's all kinds of reasons we may not know.

0:23:03.4 BB: But in that environment, we may, we have to live with it. We just have to say, well, and when I look at it as, and I'm glad you brought that up. Because when I look at it as, there may be decisions, we don't know the choices, we don't know the criteria, we may never know. Instead of agonizing over it, I'd like to think that if we were in the room and knew what they knew and the options they had, we might well make the same decision. And that's something that I became excited about at Rocketdyne was, I didn't have to be in the room for a bunch of decisions, a whole bunch of decisions, I didn't have to be in the room. And what I thought was, if I can help people develop a better and better sense of what a Deming organization, how that operates. And then, and then practice, perhaps, you know, how might they handle a given scenario, and in fact, Kevin's mom, Diana Deming Cahill reached out to me in the late '90s, you know, late '90s, and asked if I would resurrect a Deming Study group for Los Angeles, which existed when Deming was alive, they used to meet at the LA Times.

0:24:51.4 BB: They had invited speakers. And after Deming died it dissolved, and she saw what we're doing within the Boeing sites and asked if I would, you know, work with her to resurrect that. I said sure, I said but here's the deal. When she explained to me how it used to work, invited speakers every month and I thought, that's a lot of work finding a speaker every month. And I said, and it's so easy to be, you know, sit in the back of the room and watch somebody talk I thought. I'm not, I'm not, I don't like that format. And so, a few of us spent a good deal of time coming up with a format. And we went from three hours to two hours and, and then came down to a really neat format that we held for a couple years. We met in two different sites. We met in Canoga Park. We met in the other group met in Huntington Beach where Diana would show up we first we looked at a location there LAX, that wasn't going to work. So we spent the first hour talking about reflections how we're seeing the world through a Deming lens, things that had happened since the last month that we're seeing, that we're seeing differently.

0:26:08.6 BB: That's the first hour. And then the second hour someone would introduce a topic and the topic would be, "How would a Deming organization do X." And what was neat was just to brainstorm. How would a Deming organization go about doing something, that may be way beyond our, our personal responsibility and it just allowed us to play in this space. And, and just, you know, wonder what is, what is going on there. And I throw that out in the spirit of transparency is, it was just to me it was just fun to just practice. How would you deal with, how would you deal with, how would you deal with. And that's what got me thinking that, now going back to, I think that if you get a diverse enough group of people with different experiences and perspectives I think the better they understand, yeah, where Deming and the others are coming from.

0:27:02.5 BB: I think we're going to see a lot of common decision making. And that was for me was very relaxing, that I didn't have to worry about "now they're going to make the right decision." I just thought, if they understand the process, and they use, you know, Edward de Bono's ideas to go through ideas. I thought, the best I can do is say, how did you reach this conclusion, what options did you consider who was involved in the decision making? I can ask those types of questions. I can ask, you know, did you include the supplier did you include... I can ask that. And once I understand that I'd say, if I trust the process. Then I have to trust the result, which goes back to transparency. So I no longer. I mean, that's what parents do - you trust. You raise your kids in a way that you help them develop a sense of a process. And then you just have to live with the results.

0:28:00.8 BB: And same thing as sports. You, I've seen coaches. When I was a youth referee, they're trying to micromanage every minute of the game and I thought it's too late for that you've got to do that at practice. And then once they're playing you just let them go. And that's a demonstration of how well you've prepared them.

0:28:21.6 AS: That's a great, you know, a great one. It's so, it's so amazing to see a team in action and a coach being able to kind of sit back and say now it's up to you. And, you know, I've trained you and everything I can. How would you, how would you wrap this up and provide people with how a Deming organization would apply transparency and maybe give, you know, some one or two ideas about how someone can leave this conversation and bring more transparency back to their organization.

0:29:00.8 BB: I think it's, goes back, to me it goes back to, as a point source within your respective organizations, listening to our podcast, you know, reading articles on, I mean, watching things on DemingNEXT and learning more. And, and yeah. Reaching out and finding people that are, you know, perhaps more knowledgeable than you about Deming's work or Ackoff work. And then Deming once said something about everyone's entitled to a master or mentor or someone, and I was very fortunate to be associated with some brilliant people that worked closely with Deming and Ackoff, and Ackoff himself and Taguchi. I would say, one is, what can you, what can you be doing to improve your understanding, with the appreciation of going off to the Milky Way.

0:29:51.6 BB: And then how can you then practice sharing that with others? Like we did going back to this Gang of Eight and what can be done within your respective organizations to create this group of one, group of two, group of three, group of four. And how might you work together to better appreciate what you think Dr. Deming and Ackoff and others are saying, how you might apply them? How can you support one another? And then, and at least, again, you're gonna have ups and downs, but I don't think there's any substitute for that. And many people I've mentored are solo people within their respective organizations. And what I keep telling them is you've got to find someone else to help you. You can't be the only one in that meeting lobbying for working on things that are good when everybody else is working on things that are bad.

0:30:46.4 BB: It's just gonna sound foolish but imagine being in a situation where you're lobbying for working on something which is good because you want to prevent it from going bad or improve integration. And then someone hears that remark and says, Bill, with all these challenges we have, I can't believe you're going off and doing that. Then imagine you're there in the meeting. And then after that person tries to sidetrack it, you say, "Bill, is that what you were trying to say?" And I say, "no, Andrew, that's not at all what I was trying to say." So you can come to my rescue. And when I'm being shoved aside, I've been in those sessions where I get shoved aside and it takes someone like you to be able to step in and say, Bill, did you say you wanted to do that? I don't think that's what you said.

0:31:10.5 BB: And that's what I would say is, increase the transparency amongst a small group, and then try to increase that transparency. And what becomes a lot of fun is, there are a handful of people at Rocketdyne, we can go into an office of any number of people and take turns exchanging things and reading. And we could see where things are going. And two of us, two or three of us can have a room of 10 and change the course of that conversation because we were incredibly transparent amongst each other. So I just leave it with that, Andrew.

0:32:21.8 AS: Well, Bill, on behalf of everyone at The Deming Institute, I want to thank you again for this discussion. And for listeners, remember to go to deming.org to continue your journey. If you want to keep in touch with Bill, just find him on LinkedIn. As you can see, he responds. This is your host, Andrew Stotz. And I'll leave you with one of my favorite quotes from Dr. Deming. People are entitled to joy in work. And, are you enjoying work?

In our 4th interview podcast of 2019, Donald Berwick, co-founder and former President and CEO of IHI, the Institute for Healthcare Improvement, shares his Deming Journey.  Dr. Berwick, who presented at The Deming Institute's 2018 Conference, is one of the nation's leading authorities on healthcare quality and improvement. 

(This is Tripp's first interview with Dr. Berwick)

Highlights include:

• His training as a pediatrician
• His efforts to apply quality management, before his introduction to the Deming Philosophy
• Co-Founded IHI in 1989 as a non-profit organization
• Appointed by President Obama, in July 2010, to the position of Administrator of the Centers for Medicare and Medicaid Services (CMS), which he held until December, 2011
• Ran for governor of Massachusetts in 2014
• 4 children and 7 grandchildren
• Attended a Four-day Seminar with Dr. Deming in 1986, leaving early and then returning
• Prior to meeting Dr. Deming, serving as "VP of Inspection"
• In the world of inspection, everything stayed the same
• Waiting times of 2 minutes for x-rays were reported to him (with falsification) by the radiology department 
• "Do something about it"
• Question: What is the pushback that you see today in healthcare?
• The Red Bead Experiment was "electrifying," including triggering a vicious cycle of blame by management and withdrawal by willing workers.
• The workforce (willing workers) wants to do well
• The influence of Dr. Deming, and others, on IHI
• Prescriptions for fixing healthcare - "It takes leadership"
• General tone of healthcare today; "measure enough, yell enough, things get better"
• Continued focus today (backsliding) on measurement for inspection
• Question: What are physicians learning today about management? Answer: "Heroism as the route to excellence"

What's the difference between Compliance Excellence and Contextual Excellence? Is one better than the other? Which one does a Deming organization pursue? In this episode, Bill Bellows and host Andrew Stotz talk about the variety of types of excellence, and why they matter.

TRANSCRIPT

0:00:02.7 Andrew Stotz: My name is Andrew Stotz and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with Bill Bellows, who has spent 30 years helping people apply Dr. Deming's ideas to become aware of how their thinking is holding them back from their biggest opportunities. The topic for today is episode 11: In Search of Excellence. Bill, go ahead, take it away.

0:00:28.9 Bill Bellows: All right. So, as I've been doing for the last few episodes, I like to go back to the prior episode. Because I listen to these again and again and again. Oh, there's other things I wanna say. [laughter] Remember the title of the last session, Andrew?

0:00:46.1 AS: Well, that depends. [laughter] The title was, It Depends.

0:00:50.7 BB: Alright. Alright. So you know I'm fond of that phrase. So I wanna... I thought of after, you know, in the last couple weeks is, I took a class in program management at a big university in Greater Los Angeles. I mean, it could have been anywhere, but it was in Los Angeles, and there were 25, 30 people in the room, maybe more, from around the world coming into this university. It was a three day program, you know, like, $1,800. $1800. I had just joined a department called The Program Management Office, and I thought, I should go find out what program management is it all about? I had some ideas, but I thought, "I want to go take a real class on this." The class was presented by an aerospace veteran in project management. He had been involved in major programs with Hughes, installing, you know, working on airports around the world and other DOD stuff.

0:01:48.6 BB: And I mean, he was, he was a very interesting guy. I got there early every day looking, I was hoping there'd be an opportunity I could start a conversation with him, have lunch with him, that never happened. But three days long. And so, on the second day, he threw out a question to the audience, and people are sitting in a... It's kind of an amphitheater, with the rows were kind of curved. So he throws out a question to the audience and the guy in the front row answers, "it depends." [laughter] And the instructor very deliberately walked from the front of the room, a good 15 feet without saying anything, just walked right at that person in the front row, you know, all at the same level, gets right in his face and says the following, Andrew, are you ready?

0:02:47.6 AS: I'm ready.

0:02:48.6 BB: He says, "Are you an attorney?" [laughter] And I thought to myself, "All of that for the answer, "it depends," really?" And so, [laughter] later that afternoon, somebody asked the instructor a question, "Hey, what if you're in a situation where you gotta deal with blah, blah, blah, blah, blah, this, this, this, this, this, how would you handle that?"

0:03:17.3 AS: And for the listeners out there, you know the punchline here, come on, give it to me. What did he say?

0:03:23.5 BB: No, here's what he said. He said, "Well, if it involves this, I would do this. If it involves that, I would do that." And so, what did I say, Andrew?

0:03:42.6 AS: What did you say? What do you mean?

0:03:44.7 BB: I bit my tongue.

0:03:45.9 AS: Oh, you didn't say anything when he said that?

0:03:48.6 BB: Because what he just said was, "it depends."

0:03:50.4 AS: “It depends” in another way.

0:03:52.8 BB: Yeah. He found another way to say “it depends.” So it was also...

0:03:56.0 AS: He sounded kind of smart, you know, well, let's just narrow it down to two potential options.

0:04:00.8 BB: “Are you an attorney?” Yeah. But he still... What he was still saying was, it depends on the situation.

0:04:09.3 AS: Yep.

0:04:09.8 BB: And I just thought... I mean... And not that I didn't mind that answer, but I was just dumbstruck as to why he was so emphatic in challenging this answer, "it depends"? And I just thought, again, I never went up and asked, but I just thought, I wasn't sure it was gonna go anywhere. So anyway, so I wanted to throw that out. Going back a couple episodes, I wanna talk about metrics and KPIs and point out that there's nothing wrong, I mean, we're not saying KPIs are bad. What we're talking about is, when KPIs are used as goals and in a way that unnecessarily drives the organization in different directions, but if a KPI is just a metric of how we're doing in sales, that's one thing.

0:05:03.7 BB: But if the metric is, I want sales to be this number, and I go to people in procurement and say, "I want you to cut back on procurement," you know, we can end up with a conflict. You know, I had a woman in class once who worked for a gym, health club. And her job was to sell memberships and get on the phone every day, sell memberships, sell memberships, sell memberships. And she told her boss, she says, "Now, if I do a really good job, lines will form if we don't get more equipment. So, while I'm doing this, shouldn't we be working on that?" And her boss' attitude was, "You keep working on that and don't worry about that." So what she realized, it was just a revolving door of replacing old people with new people. They were just managing the parts in isolation. But another thing I think we had agreement on, you know, also had agreement on KPIs is it's... We're not saying there's anything wrong with metrics, but in organizations where we've worked, we've seen people drive change with, "give everybody a KPI."

0:06:17.5 BB: We could have great ignorance of variation. We have... Leading to dissolution of, just increased separation of organization. What I'm also reminded of is a quote that Dr. Deming used to use of his statistician colleague, Lloyd Nelson, who said, "the most important numbers used to manage an organization are unknown and unknowable." And one example from when I worked for Boeing is a good friend of mine was at the Boeing Leadership Center and there was a big emphasis at that time on what's called the Economic Profit Calculator. Making sure that business decisions close. They were not gonna build the next generation airplane unless they've got all the sales lined up and you have to have closure and closure within some timeframe, and that person came out.

0:07:12.4 BB: That was the big driving change in that era. Well, right after that presentation by somebody senior, the Chief Operating Officer, Harry Stonecipher presented. And what was near and dear to Harry at that point was something he started when McDonald Douglas was separate from Boeing, then Boeing bought McDonald Douglas, and he was really big on an education program that allowed anyone to pursue any degree, all reimbursed. So if he wanted an AS degree, a Master's degree, a law degree, not only were they paying for the degrees, but there were people getting a Bachelor's and then getting a Master's in Science and a MBA, so he just go at it, go at it. And he's very proud of that.

0:08:00.5 BB: So, my friend Tim is listening to all this and he says, "This afternoon, we heard from so and so in finance about Boeing business decisions needing to fit into this Economic Profit Calculator, how does your education reimbursement program fit into that model?" And his answer was, I thought really profound, he said, "there are some things you just do." And to me that fits in with Deming saying, you can’t measure the price of education. We brought an instructor in, we had you away for so many hours...

0:08:34.6 AS: You can measure the cost.

0:08:36.1 BB: And so, we can put some numbers on it. But what are the benefits? The benefits show up in the future. So I really admire that Stonecipher's answer was, I think very much in keeping with Deming is, we're gonna spend money on education. So, I just wanna throw that out for in terms of metrics and what not.

0:08:52.9 AS: And I would just throw in my thoughts on KPIs, which has gotten stronger and stronger over the years, and that is that, I really think people should stop KPIs. And the reason why is, because I think they've gotten to the point where it's just so misused and so, people are so reliant on it. Now, I know that that's an extreme view and so... But I say it to also challenge people to think about it, but if you can't stop the KPIs, then I would say the most important thing from my perspective, is make sure that compensation is not linked to the KPIs. Which of course, people will come back and say, that's the whole point of KPIs.

[laughter]

0:09:44.4 BB: Exactly.

0:09:44.5 AS: And if you remove compensation connection to KPI, and instead of that, you use coaching and working with your team, and you have metrics of what you want to achieve as a company, as an organization, as a department, and you look at those metrics... Nothing wrong with that, but it's when you bring in the personal, particularly the personal incentive or the division incentive that can then sub-optimize... Can optimize a part of the organization, either an individual or a department, and therefore, sub-optimize the total.

0:10:22.0 BB: Oh, yeah. If you tie those metrics... Yeah and that becomes the... What makes them sinister, when you provide that incentive that... And I'm sure we've both seen people given incentives and they're not gonna leave, what I tell people is, they're not gonna leave a penny on the table, whether it's get rid of that division, lay off so many people, they are going to achieve that metric, because there's money on the table and in the way of that problem.

0:10:55.2 AS: And for those people who are listening or viewing, who feel like, "My God, what would I do if I don't have KPIs, because that's kind of the way we've been managing?" The first thing is, I would say is that, if you know that... So first, talk to your staff, because once you go out and talk to the people in the company, you realize that almost nobody is in favor of KPIs, because they're being manipulated in many ways and they all see it. But if you know in your heart that it's not the right thing to do, my argument is, don't wait to stop doing the wrong thing until you know what the right thing is. You know? Stop... "I don't wanna stop beating my child, because I don't know the other way to do it." [laughter] No. Stop beating your child today, that would be a first step. Don't worry about what it is you're gonna do next. Anyways, that's enough on KPIs.

0:12:00.4 BB: You've reminded me of a story that's coming to me, but it's not coming in loud and clear, so I made a note, I'll share it next time 'cause you're gonna love it. I wanna give an example of what, of what, of what a narrow focus on KPIs can do. Just a couple of little ones, that are, you just can't make these up. In 1999, while at Rocketdyne, there was a focus on reducing costs. And this is, all organizations have these stories. And this is one I use to talk about in class all the time. So I don't think anyone's gonna be offended. Hopefully they'll laugh more than be offended by it.

0:12:37.9 BB: So there's a big focus across the company of reducing cost. Reducing cost. What do people do in a non-Deming organization? They look at cost in isolation. Where I wanna reduce the cost of this, not look at how it affects the others. And so, at that point of time, again, we're talking over 20 years ago, all the documentation to make every space shuttle main engine was on, was on paper. Every page used to fabricate the engines on paper. And there were page by page instructions of manufacturing to do this, do this, line by line by line, and on every line it might say, torque this bolt to 55 inch pounds, and it was stamped by me, the mechanic, and by you the inspector. Boom, boom, boom.

0:13:28.2 BB: So if NASA ever wants to know, was that bolt torqued on that engine on... And we have all the documentation. Guess how many pages of documentation there are? Nowadays it's likely all electronic, but in that day it was all paper. Guess how many pages of documentation for every single space shuttle main engine of which they're on the order of 18 made? Take a wild guess.

0:13:55.9 AS: Gosh. I'm just thinking thousands.

0:14:00.5 BB: 18,000 pages of documentation. So Andrew, that's like, 60 3-Ring Binders and I mean, 300 pages in a 3-Ring Binder, right? So imagine every engine's got 60 3-Ring Binders. So in 1999, all the pages in those books are on card stock heavy... Card stock paper, heavyweight paper, right? And why is that, Andrew? Because these are a storage document, right? So, I kid you not, one week I'm doing a class, you know talking about paradigms of variation and all the things we've been talking about. And somewhere in the conversation, somebody mentions that the card stock paper was replaced by lighter weight photocopy paper. And then, the person mentioned that, shared that, as a result of that, in the use of these 3-Ring Binders, the pages were falling out.

[laughter]

0:15:05.4 BB: And when I... And then the person went on to say...

0:15:07.1 AS: Oh, that's okay.

0:15:09.3 BB: Oh, no. Hold on, Andrew. So, as a focus on reducing costs, the heavy card stock paper is replaced by a lighter weight paper. The pages are falling out. So when I asked the guy, what are we doing with it? And the answer was, we're putting hole reinforcement circles on the pages to put them back in the binder.

0:15:34.2 AS: Absolutely.

0:15:35.1 BB: Right? And so, for those who don't know, hole reinforcement circles are little circles about the size of a, of a cheerio that get put on either side of the sheet of paper...

0:15:46.9 AS: With adhesive on the back of it.

0:15:48.1 BB: And it's a heavy cloth to keep it from pulling up. So, I mentioned that a couple of days later to some colleagues and they looked at me like I was from Mars. They're like, no, I mean, you've got some great stories, Bill, but they weren't buying the story. So the following week in class, [chuckle] I said, Hey, last week somebody mentioned, anybody know anything about that? And the guy in the front row, not only does he nod and say, yeah, he pulls out of his box a roll... Pulls out of his pocket a roll of like, 300 of these. And I said, so, this is really going on. He says, Bill, I go through a box of these a day.

0:16:29.9 AS: Oh, my God.

0:16:34.5 BB: So when you focus on the cost of the paper and forget that the paper is actually a storage document, not just a sheet of paper, you end up with hole reinforcement circles as a solution. Now...

0:16:46.1 AS: And the cost of the circle, the reinforcement, hole reinforcement adhesives that you put on and the cost of the labor that's spending time doing that by these high value added people.

0:17:04.6 BB: Well, and I also realized, if the space shuttle is on the pad and ready to go, fueled, if you're in that window and something comes up and somebody in NASA calls up Rocketdyne and says, we need to know for the second engine in that vehicle, if this work was done? If this work is done? If you delay the launch, if you're in the window, the vehicle was fueled, it's like a million dollars a day. So imagine going to the binder and the phone call back is, we can't find that sheet of paper. So this is...

0:17:46.8 AS: That was on page 47. I've got 46.

0:17:52.7 BB: We've got 40...

0:17:53.3 AS: And I got 48.

0:17:55.5 BB: So, but I use that. Okay, well, pre-pandemic, I was doing some training in New Zealand at a university. I needed to staple... I needed... [chuckle] I needed to staple these documents together. And so, the instructor who was hosting us, said, "What do you need?" I said, I need staples. So he goes to his office, comes back five minutes later, gives me a couple reams of staples and I go to put them in the stapler. And he says, "You're using these?" I said, “yeah, I'm using them.” He said, “wait.” He says, "Let me go get the good staples." I said, [chuckle] “what do you mean?” He says, "The university buys us really cheap staples. So all of us in the faculty keep a private stash of good staples. Let me go get the good staples." Right?

0:18:48.8 BB: You can't make up... Right? This is little stuff. All right. So now I wanna get to what Dr. Deming said last time I used a quote from Dr. Deming about it would be important for people to work together. And what I share in some of my seminars is an Aesop fable, from Aesop the Greek fablist. So we're talking like, 500, 600 BC and the particular fable I referenced is the four oxen and the lion. Are you familiar with that one?

0:19:23.7 AS: No.

0:19:25.1 BB: Okay. Well, I came across this, because I was doing some research on the expression "United we stand divided we fall." And I'm thinking united, divided, I'm thinking Abraham Lincoln, Civil War and to come up with, no, that's the punchline for Aesop's Fable about the four oxen and the lion. And the storyline goes that these four oxen would stand looking outward with their tails connected. That's the united we stand, they looked outward and the lion would circle them, but the lion couldn't do very much, because we're protecting one another. And then when the oxen broke rank, the lion jumped in and ate them. So the united we stand divided we fall. So the reason I use that is, I'm not proclaiming that Dr. Deming is the one who figured out the importance of teamwork. [laughter] I think that was figured out a long time ago. I look at what Dr. Deming's work is about - is helping us understand what are the obstacles to what I think we all really want. But I don't think he... So when he references teamwork, that's an old concept. That's why I like to use the Aesop fable, as it goes back a long way.

0:20:41.3 AS: Yeah.

0:20:42.2 BB: All right. But in terms of division, I'm gonna share from Russ Ackoff one of the many things I learned from him and that is that the adjective in front of the word "problem" is divisive. And so, when I worked in Connecticut for the jet engine company, we're making 120 tank engines a month, 1500 horsepower $300,000 each. And at least once a year there'd be an issue. We gotta stop production. Which would lead to the conclusion that it's a design problem in which case manufacturing did what, Andrew?

0:21:24.5 AS: Not sure.

0:21:25.1 BB: Breathed a huge sigh of relief.

0:21:26.7 AS: Not our problem.

0:21:28.4 BB: Or if it's not a design problem, it could be a manufacturing problem, in which case engineering said... And the engineering people felt slighted, because the president of the company was a manufacturing person. And so, what I saw was, yeah, as soon as you define the problem from that vantage point, then it's stuck on someone. And everybody else just says, whew! Thankful it wasn't us this time. So, I wanna share from Russ, what if we aren't so divisive?

0:22:02.4 BB: So Russ has a really neat story going back to, could be the '60s and you'll know by the punchline the timeframe. So at that point in time he was invited to GE's Appliance Center in Kentucky and he brought a graduate student with him. And he said, in the room, in the center of the room of this conference table, they're discussing this issue they're having. And around the perimeter of the room are all the major appliances that GE is selling at the time from refrigerators, freezers, stoves, washing machines, dryers, they're around the perimeter. And the issue they're facing is, what is labeled a "forecasting problem." And store owners are complaining that when the people are coming in to buy the appliances for the kitchen, they need to remodel the kitchen, they need a new refrigerator, they need a new washing machine, I mean a dishwasher and a stove.

0:22:54.2 BB: They need those three. And the forecasting issue is they come in and we only have two of the three, or we don't have the right... We don't have the matching colors, the matching styles. And so, that's why we're losing sales to the others. And we needed a better forecast. And in addition to having the right colors and the right model, another feature in that timeframe was the refrigerator door had to either open from the left or open from the right to match the configuration of the kitchen. So you may have the right... All three are right, but now you've got a left-handed door and the refrigerator needs a right-handed door. Oh. All right. So the graduate student upon hearing this uses a Swiss Army knife, Russ said, to take a door off of the refrigerator and said, have you ever thought about a reversible door design?

0:23:49.1 BB: And so, the reason I share that story for our audience is, that's what happens when you involve design in a solution to a forecasting problem. You get their inputs. And so, anything short of that, when we, when we focus on a manufacturing problem, only invite manufacturing, not invite others and as is prone in a non-Deming organization you end up with solutions that don't involve the others. And so, I just wanna throw that out that these are... The everyday things we do in organizations to divide. Alright. So now let's talk about the featured movie tonight.

0:24:27.3 AS: Yes.

0:24:27.8 BB: In Search of Excellence inspired by the book by Tom Peters and Robert Waterman. Correct?

0:24:35.3 AS: Yes.

0:24:35.9 BB: Roughly '82, '83 timeframe. And so, Dr. Deming's work has been known for a couple years and Tom Peters and Waterman wrote a book talking about... There's US companies doing excellent work, so let's go look at them. So at Dr. Deming's last seminar there were three assistants helping him. He was very frail, he was in a wheelchair, ended up dying 10 days after the seminar ended. And I think I mentioned sitting next to me for all four days was a rabbi praying for him. So, Dr. Deming is very frail in the wheelchair the entire time, when he would get fatigued, he'd be wheeled off the stage. One of these three assistants would come up and pick up the pace. Couple hours later Dr. Deming comes up. And so, during one of the breaks I went up and introduced myself and, to them. And one of them told me that...

0:25:30.0 BB: You know, he traveled with Dr. Deming. He was one of what's called a Deming Scholar. So at that point of time, there was a cadre of people that would travel with Dr. Deming if he was doing a seminar or he's at GE headquarters, wherever he was that week, this cadre came with him. So he said, somebody once in one of these sessions, said to Dr. Deming, “what's the difference between Jerry Falwell and Tom Peters?” And he says, Dr. Deming says, “who's... Well, who's Jerry Falwell?” And he says, “oh, he's a Baptist minister.” He says, oh, he says, so.

0:26:02.8 AS: A very famous one at the time.

0:26:05.0 BB: Very famous Baptist minister. And he says, “so what's the difference?” Dr. Deming says, so what's the difference? He says, "Jerry Falwell has a message." And so in that timeframe, I remember... I used to remember... And you likely watched these as well. So Tom Peters would be working on his next book and whatever the theme of the book was, he's doing research. And I give him credit. I mean, he's a Stanford Business School graduate. He's doing all the research, incredible at marketing. So he picks a topic, does his research, writes the book, goes on PBS to do this presentation with a thousand people in the room. And he's using real life people and companies to tell this story one at a time, one at a time, one at a time. So I thought, well, what if Tom Peters was to write a book about how to live to be a 100? Well, what do you do, Andrew? You've got to go find people who are a 100, right?

0:27:05.3 AS: Yeah.

0:27:06.2 BB: You can go find them, right?

0:27:07.1 AS: Yep.

0:27:07.8 BB: And so, I used to imagine that if Tom Peters is, you know, writing a book about how to live to be a 100, he's gonna go... The recipe is find the people, find the successful companies, go research them, a chapter on each one of them. Each of them comes up and presents. And so, there we are on PBS and the first guests that come out are a 101-year-old gentleman. And he comes out and he's chain smoking and he explains that, how does he live to be a 100? He says, well, "you...smoking is good, cigars sometimes, shots of Old Granddad and that's how you live to be a 100." And then next we have the sisters, live together, twin sisters, never married, lived together their entire lives, don't drink a thing, teetotalers, and that, you know, vegetarians. And so, you say, oh, so that's how you live to be a 100, Andrew, you drink, you drink tea, no, you stay away from alcohol, stay away from red meat.

0:28:14.6 BB: Next one comes out, right? And the point is that all these companies are different and you're left to figure out which one to think. And whereas what Dr. Deming's talking about is a theory by which to understand organizations that you could take to your organization and figure out how to live to be a hundred, not just what we see otherwise. So anyway, I was aware of all that, studied all that. I wasn't aware at the time that's what was going on, but as I started to research this Peter's and... Why Dr. Deming thought of him that way. And so, Rocketdyne was sold by Pratt and Whitney, sold to United Technologies after Boeing, and they had a big Lean Six Sigma program, but they didn't call it Lean Six Sigma.

0:29:02.7 BB: And the Rocketdyne people are asking, why did you call it Lean Six Sigma? He says, well, it is Lean Six Sigma, but GE calls their program Lean Six Sigma, and we're not gonna use the same name as those guys. Those are the light bulb people. So we've got our own name. Well, what's your name? Well, we call it ACE. What is ACE? Achieving Competitive Excellence. But it's really Lean Six Sigma. So I spent a few years trying to wonder, what does it really mean? And I'm and I'm embarrassed that it took me as long as it did, but it dawned on me what it really means is achieving Compliance Excellence.

0:29:42.9 BB: And it was all about, does this meet requirements? And so that's what I referred to early on as question number one. Does this characteristic, have you passed... You know, have you met all of the requirements? And that's all it was, it was meeting requirements, meeting requirements, meeting requirements. And then, and what it reminds me of is, I was doing a seminar in England once for a one-on-one, went over for three days through a translator, and the audience was a physician from Kazakhstan who was anxious to learn as much as he could about Dr. Deming's work and that led him to England. And through some fortunate situation, I had a chance to meet with him one-on-one and went through and explained to him, Me and We organizations, Red Pen and Blue Pen companies, all that, all through a translator. So I had asked a question in English, the translator would translate, boom.

0:30:36.5 BB: So the question I asked him was, that I wanted to share is, I said to Ivan, I said, "what's the fastest way for a Red Pen company to become a Blue Pen company? What's the fastest way?" So that gets translated into Russian. Then it comes back to me and he says, "what?" I said, "spray paint." [laughter] And to me, that's the epitome of Compliance Excellence where we're... You get a really light surface texture, where it's looking good, but it misses the deep sense of the theory of Dr. Deming's work. But I'm not saying Compliance Excellence is bad. And so, when I wrote an article about this, and if any of the listeners want to contact me on LinkedIn, I can send them an article I wrote about it. And so, 'cause when you go to write about something, now you start to think deeply about this, does this make sense as opposed to just having a conversation? And it dawned on me that Compliance Excellence is not a bad thing.

0:31:39.3 BB: And the example I want to use here is, I was listening to two friends, husband and wife who spent a whole year serving society. They were compelled, had incredible military careers, and they decided we wanna pay back society. So the plan was that the husband, Doug would ride his bicycle every day through every state in the United States, including Alaska and Hawaii over the course of one year. So they started upstate New York, crisscrossing around the country. So he was on his bike every day riding, raising awareness for veterans' issues. 'Cause for those who don't know, there's... The the suicide rate of veterans is enormous. And so, they're looking... They're out there trying to help veterans. They were compelled to do that. And Doug's wife Deb, rode the motorhome, either ahead or behind, hooking up with local radio stations, trying to get PR.

0:32:38.8 BB: Then Doug would show up and he says one day they're riding through the Rockies, having dinner... And they're having dinner that night. But all day long, Doug is going up these hills, down these hills, up these hills. And so at dinner, Doug says to Deb, he says, I mean, "how'd you like that hill?" [laughter] Deb says, "what hill?" [laughter] So to Doug, every mile is not the same. [laughter] Right? So it's 18,066 miles. Doug felt the difference in every one of those miles, more so than Deb did. So if somebody says, how far was that route, Doug? For Doug to say 18,066 miles, 67, that's ups and downs, he felt every one of them. For Deb, it was a little bit... They were more of the same. So I'm not saying there's anything wrong with answering the question 18,067, but to me that's a compliant... That's looking at every second being the same, every hour being the same, every widget being the same, not understanding the differences or how they're being used.

0:33:49.1 BB: So now I wanna talk about, instead of Compliance Excellence, again, I'm not saying Compliance Excellence is bad. What I would say is that non-Deming organizations thrive on Compliance Excellence in this sense of interchangeability. Everything is the same, looking at things in isolation. So then I started thinking, well, if that's what they do, what is it that that Deming organizations do? And that's what I would call Contextual Excellence. There's an understanding of context, understanding of the context of the system. Tom Johnson, who has written about, Management by Means, which I wanna look at in a later episode, when Tom was doing research, this is around the time I met him, 1997, '98 timeframe. He was, he was visiting Toyota Plants, definitely in the United States. I'm not sure how many overseas, but he is taking copious notes, going behind the scenes. So this was before the world was all over Toyota.

0:34:47.3 BB: So Tom had free access. He said eventually they start charging for all this stuff. But Tom was there way ahead of the crowd. And he said one day he is with his notebook and he is walking around, he is looking at the stamping presses. But they're notorious for stamping out one part at a time. One single minute exchange of dyes. So they don't make a thousand parts and then figure out how to use them. They figured out how to change the dyes quickly. So Tom said, he asked the guy, "how long does it take to change this dye?" And the guy says something like, 28 minutes. And so Tom writes down 28 minutes and later the guy came back to Tom. He says, "just so you understand" he says "28 minutes is not world class, but this does not require world class."

0:35:32.3 BB: And so this is when I was explaining Contextual Excellence to Tom. And he says, is that what you're talking about? I said, that's exactly what I would expect to see within Toyota, that things are... They fit the situation. So it's not speed for the sake of speed, it's speed that fits the context of the situation, which is also like saying, have card stock paper where it makes sense. Have the appropriate staples where it makes sense. And so, when I talk about "in search of excellence," with my classes or in presentations, what I'm trying to get across is, there's a place for Contextual Excellence and there's a place for Compliance Excellence. But I think that difference is far better understood in a Deming organization that has a great understanding of systems and connectedness and synchronicity and teamwork, and lacking that non-Deming organizations, I think unknowingly default to Compliance Excellence, driving things to zero, thinking you could have zero waste in these things.

0:36:39.9 BB: And then you end up with cheap staples, lightweight paper, and you end up paying for it somewhere else in the system. So I just wanted to point out that there's... I'm not saying one is better than the other. What I'm saying is, I believe a Deming organization would have a profound appreciation of when to use each. And as simple as, if you were to say to me, Bill, how far is it to the nearest airport? I could say, it depends Andrew, what are you... How are you getting to the airport? You say, I'm riding my bike. I said, "okay." Right? And again, not that we're always gonna say it depends, but that's what I think that appreciation has. Let me just stop there and...

0:37:19.6 AS: Yeah.

0:37:20.2 BB: See where you are.

0:37:21.6 AS: So, I have two little stories that I wanna share in relation to this. One of them is about my uncle Ham. Hamilton.

0:37:28.4 BB: Yes.

[laughter]

0:37:29.8 AS: And then the other one is about my own business, Coffee Works. And when we set up our factory 28 years ago, my business partner Dale, was absolutely passionate about coffee. He roasted every bean for our first 10 years. And he sold and he did the accounting and he did everything basically, until eventually he trained staff. And some of those staff still, they've been with us for years, for decades, and they take care of the roasting now. But what Dale really understood was what he called, "in the cup quality." The idea that when... When it's in the cup, that's about to touch the customer's lips, that's the quality that matters. Nothing else matters.

0:38:15.1 AS: If you don't get that right then, you know, it doesn't matter how much you've documented or did whatever you've done in the past, in the temperature of the water, in the grind, you know, in all of these different things. So he was really all about excellence, and we didn't get... We never got complaints. Maybe we got an occasional one, but it wasn't very common. Anyways, we got a big, big multinational company came to us and said, we want you to bid along with some other coffee companies for our business, and we bid for the business. And they said, "We're picking you. And now we're gonna go out to your factory and we're gonna inspect your factory. And if you get a score in our quality audit below 70, you're basically in trouble, [laughter] already, and you're gonna have six weeks to fix it or else you're fired."

0:39:05.9 AS: And this was a huge amount of volume and a prestigious company for us. So we pulled everything together to get ready for their audit. And they came and they gave us their score and we felt like we were pretty damn good. And they said, 65. [laughter] And you know, what we realized to them, quality was about paperwork and quality was about, you know, compliance to that paperwork. And so, we had to do that, because that's what quality was to them. We'd never done anything like that. You know, now, 15, 20 years later, we still supply that same customer and they still do their annual audits and our scores are much... They're in the 90s, which puts us in like, world class. But the point is, we learned a lesson, you know, the difference between contextual quality or let's say, intrinsic quality that Dale was working on versus this kind of, what did you call it? Compliance Quality.

0:40:08.5 BB: Yes.

0:40:09.9 AS: So that's my first story. The second one is about my uncle in Germany where he was in charge of the, of the logistics of a base of a US military base. And the commanding general came to see, and they had cleaned up everything. And they got to the end of the whole thing, and they kind of dumped out to the parking lot where there's, you know, 700 or 500 vehicles lined up in different ways and whatever, all kinds of different sizes of vehicles. And Uncle Ham said, "Sir, so how did you like the tour of the facility and all that?" And he says, “of the base?” And he said, "Ham, everything was great except one thing."

0:40:48.4 AS: And my uncle's like, "Okay, what is that, sir?" And he said... And he looked at the vehicles, a long line of vehicles parked side by side. And he asked him, he said, "Next time I come here... " Now remember, these vehicles are all different lengths. "Next time I come here, I want these vehicles all lined up. It's a mess the way you've got it done." Yeah. And so, my uncle said, "Yes, sir!" And he said, "Before you leave, sir, could you walk to the back of the vehicles for a moment with me?" "Yes, yes, I will." And he said, "Sir, would you like them lined up in the back or in the front?" And they had lined them up in the back, which meant their noses were in different lengths. And the point is, is that you can't have it all, right? Everything's a tradeoff. You want it this way. There's a compromise here, there's a challenge there and all that. And that's a lesson I learned from Uncle Ham.

0:41:46.1 BB: Well, and then he, I'm sure he learned it from that point on is, you know, when, when he is asked to line them up and make them more uniform, the question is, help me understand what that means.

[laughter]

0:42:00.3 AS: And the answer's gonna be, it depends. 'Cause this general likes them lined up in the back and this general likes them lined up in the front. We're gonna need to wrap up. So how would you close out this episode?

0:42:17.0 BB: The main thing I want to get across saying is that, first of all, Contextual Excellence is the bedrock of investment thinking. To look, when you begin to look at things as a system and to understand that every mile is not the same or do I need to... Does that matter to me? But to me, instead of everything could be improved, you know, we focus on where are the most red beads, get all the red beads to zero and then go across the organization. And what is that? That's managing actions. We talked about that months ago. And to me that's Compliance Excellence. It's looking at the parts in isolation. But to me, what Contextual Excellence is about is the better we understand, the greater how things fit together.

0:43:10.5 BB: And there, the challenge is that everything we work on is part of a bigger system, which is part of a, then again, bigger system, which is part of, then again, bigger system. So we're not proposing that you're going to infinity, you know, that there's this big picture of you, whatever that means. It's, it's, and I like it... You know, people talk about, well, you know, Andrew's a systems... You and I, Andrew are systems thinkers, as if the others aren't. What does that mean? That means that we think of the big picture. There's no such thing as a big picture. So there, what we're talking about is Contextual Excellence, is trying to gather as much context for the system as it makes sense with appreciation that you might still be missing something.

0:44:00.3 BB: And that's where learning comes in. But that understanding is part of, is fundamental to investment thinking. You know, is the education system paying off? How would you know? Where are we gonna see that benefit? What is your theory for that? So I just wanna point out is, I'm not trying to condemn Compliance Excellence. I think Deming organizations are gonna have a place for that. Just like there's a place for, you know, does it meet requirements? Yes or no? It's just becoming more mindful of these choices is, is what I'm suggesting or proposing.

0:44:31.1 AS: Yes. Well, Bill, on behalf of everyone at the Deming Institute, I want to thank you again for this discussion. For listeners, remember to go to deming.org to continue your journey. There's so much there for further learning. And if you wanna keep in touch with Bill, just find him on LinkedIn. He's right there. This is your host, Andrew Stotz, and I'm gonna leave you with one of my favorite quotes from Dr. Deming. "People are entitled to joy in work."

In our 5th interview podcast of 2019, Alan Winlow, MBE, former Managing Director of Yorkshire Brick Company, Continuous Improvement Director at Marshalls PLC, and 2019 ASQ Deming Medal Recipient, offers insights on his efforts to lead a Deming transformation.

(This is Tripp's first interview with Alan)

Highlights include:

• Opening quote from Myron Tribus, “If you continue to do what you’ve always done, you will continue to get what you’ve always got”
• In the late 1980s, while serving as Managing Director of the Yorkshire Brick Company (YBC), employment in the UK brick industry plunged from 14K to 8K employees and plants were closing
• Question at hand, "How to survive in a labor-intensive business?"
• How had the Japanese captured critical UK business segments?
• Started to read about Dr. Deming and attend British Deming Association conferences
• Discovered sources of variation and PDSA, plus the importance of data
• Found the majority of variation came from manufacturing equipment and raw materials for the bricks
• Discovered how to change the brick manufacturing process to improve brick uniformity
• Began to meet regularly with YBC's production team to continue to improve brick uniformity, savings in water use, energy use, and discarded bricks
• Discovered mental models, including the Taguchi Loss Function
• Explored how to remove barriers within workforce, everyone came on staff
• Began to understand what his job was, including reading books and seeking new learning
• Alan led consulting visits to China in 1987 to assist in developing the Land Fill Gas business.  The Chinese were extremely interested in the landfill gas abstraction at YBC and sent no less than 8 delegations to visit the Yorkshire site. Alan was invited to visit by the Mayor of the city of Anshan.
• Teaming with local schools and universities, a local jail, and a county council to share lessons learned within YBC, including environmental projects
• Yorkshire Brick was honored in 1991 for contributions to environmental causes
• In 2000, Alan was honored by Queen Elizabeth as a Member of the British Empire for his leadership within YBC
• Never met Dr. Deming at BDA events; met Myron Tribus on many occasions
• Comments on challenges in implementing the Deming Philosophy
• Continued relevance of the Deming Philosophy today  

"The Cloud" is a metaphor for the top level of corporate authority - the CEO, CFO, CTO and maybe some Vice President positions. And if you're trying to transform an organization, your ideas need to penetrate the Cloud - but how? In this episode, Bill Bellows and host Andrew Stotz talk about influencing others with the aim of transformation. 

TRANSCRIPT

0:00:02.2 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with Bill Bellows, who has spent 30 years helping people apply Dr. Deming's ideas to become aware of how their thinking is holding them back from their biggest opportunities. Today is episode 16, and the title is, Get Off of My Cloud. Bill, take it away.

0:00:29.5 Bill Bellows: Hey. Hey, hey. [laughter] Mick Jagger, Keith Richards, get Off of My Cloud. Yeah. Alright, so here we are, 2024. So before we get to the Cloud, some opening remarks. And in particular looking at session 15, which is soon to be released. And one thing I... What I tell people is, what's exciting about understanding Deming's work is how revealing, how you see the world differently, and Dr. Deming used the metaphor of a lens. But it's not only what you see, but what you hear.

0:01:19.5 AS: Right.

0:01:22.3 BB: And, and I tell people I can go into an organization and within a few minutes between what I see and what I hear, I can get a pretty good sense, is it a ME or WE organization. And we think back to the comment I shared in episode 15 where the Boeing executive said, "Let's be honest," to the room full of 300 plus internal audit people who just do great, great work.

0:01:54.4 BB: I mean, if they didn't do great work, why would they be there? Everyone in our organization does great work, otherwise, why would they be around? But when they said to them, "Let's be honest, we don't make the airplanes." And I thought, that's right up there with my wife saying to me, "Look at what your son did."

0:02:22.4 BB: My son? Or is it, look at what our son did. Another giveaway expression is, we're gonna do a root cause analysis or RRCA, which is Relentless Root Cause Analysis. Well, every, and from a Deming perspective, instead of talking about a root cause, we can say there's root causes, and there's... They're dozens, hundreds of root causes, or sorry, common causes, common causes. And then every now and then there's a special cause.

0:03:01.0 BB: But even when a special cause appears so does a bunch of common causes. So from a Deming perspective there's never a root cause. So I... One poke I have for people that like to think in terms of root cause, 'cause they have this sense of, you can explain everything by a series of connected root causes. This cause leads... It's like the five whys. That this leads to this leads to this. But it's always, this leads to that, this leads to, and it's singular strands. And I think of it like a strand of spaghetti and everything is along some pathway. And I thought, no, that's not the model Deming had in mind. Deming had in mind a multitude of strands that are all woven together that you can't... What comes out is a bunch of contributions, not just one thing. So my poke at people like to believe in root cause phenomenon is, "If life can be explained by a series of root causes, then why do you need two parents? Why isn't it a single parent?" Sorry.

0:04:18.9 BB: I just finished the fifth cohort at Cal State Northridge in a eight-week class as part of an 18-month program where the students, we start with about 30, by the time it gets to me there may be 24 or so. And one course after another, after another, it's a very rigorous program. And I do a class called Seminar in Quality Management. And I love at the beginning of the course when I ask them about, if all the beads are red, if all the red beads are eliminated, can improvement, can still go on to, all those things we've talked about in this program. And I have them write essays on it, and it's so neat to see where they are in the beginning and where they are at the end.

0:05:07.1 BB: And in the beginning they'll be talking about human error. And so every time I see human error, I just write back, is it human error or is it system error? And one student in the class commented at the end of the course of what she learned, she said, No one had ever pointed that out to her. And she distinctly remembers the very first time I said that it was like, but wait a minute. And then it made more and more sense and I thought, yeah, I mean not... Is there such a thing as a human error? Well, Deming would say that 94 plus percent comes from the system. Another cute story, I used to host a monthly conference call for 17 years, every month for 17 years.

0:06:02.0 AS: Wow.

0:06:02.8 BB: And featured on the call was a thought leader, Russ Ackoff did it four years in a row. He became the January thought leader. And generally it was random, different people. But then when it got to Russ, it was every January Russ did it. And I would go out and stay with him and be in the room with him and the distribution list was at one point in time, 5000 people around the world, that I had somehow interacted with. And the announcement would go off out every month, and it would say, this month's ongoing discussion with thought leaders, is Andrew Stotz, Andrew's gonna talk on this topic. Please find attached his thought piece. You can join us. And there were four opportunities to call in on 12 to one and one to two on the last Thursday and Friday of the month. And there was four different opportunities for the audience to engage with Andrew, and it wasn't a presentation by you. The protocol was they would read the article, then they would say to you, Andrew, on page five, you said this can you clarify? So I said to them, it's not a presentation, it's a conversation.

0:07:08.9 BB: So a friend had in mind, somebody that he worked with as a thought leader. I said, okay, let me, She'd just written a book. And the book title was along the lines of Think Like a Champion, so I read the book and it's sports stories, all these sports stories. Turns out she has an advanced degree in sports psychology and she was hired by his company as a coach. And throughout the book, her story is about people contacting her, I need help with this. I need help with this. I need help with this. A lot of these people are in sales, I need help, I need help with this. So I read the book cover to cover, and I started to notice a pattern. It was all individuals. I need help, I need help. And so when I got on the phone with her and the role of the phone call was to talk about the book, talk about the phone call, let her know what the overall strategy of what we're trying to do with these calls, promote a word as of Deming's work and working together, all that stuff.

0:08:20.6 BB: And then with that, see if that fit, what if she felt, in fact, what I had in mind was that there's things in there she could contribute, but there's things in there that might be slippery. So I shared with her that I had a friend who was a high school coach for the Valencia Vikings and I bumped to him one day in a park. And he's walking towards me and he is wearing a T-shirt, and across the top are the letters V-K-N-G-S. So I'm looking at the letters and I said, I don't get it. To which the author says, there's no I in team, and that's what it was V-K-N-G-S. And so she beat me to the punchline. So I said, so you're aware of that story?

0:09:15.0 BB: She says, oh yeah. I said, "Your book is filled with sports stories." She says, "Yes." I said, "Did you ever consider that story for the book?" She says, "it really wouldn't fit." I said, "that's right." I said, "that is it, it doesn't." I said, "'cause your book is all about the I and not about the team." So at the end of the call, I said you know, when I got your book, I said the cover was revealing. And this is what I find, going back to language. You can be in a meeting and you can hear how people think, which then leads to how they act and you can't separate, you can hear that. So I said, "I looked at title of your book," which is something like, Think Like A Champion. And I said, "as soon as I saw that title," I thought. But I said, well I told her, "I said, there's a lot of good stuff in here." I said, "but, and I'm not saying everyone hears what I hear, but I don't want you to be caught short on that." She said okay. So then I said the title was kind of a giveaway of what the book was really about. She said, "well, what would've been a more appropriate title?" I said, "Think Like a Contributor."

0:10:34.5 BB: And so we are within our respective organizations, we're one of many contributors, we don't do it all by ourself, we contribute to the results and we talked last time about... Sorry.

0:10:47.1 AS: And that's an interesting point because that's a, maybe a difference between let's say American style thinking and Japanese style thinking, where Japanese may see themselves clearly as a contributor in a system. Whereas Americans, we like to think of ourselves as a unique person that fits into a certain place in this world.

0:11:08.9 BB: And I won the game, I won the game and I made it happen. And, um, but sure, and I've heard that about Japanese management, that it's more like, I am humbled and honored to be your executive and there's a real... And it comes across that it's not just talk, there's a real sense of humility and honor to be in this position as opposed to a sense of I'm the smartest guy in the room.

0:11:39.4 AS: Servant Leader.

0:11:41.4 BB: Yes, very much so. So, next thing I wanna bring up is, we talked last time about Myron Tribus's his comment, management works on the system, people work in the system, and the theme was making a difference from where you are and I mentioned that this gentleman came in, was one of our classes, and he wanted to, how often I met with our president. And I said, not very often. He said, oh, it's really important, you gotta go meet with him. And I said, "well what if I spent time talking with senior people at NASA or senior people in the Pentagon," which I did. And a mistake I made, a minor perhaps a minor error that somebody may or may not have caught. So I said, that I had the distinct pleasure of being invited to speak at the Army's largest annual logistics conference back in the 2000s. And the invite came from a senior officer on the staff of General Anne Dunwoody, who went on to become the Army's first woman, Four Star General, and so in the podcast number 15 I said, I was invited and spoke with the Army's first Four Star General, it was the Army's first woman Four Star general.

0:12:57.2 BB: So this is a clarification. I also talk about how pragmatism is being practical, but I think is, if you're trying to introduce these ideas into your respective organizations making a difference where you are, I think it's important to realize that everyone is acting as if they're being practical. And if practical means work on things that are bad to make them good and stopping, that’s their, that to them is practical. Now, from a Deming perspective to not work on things that are good, to make them better to improve integration - that is practical, but it might not be practical where you are. And I mentioned, I had a Lean Management journal article that talked about that, and I couldn't remember the title. The title is Profits, Pragmatism, and the Possibilities of Possessing Other Eyes. I told you I like alliteration.

0:13:56.6 AS: Alliteration.

0:13:57.5 BB: Alright, so what is an application? We start where you are. And I would say an application, first of all, relative to an application, it's thinking, can I do this by myself? Do I need help? Do I see opportunities to reduce losses? And it's one thing to see opportunities to do something. It's a whole 'nother thing to realize that the timing might not be right. I may not have the support that I need. I may not have the funding that I need. There could be other priorities. So when I would tell people I was mentoring to see opportunities is a really big thing, whatever those are. An opportunity to shift from managing actions to managing interactions and realizing that addition doesn't work, that things are not adding up and you're realizing, holy cow, there's some opportunities for synergy here. There's opportunities to work on things which are going well to prevent the red beads, work on things that are well to improve integration.

0:15:05.3 BB: There could be opportunities to stop doing incentives within your sphere of influence, to stop handing out awards to your people on your staff. Had a friend who just became a manager years ago and I had been mentoring him and within a few weeks of him being manager in operations, he came to me and he said that somebody on his team helped him do something and he gave him a $10 lunch coupon. I didn't say anything, I just let it pass. A couple weeks later, he comes to me and he says the same guy helped him again and then reached out his hand, he says, “Where’s my coupon?” I said, “I was waiting to see how long that would take.” And Andrew, that happened 25 years ago, if I was to have breakfast with him tomorrow, it would come up. Every time we meet, which is not that often, he lives a lot too far.

0:16:05.5 BB: And it was just so cool how, as I said let’s just see how this goes. So the idea is that what can you do from where you are to not pass on the pain? And so it may be flowing down to you, but maybe you, if you’ve got a team, can stop it from where you are. Maybe. Maybe you can’t. I mentioned Jim Albaugh, who went on to become CEO of Boeing Commercial, CEO of Boeing Defense. He was my boss for a number of years at the beginning of his doing these amazing things. And one day after we had some really stellar applications of Taguchi’s ideas with Deming’s improving integration, the hammers went away and things came together. Performance, we had an incredible advances in engine performance and integration. It was really cool. So he was really thrilled by all that. So I go, I would meet with him once a month and I’d poke him.

0:17:10.0 BB: So one day I went in and I said, “I wanna bring something to your attention.” And he looks at me with this smile. And I said, “I wanna put something on the table. And I’m not saying you’ve gotta do it now, but don’t ever tell me I didn’t bring it to your attention.” And he is like, “okay, Bill, what?” [chuckle] I said, “we’ve got to get rid of incentives, rewards and recognition and performance appraisals.” And then he just rolls his eyes. I said, I says, “I know you can’t do this.” And I said, “but these are ankle weights on how fast we can run as an organization.” But I knew that was... I mean, he was, at the time he was a VP, even when he was CEO, he can’t get rid of those. Those are such an institution. But I just wanted to go on record with him. I just chose the moment to go on record with him knowing the limits, but I wanted to be upfront and honest with him that if I don’t go to those events, this is why.

0:18:18.8 BB: And so it’s just making a difference from where you are and sometimes you speak up, sometimes you just keep your mouth shut. Another thing I encourage people I mentor is, if you’re out managing interactions and things are improving, you’ve improved integration. Is that, my advice to them is go about it quietly be the change you wanna see in your organization. Be the change you wanna see in the world, to quote Gandhi, I said, but unless your boss asks you how that happened, don’t explain it to them.

0:18:53.2 BB: I said, if they ask you how did you know how to do that, that’s your opportunity. But if you’re not asked that, I mean, in other words, don’t do it expecting to be asked for what, you know, to be complimented. You do it because it’s the right thing to do. Use it as a learning experience. Be deliberate about it if you’re gonna go off and do it. But if you’re doing it to get praise, you’ve missed the whole point. If you’re doing it to get your boss’s attention, you’ve missed the whole point. What I tell people is, do it’ And maybe at some point in time, they say, ’'ve noticed a pattern. Tell me how you do this. ’I've got a manager I work with, with a client, was asking me about how to praise someone. And I said, one is, there’s nothing wrong with one-on-one in the office saying, your contributions were enormous. I said, do’'t ever imply without you, we could not have done this. You’re a contributor. But I said, more important than that is, ask them, how did you know how to do that? Where else could we apply this?

0:20:07.4 BB: I said, I think that is far more, I think being asked those questions are far more thrilling than a pat on the back. Back in ‘93, it was '92, I was nominated to be an engineer of the year at the Rocketdyne, which is a really big deal. I was one of a dozen finalists. And the vice president of engineering invited everyone into his office to ask us a bunch of questions. And he used our answers for the engineer of the year dinner. And what I found out from the others is, he never asked any of us, how can your work, what is your vision, Andrew, for how your work can impact the organization? And I thought that, that never came up. And I would have been thrilled, my whole interest in going through this, 'cause I knew at that time about awards and recognition, but my hope was that, that could create visibility and help me further the cause.

0:21:13.8 AS: Make an impact.

0:21:14.8 BB: This is... But another thing I would say is, I have my knuckles rapped this way a few times. And when I would try to explain to the executives how we achieve these solutions. And once one of the VPs, my VP, his comment to me was, he was watching me, he came by to see the slides I was gonna use. And he says, Bill, don't be tutorial with us. And I thought, oh, man. So what I tell people is, a staff meeting is not the time. This is really important. If you're trying to explain in a staff meeting how you accomplish something, what makes it bad is, even if you're invited, a staff meeting is not a classroom. When I walk into a classroom as the instructor, I walk in, and I know what my role is, and everybody else knows what their role is. But when you walk into a staff meeting, and you're about to present something you did, if it comes across as being tutorial, what makes that offending is, who appointed you to be the professor? But if you have a separate meeting and, but it's just these nuances, can really get in the way, which leads to tonight's feature, the Cloud Model...

0:22:42.6 AS: Before you go to tonight's feature, I'd like to go back in time to November of 1965. It was a tumultuous year. In fact, it was February of 1965 that Malcolm X was assassinated in America. 1963, November, John F. Kennedy Jr. Was assassinated. America was going through a lot of turmoil, and the Rolling Stones were the bad boys of rock and roll. In November of 1965, I was four months old, so I don't remember this personally, but the Rolling Stones came out with a song, and it was called Get Off Of My Cloud. And I just wanted to put it in context, because for us older guys, we know that this lyrics, Get Off Of My Cloud, is referring to this song where they're oftentimes saying, "hey, hey, you, you, get Off Of my Cloud." So with that introduction, tell us why you named it, this episode, Get Off Of My Cloud.

0:23:44.3 BB: Well, you're not gonna believe how apropos that, that intro was. Oh, this is so cool. It's so cool, so cool. In 1995, I met Barry Bebb, a retired, very senior executive from Xerox, who was on a very short list to be the next CEO of Xerox after David Kearns. And Barry left Xerox and became a consultant, and I met him in the Taguchi community. And somewhere in the beginning of '95, I bumped into him. I'd met him earlier at another event with Dr. Taguchi, and, um, and then there was an event in LA, a conference, and I bumped into him, and he said, hey, I know that guy. We knew each other. And he said, hey, I'm putting together this group of people, about a dozen or so people, a couple from Ford, a couple from GM.

0:24:46.7 BB: Would you like to be part of it? I was like, well, what do you have in mind? He said, "we're gonna to meet once a quarter. I wanna mentor you and help you create change within your respective organizations." And it's like "sign me up." And I was there with a very good friend, Tim Higgins, and so we signed up. And we... Barry called the group Impact 95 'cause it was 1995. And we would get together all day Friday, all day Saturday, through Sunday at noon. We would meet either within Ford, because there was a Ford member, within GM. There was a printer company we met at their headquarters, at their site.

0:25:28.7 BB: We met at Rocketdyne. We'd meet in San Diego with Barry. But once a quarter for three and a half years, we met, all on our own time. The company didn't pay for this. I told Tim, we're just gonna go off. We're not gonna tell anybody what we're doing. But what we learned from Barry is how to create change from an organization when you're in the bottom, you're an individual contributor. And so that... And I've got the notes. I've got a big pile of notes. And some of the things that jumped out when I was pulling my notes together are things we learned in that very first session. One is you can't tell anybody anything. He said, "You can lead people on a path to discover, but you can't force them to drink." And that became really powerful that, telling people something's important is a losing strategy. So what I find powerful about the Me and the We Trip Report, Red Pen, Blue Pen, whatever it is, that's not me telling people what the organization is about. That's them telling me what the organization is about.

0:26:43.7 BB: But trying to tell people this Deming stuff will change your life, that's a losing strategy. So he says, you can't tell anybody anything. And then my paraphrase is, "telling is a losing strategy." Even if you tell a loved one. If I tell our daughter, Allison, you gotta go watch this movie. You gotta go... You need to go learn more about the Rolling Stones. She's like "Dad, I'm a Swifty." It's like her telling me, "well, I'll go do that if you go watch the Eras movie with Taylor Swift." I'm thinking, "that ain't gonna happen." But anyway, so even with a loved one telling, telling is a losing strategy. Well, another thing he told us that very first meeting, you're gonna love this. He said, he points at each one of those and he's like a drill sergeant, and he says to us, "you have to be able to do this by any means necessary." You know who used those words, right?

0:27:43.8 AS: Malcolm X.

0:27:44.9 BB: Malcolm X. I remember looking at Barry saying, said that's Malcolm X. He says, and he would say, "every morning you've gotta get up and ask yourself, am I doing everything I can to make a difference in our organization?" And it was just beaten into us again and again and again and again in a very loving way. So back to the, "hey, you Get Off Of My Cloud." Barry came up with a Cloud Model. And I don't know that he had in mind to write a book about it. I don't know that he ever did. I don't know if it was ever published. I have not, I share this in all of my classes and all my consulting. I share it with clients. I'm not sure if it's out there on the internet. Well, what Barry had in mind, his model, his mental model for organizations is there's a Cloud.

0:28:31.7 BB: The Cloud is the top of the organization where all the executives are. And Barry got to the Cloud. He was in charge of Xerox's division that made the, not office copiers, but these really big, big things. And, um, and I don't know how many thousands people worked for him, but he was in the Cloud and he's briefing us. And we're individual contributors in our respective organizations. And what brought us together was each of us was trying to introduce Dr. Taguchi's ideas into our organization. But the Cloud model is universal. It's not just, it's introducing any change in our organization. And what Barry confided with us, and it kind of burst our bubble is, he said, if you get an email that says, we want you next Monday, Bill Bellows, to go to Boeing headquarters and share with them how Dr. Taguchi's work can impact Boeing.

0:29:31.7 BB: And I'd be thinking, "what an incredible opportunity." What I learned from Barry was you have to say no. And I'd be like "well, Barry, isn't that the audience I want?" And he says "no." "Why not, Barry?" He said, "here's how it works." He said, "the people in the Cloud may not like each other, but they respect each other." He said, if you're...

0:29:56.3 AS: And the people in the Cloud, remind everybody who are the people in the Cloud?

0:30:00.2 BB: The top executives of the organization are the Cloud. So that's the...

0:30:05.4 AS: They're living in a, they're living maybe in a comfy zone. They're not necessarily dealing with the nitty gritty of the business, what's going on.

0:30:13.7 BB: They're way up there in the upper atmosphere. They are... And they're the chief executive people, the senior most people in the organization. And what Barry said is, "they create the rain. They create the KPIs. They create all those things that flow down." And what Barry says, "what we're tryna do is influence what flows down. So in order to influence what flows down, you've got to get into the Cloud." He said, but the deal is, what Barry's model was, "Bill and Tim and Larry, you can't go to the Cloud." Well, why not? He said, "because you're an outsider." And he said, "they shoot outsiders, but they don't shoot each other."

0:31:02.8 BB: So what do we do? He said, "when you go back to your respective organizations," this is the very first time we meet, this is how impactful it was. He said, "when you go back to your respective organizations, start thinking about someone in your organization above you. It doesn't have to be your boss. It could be somebody over to the right, but find someone above you that you can get smart about Taguchi's work, about Deming's work, about whatever that passion is that you wanna bring to the organization to rain down. Get them smart, 'cause you can't go to the Cloud, but you can get them smart. So make it your calling to go back to work, begin to meet with someone above you. Help them get someone above them smart. Help them get somebody..." So I, I hand, I get you smart, and then I help you get your boss smart, and then you're...your boss on up. So you have to hand off. So this is not me coaching you, and then coaching you all the way. So I have to let go. I have to be a contributor.

0:32:17.5 BB: And I thought that's not what I... I thought I could be the hero and go in there. And he is like, no, it won't work. And so I went back and immediately began to mentor my boss, Jim Albaugh, who's a VP. And that was my, my strategy was to get him smart on all the things we were doing. And then he, in turn, eventually got his boss, Alan Mulally smart. And I just, but you have to let go. And then you're trying to influence the organization - so it can be done. So in terms of making difference from where you are, it's not running into the Cloud from down there and thinking, Hey, I've got these great ideas. And what Barry said is, it's not gonna work. Don't. And he saw it not work on many occasions.

0:33:08.9 BB: Now, one time I got invited to a Boeing corporate setting, and it was not, it was halfway to the Cloud. It was pretty high up. And my first thought was, No. This, you know, Barry on my shoulder, Barry says, "Bill, don't do it. Bill, don't do it." When I found out who's gonna be in the meeting, and it was all the VPs of engineering across Boeing, space and communications, and they all reported up to the VP of engineering, corporate, senior VP of engineering, who reported to Jim Albaugh. So I thought, okay, against my better judgment, I went in. But being aware of Barry's model, I went around the room and amongst the nine VPs of engineering, I knew half of them. So I went around the room,, and hi, how're you doing?

0:34:14.8 BB: I haven't seen you. And part of what I was doing in my mind, what I was doing was preparing them to help me should the others start to shoot at me. But I knew to do that. And without the awareness from Barry, I would not have known to go around the room. So it was... I mean, it wasn't the very, very top of Boeing. It was a good ways up. But I still took what I learned from Barry and said, okay, I need some help with this. I can contribute, but I'm just gonna stop there.

0:34:56.3 AS: Well...

0:34:56.4 BB: And so when it comes to this, Get Off Of my Cloud, it's the people in the Cloud, it's their Cloud. We just work here.

0:35:04.9 AS: And in the theme of music I'm gonna wrap up my part of this and then ask you to do a final wrap up. I wanna go now to 1976. 11 years after the Rolling Stones came out with their song, Get Off Of My Cloud. By this time I was 11 years old. And in 1976, the band, the Canadian Band, Rush came out with the album 2112. And the song 2112 talks about how, Neil Peart wrote this, the drummer, about how he, that it was a society he liked to show it was like a communist type of society where it was ruled by the elders. And he found a guitar, and it was an ancient guitar, and nobody had heard of a guitar. And he figured out how to play it. And he thought it would be amazing to take this to the priests, to the elders.

0:35:57.4 AS: And he went to them after learning how to play. And he said, "I know it's most unusual to come before you, so, but I found an ancient miracle. I thought that you should know. Listen to my music and hear what it can do. There's something here as strong as life, I know that it will reach you." And the priests respond. The priests in unison respond, "yes, we know it's nothing new. It's just a waste of time. We have no way need for ancient ways. Our world is doing fine. Another toy that helped destroy dah, dah dah, dah, dah." The point is that they were in their comfort zone and they didn't want to be disturbed. And so having an awareness of that, I think is what you're trying to teach us so that when we, make a change where we are and be an influencer rather than a teller. And don't use the telling strategy.

0:36:54.2 BB: Yeah, no, it's... Exactly. It's, um, I had a VP of HR once pulled me aside and he said, "what's your vision for the organization?" I said, "don't ask me." I said, "ask them, ask them." I said, "it's not what I want" is, and this is, I told another group of people I was mentoring. I said, something like this. "I'm not gonna be here forever." 'Cause they're saying, "well, what should we do?" And I said, "my question to you is what do you want to happen?"

0:37:36.3 BB: And what was so amazing when I shared that with this one group, a couple of days later, two of them sent out an email to a bunch of their peers with announcing some opportunities. And I had tears in my eyes. I was reading it on an airplane. I was at LAX and looking at it. And what blew me away was, they didn't call me up and say, Hey, we have an idea. They just went out and did it. They became the change they wanted to see amongst their peers. And I was just overwhelmed with it all. All I said to them, is that, "what do you want? What is it that you want this place to be?" I said, "it's not what I want. It's what do you want?" But the other thing is I'll share some great wisdom from Edward de Bono. And this is the book, Handbook for the Positive Revolution. You can buy it on Amazon for probably 5 bucks. And the original copy, I'm told, this is not an original, it has a yellow cover, and there's significance there that I'll come back to, but what somebody told me is the original book not only was the cover yellow, but all the pages were yellow. Well, yellow in the Edward de Bono world is associated with one of the six colors of his so-called Thinking Hats, and yellow is the Logical Positive. Your ability to explain the benefits of something. Not your gut feel, which would be your Red Hat, but your Yellow Hat is saying, I can articulate the benefits. The Black Hat is the Logical Negative, I could tell you all the weaknesses.

0:39:29.8 BB: So this is coming from that place of yellowness. So the book came out, and I got it for a bunch of colleagues in our InThinking transformation community at Rocketdyne early on. And the introduction, Edward says, "this is a serious revolutionary handbook. The greatest strength of this serious revolution is that it will not be taken seriously." So when I'm reading that, I'm thinking, "what?" Then he goes on and he says, "there is no greater power than to be effective and not to be taken seriously." That way, Andrew, you can quietly go on with things without the fuss and friction or resistance from those who feel threatened. And that was so invaluable to our efforts is, if people don't take it seriously, fine. 'Cause what Barry talked about is, he said, "for every proponent," as you're trying to get this message to the Cloud, he said, "for every proponent, he'd say there's nine opponents." So they're out there. So as I'm trying to get my boss smart, you've got this. And I come across Edward's work, and he says, you just take it in stride. You just try not to be dissuaded. You get up every day and say, what can I do? And how do you get to the Cloud?

0:41:14.2 AS: Bam. Well, Bill, on behalf of everyone at the Deming Institute, I wanna thank you again for this discussion. And for listeners, remember, go to deming.org to continue your journey. And if you wanna keep in touch with Bill, just find him on LinkedIn. He's there. This is your host, Andrew Stotz. And I'll leave you with one of my favorite quotes from Dr. Deming. People are entitled to joy in work.

In the second episode of The W. Edwards Deming Institute Podcast moderator Tripp Babbitt interviews Kelly Allan.  Kelly serves on The Deming Institute's Advisory Council and is the senior associate of Kelly Allan Associates.

Kelly discusses the creation of the 2.5-day seminar and the current activities of the Institute while also touching on various aspects of the Deming management method.

What is the Taguchi Loss Function and how does it apply to education? In this episode, Andrew and David talk about statistician Genichi Taguchi's idea that the further you move from a measurable quality target, the more quality is lost, even if the item still "meets specifications." David shows how you can apply this to education.

(For more about the Tachugi Loss Function, visit Wikipedia or Christopher Chapman's Digestible Deming blog post.)

purpose. Do you have a constancy of purpose or a meaning about why you want them to get into groups? Are they struggling with group, being able to be in a group and communicate in a group and those kinds... Okay, if that's my purpose that's much different.

Stotz: Which it's not, because one of the unique things about Thais, when I teach them in Thailand is that they're much more comfortable in groups compared to let's say Americans, so they don't need group work. But I also see that what you're telling me, that method will accelerate, the process won't take as long, I think it would accelerate pretty quickly. So alright, well, I would say I learned something from today's lesson and I'm gonna test it out because my purpose for that class, I had 50 people in the class, many of them were very scared of finance, and I said, "I'm gonna get all of you to the level of competence that I want, that's my goal." It is... That was my goal in that class, and so that's part of why I did it that way.

Langford: When you're optimizing it, what you're saying is correct, you're optimizing, 'cause you want every single person to really enjoy... And I have a joy in learning for finance, right?

Stotz: Yeah.

Langford: So how am I gonna get there? What's the quickest way I'm gonna get there? How I'm gonna optimize that?

Stotz: Fantastic. Well, David, on behalf of everyone at Deming Institute, I wanna thank you again for our discussion. And for listeners, remember to go to deming.org to continue your journey.

Stotz: This is your host Andrew Stotz, and I'll leave you with one of my favorite quotes from Dr. Deming, "People are entitled to joy in work."

Most of the time, variation between students or workers is the result of common cause situations, but sometimes you find folks who consistently aren't performing at the same level. Does more punishment work? What should you do instead? In the episode, David Langford and host Andrew Stotz discuss how managers (or teachers) should approach these "special cause" situations.

TRANSCRIPT

0:00:02.4 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today I'm continuing my discussion with David P. Langford, who has devoted his life to applying Dr. Deming's philosophy to education, and he offers us his practical advice for implementation. Today we continue our discussion of Dr. Deming's 14 items that he discusses in his New Economics book about the role of a manager of people after the transformation. This is on page 86 of the third edition, or page 125 of the second edition. And this is point number nine. Let me read it to you before we get started. So again, for a, the role of a manager of people, this is the new role of a manager of people after transformation. Point number nine, he will try to discover who, if anyone, is outside the system in need of special help. This can be accomplished with simple calculations. If there be individual figures on production or on failures. Special help may be only simple rearrangement of work. It might be more complicated. He in need of special help is not in the bottom 5% of the distribution of others. He is clean outside that distribution. And Dr. Deming presents a normal distribution and some other things, in this chart that he presents in this one. And we're gonna call this episode: Who Needs Special Help? David, take it away.

0:01:40.5 David Langford: Okay. Yeah, this is always a topic of discussion because, there's all kinds of management theories out there, right? About, how we manage, I can't remember who, was a proponent of just getting rid of the bottom 10% of your...

0:01:57.9 AS: Jack Welch.

0:01:58.0 DL: Organization every year. Jack Welch, yeah. Notoriously wrong, with that. And, or well, "if you can't cut it, out you go." And that all sounds good until it becomes so expensive to constantly be hiring new people and replacing people. And the fear level goes up so high that you can't get anything done because nobody wants to take any risks because you really can't take a risk because you might be gone. So Deming is saying a lot really in this point, he talks about the distribution of people. Well, so first thing is you have to figure out what is that distribution, right? So how are you calculating that? Or how are you figuring out what that performance level is? Well, as a teacher in a classroom, obviously, you have tests that you're giving, you have projects that are happening, etcetera. It is actually pretty easy to see that distribution of performance in a classroom. You give a simple test on something and then you look at the test results and you start to see, okay, everybody scored on this test from 70%-100% on this test, right? So you can say, okay, that's an average of about 85 or so for the whole class.

0:03:31.5 DL: When you look at it on a histogram scale like that, what Deming is really talking about, he's not talking about just the people that were scoring at the lower end of that distribution. People that were getting 70, 75, 80, etcetera. They were all at the lower end of the distribution of that system. But what it's showing is that's the capability of the system. You did something, you did a process with people, you tested the process, the process produced that curve, and on average, it gives you an average of 85. Now deciding whether or not that's good, is good, is good good enough, that's a whole different really discussion than what really Deming is talking about here. So he's not talking about people just on the lower end of a distribution of performance. He's really talking about somebody that's completely outside of that distribution. So in a classroom, if I did something like that and we did a project or a test or whatever, and everybody is scoring from 70%-100% except for maybe two people that got 10 or 5, right?

0:04:46.6 DL: Obviously these are two people completely outside of the system. And what he is really talking about is probably no amount of adjusting the system is going to help those two people. They are so far outside of the distribution that they really do need special help. So in a classroom that can mean, this could be children with special needs, they could be hearing defects, they could be the eyesight that, I don't know how many times I thought somebody was an understanding problem. And then we find out, oh, they couldn't see, either they couldn't see to read or they couldn't see the...

0:05:31.8 AS: Something very simple.

0:05:32.3 DL: The whiteboard in front of them. Yeah. And they got tested and got glasses and everything and wow, it just made a huge difference. But obviously when you have people in a special category, it's gonna take much more time and effort individually to deal with them. Right? And that's why it's called special, special needs, right? Because you are gonna take the time and effort individually to deal with those individuals. If you don't have anybody completely outside of the distribution of performance, then you're gonna go back and look at the system itself. So in my example, everybody is scoring from 70%-100% on some test that you give them. And the average is 85. Then you have to decide is good good enough, is that a good enough distribution on this? And as a teacher a lot of that has to do with understanding where does this fit in the entire curriculum.

0:06:40.2 DL: So is this a critical skill, that if these students don't have this skill and they don't have it just down pat, and are acing it, it's gonna cause huge problems later on. So it might be worth the time to go back and sort of rework that for the entire class and see if we can get a higher average. On other things, you might look at that and say, "Oh, okay. Only I know really the whole curriculum for the year, and I know that we're gonna be revisiting the same concept probably four more times throughout the year. So this average at this time of the year is probably good enough." I often joke with teachers and say, "If you're happy with your average, and you know it, clap your hands," so.

[laughter]

0:07:31.0 DL: But if you're not happy with your average and you know it, then you have to think about, okay, well what am I gonna do about it? Do I have the time to go back and rework this? And Deming in his example in figure 12, that he's showing there, is actually talking about moving in the entire system forward. So shrinking the variation so that it's not nearly as wide as it used to be, and more people are getting a higher average within that. So how do you get that higher average? Well, prevention is the key to quality. So every time you're doing a lesson that you've done before and you're taking that feedback that you've gotten before, folding that in. And this time when I did it, ah wow, we got an average of 89, or we got an average of 93, or...Excuse me. It's really difficult when you're improving a system and you're moving that average up, each time you go through something, when you start to get up and really high levels performance, going from 93 to 94 is a really big effort.

0:08:57.4 DL: There's gotta be something really happening there to get that next level result. And do you really have the time right now to get that? Or is it a problem of tomorrow that we have to figure out, okay, what are we gonna do in this system, in the future, to get a higher average? But I didn't believe, really, this when I started working with Deming, but then I went back and looked at all the grades and scores that I had given people, and I was so predictable. Every year I had the exact number, the same number of people getting A's or doing top-level work. I had the same level of percentage of kids that were failing I had... But of course it was always their fault, not my fault, so. And so that was really eyeopening to me that all I had been doing is just basically, for five or six years I had been doing the same thing over and over, and over, and expecting a different result. And it just doesn't work like that.

0:10:05.2 AS: Yeah, this one is interesting because first of all, he's presenting us with a distribution. We can see a normal distribution, and he's presenting also a more narrow distribution, saying that the goal is to try to, maybe in this particular case that he's showing to, he says, "You wanna work to improve the system by narrowing that distribution so that..." And shifting it, as we can see, as we've talked about. But I think also in this one, if you don't understand the system, you can get caught up in chasing performance in individuals that actually are just a normal outcome. And you miss the time that you need to spend to fix that special cause that needs to be fixed. So that was one of the things I took away from it. What do you think about that?

0:11:02.6 DL: Yeah, that's why he hated practices like grading on a curve. Which is notorious, it is still is notorious in many universities, grading on a curve. And... Because that shows no understanding of performance and distribution and average performance and it takes no accountability. And for you as the teacher, it just all blame on the student. "Well, if you tried hard, you could do that." Well, no, that's not true. There's only gonna be so many A's, so many B's, etcetera. So you're not gonna ever get there, so. But really this is about... Go ahead.

0:11:43.8 AS: To understand that a little bit more, so is the problem about grading on a curve that you're constantly... You're not necessarily improving? You're just like, "Well, this group had a curve that was here on the continuum and this group had a little bit better, they were better." And what is it? 'Cause I'd say grading on a curve is something that people on initial blush would think, "Isn't that what Deming is talking about?" I mean, we see normal distributions, we see curves. Explain that in more detail.

0:12:15.1 DL: You're creating an artificial scarcity of top marks. So only... No matter how well we do as a class, there's only gonna be so many top marks or people that are gonna get the top grade, right? And so you're gonna create all kinds of competition and you're gonna create all kinds of weird behaviors that go on. You're actually encouraging people to cheat. And I can't remember if I told you this story or not, but one of my children, she was in a advanced chemistry class or something, I think it was. And she comes home the first day of school and she said, "Dad, I think this teacher would be really interested in talking with you about what you do and improvement, and everything else." And I said, "Why?" And she said, "'Cause he said, well, everybody in here can achieve, everybody in here can get an A, can do well."

0:13:14.1 DL: She comes home the second day of school and she said, "I think I'm gonna drop this chemistry class." And I said, "What happened in two days?" She said, "He came back today and he spent the whole hour of the class explaining how he grades on a curve. So there's no way in the world that everybody in here is gonna get an A," right? You're creating an artificial scarcity of top marks and it's just not gonna happen. And I said, "Okay, well, just let me know what you decide to do with that." Well, she comes home the next day and she said, "I think I'm gonna stay in the class. I'm pretty sure I'm gonna be one of the people on top of the curve." And this was an honors chemistry class and in that class, half of the kids in that class had had straight A, 4.0 averages to that point. So, there was a bunch of kids that quit, 'cause they could not risk getting even a B in a class like that.

0:14:18.0 DL: But my daughter stayed in the class, at the end of the first semester, she comes home laughing one day and she said, "Dad, you'll never guess what happened." I said, what? And she said, well, this is a very, very smart group of kids. And not only did kids keep track of their own scores, they actually kept track of other kids' scores in the class as well. And I think there were one or two kids that found out that there were a bunch of kids that were just right on the line between a B and a C or something. But if those kids failed, it wouldn't make any difference to them. They're still gonna get the same grade at the end of the semester. Even if they didn't even take the final, it's not gonna affect them one way or the other, they're still gonna get that B or a C grade that was in that. But if they did fail it would mean it would change the curve and these other top kids could move up into the top echelon.

0:15:13.3 DL: And so they paid these kids $20 to fail the final. Well, somehow the teacher found out about it and then the principal found out about it. And there was a Spanish inquisition that was taking place and then they were talking about expelling kids and all kinds of stuff, I couldn't stand it, I had to go and talk to the principal and I said, how do you like it? He said, what do you mean? I said, "They're better at managing your system than you. They figured out how to play your game better than you. And you gotta be rewarding these kids not... And recognizing amazing statistical analysis and capability, not punishing them through that process, so." I think it was the same principal that said, "I know I'm having a bad day when your car is in the parking lot," so.

[laughter]

0:16:06.6 AS: Exactly. You should have said, you should have been... You didn't even realize you were teaching 'em a double major AP chemistry and AP statistics.

0:16:17.6 DL: Yeah, absolutely. So.

0:16:19.3 AS: Well, let's wrap this up by... I think the key thing of what Dr. Deming is telling us in this is about understanding your system and then identifying if someone is outside of the system, and that person or result outside of the system is... You know, warrants some special attention or special help and that that, you can't really know that without understanding the system and also not being too distracted by the variation that's natural from that system. And therefore, ultimately, once you understand that, then you really can clearly identify that some outcome or some individual is a special cause and then you can focus in on that and fix it. And so that's how I would summarize it. Is there anything else you'd add to that?

0:17:12.9 DL: Yeah. I was just was recalling that you are... Deming explaining several times that if somebody is outside of the systems that, far outside of the system, further rating and ranking are not gonna help them at all. Giving them more failures, more Fs, docking their pay. Whatever you're thinking of doing to somebody that's completely outside the system it's really not gonna help them at all in that process. And that... That's not help. Rating and ranking and bribing people to do better is not actually helping them. You actually have to study cause or the reason why that person is special cause and then do something about it. And in a classroom, and it could very well be that this person really doesn't belong in this class. They don't have the prerequisite skills that the other 98% of the class has. And so therefore they really don't even belong in this class. So that just means you have to get them in a different class or help them in some way to get caught up or, and it's gonna take more time and effort. Special causes take more time and effort. That's why they're special. So.

0:18:31.3 AS: Well, David, on behalf of everyone at The Deming Institute, I want to thank you again for this discussion. For listeners, remember to go to deming.org to continue your journey and you can also learn more about David at langfordlearning.com. This is your host, Andrew Stotz, and I'll leave you with one of my favorite quotes from Dr. Deming, "People are entitled to joy in work."

In this episode (part 4 of the series), John and Andrew continue their discussion from part 3. They talk about how to use data charting in combination with the Plan-Do-Study-Act cycle to gain the knowledge managers need to lead effectively. 

0:00:00.1 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today I am continuing my discussion with John Dues, who is part of the new generation of educators striving to apply Dr. Deming's principles to unleash student joy in learning. The topic for today is Prediction is a Measure of Knowledge. And John, to you and the listeners, I have to apologize. I'm a bit froggy today, but John, take it away.

0:00:30.9 John Dues: Yeah, Andrew, it's great to be back. I thought what we could do is sort of build off, what we were talking about in the last episode. We sort of left off with sort of an introduction to process behavior charts and importance of charting your data over time. And sort of the idea this time is that, like you said at the outset is prediction is a measure of knowledge and prediction is a big part of improvement. So I thought we'd get into that. What role prediction plays in improvement, how it factors in and how we can use our chart in combination with another powerful tool, the Plan-Do-Study-Act cycle to bring about improvement in our organizations.

0:01:15.1 AS: And when you say that prediction is a measure of knowledge, you're saying that prediction is a measure of how much you know about a system, or how would you describe that in more simple terms that for someone who may not understand that, that they could understand?

0:01:31.4 JD: Yeah, it took me a while to understand this. I think, basically the accuracy of your prediction about any system or process is an observable measure of knowledge. So when you can make a prediction about how a system or a process, and I use those words interchangeably, is gonna perform the closer that that sort of initial theory is, that initial prediction is to what actually happens in reality, the more you know about that system or process. So when I say prediction is a measure of knowledge, that's what I'm talking about is, you make a prediction about how something's gonna perform. The closer that prediction is to how it actually performs, the more you know about that system or process.

0:02:19.1 AS: I was just thinking about a parent who understands their kid very well can oftentimes predict their response to a situation. But if you brought a new kid into that house that the parent didn't know anything about their history, their background, the way they react, that the parent doesn't really have anything to go on to predict except maybe general knowledge of kids and specific knowledge of their own kid. How could that relate to what you're saying that prediction is a measure of knowledge?

0:02:52.3 JD: Well, I think that's a great analogy. One of the things that Dr. Deming said that it took me some time to understand was that knowledge has temporal spread - just a few words, but really causes some deep thinking. And I think what he meant was, your understanding, your knowledge of some topic or system or process or your kid has temporal spread. So that understanding sort of increases as you have increased interaction with that system process or in this analogy, your own kid. So when you replace a parent who knows their kid well with some other person that doesn't know that kid as well, they haven't had that sort of, that that same, that shared time together. So there's that, they don't have that same understanding. It's gonna take time for that understanding to build. I think the same thing happens when we're trying to change a system or a process or improve it or implementing a new idea in our system or process. And so the prediction at the outset is probably gonna be off. Right, and then over time, hopefully as we learn about that system or process or kid in this instance, that that prediction is gonna get better and better, as we learn over time, basically. I think.

0:04:15.8 AS: Yeah, it's interesting because saying the words temporal spread kind of gives way to the idea that Dr. Deming was educated in 1910, 1915, in speaking, reading, writing. And then he also, he said things, that his objective wasn't to just completely simplify. And I think that the messages that he was bringing were difficult to simplify, but you could say that, "improves over time" is what temporal spread may mean. Right? Okay. Let's keep going on this. This is interesting.

0:04:55.0 JD: Yeah, I think, maybe it'd be helpful if I share my screen and we can sort of connect the dots from last time to...

0:05:00.8 AS: Yep. And for the listeners out there, we'll walk you through what John's showing on his screen in just a moment. All right. Now we can see a chart on his screen.

0:05:11.7 JD: Yeah, I think, so we see a process behavior chart sort of orient, the watchers and then even the listeners. So the chart is a process behavior chart. That terminology can be a little bit confusing. Some people would call this a control chart, some people would call it a Shewhart chart, my sort of preferred terminology is process behavior chart because it's literally charting some process over time. So the example I used last time was charting my own weight. So you can use, you can chart personal items, you can also obviously chart things that are important to you in your organization. But the main thing is pull numbers out of a spreadsheet. That's what we talked about last time. Pull numbers out of the table instead plot that same data over time. So you can see how it varies naturally, perhaps, or how it varies in, special ways over time. So the, for the watchers, the blue dots are individual data points. The dates are running along the X-axis of the chart. And so you can see those moving up and down over time as I weigh myself every morning. Then we have the green line.

0:06:30.6 AS: At the beginning of the chart, we see those individual data points hovering around maybe 179 to 80, something like that.

0:06:41.8 JD: Yeah. Bouncing around in the 180, 178, 176 range. And then...

0:06:48.8 AS: And just for the international listener, John is not 180 kilograms [laughter], he's 180 pounds. Okay. Continue.

0:06:56.8 JD: That's right, that's right. On the Y-axis, we have weight in pounds. And so in addition to the blue dots and we've added a green line that is the average over time. And then we have sort of the last component of the process behavior chart, we have the red lines, which are the upper and lower natural process limits, or some people call them control limits sort of are the bounds of this particular system at a given point in time. And so, as we watch this data unfold, we can see that it does move up and down in different ways, in different patterns, but it's far more illustrative than if I was just looking at that table of numbers. So when I do this daily, I don't wanna overreact to any single data point. Instead, what I'm trying to do is get a sense of how this data is performing over time, right? So I can see this unfold over the course of days and then weeks and then months and all along, my knowledge of my weight system is increasing.

0:08:09.7 JD: Even if you don't know anything about process behavior charts, you could do this on a simple line chart or run chart without the limits, and you'd still learn much more than what you would with that table of numbers. But with the addition of the red lines, the natural process limits, what I am doing is sort of saying based on some simple mathematical calculations, that these are the bounds of my system that I would expect because of the data empirically based on the actual dots on the chart, these are the bounds of my system. And if a point would happen to fall outside of those red lines, I know something special has happened because it's so mathematically improbable that it's not to be expected. And there's a few other patterns in the data too that you can look for besides a single point outside of one of those red lines.

0:09:08.4 JD: But I'm looking for those patterns to see if something special has happened or I'm seeing if my data is sort of generally bouncing around between those red lines. And in either case, there are different approaches to trying to improve that, improve that data over time. And one other thing that I like to do, I always make my data blue, my average line green and my process, my natural process limits red. And then whenever I do this internally with data from our own organization, whether it's attendance data or test data or financial data, whatever the data is, I always use that same pattern. So people get used to seeing these colors and they associate blue with data, green with the average and red with the limits.

0:10:00.7 AS: So tell us more about, I mean, one of the things before we even talk about PDSA, what's happening here is that the upper limit and the lower limit at two points in this chart shift down. So you're, if you didn't change the upper and lower limit and you just had your, that standard one across the whole chart, then it probably starts to lose its value because the process that you're describing is going back in time to such an extent that things were different. Tell us about why you've made this adjustment.

0:10:46.0 JD: Yeah, I'd say if the natural process limits, so the red lines sort of stay in the same spot. So if I don't see those special patterns, basically what I can assume is that that system is, despite the fact that the data is bouncing around a little bit naturally, that, there's nothing sort of significant that's happened either in terms of my weight system getting worse, or in this case I want to get better. Obviously, I wanna lose a little bit of weight. If I don't see those patterns in the data, then nothing has changed. So if I'm trying something new to bring that weight down and I don't see any of those special patterns that tell me to adjust the natural process limits, that means what I'm doing is not having an effect. Right. So there's one, you wanna know what reality is for whatever the thing is that you're talking about.

0:11:37.7 JD: So on the very first day, you can see, when I weighed myself, it was like something like 182 pounds or something like that. And I could say I weigh 182 pounds, but that's not really reality, except that I weighed 182 pounds on the morning of November 28th when I recorded that data. But the very next day it goes down a little bit and then it goes down quite a bit that third day, and then it bounces back up, and then back down, and then back up and then back down a little bit. And that's the real sort of reality. And I don't really weigh 182, I'd probably weigh somewhere closer to that average of 179 across those first two weeks or so. Right? But I don't know that until I've collected, 7, 8, 9, 10, 11, 12 data points, what my reality is.

0:12:30.0 JD: And that's why this charting is so important. It helps me understand reality in a much more accurate way. So when we're trying to improve, I think, in this case, I decided to gather data on a daily basis. And I think when that's sort of another important consideration, when you're doing improvement work and charting, you wanna gather data in a rhythm that matches whatever it is, whatever that metric is that you're concerned with, you want that, you want the data to be gathered in a way that matches that metric. But in general, more frequent is better, as long as you're not overreacting, like I said earlier, to any single data point. Instead, you wanna gather data, you wanna have those 15, 20 data points, see the patterns, and then start to look for changes in those patterns. The three that I happen to look for are, a single point outside the natural process limits, or I'll look for eight consecutive points, either above or below that average line, or I'll look for three or four points that are closer to the red line than they are to that average line.

0:13:41.4 JD: Any of those three patterns emerge. I know something has changed, and I'll go ahead and shift the limits. If I know, when I'm looking for those patterns, I wanna know why that change has happened. So sometimes when I see a pattern, and if I don't have an explanation for why that data shifted, even though it shifted in a way that was mathematically unexpected, sometimes in those instances, I won't shift my limits. So I generally will only shift when I see a pattern and I can sort of pinpoint a reason for that, for that shift.

0:14:18.4 AS: And when you say shift, you're saying shift your upper and lower process limit?

0:14:20.0 JD: Yeah. I shift the limits at the point where I saw one of those special patterns begin, basically.

0:14:29.6 AS: Okay. All right. Keep going. So you got PDSA on there now.

0:14:32.9 JD: Yeah, so I think, when I think about continual improvement, there's a lot of different tools we can use and a lot of tools that are valuable, especially when you sort of facilitate an improvement team, a group of people working together, especially because those various tools can help you visualize what people are thinking. But if I had to boil continual improvement down to two tools, it'd be the process behavior chart combined with the Plan-Do-Study-Act cycle. So sort of the theory of variation is the process behavior chart, and then what Deming would call the theory of knowledge, the PDSA or Plan-Do-Study-Act cycle is a key component of that theory of knowledge part of the system of profound knowledge. So you can see on my chart, I have three cycles that I've gone through so far.

0:15:24.6 JD: So I've basically run three experiments to try to bring the weight down. So PDSA cycle one, then I made a slight adjustment based on what I learned adjusted after about 30 days, I ran another Plan-Do-Study-Act cycle, ran that for another 30 days to see how it'll impact my weight. And then I've started a third cycle, and I've been running that now for about 45, 50 days. So the idea is, you run a, basically a structured simple, it doesn't have to be overly complex, simple experiment. And then you see if what you're doing is working, and in this case it's resulted in two, two shifts or two patterns of data that tell me that that actual improvement has happened. Not that I just decreased my weight, but it decreased to such an extent that it showed up as a mathematically unlikely pattern in my data.

0:16:33.3 AS: Well, I think all of us who wanna reduce our weight, kind of wonder, what did you do that caused your weight to fall and be consistently lower?

0:16:47.5 JD: Yeah, [laughter] that's a good question. I mean, pretty simply, mostly I focused on what I was eating. I sort of cut out the sort of typical culprits, the extra carbs, the processed food, and the sugar and focused mainly on meat and vegetables, across all three meals. And I added a little bit of exercise, there's a little more detail to it than that, but that's the basic, the gist of it. But the thing was, I wrote it down in a template, a Plan-Do-Study-Act cycle template. So I had a simple plan written down. I had the dates during which I was gonna do this, and then I was gathering the data and charting it every morning to see how the experiment was working. And then after 30 days or so, I would study it a little more closely, revise the plan, and then sort of keep going with it. So it's not, certainly not rocket science, but it's a powerful method when you combine these two things. And again, you can do this for just about anything, any data that occurs over time in your organization, you can run these same experiments.

0:17:58.5 AS: So the power of the chart is that it gives you feedback to try to see if your prediction came true?

0:18:10.7 JD: Yeah. And you have the historical results. And then you can also look to see, again, if those special patterns emerge that tell you that actual improvement happened, verse, an insignificant, in this case, decline in weight.

0:18:29.0 AS: And what's interesting is after PDSA number three, you've gotten your weight down to an average of let's say 172, 173, something like that.

0:18:38.1 JD: Yep. That's right.

0:18:39.6 AS: And it's just kind of bouncing around tightly, somewhat within that level.

0:18:47.0 JD: Yeah, I mean, basically what you see is you'll see three or even sometimes four, or even close to five days in a row where it's below that average line. And so you're saying, "Oh, I'm getting close to being able to shift again." And then what actually happens is the weekend [laughter] So I'm way more disciplined during the week when I have to go to work and those types of things. And then, but you can learn from that. You can learn that that's what's showing up in the pattern. And I've also gotten to a point where it's gonna be harder. Those first five eight pounds are much easier. And then, from there, depending on what you wanna do goal-wise, it could be harder, it could require a sort of a slightly different plan because PDSA one, two, and three are all variations of each other. There wasn't a lot of change from each of the cycles, but there was some learning that happened.

0:19:35.1 JD: Yeah, I mean, I think that's, I mean, that's a good point to maybe go little deeper into the PDSA cycle. So I mean, I think, for me, it took some time to sort of understand the PDSA cycle, even though it's, again, it's a relatively simple tool, and I think it's just one of those where you just need to do it, and over time you're gonna learn. So I think the first thing, you make a plan, you do it, you carry out the plan, you study what happened, and then at the end you act and you decide what to do. And I think really, the most powerful part for me was this realization that during the plan phase of the PDSA, it is absolutely imperative that you make a prediction.

0:20:29.0 JD: And if I'm doing team-based work, I have everybody on the team make their own prediction independently. We actually record that prediction in the PDSA cycle. And then during the study phase, we compare the data that actually was produced from that system or process, and we go back and compare it to what we predicted. And the difference between those two things is the learning that drives the next cycle, basically. So it's this iterative process. So you're, you don't just run one PDSA cycle, you basically run it until you've brought about an amount of improvement on that system or process that's acceptable, not, and then you may turn your attention to some other metric in your organization that's important to you.

0:21:22.0 AS: So I think what's important about this is that what he's describing is the way to acquire knowledge within an organization. But many times we see organizations lose the knowledge that they had. And I think that brings us to the concept of training and making sure everybody understands how we're improving the system based upon the knowledge that we gain. And if you can hold that, then the next time that we wanna try to improve the system, hopefully we go to another level, and then we hold that other level through training and making sure that everybody understands the knowledge that has been acquired in the system. And once we feel comfortable with that, then we go to the next level. And let's say that we do that 10 times in a particular process. That means that we've acquired, at 10 different points in time, we've acquired additional knowledge about the system.

0:22:23.2 AS: Now since I'm a finance guy, I like to bring that into finance terms and say, and that's how you build a competitive advantage in your company. It's the acquisition of knowledge of your system and continuing to improve that. And by doing that, you start to get to a point where your competitor doesn't understand nearly as much as you do about that one area. And if you can solidify that through training, then you now are operating at a different level than your competitor. Now your competitor may be doing the same thing in another area, but you've built some competitive strength. And the end result from a business perspective is that you start to produce slightly better profitability relative to your peer until either they catch up or maybe they build some competency in another area. But I'm talking and thinking all about, business. Tell us more about how to apply this in education.

0:23:25.7 JD: Yeah, I mean, I think there are all kinds of applications, and I think you're exactly right. I think what most people have is streams of information coming to them in the form of various types of data every day. But they have very little knowledge, actual knowledge about that data, lots of information, little knowledge. What the PDSA does is allow us to gain that knowledge in combination with the with the process behavior chart. And I think having this structure is very important. I mean, I think you talked about building knowledge over time in your system. I think the fact that the PDSA, when you plan it, you write it down, just doing that is a huge advantage over how most people operate, and you write it down in this structured way.

0:24:23.0 JD: So there is this knowledge store, there's this written record that someone can go back to to see what you did on whatever area you were trying to improve at that time. You have this written record, you have this plan, you understand how that plan was put together, who was doing what, when were they doing it, where were they doing it, how were they doing it? Who was doing it? And then you can see how it actually worked in implementation. And then you can see the actual data that sort of came back when you tried something. And you can do these PDSA cycles on a very, very tight timeframe. So when I got some training on this, they suggested, some of the trainers suggested you, you do this, you can run a PDSA for one day, one hour, depending on the situation.

0:25:09.5 JD: I think in general, what I've seen is that PDSAs that I run are generally somewhere in the two to three to four week timeframe. And I try not to ever go beyond four weeks with the PDSAs. I wanna get back some learning... It may not mean that I know everything about whatever it is I'm trying to improve, but I wanna give back some data that tells me sort of what direction should I go next? What direction should I go next, and I'll keep going in that way until I learn sort of more and more over time. I do think it's helpful to have just a very simple template, which I'm happy to share with folks, in terms of the plan, I'm writing out a question or two that's most important for us to answer. And again, I'm making predictions around those questions. What do I expect to happen when we do this change, when we make this change.

0:26:07.6 AS: Like cutting carbs down to 30 grams per day from 60 grams per day, will, my prediction is that will bring my weight down over the next week or two by one or two pounds or something like that.

0:26:23.6 JD: That's right. That's right. If we have an attendance problem, we're gonna try some attendance intervention, and I predict that if I make this change, it's gonna improve X amount in the next three weeks. Right it's a concrete prediction and I, again, I mentioned that I have everybody on the team do that because then you can start to see too how people are thinking about these ideas, how much they believe, what degree of belief do they have in the change idea. You see that show up when you see their prediction and then you literally, it's the who, what, where, when of this idea. And you get, when I do this, I get very, very specific, John will do X, Y, and Z on Monday, Wednesday, or Friday for each of the four weeks of this cycle. Catherine will do this, Ben will do this, you're very specific.

0:27:11.4 JD: So everybody knows their role, what their job is in this PDSA, and then the two other things that are a part of the plan. First one is super important, it's the operational definition. So whatever the key concept or concepts are that are under study, we operationally define them. So it's very, very explicit how we're gonna measure those things when we start actually running the experiment. And then we have a plan for collecting data. And I like to put the data right into my PDSA template, so everything's in one place. Sometimes it'll be a link to a Google sheet and a series of charts, but a lot of times I'll just create a table and then link the charts. So you can see, you can see the data right there in the PDSA.

0:27:58.5 JD: I think from there we just, we run the test, we run the test on a small scale, and after the test, as the plan's been implemented, we're going to describe what happened. We're gonna talk about what data we collected and what observations we made. Now in this Do phase, you're not actually doing any analysis. All you're doing is describing how the plan was implemented in when the rubber met the road, when you actually put things into action, how did implementation go compared to how you said it was gonna go in the plan. And almost every time I do this, there is some sort of aberration, some change from the plan that needs to be noted because I didn't anticipate, or we didn't anticipate, something happening. In schools, maybe I was gonna do this for three weeks and, on the third day of the test cycle, the experiment, we had a snow day that was unanticipated, or a key person in the experiment was not there. A student that we were working with on a PDSA cycle missed three days of school because of the flu, you report those things back because they're gonna impact the data that you collected.

0:29:22.4 JD: So that's what you're doing in the Do cycle. You run the test and then you describe what happened, verse the implementation plan. I think probably the most sort of important part then is that study phase, so we're gonna analyze the results and again, compare 'em back to the prediction. So this is the absolutely critical part of the Plan-Do-Study-Act cycle. I almost think of it like a mathematical formula. The analysis minus the prediction equals the learning. This was a sort of aha moment for me. And this is where you...

0:29:58.6 AS: Which is where Dr. Deming said, what is it? Something like, testing without prediction, doesn't acquire, you don't acquire knowledge. The only way to acquire knowledge is to make a prediction and then look at the results relative. Otherwise you're just messing around. You're not necessarily acquiring knowledge.

0:30:26.7 JD: Yeah, that's exactly right. Yeah. There's like, no, there's no theory without prediction. There's no knowledge without prediction. That's what we're doing in the study phase. We're, again, we're, why, why did what we see happen? Why did that happen? Why was it so different from my prediction? Or why was I able to make that prediction? What did I understand about our system or process? So again, it's not a test, one of the first PDSA cycles I ran with a teacher, the prediction, was very different than the outcome. He said, "Oh, the test failed." And I said, no, we learned something on a very small scale before we did that same thing. Instead of with one student, we could have been doing it with a whole school of students and imagined the time and the resources that it would take to do that sort of failed effort.

0:31:22.3 JD: We learned on a very small scale not to do it that way. And in PDSA cycle two, we're gonna adjust, right? And that's what we're doing. So in the study phase, we're comparing prediction and what actually happened. And then in that act phase, basically we take what we learned and make the next test, right? This on this continual basis. And I always sort of say, think about the Act as the three A's. We're either going to Abandon that change idea because it went so poorly. Now, that's not gonna happen very often in that first cycle, or two or three, but down the road, maybe it is, we need to abandon this idea and let it go. But more generally, what happens, especially early on, is that you Adapt each cycle a little bit. Like I was doing in that weight example, I was just adapting, I was sticking with the same basic diet plan and making some tweaks as I learned.

0:32:19.4 JD: So I was adapting each of those PDSA cycles. And then the third sort of option is to Adopt. And by adopt, I mean, you're gonna make this sort of a standard approach, standard work in your system. This is how we're gonna do things from now on. And generally, we're not gonna make a decision to adopt something, an intervention, until we've tested it across, four or five, six, seven test cycles. And, as we do these iterations, in a school example, maybe we're gonna try an attendance intervention with one student, and then we're gonna try it with 15 students. If the test with the one student went pretty well, and now I want those 15 students to vary a bit from that original student, I want this next group to have, some other characteristics, whatever that may be, than that, that original kid, and then maybe I'm gonna test it with a whole classroom and then maybe I'm gonna test it with a whole grade level, and then maybe I'll test it with the whole school. But that's sort of the mindset. You sort of go up this ramp of testing, and as you go up that ramp, you sort of increase the sample size of who is included in that test. So that if you're gonna adopt this into your system, you wouldn't be pretty sure it's gonna work broadly within that particular context.

0:33:51.5 JD: So that's sort of the basic idea. And then, what I stick in all of the footers, and I stole this idea from the Carnegie Foundation for the Advancement of Teaching, but in the footer of my PDSA template and in all my sort of improvement templates, I put this phrase "probably wrong, definitely incomplete." Because that's the sort of the mindset that you have to have with continual improvement in general. And definitely with the PDSA cycle, because those first cycles, you're probably gonna get a lot wrong as you're sort of turning information into knowledge early on. You're not gonna know a lot about that thing, you're gonna learn over time. And so you sort of have to adopt this as your sort of mantra for PDSA cycles.

0:34:32.1 AS: Great. I was just looking at quotes by Dr. Deming, and the quote is, without theory, there is no learning. All right. So how would we wrap this up?

0:34:45.8 JD: Yeah, I mean, I think that's a great quote. And I think, so it doesn't, I mean, theory can be a little intimidating, just the word theory. I sort of originally thought of these grand academic or scientific theories, but that's not really what he was talking about. Generally, a theory can be a hunch. A theory can be an idea you have, a theory can be at one time I had a student that wasn't doing their homework, and I just, said, can you do this piece of homework first? [laughter], when you have study hall, you're never doing your reading homework when you go home. Can you just do this before you leave school? So that's a hunch, that's a theory, a theory to make things better.

0:35:28.1 JD: So I think, what I would do for folks that are listening to this, just grab a PDSA template, which you can find on a simple Google search. Just start plotting your data for something that's important to you. Get a bit of a baseline 10 or 12 or 15 points, and then try to run one of these PDSA cycles. I mean, I think it's this whole idea. I was in this IHI Improvement Advisor Program, and they would say, Okay, you got this whole hospital or this whole school, or this whole school system or hospital system, you need to improve. What are you gonna do on Tuesday? What are you gonna do on Tuesday when you go back into the office or the school or the hospital? That's sort of this idea of PDSA, do something, try something, get some change ideas going and see what that does to your data. It doesn't have to be this huge, huge scale thing. Try it on a small scale and see what happens. See what you'll learn.

0:36:31.1 AS: Well, there's a challenge. John on behalf of everyone at the Deming Institute, I wanna thank you again for this discussion. For listeners, remember, you can go to deming.org to continue your journey. This is your froggy host, Andrew Stotz, and I'll leave you with one of my favorite quotes from Dr. Deming. People are entitled to joy in work.

In this episode, John and Andrew shift from management myths (don't do this) to principles for transformation (do this instead) based on Deming's 14 Points for Management. This episode introduces the principles and the context you need to get started.

TRANSCRIPT

0:00:02.4 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today I'm continuing my discussion with John Dues, who is part of the new generation of educators striving to apply Dr. Deming's principles to unleash student joy in learning. The topic for today is shifting our focus from management myths to principles for the transformation of school systems. John, take it away.

0:00:31.8 John Dues: Yeah, Andrew, it's good to be back. It's good to make this shift from the sort of the "don't do this" to the "things that we should focus on" as leaders of our systems, whether it's in business or education or whatever. And just as sort of a recap, we did these three episodes on management myths, and I think I made this point where sort of the common thread amongst all those myths is that they suboptimize our systems. I think the key thing to look for, whether it's sort of something we should be doing or whether we should not be doing when it comes to management practices, is does the thing, whatever that practice is, does it fragment the whole into parts and fail to appreciate the organization as a system? I think that's sort of the key differentiator between what I would call management myths, and then the things that we should be doing, some principles that we should be following. And I think that Deming philosophy is the opposite of the management myths.

0:01:33.0 AS: It's so tempting to fragment... I like what you said, fragment the whole into parts and optimize those parts. That is just so natural for us in some way, that it's manageable, it's accountability. And what you've taught us is that well, actually it produces a suboptimal result for the system. So I think, it's exciting to move into like, okay, now I understand that, so what do we do?

0:02:06.4 JD: Yeah. And I think with the myths, a common...sometimes people are gonna push back, obviously and it can be hard to wrap your head around the myths because they're often common practices. That's how we're often trained in business schools or schools of education. But if you sort of start to unpack and say, "Okay, you say that practice is working in your organization, but tell me what you hear when you talk about a particular practice, let's say merit pay for example?” "No, that works for us. That works for our organization." But then you start to say, "What do you hear around that particular system?" And I think a lot of times people start to say, it sort of dawns in them that, oh yeah, departments are competing against each other. Well, we sort of go around the rules to do X, Y, and Z so we can get the reward. And when you start to sort of think about those things, you can see how those myths sort of lead you in the wrong direction and you wanna sort of steer towards these principles that guide you in the right direction.

0:03:03.7 JD: But I think it's important to understand those myths and then take that next step, that next step to follow the principles that Dr. Deming talked about. Of course, many people that follow Dr. Deming's work are familiar with his famous 14 Principles for Management. I basically took those 14 Principles and translated them into sort of a language that's closer to what education folks are used to. And really what I think they do is they provide this sort of strong philosophical foundation. The management myths, again, are the don'ts, the principles, the guiding principles are the dos. But I think it's always good to steer it back to sort of these central ideas, quotes from Dr. Deming or someone else that captured the essence of what you're trying to do. And I thought one of the Deming quotes that stuck with me when it came to transformation is that Dr. Deming said, "The transformation will release the power of human resource contained in intrinsic motivation."

0:04:14.3 JD: And so, a lot of times people talk about transformation, but what do you actually mean? And to sort of put it simply in the Deming world is: transformation is a process where you begin to understand the System of Profound Knowledge and that helps you pull away from this prevailing system of management, the management myths that we talked about, like accountability, or merit pay, or a number of the other things that we talked about and move to this new philosophy. That's where the transformation is actually happening. And again, these guiding principle...

0:04:47.5 AS: You said release the power of human resources contained in intrinsic motivation. Is that what you... Did I get that right?

0:04:53.1 JD: That's right. Yeah. Yeah. Yeah. So I said...

0:04:54.5 AS: Incredible.

0:04:55.5 JD: The transformation will release the power of human resource contained in intrinsic motivation. And so, what you're trying to do is set up your system to tap into that intrinsic motivation instead of stomping it out. And those management myths stomp it out. And then these guiding principles will lead us in a different direction.

0:05:13.4 AS: And one of the things I would like to just highlight is that, a lot of times I'd like to just go back to childhood and look at what do we naturally do? We naturally work together. We naturally make friends. We naturally try to solve problems and we share. There's just so much natural learning that goes on. And if we would just go back to that, instead what happens is, like you said about the myths, adults start layering on all kinds of systems that all of a sudden just crush.

0:05:52.4 JD: Yeah. I think a lot of that comes from optimizing for competition versus optimizing for cooperation. And if we really wanna make our systems work, then we have to do the latter. I think that's key. And one thing I was gonna do is sort of tie these principles and the myths back to two sort of major problems that have unfolded in education over the last 50 years. And I think we've sort of talked about this in some earlier episodes. But sort of that first problem I would frame as, you remember that Nation at Risk report that we talked about came out in the early '80s, so 40 years ago or no. So I think all of the sort of major federal education reform policies that have come out since A Nation at Risk have fallen prey to one or more of those myths. So that's the sort of problem one.

0:06:49.1 JD: About the same time in the late '80s, we saw this major shift in the demographics of the teaching profession that we've only just more recently started to realize. So this actually blew my mind when I read this in a research report. But basically in 1988, so not that long ago, the typical teacher in the United States had 15 years of experience. You fast forward to 2017, the typical teacher was in their first year of teaching. So we've had this dramatic shift where the model teacher used to be sort of mid-career, and now the model teacher, the most typical teacher in the US is in their first year, they're a beginning teacher. So that's gonna cause all sorts of problems.

0:07:39.0 JD: Now, part of the issue, I can't tie this back to the federal education policies, and I'm not attempting to do that. I think maybe a contributing factor to sort of the general ecosystem, but not maybe causality, that's too strong to say that it caused it. But there's one, there's been the significant growth in the teaching profession, meaning there's lots more teachers than there were today, or in 1988 as compared to today. So of course if you're gonna add teachers for all sorts of reasons, more specialization is required, kids receive special education services that require smaller groups and things of that nature. So that's led to this explosion in the number of teachers in the United States.

0:08:28.7 JD: But regardless of the cause, this means that large numbers of teachers are entering the profession and they're leaving the profession, so there's all this churn. And so when you tie these two problems together, so number one is you got the federal education policies following sort of a lot of those management myths, then you got this sort of significant change in teacher demographics. It's basically massive instability in the US's education ecosystem.

0:09:03.6 AS: And before you go on, that statistic is almost unbelievable. And I wanna get more from you on that later, but I just...in order for that statistic to be correct, it would seem like there was a huge drop off of older teachers exiting, as you mentioned. And also, I guess what would be correct is that it was a massive influx of brand new teachers.

0:09:34.0 JD: Absolutely. Yeah.

0:09:34.4 AS: Like huge. And it kind of depends on what year that happened, because if that's the case, that number will be changing very rapidly as those new huge mass of new teachers mature over time. I wonder, I have a lot of questions about that data and I'd love to see more of that.

0:09:53.9 JD: Yeah. And I think...I'm certainly not an expert in demographics in the US but I think what I've seen is there's both a graying and a greening of the profession. Meaning there's lots of people that are retiring or nearing retirement age and there's lots of new teachers. There's less people in the middle. And a big reason for the churn is, or to keep in mind, is that a lot of these new teachers are leaving, so they're being replaced by more new teachers. So I don't see this sort of subsiding anytime in the near future.

0:10:28.1 AS: Could you imagine running a business like that? It would be just impossible.

0:10:34.1 JD: No. No. And that's sort of one of my theses right now. And sort of tying back some of the work that I've done with the book I wrote is that there's this massive instability in the education sector. And part of the reason for that is that we as a sector lack this sort of solid philosophical foundation and a sound theory of management. And I think that's where the Deming Philosophy can actually fill in sort of this major hole in how we're operating in education. I think specifically that's where these 14 Principles for educational systems transformation, is what I call them, I think that's where these principles can come in and play a role in sort of stabilizing the education sector that's been so topsy-turvy for 30 years or so.

0:11:36.1 JD: So I think it's a good place to start with sort of an introduction to the 14 Principles. So the Deming sort of crowd will be familiar, if you're coming to this as an interested party but less familiar with Deming, you may not know. So I think there's some things to clarify that were a little bit confusing to me initially.

0:11:56.4 JD: One thing that you'll hear in the Deming community is people will refer to the 14 Points, but then also Deming sometimes called them Principles. He sometimes called them Obligations of management for clarity and just to be straightforward I just call them Principles, my 14 guiding principles. I think it's also important to sort of call out that while they're an important component of the Deming philosophy, they're not in and of themselves the Deming philosophy. I think that's really important to call out. And I think when you discover something like anytime you have a numbered list, like 14 this, or 10 this, or five this, I think there's this sort of almost human nature to sort of start to think of them as a checklist to be implemented. Really, they're not. They're not. You can't just do number one and then you do number two, and then you do number three. That's not how they're set up. Really, what they're set up to do is sort of open your mind to a whole new way of thinking in terms of how we organize and run our institutions, in this case, our educational institutions.

0:13:09.2 JD: And I think most importantly, these 14 Principles are these interlinked points within this larger management philosophy. And you can't simply put the points into action without first understanding why Deming wrote them in the way that he did. So, they're not super long. Some of the points are a couple pages, some of the points are just even a page or so in Out of the Crisis, one of Deming's books. So he is very deliberate about the words he chose and the framing of the Principles.

0:13:43.4 JD: And the last thing I would say, if you're sort of new to the 14 Principles, that you have to account for your organization's context. So you can't just adopt the 14 Principles without a deep appreciation of both the principles themselves, and that organizational context. If you just sort of tried to throw this into your system, without deep study and deep understanding that, it could cause sort of mass chaos. So I think those are some things that I would say to anybody that's considering looking at the the 14 Principles.

0:14:19.9 AS: Yeah. And the point is that the reason why it's not a checklist, it's because number one, it's hard, it forces you to think, number one. You really have to think about what it is that he's presenting. And number two is, it's even harder to implement, because once you start to realize that there's so much value in what he's saying, now you're gonna have to come up against the prevailing system of management, all the myths and all of that stuff. And that's the reason why, one of the reasons why it's not a checklist, it's 14 Points for Management. And here is what...and I can say I first read that when I was 22, 23 working at Pepsi, and now I'm 57 and I can say that I still look back at them and go, "Oh, now I see."

0:15:18.5 JD: Yeah. I think there will always be that. There will always be that, even for somebody that's done this for 30 years or 40 years, there's always gonna be that sort of continual "aha" moments, or connections. But you sort of have to go all in in the sense that you can't pick and choose like a menu, like, "I'm gonna do, of the 14 Principles I'm gonna do 1, 2, 4, 6, and 9," it just doesn't work like that. You have to sort of go in all in on the 14 Principles. It doesn't mean that you have to do them all at the same time, or at the same rate, but you can't just sort of pick and choose which ones you're gonna do. They work together.

0:15:55.9 AS: And it's interesting cause the first one talks about constancy of purpose.

0:16:00.8 JD: That's right.

0:16:00.9 AS: I would say that, that's the one that really challenges the management. I'm gonna be meeting with the management team of a...the ownership team basically of a factory in Thailand next week and what we'll be talking about is: how do you build constancy of purpose, or how do you think about that? And also the idea of constancy of purpose of thinking that our job is to improve. How do we keep learning? How do we keep improving so that we deliver more and better value to our customer, to our student, to whatever. And that, without that commitment, it's hard to do the other ones. But I agree that there's...you can jump around and think, "Okay, I can do this one right now, I can drive out fear right now. This one's gonna take more time," or that type of thing. So, yeah.

0:16:52.3 JD: Yeah. So I think that's a good segue and so, with that sort of introduction of mine, I think diving into Principle one, sort of the short version is "create consistency of purpose." And then I sort of took Dr. Deming's version and rewrote it for educators, and the way I did that was I said, "Create consistency of purpose toward continual improvement of high quality learning systems. These systems should be designed in such a way that they enable joy and work for staff, and joy in learning for students, with the aim that everyone can access opportunity rich lives in our society now and into the future." So that's sort of the long-term vision, that's the long-term purpose that we're working towards. Now you have to say, "Okay, now what do we have to do to get there?" That's the hard part.

0:17:45.8 JD: And I think, what I read from Dr. Deming is that he often spoke about two problems that all organizations face if they want to stay in business, whether they are a factory, or whether they are a school or some other type of organization, doesn't really matter. First, there's these problems of today, and second, there are the problems of the future. And both camps are a fairly daunting list, but we'll start with sort of problems of today. I think with all schools, but maybe even especially so for schools like where I work where they're... We're a network of public charter schools, we don't have any kids geographically assigned to us. But even for a traditional public school I think enrollment, student enrollment is a constant concern. "How are we gonna make sure that we are setting up our program so it best serves our students and families?"

0:18:48.3 JD: And I think if you think of the problems of today, of the typical public school, ensuring the quality of learning experiences, balancing the demands of local, state, federal education policies, attracting, retaining... Or attracting, training and retaining employees, making sound budgeting decisions, recruiting and retaining students. Fundraising is a component of our system. Acquiring, maintaining, upgrading school buildings, you could go on and on and on. It's pretty self-evident from that list that educational leaders could easily stay tied to those problems of today, and that would be more than a full-time job, just sort of keeping up.

0:19:40.8 JD: That's even before you consider this second camp, this idea of problems of the future. And that's really where constancy of purpose becomes especially important. And this is where this idea of continual improvement of the school district's competitive position within the educational ecosystem really comes into play. So why are parents gonna choose my school or my school system for their child? And a really important question for all school systems to consider: is the board and the superintendent dedicated to the short-term or are they dedicated to the long-term of the institution? And of course, short-term, maybe in a business setting may be quick profits. Short-term in a school system may be something more like really focusing on these state test scores.

0:20:47.6 AS: Pass the exam.

0:20:50.1 JD: Pass the exam, right. There are certain things we could do to increase those scores on the short-term. Or are we taking the mindset that our school is set up to ensure that our schools will be success...or our students will be successful 10 or 20 or 30 years from now. And focusing on short, long-term is not mutually exclusive. There's certainly things in the short-term you need focus on, certainly things in the long-term, but I think taking that long-term view is the most important. I am not as concerned with how a sixth grader in my system does on the state test, although that has some importance to me. What I'm most concerned about when I'm thinking about that 12-year-old is what will they be doing when they're 18, when they're 28, when they're 38. Did we set the right foundation for them on a long-term basis? And that's a really weighty responsibility for school to balance those two sets of problems, the everyday things that we have to deal with and then keeping our eye on future problems that we should be anticipating.

0:22:03.0 AS: Yeah, one of the things about that, that's interesting is that you're pretty much never pulled to future problems and you are constantly pulled into today's problems, and therefore majority of people just...all they can do is deal with today's problems and the idea of starting to think about how do we start to devote a portion of time, some of our thinking, some of our efforts. I remember Dr. Deming saying that somebody could put out fires for their whole career and never improve the system.

0:22:40.6 JD: Easily, easily. In fact, I'd say that's what most people do.

0:22:44.7 AS: Well, it's pretty exciting to be a problem solver and to walk in, "Alright, do this. Okay, I know this problem, we've seen it before, let's do this. Okay, here's how you solve that." And it's really exhilarating to go home from the end, at the end of the day, just say, "Man, I fixed a bunch of crises that came up. I'm the hero."

0:23:07.6 JD: Yeah, absolutely. And with Dr. Deming, he did give us some key things to focus on and he really talked about when it comes to this commitment to constancy of purpose, he really talked about this alignment of acceptance of these three obligations you talked about. First, one obligation is a focus on innovation. A second obligation was a focus or is a focus on research and education, kind of clump those together. And then the third obligation was to focus on continual improvement of, in our case, educational services. So it is helpful to go through just a little deeper on each of those obligations and what he meant.

0:24:04.1 JD: So obligation, one, is innovation. And so to your point about how we sort of shift some of our focus on to future planning. Well, one thing is, if you're gonna do that as a school or any type of organization, you have to allocate resources to long-term planning, whether that's staff that's focused on long-term planning specifically, or other types of resources. It could be new educational services, that better prepare students for the future of work, could be new curriculum resources. It could be educational technology. It could be the cost associated with those things. There could be new pedagogical approaches grounded in neuro-scientific discoveries as we learn how people learn, adjusting our instruction accordingly.

0:25:01.0 JD: New skills for teachers and administrators, training and retraining staff. All of these things are costs and you, and then they're upfront cost and though if we are gonna be serious about planning for the future that you then have to allocate some resources. And I think a key to this is the people that are working in your system, they have to have faith in a future. That's a pre-requisite for innovation. If all you're doing is putting out fires and not thinking about the future, if there isn't this unshakable commitment to quality, then especially middle managers, who in a school system is like principals and teacher leaders, the frontline people are the teachers, and of course the students, if they are skeptical about the future of your organization then they're not gonna put in best efforts, and then it's gonna be impossible to put any attention and energy towards innovation.

0:26:11.2 AS: So just to summarize that part, so is what you're saying is that the most important thing that you can do as a leader in a school, as an example, is to switch the focus from putting out the fires and stuff and start to say we need to think about innovation, research and education, and continual improvement, and get everybody focused on those things as the way forward?

0:26:42.4 JD: Yeah, that's certainly part of it. And I think saying things like, you know, talking about constancy of purpose explicitly. So I think saying like, teachers often get very stressed out about state test scores. So I would say okay, look, these things are important. There's something that we have to do. But what I'm most concerned about is the long-term health, well-being of our students. So that's what I'm most concerned with preparing them for. So I think even little statements like that, the sort of reorient people and how they're thinking about their sort of day-to-day, I think that's really important. And I think you also - doing things to tie back sort of that message to things concretely in your system such as having alumni come back and speak to your current students, having events where you can see sort of what students are doing now after they've left your system, that makes that connection real to that long term constancy of purpose. So I think it's all of those things.

0:27:54.6 AS: Yeah. So one of my questions you know to start to think about how we wrap this up is how does somebody take all of what you just described. We've shift from myths, now we're like, okay, let's focus on what we can do. What are some...what's one take away or something that you feel like somebody listening to this could go back to their classroom, back to their office as an administrator and say here's step number one I can take towards this?

0:28:34.9 JD: Well, I think one initial activity just to get a sense of where your system is, so let's say you're a superintendent and you have a team of five or eight people that report directly to you. I think going back and ask them to individually write what is our purpose? What's the...why are we here? What's our long-term purpose? And I'm betting that you're going to get five to eight different answers. So, I think that would be a helpful exercise, is just what do people see now as the core long term purpose of your organization, and I think there's many exercises you could build from just that simple question.

0:29:17.7 AS: Yeah, that's a...I'm absolutely sure you're going to get five different answers. 

0:29:23.4 JD: Yeah. I agree. I agree.

0:29:25.8 AS: All right. So is there anything else that you want to add before I wrap up and summarize what we've been talking about?

0:29:35.1 JD: Yeah, I would just... Maybe just touch really quickly on those two other obligations. So innovation was the first one. The second one is Deming talked about research and education and I think when he was talking about education, he was talking about self-improvement and acquiring new knowledge and he differentiated that from training. You know, whereas training is something that you're going to do and once you do it, you expect to see it the next day. That's different than education, that's sort of acquiring new knowledge about the best way to teach or do some other key function. There needs to be a focus there.

0:30:11.1 JD: And then that third obligation is continual improvement. And what he's talking about there, at least in an education setting, is systems leaders have to continually improve the design of their educational services. You have to have this growth mindset. So because this particular obligation never ceases. You never stop improving. I mean as soon as you start thinking you've arrived, your organization has already started to move backwards. So that can be - you know depending on who works in your organization that can be a hard thing to sort of hear. Like I thought I had my lesson plans done. No, your lesson plans are continually improving. You're continually making them better. That doesn't mean you have to overhaul everything that you're doing all the time, but it does mean that even in small ways, I'm going to be working on that on a never ending basis. You know, for my teacher, it's my lesson plans. If I'm a systems leader, there are other aspects of my work that I'm going to continually improve.

0:31:12.5 JD: And I think, you know, you asked about what could people do concretely is, you know, once you understand what your core long-term purpose is, everybody in the system has to understand that. So customers, be it families or higher education, government, industry, whatever, that has to be employees, that has to be the suppliers to your system, which are families, other school districts. Everybody needs to know what that long-term purpose is and they need to know even explicitly that you're committed to those three obligations, that you're committed to sort of longterm success of your organization.

0:31:53.8 AS: You'll notice over my shoulder I have a piece of paper on the wall and when you were talking I walked over...I slid back to look at it and it's a reminder from David Langford, who teaches us so much and that is continual improvement. Not "continuous" and you said "continual." So the point is he makes is that if you say continuous, it's like just constantly improving everything. It's like jumbling things up forever as opposed to continual where you're codifying the things that are working, standardizing some things, and then moving on to the next step of learning. So...

0:32:35.9 JD: Yeah. I think Deming was wise in choosing those words always deliberately. Continuous sort of implies like software, always self-improving and never ends. But humans can't continuously go on. Continual means there's discontinuous improvement. There's stops and starts. There's changes in focus, those types of things. So it's another nod to the humanistic nature of the Deming philosophy.

0:33:01.8 AS: All right. So let me summarize. We started off by talking about, it's a shift from talking about the management myths, now we're into the principles for the transformation of school systems. And basically, I think you kicked it off by saying that when people are implementing the myths, they're sub-optimizing the system and they're fragmenting the whole into parts and thinking if they can just get those parts right, that's gonna get the best result for the system and that is unfortunately wrong and we've gotta look at it from a systems basis.

0:33:39.0 AS: And then also you mentioned the quote of Dr. Deming saying, "Release the power of human resource contained in intrinsic motivation." And that, I just love that. That really helps to understand what we're trying to do is that people do want to contribute and they want to contribute in a great way. And then you also talked about, start with constancy of purpose and an aim. And you talked about the balance of problems between of today and the future. And I was adding in that you're constantly pulled into problems of today, and you're never pulled into problems of the future. So it takes some discipline, as you said, to start to strike that balance.

0:34:22.5 AS: And then, you talked about the importance of really taking that long term view. Then you mentioned about the three obligations, which all seem to look towards the future, and therefore maybe that's a good way to start to draw your people into thinking about the future. And the first one you mentioned about was, that Deming talked about, and you mentioned about was innovation. He also talked about research and education, and you highlighted, when he talks about education, he's talking about self-improvement and how do we acquire new knowledge in this organization?

0:34:56.2 AS: And then the third one is continual improvement. And the point is in education, it's design of the educational services. And then finally I think a call to action, a challenge to everybody that you have now given us to say, how do we take this back to the classroom or as an administrator back to the school? And your point was maybe ask your top three to five people, whatever, to answer the question, what is our long-term purpose? And have them do it individually. Write it down in short little statement and what you pretty much guarantee and I would second that you're gonna find probably five different statements of purpose. And I think that then, a note that I took as you were speaking was, "Use that as a starting point to clarify your long-term purpose." So great call to action at the end of this one. Anything you would add to that?

0:35:52.0 JD: No, I think, that was a perfect summary. Without an aim, there's no system. So that long-term aim that defines your constancy of purpose is that good place to start like you just said.

0:36:06.0 AS: So ladies and gentlemen, there's your challenge. Go back and do that little bit of homework. John, on behalf of everyone at The Deming Institute, I want to thank you again for this discussion. And for listeners, remember to go to deming.org to continue your journey. Oh, and by the way, you can find John's book Win-Win with Dr. W. Edwards Deming, The System of Profound Knowledge and the Science of Improving Schools on amazon.com. This is your host, Andrew Stotz, and I'll leave you with one of my favorite quotes from Dr. Deming. "People are entitled to joy in work."

With this episode, Andrew and David P. Langford start a new series on the Role of the Manager in Education. Inspired by chapter 6 in The New Economics, Andrew and David apply Dr. Deming's 14 points for "the role of a manager of people after transformation" to the world of education. (Note: this is not about Deming's 14 Points for Management.)

0:00:02.6 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with David P. Langford, who has devoted his life to applying Dr. Deming's philosophy to education, and he offers us his practical advice for implementation. Today's topic is the beginning of a series, The role of a manager in education. David, take it away.

0:00:29.9 David Langford: Hello, Andrew. So I always wanna say good morning or good evening, but you're in Thailand, and I'm in Montana, so there's a problem there.

0:00:39.8 AS: [laughter] They both work.

0:00:41.8 DL: So yeah. [chuckle] So glad to be back again.

0:00:43.4 AS: Great to be with you.

0:00:44.8 DL: So yes, I wanted to dive into this, because I actually had a number of comments that people have sent me, both email and Twitter and all those kinds of things, yeah, asking questions about it, et cetera. And even at seminars, I get questions about it. So we're working from Dr. Deming's book, The New Economics, in chapter six, and I have the third edition, so in my case, we're on page 86. And Deming... And the whole chapter is about the management of people. So Deming laid out about 14 different points about what managers should do, how should you operate, and what should you do, and et cetera. So I thought it'd be really good for us to kinda work our way through those and discuss what does that mean in education. Because, do we even have managers in education? So probably the first thing I wanna point out is he has a whole chapter on leadership, which is different, I think, than management. And so, I think this is getting more to on the day-to-day operations, what are we supposed to be doing or how do we operate?

0:02:03.5 DL: And he even makes the distinction, the role of the manager of people after the transformation. So that basically means, okay, you've read about Deming, you've... Or you read The New Economics, or you've watched videos, or you learned about it. And you kinda made that transformation that, "Hey, this is where I wanna go, and this is what I wanna do." Well, then comes, "Okay, well, what do I do Monday morning?" is the big... Always the big question I get. And if somebody can't help you figure out what to do Monday morning, then they really... I don't think they really understand themselves about what to do, and you should probably find another coach or another leader to [chuckle] help you sort of figure that out. So let's take the first point, and maybe you wanna read it off for our audience and...

0:03:00.2 AS: Yeah. So the first of these points is, "A manager understands and conveys to his people the meaning of a system. He explains the aim of the system. He teaches his people to understand how the work of the group supports these aims." Simple stuff.

0:03:26.6 DL: Well, it... On the surface, it does sound simple, but doing it is another matter. So I wanna take this right down to the classroom level and say that as a classroom teacher, you are a manager of people. And it doesn't really matter what age they are, if it's talking pre-school all the way to graduate school, you're a manager of people. So the first thing he says, "The manager understands and conveys to his people the meaning of a system." So people always wanna know, "Where do I start? What do I do?" Well, there's a pretty good place to start right there. What is a system? So a system has inputs coming into it, and then it has the system itself, which is made up of processes within that system, and the system then has outputs, right. So in education, I remember back when Deming first started to get well-known, and people from business especially would come into education circles and try to tell educators what to do or how they should be managing to achieve quality, et cetera. And one of the first things they would do is they would talk about students as products, like you would think about in a company.

0:05:00.5 DL: And I kinda went for a couple of years thinking through that, and then all of a sudden it dawned on me, and a lot of it had to do with reading this section here. Students are not products, right? And if you think of them like that, then you're gonna think of them like inanimate objects that you do things to basically. And if I just adjust the process here, then suddenly all the kids will just be better, they'll learn better, et cetera, et cetera. Or I just throw in a new curriculum, and everything is gonna be fine, or you're not actually involving them in the process at all. So when I started giving seminars and working with people, I started to explain that the product of an education system is the learning itself. So what are they learning and to what degree do they... Are they learning, and how are you managing the people in that system to optimize the learning? And if you think of it like that, then you start to think of students as basically workers like in a company, in an organization. They're there to actually help you produce a product and tell you when things are going well and when things are not going well and how to make adjustments and everything to get a different result, right. And I find that when people sort of make that understanding in a system, especially as a teacher, you start to think of kids totally different.

0:06:46.6 DL: I remember when I first started and encountered Deming, teachers used to talk about students in a very derogatory way, and, "Oh, that kid isn't even worth this," and, "That kid's not worth that and can't... " That they didn't actually think of them as part of the... Of a system. And so when I started... Part of the problem is the nomenclature that we use, we have system, we have teachers, we have students, and along with that comes certain definitions that have evolved over the last couple hundred years. So when I started actually teaching teachers to stop using the term students and start calling them colleagues. Well, at first there was sort of an uproar [chuckle] about that. I remember one teacher telling me, "I mean, that snotty-nosed kid that says duh all the time, I'm supposed to think of him as my colleague?" and "Well, yes, you are, [chuckle] because that's your job," right, is to sort of... And Deming's talking about it here, is to optimize the system. Alright, so your job is to get those students to work with you as colleagues to study the system of learning, understand is it working or not, right? So how would we know it's working?

0:08:20.7 DL: Well, if you understand a system, you understand that there are outputs. So when students go on to the next level, is it working? It's pretty... It's actually pretty easy to measure that, right? So if I'm a third grade teacher teaching third grade math, am I sending students onto fourth grade math, continually getting better and better every year, and more and more of them are achieving to higher and higher levels every single year? Well, I can measure that pretty easily. I can just get the fourth grade math scores, or I could go to fourth grade teachers and find out, how are these kids doing?

0:09:01.2 AS: It's such an interesting... You're making me think about it, because really what education is, is it seems to me like it's a service, and it's a process, and if... And it's something that's repeated over and over again just like on a... In a business, we have many processes that are repeated over again. And when you improve that... Imagine that one school went on a mission to continually improve. And they're constantly looking at how to improve, and they have iterations every term as they go through these lessons. Imagine if they were focused on that, students would flock to them from around the world to come to get that transformation of learning and that experience and of learning the output and say, "I wanna come out of this process where those other people are, where I've really gained that knowledge." So am I right about that? Is there anything that you would add to that?

0:10:06.2 DL: Yeah, no, that's exactly right. And I think that's what Deming is giving here. I mean, it sounds simple, that as a leader or a manager, you're supposed to explain what a system is and how it works, but there's a lot of depth there about... And you mentioned continual improvement. Well, is your system continually getting better year after year, or are you just doing the same thing, you're no worse this year than you were last year kinda thing? I used to... I had an uncle, he's in his 90s now. But he taught eighth grade social studies, I think for something like almost forty years. And every year or two, family reunions or something, I'd get together. I'd talk to him about what I was doing and things [chuckle] like that. And we were talking about the system in the classroom and getting better every year, and he just looked at me blankly like I was a complete idiot. And I said, "Don't you do that?" and he said, "No." He said, "Give me a date." I said, "What do you mean give you a date?" And he said "Just give me a date." And I said, "Okay, March 15th," or something. "We'll be on page 286 in the textbook, we'll be studying this, 77% of the kids will be failing the test." I just...

0:11:31.1 DL: My mouth just dropped open, because it was a system totally set up for poor performance, and he didn't see it's his job at all to help kids understand the system they were in or try to optimize it or try to make it better, or... That wasn't his job, right? And I remember at Deming conferences, Deming would often say, "A lot of people don't know what their job is."

0:12:00.2 AS: Yeah.

0:12:00.8 DL: I remember, oftentimes people would get up and ask questions, and he would [chuckle] say, "Sounds like you don't know what your job is." [laughter]

0:12:07.3 AS: I remember being a 24 year old...

0:12:07.9 DL: And that's sad confronting it. [chuckle] Yeah.

0:12:12.1 AS: Twenty four year old kid listening to that when I was in my Deming seminars, and I was just like, "Whoa," listening to the way he responded to these older men and women that were in the audience was kinda shocking for me as a young guy.

0:12:23.3 DL: Yeah, a lot of times he's talking to CEOs, he's talking to major [chuckle] people in the military or politics or whatever kinda thinking. But to me, that's how deep this point is. So are you explaining the aims of the system? Well, that first implies that you do have an aim of the system. So, go back...

0:12:45.5 AS: Yeah, and so just to highlight for the listeners. So this very short point, number one that he makes starts with this discussion that we've just had about the meaning of a system. And now David is going on to talk about, "Okay, not just the meaning. Okay, now you got that. The question is, What is the aim of this system?"

0:13:07.0 DL: Right. So again, if we go back to our example of it was a third grade math teacher. Well, what is the aim of the system? [chuckle] Right? What are you... And are you working with students to actually produce the aim of the system, aim of this classroom, right? And it's not just a matter of just coming up with a phrase that you're gonna put on the wall or something, it's the idea that you're gonna keep communicating that constantly to people, what's the aim of this system. So if you think about if you're supposed to optimize a classroom, well, optimization, we're gonna get the highest number of students to the highest possible level we can get them to in the time that we have to do that, right? And so, if you start thinking like that, this changes your job, because you start to realize, "Wow, I'm supposed to optimize this group of students to the highest level I can get them in the nine months or however... 10 months or however long you have to work with these people. And that is confronting. And if you start to understand that, you start to realize why Deming was so adamant against grading systems, how grading systems just defeat kids.

0:14:36.4 DL: So instead of thinking that we're supposed to be spending all of your time figuring out a grading system... Oh, my gosh, over the years, I have heard so many grading systems. And teachers talk about five points for this and 10 points for that, and then I deduct 10 points if they don't do this and if it's not on time and... Wow. Well, pretty soon you start to think that's your job. That my job is to create this grading system, and then you forget all about, "No, my job is to optimize the system." So if I go through a chapter in math, and I'm teaching a particular concept, and then maybe I give students a test on that. And Deming's not saying he's against testing, he says he's against grading and ranking people. That's totally different. And if I give this class a test, and they all do really poorly on [chuckle] this section of math, I just don't say, "Oh well," and go on, because I haven't done my job, I haven't really optimized that. So one of the first things in the system you'd wanna do is to go back and figure out, "Hey guys, what happened?"

0:15:50.0 DL: We only got an average of 66% for the whole class on this concept, or... Did I not teach it well enough? Did I... And when I started asking students like colleagues and saying, "Hey, what happened?" they told me things that I didn't wanna hear, like, "You talk too fast," or, "I couldn't understand your accent," or, "We didn't have enough time to work," or just a whole host of real issues from their perspective about what was going on, how you could optimize the system. So then I've got two problems. I got the problems of today, that we gotta re-work this chapter, right? We gotta go back and do it again and optimize that so people do understand this concept. And then the problem of tomorrow was how do I make sure this never happens again, that I never find myself in this same place? But I don't just accept poor performance and just go on, because when you're doing that in a system, especially a system in education where learning is the product, right? Well, what I learn in... What I don't learn in September is going to be magnified by March, April, et cetera, 'cause I didn't learn those concepts back there that I need for subsequent concepts, and therefore, I'm gonna get further and further behind. So as teacher, you're actually just...

0:17:18.6 AS: That's so much damage.

0:17:19.7 DL: Yeah, you're just shooting yourself in the foot when you just go on and just accept poor performance. And so...

0:17:27.8 AS: Well, that... The corollary is of course in manufacturing, in any process, if you're not focusing on the beginning of that process and the design aspect, you build in all kinds of problems that multiply. And that's so critical. I'm just curious, so we've got the meaning of a system, and we've got the aim in the system, and you've talked about highest number of students to the highest level in the time that we have. Also, I'm thinking about my own... In my valuation masterclass boot camp, I always say, and I repeat it, and you said something about repeating, and it made me think, I always say... I mean, every single time I speak to my students, "The valuation master class is about transformation not information." And I set in their minds, the point is I want them to make a true transformation in their thinking. And just by identifying this aim, they become... They think, "What am I talk... What is Andrew talking about? I don't see a transformation, where would that come from? What would that be?" But I'm telling you at the last time that we meet on the final of the six weeks, each person explains the transformation that they went through.

0:18:45.2 AS: And it wasn't due... It wasn't mainly due to the content, it was due to the process and all the experience as a whole. I'm just curious.

0:18:58.2 DL: So you're making it clear...

0:19:00.9 AS: How does that clear?

0:19:00.9 DL: Yeah, you're making it clear the aim of that system. I'll ask, sometimes I'll ask teachers, I say, "What's the aim of your system?" And they'll look at me blankly. Sometimes I get answers like, "To get through it." Well, if that's your aim, that's exactly what you're gonna do, right? "I'm just gonna get through it. I don't care if people learn it or not. I don't care about the product of learning, I'm just gonna get through it. That's my job." And if upper level management is pushing that, and, "You must be here on January 12th, and you must be here on February 2nd. And if you're not, then you're gonna get in trouble, right?" Well, you're not really caring about the product of learning at all, right? Your job is just to get through it.

0:19:49.0 AS: And how does this differ from, let's say another... I don't know if you would call it an aim or not, but there's a final assignment in my valuation masterclass boot camp, which is that you've gotta do a complete valuation of a company, submit it and then present it. And that's the final... If they can't do that, they don't graduate. What's the difference between that final assignment versus me talking about transformation, not information?

0:20:18.0 DL: Well, I think what you're saying is really good, but I'd wanna look at my statistical data, the variation of that class, and if 40% of the students can't do that, there's something wrong with my process, right? So I've gotta spend extra time with these students and get them caught up and get... Because they weren't able to do that. And then I wanna take the feedback that I get now, apply it in the systems thinking can to my next master class and say, "Okay, how do I prevent the very problems that I had before?" And it's actually pretty easy to track until you get down to maybe only one student is not able to do that at the end of the master class. And then you lower the variation even more, so only one student every three years doesn't make it, right? Because I'm so good at dealing with special causes, issues, setting this up in the beginning, and talking about the aim, et cetera, that I've lowered the variation until it's just very, very rare. And that's really a special cause.

0:21:38.4 AS: Yeah. Well, we have cases...

0:21:38.4 DL: You have to visit a specialist.

0:21:40.2 AS: Where someone's gotten sick, or something in there.

0:21:42.4 DL: Of course.

0:21:42.6 AS: But I just to follow up on that, what I was noticing in my first couple of the... We're now on the seventh iteration, and in my first couple ones, I realized these final reports are not that great, because what's happening is, I'm overloading them with information for the first four weeks. And then in the last two weeks, I'm saying, "Now, finish this report." So I work with the team, and I said, "Why don't we assign them the company they're gonna value six weeks from now, on day one, number one. Number two is, the students were complaining there wasn't enough feedback, so why don't we break the assignments down week by week, and we're gonna tell 'em what they gotta get done by Friday, and then we have feedback Friday, where one member of their team presents that. And then, we give them feedback on it, and all of a sudden we're starting to build towards this final report week by week, and I just realized I should have been doing this all along as we go through this iteration, so it's a good reminder.

0:22:43.7 DL: Yeah. But you learned, and you listened to the students and they said, "Oh, we gotta have this kind of feedback all the way through." Okay, well, that means you as the manager, you have to make an adjustment in the system and the process of what you're doing, and then it's a PDSA cycle, right? You try one class and you say, "Okay, I'm gonna make this adjustment, and I'm gonna look at the data now and compare it to the data before and see, did it work? If it did, I'm gonna do this with all my classes, because I found out something that's making a huge difference for people through that process, so...

0:23:17.1 AS: Yeah. And the feedback was hard to get, David, when I could see the problem, the students talked about the problem that they were overwhelmed, and but what the answer to that was, was that, "Oh, man, they are asking for one-on-one feedback, and how can I do that with 100 students, with 500 students?" And then, the point is, is that once you raise the problem, then it opens your mind to think, "How could we solve it?" And my solution was, "Well, wait a minute. That they're making the same mistakes a lot of cases, so if we just create feedback Friday, we tell them, "You are getting feedback," and then we focus in on a small number of them, but let them all observe and then we accomplish the same thing that they wanted, but they wanted it in one-on-one, which wasn't scalable for us, which would have been difficult. So getting the information back, that's a bit painful, and I'm like, "I can't do that," but being aware of it then allowed us to come up with some alternative. So yeah.

0:24:19.1 DL: Because I don't know how many times I heard Dr. Deming say at seminars, "It's not the answer that's important, it's the question. And do you have that right?" So when you start asking the question, "Well, how do I do this with 100 students?" Okay. Well, now you're asking the right question. Right? And there's always a way. There's always a method. But instead of saying, "Oh, I can't do that, it's not possible. I don't have time for that." Well, okay, then it's never gonna happen then, is it?

0:24:49.3 AS: David, is that what my mom meant...

0:24:49.7 DL: But as soon as ypu start asking the right...

0:24:51.3 AS: When she said, "You're jumping to conclusions?"

0:24:53.1 DL: Yeah. As soon as you start asking the right question, then you'll start to solve the real problem. So I wanted to get to the third sentence here before we run out of time. There's a lot in just this one...

0:25:06.2 AS: It's amazing.

0:25:06.5 DL: Point he makes. But he says, Dr. Deming wasn't into all the pronouns and everything that we use today. We always just used he, so, but he says, "He teaches his people to understand how the work of the group supports these aims." Ah. So I've got this group of students, right, and so I've explained to them what a system is, and that we are a system, and we work to develop an aim for that system. Okay, now I have to optimize these people working together to achieve that aim, right? I remember when I first started, I couldn't get rid of just grading kids, and keep my job, I still had to... So I had to figure out, "Well, how do I do that within a grading system, even though Deming says we should get rid of the grading system. And so, when I started talking to students, I said, "What would be the aim here?" And somebody said, "Well, our aim should be that everybody in the whole class would get an A." And I was just shocked, because at that point, that never happened in my history.

0:26:23.0 DL: Well, and partly the reasons that it was never gonna happen, was a huge part me purposely was doing things to make sure that everybody wasn't achieving at a high level, and then that sounds just like heresy, but most of education is built on that. I can guarantee you, especially like a high school teacher, if suddenly all of your kids are getting As and you're turning in your grades and everybody's got an A...

0:26:49.5 AS: You're in trouble.

0:26:50.2 DL: Yeah, you're not gonna get an award. [laughter] You're gonna get visited, alright.

0:26:56.8 AS: The statistics guy will come down and say, "No, this is impossible."

0:27:00.1 DL: Yeah, the principal, or the superintendent, or, "You're destroying the whole grading system," all those kinds of things will come into play, but in reality, you should be having that person teach all the other teachers, what are they doing? What are you doing? And we're not talking about just giving them As just for the sake of giving them As. But they've established a system that almost everyone always get... Does A level work. Well, you're gonna have to do what Deming talks in this third sentence about how the work of the group supports these aims, so how do we work together as a class to support each other, so everybody can get there? That's totally different than the stereotypical classroom where I say, "Sit down, don't talk, don't talk to your neighbor. If you talk out loud, you're gonna get points taken off your grade," and those kinds of things. That's much different when I say, "Hey, we need to all work together." And so what happens if somebody struggles, or takes a little longer? Or what could we do to support them? That's a whole different kind of a way to think.

0:28:20.2 AS: Ah. There's so much to that, and the idea too, that sometimes teachers, and maybe managers in companies are really busy, and so they feel like, "I just don't have time to explain all of this." And so they end up leaving either employees, or students in the dark knowing that it is a little bit like driving in the foggy conditions. All the students see is ruts right in front of them, they're not seeing the aim. And as a result, they really... It's just a routine. "Just go in and do whatever they say, because we don't really know where we're going."

0:29:02.1 DL: Right. So we use the example of a classroom as a system here today, but whatever level of a system you are, if you're a principal, oh, well, your system is the whole school, right? If you're superintendent, your systems the whole district, or whoever you are he's talking about, your job is to do the same thing. Are you explaining to everybody in the entire organization what the system is, number one, and does it have an aim, and how can we work together to optimize this aim for the whole system? And I remember talking to a major CEO of a huge multi-international corporation, and that she was... Had worked with Deming also, and I said, "Well, how do you go about that?" She said, "Every single year, at the beginning of the year, I do 10 days of training with all managers worldwide." I thought, "Holy cow." [chuckle] That's huge, right? And who's doing the training? She is, the CEO, because she wants it coming directly from her, "This is our job, this is our aim, and our job is to optimize the system."

0:30:20.7 DL: And she didn't just do it once and then go back to her office. She said, "No, every year I've got new managers, and I've got new people come on board and we have new levels of discussion and new depth to take it to." Well, it's the same thing in a classroom, right? I'm better and better, I get faster and faster at setting the aim with this group of students. I get better and better coming up with metaphors of how to explain a system, even to preschool kids, or... And I get better and better at coaching people to support each other and help each other to achieve the overall aim. And then I use my statistics to see "Is it working? Am I actually getting better at that?"

0:31:08.2 AS: I was just thinking kind of a little bit of an inspirational thing, is to tell students that, "The aim here is to figure out the best way to get to where we're going for the benefit of the next class, the next group of students. And how could we take the way I'm explaining this particular subject and improve upon it so that the next group gets it even better? What an inspirational thing. So...

0:31:41.8 DL: Yeah, I remember a teacher that really took this to heart, and so what she would do is, she would take next year's students that she was going to have, and she'd have them come to a sort of a field trip to her class this year, and have her current students explain how we do things here, and what we do and everything. Now she's going upstream in the process in the system, and so kids were actually anticipating, "Hey, when we get to her class, oh, we have to do this, and we have to think like this." And then she had... She went to students that had left her class and asked them, "How did I do? Did you have the kind of learning that you needed for the next stage in that class," and then she used that feedback to change the system that she's in now, so...

0:32:31.9 AS: And that also makes you think about the wider system of a school, where there's a connection between the curriculum so that people see like, "Okay, there's a reason why our teacher, Mr. Tyler, that taught me pre-algebra, made me underline and write out each step in the solving of that algebra equation, because he knew I was gonna need it in the next level."

0:33:00.6 DL: Yeah, very good.

0:33:03.5 AS: So shall we wrap up?

0:33:05.5 DL: Yes.

0:33:07.3 AS: Okay. So just to wrap up for the listeners and the viewers out there, we're talking about... We're just kicking off a series on the role of a manager in education, and it's based upon Dr. Deming's writing in "The New Economics," in the Third Edition, it starts on page 86. And in the Second Edition, it starts on page 125. And the title of his list of 14 things is, "Role of a Manager of People. This is the new role of a manager of people after transformation." And just to review some of the things that we went through with that just first point, the first thing that we had talked about, is that classroom teacher is a manager of people ultimately, and we talked about three things that come out of that. The first thing that comes out of this first point is, you wanna teach what is the meaning of a system? The inputs, the process, the output, you've gotta start with that. If people don't understand that they're operating within a system, then they can't make the progress. Remember that students, as you've said, David, are not products, they're not inanimate objects, the product is actually the learning itself, and so the objective is to manage to optimize that learning process.

0:34:23.8 AS: The second thing that we talked about was that people need to understand what is the aim of the system? Okay, fine, it's good enough that we need to understand that things work as a system, but what are we aiming for? And you propose, "Well, maybe highest number of students to the highest level in the time that we have." So once people understand the aim, they understand where we're going, and then it brings the third part of this one, which is, so how does the work of the group support the aim? And I would say that this is part of the concept that Dr. Deming talked about, about bringing meaning to work, bringing the value to work that you have a role in this, and that is to get to that aim, so we have a common mission, a common goal, and we're working towards that, and that's an environment that I think everybody wants to either work in, in a school environment, or in a work environment. Is there anything you would add to that wrap up?

0:35:20.1 DL: Well, there's these phrases like joy in work that Deming talked about and joy in learning. How do you get there? Well, here you go, here's the first step. [chuckle] Because when I understand my job in that system, and my job is to help other people also achieve, I have joy in what I do. My relationships can flourish, right? I can share information, I could support other people, and that's really part of the human condition, and it makes it actually fun to go to school.

0:35:55.9 AS: Well, what a great way to end that discussion, fun to go to school. David, on behalf of everyone at the Deming Institute, I wanna thank you again for this discussion. And for listeners, remember to go to Deming.org to continue your journey, and we are talking about "The New Economics," so you can get that on Amazon, just go to amazon.com and download it, or buy the hard cover. And listeners can learn more about David at langfordlearning.com. This is your host, Andrew Stotz. And I'll leave you with one of my favorite quotes from Dr. Deming and this discussion today kind of explains where it comes from, "People are entitled to joy in work.”

Bill Bellows serves as president of the In2:InThinking Network, and as a Board Trustee of the W. Edwards Deming Institute®. In his podcast, Bill discusses his introduction to the Deming philosophy as a young engineer, and his "aha" moment after hearing Dr. Deming speak about the destructive nature of competition. He also shares his thoughts on the challenges of conveying the Deming message in the future and the importance of collaboration in the Deming community.

This week's Podcast, continues our "Knowledge in Variation Series" with Dr. Frony Ward, Managing and Founding Partner of Pinnacle Partners, Inc.

In this podcast, Frony discusses online surveys and polls. She starts by sharing the fundamental piece of every single survey. From there she delves into elections polls, and why so many election polls show different results. Lastly, she discusses two or three good things you can do to help yourself understand a poll.

In this, the first in a series of episodes on Awakening Your Inner Deming, Andrew talks with Dr. Bill Bellows about his journey. He started with Taguchi, read his way through other quality "gurus", and finally found Deming in unexpected places - solving big problems in space shuttles along the way!

0:00:02.1 Andrew Stotz: My name is Andrew Stotz. I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm here with featured guest Bill Bellows. Bill, are you ready to share your Deming journey?

0:00:15.7 Bill Bellows: I am ready. I've got my seatbelt on, crash protection devices. I'm ready to go, Andrew. [chuckle]

0:00:23.3 AS: And I am ready indeed. So let me introduce you to the audience. Bill's a 35+ year specialist in the field of quality and engineering management. In addition to adjunct professor roles, he is president of InThinking Services, partnering with clients to facilitate the understanding and application of the Deming philosophy. So, Bill, can you tell us a bit about how you first came to even learn about the teachings of Dr. W. Edwards Deming and what hooked you?

0:00:57.8 BB: Well, I was minding my own business. No. Actually, I finished my graduate studies in 1983 and went to work in the aerospace industry with a sense that I wasn't gonna... [chuckle] I wasn't quite sure I was gonna like it. I greatly enjoyed what I was doing in the field in graduate school, and the work I was to be doing in industry was very similar. So I felt okay, but it didn't take long before I just didn't like it. And I found myself teaching some college classes and then wondering what I wanted to do. And it took about... Two years after I was working at this company, I took a class in problem solving and decision making. A one-week class. And I loved it. I started looking at everything through this lens of a model for decision making, a model for problem solving.

0:02:13.4 BB: And shortly thereafter, I was approached by the training director of the company. We were growing leaps and bounds in terms of business and employment. And this guy came in and was really cool in terms of bringing us what he thought was some really professional development training. And he knew I was excited by this one-week course. And he said, "Bill, how'd you like to be the person in engineering trained in that and to teach this course?" And I was like, "Yeah. Yeah. Sign me up." So I went away for a two-week train the trainer, very intensive training. And what was interesting is I was the only one in the room, two dozen people that wasn't an HR and wasn't a trainer. I didn't know how to train... I was gung ho on the material, but I did not know what it was like to get in front of an audience. And in fact, the instructors used to kid me that I was almost afraid to move beyond the podium. I just wanted to hide behind it.

0:03:17.0 BB: And so I came out of that having been... I have to we prepare for the next day, five minutes, 10 minutes, 20 minutes. Next thing you know, we're preparing these one hour long teachers. And I love... I liked it. And then back at work, the plan was that, given this role as the auxiliary instructor for this material, when people in engineering, my organization, have a need for this training to be used, I'd be called upon. And that was really cool. It got me associated with people I wasn't working with, and it was a much more exciting than what I was doing. And Lo and behold, the guy in training, the director says, "Hey, you know this... " He mentioned Deming's name, and I was a sponge. And I really respected what he was doing. And he gave me... He introduced me to Deming's work. And I remember, I think it was Quality, Productivity and Competitive Position. And I looked at that and I thought, "Okay."

0:04:30.4 BB: But then going back to the problem, we'll come back to that. That was my exposure to Dr. Deming's name. But in parallel, I was working on a very big problem on the... On our number one product, which were gas turbine engines, you could think of as jet engines, for applications in the US Army's battle tank. And we were making 120 of these a month. And I mean, it was a big, big... It was the biggest business of the company. And once or so a year, there'd be a major crisis. We can't ship hardware and the Army would come in and say, "Stop production until you solve this." And I had been dragged into some of those before. And that kind of got me in the realm of, "Hey, why don't you go off and take this training?" So now I'm not sitting in the back of the room. Now I'm in the front of the room but leading the facilitation of these techniques for problem... Mostly problem solving. What is a problem? The car won't start. It used to work.

0:05:38.5 BB: And so we're working on one big problem. And it was... It had incredible relevance relative... This is the height of the Cold War, Andrew. This is '87, '88 timeframe. And there was reason to believe by the Army that the majority of the battle tanks had a problem. And those tanks were the front line of defense of the allied forces in Europe. And so, we were running tests 24/7 trying to solve this, solve this, solve this, solve this, solve this, and we weren't going anywhere. And at one of the meetings, once a month, somebody had to go explain to the army, essentially our lack of progress. At one of those meetings, somebody said General Motors makes the transmissions for the tanks, and whenever they have an issue like this, they use this thing called Taguchi methods. So we're gonna contact General Motors and ask for their help and you're gonna send somebody then in Indianapolis to find out what it is and is it relevant.

0:06:49.8 BB: And so I go to this meeting and I learn about these goings-on, and I turn to the manager of the tank engine program. And I said, "So who's gonna go to Indianapolis?" And he said, "You are." And I looked at him dumbfounded and I said, "Why me?" He says, "You're the problem-solving guy." He says, "I want you to go." And Andrew, I had no interest in going. I was looking for reasons why it made no sense. And in the back of my mind anytime I get into a situation where I'm not happy with whatever it is, I look for something positive to make it appeasing. And believe it or not, I didn't wanna go to Indianapolis, but I thought, but I can go to the Indy 500 Museum, which a neighbor did years ago, and if nothing else, I can go to the Indy museum. And that's really what I was looking forward to, is going to the Indy museum 'cause I thought this meeting was just gonna be a waste of time.

0:07:49.7 BB: And I go into the meeting and I'm... And this is what hooked me on Taguchi then we'll come back to Deming. I go into the meeting and there were these transmission division's top people in Taguchi methods. Well, their senior people, their top most person had recently left the transmission division to go work for a new part of GM called the Saturn Corporation. And I'm thinking, holy cow, your top Taguchi guy is at Saturn, which I knew about. So now I'm thinking, 'cause prior to going out, I did a literature search. We didn't have the internet and I pulled up a bunch of stuff and it was just a mishmash. But when he said, "Our top guy who wrote this book... " and he showed me the book, "went to the Saturn Corporation," I'm thinking, now my ears are perking up.

0:08:56.4 BB: And then he says the other thing that's funny here. They brought in their chief transmission designer and he looked at the drawings of the parts that were failing in the engine. And he says, "This looks like a German design." I don't know anything about design, but he looks at the drawings and he says, "This looks like a German design." And I said, "It is a German design." In fact, I said, "The people who designed this engine designed the very first German jet engine in the late '30s for Hitler." I said, "It's the same team of people." And so anyway, he looked at it and he had some ideas, but that wasn't why I was there. But then the other two guys were there, and the first question they asked me is, "How do you come up with ideas for what's wrong with this tank engine?" I said, "Everyone's got an idea." And I said, "And what if that doesn't work?" He says, "Here's what we do. Somebody comes up with an idea and every idea we come up with, we write it down and we go run a 10-hour test at a thousand bucks an hour, which I thought was expensive.

0:10:01.5 BB: And then at the end of the test, we decide to go forward or not. Are we onto something or not? And he said, "What if it's not?" And I said, "Well, then somebody's always got an idea, somebody's always got an idea. We're running test, we're running test. Well, why are we here?" Because we're running through ideas, running through ideas, and we ain't finding anything. So then he says, "What do you measure?" And it's so funny. I don't know anything about gears other than the gears have teeth. I'm a heat transfer guy. [chuckle] So I said, "After each test, somebody goes to the manager in the gear group and shows them the gears that contact each other," and he holds 'em up and he says, they look good or they look bad. He says, "How does he do that?' I says, "He just looks at 'em." He says, "He doesn't measure anything?" I said, "No, he just holds them up to the light and he says, that looks worn, or that doesn't look worn."

0:11:01.3 BB: And I said, "Based on that decision, we run the next test." Well, he says, "Here's our first piece of advice." He said, "Stop thinking of it as being it's worn or it's not." He said, "It's really shades of grey." And he says, "What I want you to do is measure each tooth on each gear before and after." He said, "You're throwing away a lot of information based on this measurement." And I thought, okay, okay. And I said, how do you do it? Blah, blah, blah. And I went back about a week later based on what he shared with me and we put together a test plan that solved that problem in about two weeks later. And so now I'm all over Taguchi's work, I am all over Taguchi's work, all over Taguchi's work, and it became my next look.

0:11:49.0 AS: What does Taguchi have to do with just measuring versus eyeballing something?

0:11:54.9 BB: Well, that's a good question. I'd say Taguchi's work in that situation was the use of fractional factorial testing, but the issue was that we were treating the data as black and white, which is, in terms of statistics, it is a poor way of doing things, but that's... It wasn't...

0:12:19.0 AS: So either you accept or reject as opposed to measuring?

0:12:22.1 BB: Yeah. And I was... I took an undergraduate class in statistics and I just... It wasn't a field I didn't know that much about. So I just bought into it and he just brought it to my attention, and I said, okay, and it kind of makes sense where he's coming from, but the... So really, the biggest thing that came out of the meeting was not so much... It was driven by you gotta look at this Taguchi guy and it was a combination of running tests using Taguchi's ideas, which would've included using variable data and not... What was it called? Category data. And so that, it was just incredible. This was a problem that was going on with incredible high visibility at the Pentagon, and it got us out of a big jam. And we just couldn't, the answer was right in front of us, but we couldn't see it based on not so much the testing method, the evaluation method. So then that got me in love with Dr. Taguchi's work, so...

0:13:40.4 AS: Let's stop there for a second and think about the listeners for a second, and the viewers. How would you describe the lesson that you learned from that experience?

0:13:56.2 BB: I say a really big lesson is that a simple shift in our thinking, kind of like putting on glasses allowed us to see what we couldn't see that was right in front of us.

0:14:11.7 AS: And it happened by you going outside of the organization also, it sounds like.

0:14:15.7 BB: Oh inside... Oh, the organization. See, I had no reason to challenge the organization. These were the gear people. I'm a heat transfer person, so I don't challenge the gear people. What is that all about? That's why I'm just going along with the guy says, "What do you measure?" I said, again, I was out of my element relative to how organizations operate, out of my element relative to... Now I just looked at that and say, they're the experts. Why would I... I mean, [chuckle] I was just gullible. And I don't think that's uncommon. Where I worked, I found that there were fields in which everyone was an expert. And then there were fields in which... Meaning that if you... Where I worked in Connecticut, if you had some skill with statistics, people would get outta your way and they would just treat you like you walked on water, even though you were full of it. They just bowed to Andrew because you...

0:15:33.2 BB: And so I think it was something like that. I just didn't... And again, I don't think that's uncommon in organizations. But to your point, in fact, back to your point, when I walked away from that very first meeting, and here's what was cool is, it was the two of them, the designer left the room and were in a small conference room. And here I am with two instructors and me, two instructors and one student. I had a ball. And I'm taking notes and I'm writing everything down. And I'm asking this one, asking this one, asking this one, asking this one. And the plan was I would come back in a week, take the ideas, go back, talk to the experts. Well, one of the things we did when we went back is we threw out everything we thought we knew about those experiments because every decision we had made was based on this premise of look and hold a part up to the light.

0:16:27.6 BB: So I said, all this testing is meaningless. So now we've gotta go back to the original list and go forward 'cause typically you'd think, like with Edison, you try this, try this, try this. You don't go backwards. We went backwards based on what you're talking about is that I lost trust in everything we thought we knew. So we went back to the original list, which was... And the original list was what a bunch of recent design changes. So we went back to that list that had been tested, and using a shifting from black and white data to continuum data, we discovered what no one else could see. And it just jumped right out. It was just so damn obvious what was going on, but we couldn't see it. And so that got me intrigued in Taguchi's work. I was then on a mission to learn everything I could. And I then began to see my role in the organization as the facilitator of training that I was doing, and then training in this and helping the organization on applications.

0:17:41.9 BB: And it didn't take long. We were solving some pretty big problems after that. And the VP of engineering liked what was going on. And I went to one day and I said, "I'd like a job," I said, "There's incredible opportunities for us to use this, and I'd like to be the person leading that effort." And he smiled, and... "Andrew, this is the height of TQM, this is 1988. TQM is huge." And he's kinda nodding to me. And sometime thereafter I told him, I said, well what is I brought the Taguchi people in from Detroit to do a big seminar, $30,000. And I'm in charge of bringing them in. I'm in charge of who's coming to this. I remember I went to the HR training guy and I said, "Who do I invite to this training? This is out of my league." And he gave me incredible advice, and I'm sure you've heard before, he said, "It's easier to ask... " He said, "It's easier to apologize than ask permission."

0:18:48.5 BB: He said, "You are in charge of the whole damn thing." He said, "You invite who you think needs to be there." And I was like, whoa, [laughter] And I said, when did he had to tell me that. And I had so many from engineering, so many from operations, so many from procurement, invited the people in, took the course, we were able to as part of the course show what we had done and we were on a roll. And eventually I went to the VP of engineering and I said, "This is what I wanna do." And I even... In a nice way, he and I got along really well and I said, "The job I want, I've shared with you," and I said, "And I really hope it comes to be." I said, "But if it doesn't come to be, it will be because I found that job elsewhere."

[laughter]

0:19:44.0 BB: "So if I come to you and say I'm leaving, this is why."

0:19:50.0 AS: It's for that job.

0:19:50.6 BB: This is why. And then in the very same time frame that I'm out looking, looking, looking, looking, looking 'cause it would... Did not appear to be coming. And then I heard about Deming again and I heard that he was speaking about an hour away from where I worked. And at that point, I had taken an introduction to Taguchi's course, an advanced course where I drove to Detroit and self-funded a week's vacation. I was intense. And I hear about Deming speaking in the area and I thought, "Being a student of quality, I need to go find out what this is all about." So I...

0:20:28.0 AS: And what year is that and what city was it that that was happening in?

0:20:34.8 BB: Dr. Deming was speaking in February of 1990 in Danbury, Connecticut at Western Connecticut State University, and he spoke three times that day. I was there for all three and I have videotapes from the inviter, the professor. He shared with me two of the three videotapes, and one of them, the evening lecture about an hour and a half long I believe is on YouTube. I can get you that information to the link and... But Dr. Deming spoke for about an hour to the faculty, an hour to the students, and what was so cool is I attended with two colleagues from a graduate school who were in transition and I said, "Hey, there's this Deming guy appearing." He was about... He was appearing about midway between where these classmates were. So they drove and got there and I got there and we're driving around campus trying to find where this is. And what's so cool was we found the building, and found this auditorium which was empty, and as soon as we find the room, we turn, and there's Dr. Deming getting out of a limo. [chuckle]

0:21:49.9 BB: And it's about noon time, and he's with his host and all in there, and I guess they went off for lunch. So we're in the room before any... So when we found the room, we see this guy that looks like Dr. Deming. So, okay, this is the right place. So we just kind of made ourselves at home there, kind of sat. Found the place where we wouldn't be sitting kind of in the back, and he came in and started speaking, and he was entertaining. But so much of what he was saying, he was using a language that was nowhere near anything I had learned from Dr. Taguchi, who in my opinion, I was just in love with Taguchi's work. So I'm looking at Deming by comparison, I'm thinking that doesn't fit what I know from Taguchi. That doesn't fit, that doesn't fit, that doesn't fit. [laughter] So he gave pretty much the same presentation to the students and the faculty and then a little bit longer in the evening. And so much of what he said was interesting.

0:23:02.6 BB: And some of it is entertaining, I mean, entertaining in the sense that I could tell it was a joke. I mean, some of his jokes are in the context of his work and I wouldn't laugh at that 'cause I don't understand the context, but others were, so it was interesting. And then a few days later, the two guys who went with me, who lived in my hometown, I went to see them and a third classmate who got his MBA when we were getting Masters in Engineering, he showed up and he knew of Deming and he said, "So what'd you learn?" And the thing that stood out more than anything else, I said, "I don't quite... " [chuckle] I said, "I don't understand the majority of what he said." I said, "But what did stand out... " I told this classmate, I said, "I've never heard anyone speak ill of competition," 'cause Dr. Deming referenced Alfie Kohn's book, the case against competition. I can't remember the... "No Contest", right?

0:24:12.8 BB: And the guy says, "Well, what's wrong with competition?" And I said, "I don't know." I said, "All I know is he distinctly did not like it." And I'd never heard anyone... When I say people, until Deming, I've never heard anyone speak ill of competition. People always say, it brings out the best in people, blah, blah, blah, blah, blah, but here's Deming railing against it, and that was what stuck in my mind from Tuesday through Saturday was, he doesn't like competition.

0:24:45.1 AS: And when he was talking about competition, was he talking about competition, setting up competition within your company? Or he doesn't like companies competing with each other?

0:24:54.0 BB: No, and that's a very good point. And he's... And I believe that in Deming community there's some confusion. It was hard for me to distinguish competition within the company from competition between Ford and GM. All I knew is he didn't like it.

0:25:14.4 AS: Yep.

0:25:15.0 BB: And yeah. I mean, fast-forward he's very...

0:25:17.6 AS: In America, that's just a bizarre concept.

0:25:19.9 BB: He's talking about competition... Well, he's talking about competition within the team and he would say, "Naturally, Ford and GM are gonna compete in the marketplace, so they may find opportunities to collaborate." But at that point, what just blew me away was this guy doesn't like competition. That's the only... I mean, he'd mentioned special causes and common causes. That didn't mean anything to me. I never heard those words before. So, I mean, nowadays when I go back and watch it, I can see how... What an incredible set of material he was presenting, but I didn't have anything to hold onto to be able to... I'm looking at what he's doing through a Taguchi lens, looking for the black and white and the shades of gray and some other things. But there's so much of what he was saying didn't come close.

0:26:11.9 BB: But going back to the comment of the colleague... The classmate, he said, what's wrong with the competition? I distinctly remember saying to him, I said, "I don't know." I said, "But maybe because we did okay. And graduating getting master's degree," I said, "Maybe we like competition because we won - that we did okay." And what I was also thinking about when I said that was I had a summer job in college and a factory in my hometown, and in the factory people I went to grade school with, and I was thinking of them. And so when he said,"What's wrong?" I'm thinking, I've got a PhD in mechanical engineering. I didn't drop outta high school and go work on a factory. And that's what I was doing. I'm self-reflecting on, maybe it worked for me, but maybe it didn't work for the others. And that's pretty much... And I believe in that timeframe. I mean, Dr. Deming hands out an article at that time on Profound Knowledge, two or three pages and yeah, okay. There's four elements, but I pretty much put it in the back burner.

0:27:24.0 AS: So what happened next and how did you move on in your Deming journey?

0:27:29.6 BB: Well, that was February of 1989. Later that summer, I took an advanced class in Taguchi methods, and I'm interviewing with Dr. Taguchi's company. I didn't have gray hair. I didn't have any training experience. I didn't quite fit the mold they were looking for. And so I'm trying this, and I'm just trying every opportunity, I want a job in Taguchi methods. And towards the end of the year, I met some people and they gave my resume to RocketDyne where I eventually was hired and now I'm working full-time as a Taguchi expert. You know who is an expert. If I know more than you, that makes me an expert Andrew.

[laughter]

0:28:18.5 AS: One step ahead.

0:28:20.6 BB: But where Deming came back to me was 1993, The New Economics comes out, and occasionally, I go to the bookstore, that's just before Amazon. So I go to the bookstore and I was subscribing to the American Society for Quality. So I was in that community of quality practitioners learning about it. And I literally went to the bookstore... A brick and mortar bookstore, got a copy of The New Economics, and what do I do when I look at it? First thing I do, I go to the index and say, what does this guy think of Dr. Taguchi? [chuckle] And I go to the end and it's Genichi Taguchi. So I go to the page's reference, and what floored me was chapter 10, the very last chapter, the last six pages is all about Dr. Taguchi's work. And I'm thinking, I like this guy, I like this guy.

0:29:27.5 BB: So the vote of confidence in what he is talking, I'm thinking. So I think Taguchi stuff is everything and Deming's liking it too. And when I read The New Economics... So meanwhile, in Connecticut, when I was brought in to solve, help, support issues, once or twice a year, I pretty much stopped my day job, went full-time into this problem solving practitioner facilitator mode, which could take a month or two months. And then I go back to my job. Now in Connecticut, I'm the full-time problem solving guy. This is not a part-time thing. It's a full-time thing. And the exciting thing is I'm working on some very big issues, some of which were a couple months old. One in the spatial domain engine was a year and a half old. And this is exciting, but then I'm starting to realize that there's something wrong with the business model at the organization.

0:30:28.7 BB: And when I looked at Dr. Demings, when The New Economics came out, again, I had spent three years working on major problems in the special domain engine, major problems on space station hardware that RocketDyne was developing, the electric power for. I'm briefing very senior NASA people on problem solved, problem solved, problem solved. But I'm starting to hyperventilate thinking we are kept in business by being able to solve problems. The problems we don't solve, what NASA does is they call you up and they say, "Andrew, we've given you the contract to develop the engine." You're like, "Yep, yep, yep." "And we've given you the contract to produce the engine." "Yep, yep, yep, yep." "But we understand you've got a problem on this component. We're looking to have somebody else make that."

0:31:19.7 BB: And what I saw in front of me was I'm working on a problem that's a year and a half old. There's other problems on the engine. NASA's getting frustrated saying, we're gonna outsource this work to a competitor. And I'm thinking we're gonna lose the engine one component at a time. So I'm working on a big component. And before that problem was solved, a bigger dollar value component was given to a competitor. And I'm thinking one after another. So when I read The New Economics, the first thing that jumped out is, what I'm experiencing is not unique to where I work. What I read into Dr. Deming's work, my interpretation of Deming's work was kind of reinforcing that problem solving is the result of how we see the world, that we're stuck in a rut, because I'm looking and thinking...

0:32:16.7 BB: Again, the good news is I'm kept in. I'm being kept incredibly busy working on some very high visibility problems, going to very senior people at NASA headquarters to present solutions with the president of the company. I'm feeling really good. I mean, relative to having fun, but I'm thinking, but fundamentally how the company is running is not sustainable. And so, I'm looking and thinking, "I'm enjoying this. I'm keeping busy." But we shouldn't have these problems. If we understood what Deming's talking about, my interpretation was we could be preventing these problems, not solving these problems. And I'm not saying all problems, but I'm just thinking that we're behind the eight ball, and I looked at Deming's work as how to get out in front of it, not behind it. And the big part of it was we didn't understand variation.

0:33:15.9 BB: And so what I looked at it was, if you're ignoring variation, then you're... And we'll get into more detail in another session, but what I found was we didn't see the warning signs, the way it was... This goes back to the black and white, and I liken it to things are going well, which is like, your car has gas. Okay, the car has gas. Should I go get gas? No. How do I know we shouldn't get gas, Andrew? Because the car is running.

0:33:48.2 AS: The car has gas. Yeah.

0:33:50.0 BB: And so I'm thinking, "So why are people coming to me with a problem?" Because when the car is running, they don't think they need gas. [chuckle] And now I'm thinking, "If we just had gas gauges, simple devices to monitor and get away from the car has gas or it doesn't, which is the black and white thinking that I grew to, not despise, but just become aware of its limits. And now I'm realizing it, if we looked at things along a continuum, we could be preventing these problems in the first place. And then I'm thinking, "I mean, we've got an incredibly sophisticated engineers and hardware, but we're falling victim to a mindset that says the car has gas, but nobody's asking how much." But so I, from that moment on, reading Deming's book one, it was holy cow, because the riddle I was trying to solve was, why do you come to me when the car runs outta gas?

0:34:54.2 BB: And what it didn't dawn to me was why should they come see me when the car has gas? [laughter] And Deming was... Again, and I'm not saying everybody looks at Deming's ideas the same way. And we both know that's not the case, but what excited me about him at that point was that what I was dealing with was not... The solution wasn't technical. The solution was a shift in mindset. And I then very distinctly began moving from all about Taguchi to all about Deming. And what was interesting is when I started to share that influence with people, really good friends in the Taguchi community, they looked at me, some of them down their nose. Then I've...

0:35:53.3 AS: A traitor to the cause.

0:35:56.5 BB: I'm just like I had discovered a new religion, but they looked at me like, "Deming? Deming?" And I'm thinking to myself, "Well, first of all, I was, I had great... " These were really sharp people in the Taguchi community that I had greatest respect for. And I thought they'd be excited by that. And what I was sensing was kind of a weakness. And I then, from that point on, I went from the solution was Taguchi training and advanced training and blah, blah blah. And then began to think that the reason I can't get in to do these things that I wanted to do with Dr. Taguchi's work, which is focusing on things that are good and making them better. Why am I focus... I'm applying Taguchi's ideas to go from bad to good. And all the training I had is that his ideas go the other way from good to better and better and better. And I'm thinking, "I'm stuck in this rut. And Dr. Deming's giving me great insights as to how to get out of the rut." And you can tell from my excitement it was a game changer for me and a game changer for how what we did in terms of how we were deploying Taguchi's ideas and Deming's ideas where I worked.

0:37:25.0 AS: So if we go back, I mean, let's... Now that's a good breakdown of kind of your history with it. And I'm just curious, if we think about a young person right now who doesn't know much about Deming, how would you describe what they can gain from starting their Deming journey? What would you describe now? I mean, in the beginning you've described kind of simple solutions to simple problems, but there's so much more that you started discovering.

AS: Let's just talk about when I think about young people these days and I look at the management that they're learning in universities, their MBAs and all the things, and I'm looking at the KPIs and things like that, that are going on in this world, I see some strong reasons why people should pay attention to the teachings of Dr. Deming. And I'm just curious, the question I like to ask is, why Deming? Why now?

BB: Yeah. I'd say my approach is to use examples with people of all ages that are new to Deming, right? So you don't have to be right out of college. But I like to look at it as how can I help you understand through questions and examples the degree to which you have the ability to see with new eyes right now, meaning that when I talked earlier about the limits of black and white thinking, versus shades of gray thinking. Shades of gray thinking is looking at a gas gauge and see the gas gauge is going from full to less to less to less. It's time to get gas while I still have gas. Black and white thinking just says I have gas. What about now? I have gas.

AS: Accept, reject.

[chuckle]

BB: And it's not to say that black and white thinking is bad, but it's simple versus shades of gray thinking. So what I point out to people is in our personal lives, we use both modes. Throughout the day we're in one cat... We're in one mode or the other not paying attention. And it may well be that the mode we're using is the proper mode to use in that situation. But if we became more aware of those modes, if we had the ability to flip the switch deliberately, 'cause right now what I found is I can ask you a question and get you to go into the black and white mode. You don't know that, and I'll give you another question. And to me, you're jumping between modes, you don't know it. So my strategy, is how people become aware. Why? Because what Dr. Deming's... I'll give you an incredible, a great quote that Russ Ackoff shared in a conversation with Dr. Deming, and Russ says, the...

BB: And for those who don't know, Russ was a professor at the University of Pennsylvania's Wharton School of Business and he passed away about 10 years ago, or so. And he and Dr. Deming were colleagues, very deeply, deep admirers of one another, but 19 years different. Dr. Deming was 19 years older than Russ. And Russ says, "The characteristic way of management we have taught in the western world is to take a complex system, break it in the parts, and manage each part as well as possible." And then he goes on to say, "And if that's done, the system performs well." And I ask people to complete the sentence and they'll say... And actually the sentence I pose it as, "And if that's done," so the character's way of management is to take a complex and then breaking into parts manage the parts as well as possible. And if that's done, okay, how would you answer it? And they'll say, "things go well, things go well." 

BB: Well, what Russ says is, "And the system will behave badly and perform well." And then that's absolutely false. And so what I then try to show to people is that what Russ is describing is what we do at work. And then, I gradually point out to them that what he is describing we should be doing is what we do at home. [chuckle] And I try to get 'em to realize that at work they're responsible for machining a whole... Delivering, converting some data from one form to another and passing it on to the next person. But they don't know what the next person does, and I point out at home, whether they're planning a vacation, planning a wedding, buying a home, they're handing off to the next person. And they are the next person, and then they are the next person. And so I try to point out to them the differences between how you would behave if you were the next person. And by comparison, what do we do at work.

BB: And I try to use examples that show the incredible shortcoming of how we treat the next person at work versus how we treat the next person at home, who is me. And so I just give them the same scenario and just say, "So why at home, do we do this and at work we do this?" And then they'll wrap their heads around it. "Because at home I'm dealing with wood and at work, I use metal." And I've had that happen, people will say, "In the garage, I have... I'm working, making a project at wood, and that's why I do that at home. And at work, it's all metal." And I try to point out, "Who designs it at home?" "I do." "Who buys the materials at home?" "I do." Or the elements of whatever it is I'm making and I try to point out, "At home, you are the ones who conceive it, bring together the elements, buying them and putting 'em all together. Then you are the user, but that's not the case at work."

BB: And so what I try to do back to your point is show them how much more advanced our thinking at home is in terms of how we treat the next person, me, versus what we're allowed to do, the next person. Try to point out to them is that, "At home, you, the receiver and you are receiving from you the provider, and at home, the person upstream may not be as generous. Nor will you at work be as generous for the next person downstream. So I try to use examples like that of how... And get into the realm of what does it mean to look at things as a system versus looking at things in isolation. And I find examples like that can grab their attention. But it's not uncommon with these people. I'd be learning about what they do and try to use examples from what they do and point out.

BB: And again, like we were talking earlier, the difference between a shades of gray approach and a black and white approach versus, am I looking at the thing in isolation? So I try to point out those types of things. Now, I mean depending on who it is, I may look at other aspects of Dr. Deming's System of Profound Knowledge, if I think that will get me a toe into the door.

AS: Yep. So let me ask you, in wrapping up, what would you say is the most influential part of Dr. Deming's teaching for your life?

BB: The concept of the System of Profound Knowledge is... That has been a... That has changed my life. That there isn't a day that goes by that I don't look at things through the lens he's describing. The other thing I'll say for people that are new, to the Deming philosophy, and you come across this thing called the System of Profound Knowledge. And Dr. Deming would say, "If you have a better name, please help me." You have to call it something. And then you go to a Deming seminar and you learn there's four elements, and then you learn the psychology piece and this piece. And it's not uncommon, we go to school and we learn things a chunk at a time, a chunk at a time, a chunk at a time. And the challenge is that for people that are new to this, study the pieces in terms of Ackoff, in terms of the system of profound knowledge, if you're looking at variation. Dr. Deming's vast experience in education is all about variation and Shewhart's work.

BB: But if you wanna study psychology, you have to do what Dr. Deming did, was read books on psychology that are not written by Dr. Deming. Read books on systems such as from Russ Ackoff. And so what I find is my strategy was, I mean, the simplicity of the Deming philosophy relative to the System of Profound Knowledge, no one else put together those elements like that. But what I also point out to people is you're gonna have to go beyond Deming's writings to study systems and bring it back to that focus, study psychology and bring it back to there. Now again, depending on who you're reading in, may not fit the psychology Deming's talking about. But I think a big thing is you gotta be able to go beyond The New Economics to go into depth in those areas. And what you'll find is in the beginning, we think of psychology as separate than variation.

BB: And what you'll find is over time, you can't separate, and so that's what I would say is that, I know as you're coming across it and you see it for the first time and you think, "Okay, that's over there, that's over there." But don't be surprised as you continue on your Deming journey that these things come together, and then you realize that that separation is just a teaching device. And that teaching device is in every course we take, we break it in to parts and then at the end of the semester it's a whole. And that's what I would say is, what I find just breathtakingly remarkable is how that system has enabled me to think about things in a way that I would never be able to think about before. And I'm not saying I see everything, but it has enabled me to be in situations where I can turn to colleagues and say, so where do you think we're gonna go based on this decision?

BB: And we can use Dr. Deming's work to get a sense of how that might go off the rails or whatnot. And so if you think of... Dr. Deming would describe his work as a theory of management. And what is a theory? It's a prediction, so I find it's a fascinating crystal ball to look at a situation or a decision being made and start to anticipate what could happen. And I'm thinking, how can that not be invaluable to people?

Yep. Well, Bill, on behalf of everyone at The Deming Institute, I wanna thank you again for coming on the show. And I ask, do you have any parting words for the audience?

BB: I'd say, if you're new to the Deming community, welcome. [laughter] It's never too late to join. And if you're part of the community, I would say don't stop learning.

AS: Fantastic. That concludes another great story from the worldwide Deming community. Remember to go to deming.org to continue your journey. This is your host, Andrew Stotz. And I'll leave you with one of my favorite quotes from Dr. Deming, and that is, "People are entitled to joy in work."

In this episode, Bill Bellows and host Andrew Stotz discuss seeing organizations as holograms—3D images. Holograms show all parts from different views at once. Learn how using the lens of the System of Profound Knowledge lets you see the problems and opportunities for transformation.

TRANSCRIPT

0:00:02.5 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with Bill Bellows, who has spent 30 years helping people apply Dr. Deming's ideas, to become aware of how their thinking is holding them back from their biggest opportunities. The topic for today, which we call Episode 18, is, Wouldn't It Be Nice? Bill take it away.

0:00:28.9 Bill Bellows: Wouldn't it be nice if [chuckle] we were older and we wouldn't have to wait so long? Okay. So Episode 18, greetings, Andrew. So as I mentioned in the past, I like to go back and listen to the past previous podcasts and as well as hear from people and their feedback on them. And I have a few points of clarity on the last one, and then we'll get into today's feature. So the last one which we refer to as Diffusion From a Point Source. And I talked about being in a bathtub, you start off at room temperature water and, or you fill the bath and you went and got distracted and came back, and now it's not warm enough, so you crank up, let's add some more water, and you feel that heat coming towards you from the... And then the diffusion equation is about how that, all the water ends up about the same temperature, and then you turn off the water and you drop back to room temperature.

0:01:41.1 BB: But another aspect of the point source that I wanted to clarify is, is if you have in the bathtub some, a source of energy, a heat source, which is not, you know, is different than the source of the water coming out of the faucet. But imagine you've got a little generator in there pumping out heat, then the bathtub, depending on the temperature of that, the amount of energy being released, then the bathtub is going to get warmer, warmer and warmer and warmer and warmer and warmer, and what keeps it going back to room temperature is how much energy is coming out of that. And that's what I was referring to as what it takes to maintain a transformation either individually within an organization, is something which continues to churn. Else you end up by the world we're in, you're watching the news, you're hearing about some accident and people are looking for the singular source, or they're looking at two points in a row, a downturn or upturn and looking at two data points to draw a conclusion. So there's all these everyday reminders of how, of the prevailing system of management at work in terms of how people are treated, how we manage systems. And our challenge is, how do you fight that?

0:03:14.7 BB: And so even within your organization, if you're trying to get people excited by Deming's works, what you have to appreciate is when they go home, the rest of their lives, they're being immersed in a culture of blame of individuals, not the system, and that's part of what we have to deal with. So I just want to mention that what I meant by that source term is, what does it take individually that we can do within our organizations to try to keep things going and not get sucked back down, knowing you've got all this normality around us that we're trying to move beyond. So the next thing I want to talk about is transformation. [chuckle] And then as that leads into, Wouldn't It Be Nice. And I was looking at The New Economics, my Kindle version, and found out that there were 73 references to transform in The New Economics, 73. And the first one is in the forward written by our good friend Kevin Cahill, and in there Kevin references, this is in the 3rd edition of The New Economics, which is the white cover if you have it in print. And it came out 2018. In there, Kevin references Out of the Crisis. And Kevin says, "The aim of the book," again, Out of the Crisis, "was clearly stated in the preface."

0:04:48.1 BB: This from Dr. Deming now, "The aim of this book is transformation of the style of American management, transformation of American style of management is not a job of reconstruction nor is it revision, it requires a whole new structure from foundation upward. The aim of this book is to supply the direction." Okay? Now back to Kevin, then Kevin says, "Out of the Crisis supplies direction for any and all types of organizations, while many people focused on its application in manufacturing, it was a call to action for every organization from education, to healthcare, to non-profits and startups of all sizes." Okay. So now we get to the preface for The New Economics. And so this is from Dr. Deming, what I just shared with you is Kevin quoting his grandfather. So now going back to 1993, the 1st edition, Dr. Deming said, "The route to transformation is what I call Profound Knowledge. The System of Profound Knowledge is composed of four parts all related to each other, appreciation for system, knowledge about variation, theory of knowledge, psychology. The aim of this book is to start the reader on the road to knowledge and to create a yearning for more knowledge." He adds to that,

0:06:07.3 BB: "What we need is cooperation and transformation... " there’s that transformation word again. "To a new style of management, the route to transformation is what I call Profound Knowledge. The System of Profound Knowledge is composed of four parts all related to each other." And I'll just pause here and I, just thinking of a friend a couple years ago is inviting me to go to his company and do an in-house program. And he wanted to know how I would start the program, would I open up with the System of Profound Knowledge? I said, "No." I said I would build up to that, and he says, "Well, why not just start with it?" I said, "Because it's a solution to a problem you don't know you have." I said, "I would rather first give a sense of the nature..." now, and he said, "Well, how are we going to start?" And I said, "I'm going to start with the Trip Report, having people compare the ME versus the WE or the All Straw versus the Last Straw. And then use Profound Knowledge as a means by which to understand how you go from one to the other." I said, "But without that understanding of the problem we face... " again, it's an elegant... [chuckle] Every time, the System of Profound Knowledge is an elegant solution to a problem you don't know you have. So I look at it as, let's first create a sense of the problem/opportunity. Okay.

0:07:38.0 BB: So we're going to come back to transformation, but now I want to go back to the title, Wouldn't It Be Nice. And what I'll do is, when this is posted on the institute webpage, I'll put a link to an article I wrote in September, 2015 for the Lean Management Journal, entitled, Wouldn't It be nice. And that article includes in the opening, it says, "My appreciation of Brian Wilson on the Beach Boys has grown significantly in the past month," okay, and this was written in 2015, "after viewing the Brian Wilson Biopic “Love and Mercy," which for you, Andrew, and everyone listening, it's a fascinating, fascinating film. And it got me turned on to Brian Wilson and all these things about the Beach Boys I really underestimated. All right, so then I wrote, "Through this blast from my past, I was reminded of another Beach Boys classic, Wouldn't It Be Nice. And the yearning "wouldn't it be nice if we were older then we wouldn't have to wait so long." And then I closed the opening with, "And reflecting on this adolescent wishfulness, I propose a wishfulness that organizations, public and private and even governments, improve their understanding of variation in how it impacts the systems they design, they produce and they operate."

0:09:00.7 BB: And so when I was going back and looking at that, 'cause I was thinking about transformation in this article, and I thought the transformation I talked about last time was the transformation... We talked about the transformation going from an observer, me as a professor used a student, I'm an observer of your learning versus a participant, and that's just a systems perspective. What Dr. Deming is talking about is not just how we look at systems, but the transformation involves how we look at variation. Do we move past two data points and look at variation in the context of common causes and special causes? A transformation of how we engage people, do we engage them with carrots and sticks? Do we understand when we blame them as the willing workers, what that creates in our organizations? And then the last element of Profound Knowledge, theory of knowledge. How do we know that what we know is so? And so I was just looking back at that article, and the article was written about, what if we had a better understanding of variation as one element of a transformation? And what I wanted to highlight today is talk more about transformation, but also look at transformation from not just one aspect of the System of Profound Knowledge, all of them.

0:10:32.2 BB: And it may well be, we're going to need another episode to go through this. But the next topic I want to do as we go down this path. Some time ago somebody made reference to a hologram, and I have seen holographic pictures, and so I went back and I was trying to think, why did that strike me? What about this hologram got my attention? And I started to remind myself of it. And Kevin and I were in Idaho a few months ago meeting with an audience. And I was again reminded by this hologram thing, because people were saying, "How come people in operations are so antiquated?" And I said, "Well, it's not just operations, it's more than that." So first, holograms, so what is a hologram? So I found a dictionary definition. "It's a three-dimensional image produced by a pattern of interference produced by a split coherent beam of radiation, such as a laser." That's for the physicists in the room.

0:11:38.5 AS: I'm not sure if that helped me but...

0:11:40.6 BB: [laughter] But I also found on a website, the Institute for the Advancement of Service, and the website is, www.showanotherway.org. And there I found something I think it's a little bit easier to digest. And the text says, if you turn a photograph over and you see a blank white surface," so far so good. "A photograph shows the image only on the front, thus only from one side, a hologram is a three-dimensional image created by interacting light sources, it shows the same image from all angles regardless of how it's being viewed. When a hologram is divided into pieces, the text says, each part still contains the entire image within it, although each new image is from a slightly different perspective." And then, again, from this website, and this leads us into the transformation piece, is "how does a concept of a hologram apply to organizational structures?" And I thought, "Okay. Now we're getting some place." "Because when people come together, share a vision for an organization, each person has his or her own unique perspective of the whole." I said, "Okay." "Each shares responsibility for the whole, not just his or her piece, but the component pieces aren't identical, each represents the whole picture from a different point of view.”

0:13:08.0 BB: “When we add up the pieces, the image of the whole does not change fundamentally, but rather the image becomes more intense. When more people share the common vision, the vision may not change fundamentally, but it becomes more alive, more real in a sense of the mental reality that people can truly imagine achieving." And to me, what I say is, the role of the ME/WE Trip Report is in part to create a common mental model, a common 3D view of an organization. But depending on who you're talking with in an organization, they see only one aspect of it, they see what it means in finance, they see what it means in HR, they see what it means in, from engineering. And the beauty of, what I have found is, is when you look at organizations from Dr. Deming's perspective, we're able to appreciate that these views are different, but it is the same thing we're looking at. So the next thing I want to get into of the work we're doing at Rocketdyne, working harder in a ME organization at a non-Deming company, working harder is the mantra, working smarter, as you and I have talked about, is what does that mean? Think about things from a Deming perspective. What does that mean? So what you get is a lot of working harder. And in which case, you have KPIs and we're working harder to achieve these KPIs.

0:14:46.9 BB: Well, I was very fortunate, Rocketdyne in the mid '90s, the Air Force came up with a brand new program for a next generation rocket with a set of KPIs that a few of us believed were impossible. Now what's the relevance of that? As long as, my theory is, as long as a non-Deming organization can achieve the KPI in how it currently operates, then just get out of the way. And they will work harder, a lot of brute force will be done to meet those KPIs. And Dr. Deming would remind us, anyone can accomplish anything if they don't count the cost. So, I mean, it will destroy people's lives and marriages and all that, but as long as those KPIs are met, just get out of the way. Well, what I loved about the Air Force requirement, was I was convinced that it couldn't be met. And part of the challenge was to convince executives at Rocketdyne that we can't get there from here. And that then, what I thought was, "This is our moment." We, so again, if you're in an organization and everything can be done, how the organization currently operates, then I say try to find something that can't be done with the current system. It can't be done in the schedule, it can't be done at the cost, but if it can be done by the current system, then that's not your opening. But for us, it was the opening. So the Air Force in the mid '90s had a couple billion dollars to develop a next generation series of rockets.

0:16:30.7 BB: And so we're, nowadays we think of SpaceX launching rockets. Well, this is the mid '90s, which is 20 years or so before SpaceX. And so the requirement was, that everything in the entire rocket, everything in the entire rocket, that's a lot of parts including the engine. Everything had to meet requirements, everything had to be a White Bead, no Red Beads. In the past, if there were Red Beads, which the Air Force accepted, and we know you get Red Beads, we know how you get Red Beads. And if they have Red Beads, then you would get paid to repair them, extra. And a friend of mine who was the brainchild of the effort within the Air Force to eliminate the purchase of Red Beads, he said, "The entire rocket will not have Red Beads." And when I heard of that I thought, "ME organizations don't know how to do that." They just, all they know how to do is create Red Beads. And the strategy we had already developed was, if we look at the variation in the White Beads, as you and I have talked about, then that's a great means to prevent White Beads, Red Beads in the first place, let alone improve integration. So we started getting senior management on board with things we have done to explain to them, here's a strategy, as we heard this flow down from the Air Force.

0:18:04.6 BB: Well, the existing system, how bad it was, was... And I learned this from the brain, this Lieutenant Colonel in the Air Force who pushed this incredible KPI, which was, everything must meet requirements. And it translated to something called "No Material Review Board, where a material review board in the industry, in the aerospace industry, is a situation where you've got a Red Bead that may be a very expensive Red Bead that the contractor wants to sell the Air Force, but it doesn't meet requirements. And then the contractor gets together with the Air Force and they schmooze over it, and what Lieutenant Colonel Ciscel explained is, you've got the contractor that really wants to sell that, even though something is not quite right. And what makes it work for the Air Force is when the contractor says, "Well, the bad thing about not using this is, it's going to take a couple of months to have a new one." And that time delay starts to bug the Air Force. Next thing you know that white, that Red Bead starts to look pretty good. But worse than that, what Dave explained is, he said, it's like going to the car dealership and finding that beautiful car you want. Then I, the sales person, tell you, "Andrew, okay, we're going to have it for you tomorrow, all ready to go."

0:19:36.0 BB: And then you come back the next day and I say... And you say, "Well, where's my new car?" And I say, "Well, Andrew, I told you we were going to wash it and wax it. Yeah, well, when we put it through the car wash we scratched it." And you're like, "You scratched it." And I say, "Well, yeah but we buffed out that and we're only going to charge you a little bit more for that. We're going to charge you for this and this and this." And they said, "That's what the Air Force does." And so what he was pushing for in the mid '90s was to get rid of all of that inspired by, you're ready Andrew? Inspired by his undergraduate education that the Air Force paid for when he was an officer, and he learned about Dr. Deming's work on control charts. And so when I heard that I thought, "We've got a requirement that can't be met." This is the, this is our means, our opening for initiating a transformation. 'Cause working harder, convincing the executives was, we can't get there from here. But boy, if you can get there from here, get out of the way. So now I'm going to go back to chapter two of The New Economics. Dr. Deming says, "Somehow the theory for transformation that's been mostly applied in the shop floor, everyone knows about statistical control of quality, this is important, but the shop floor is only a small part of the total. Anyone could be a 100% successful."

0:20:54.1 BB: Well, what I want to share there in terms of the situation we were dealing with in the mid '90s, if we started to talk to the executives about statistical control of quality, control charts, common causes and special causes. Well, as soon as we started to talk about the process being "in control," to the majority of our executives that translated to "everything met requirements." And so our starting point was just for that, just what does "in control" mean? And it was just so amazing how that got translated to meets requirements. And we're like, "No, no, no. We need to have the process in control, understand common cause variation and control charts and, let alone being on target." But that was our starting point, was just trying to get these ideas across on the shop floor. And chapter three... I've got a couple of things from each chapter, at least from some of the opening chapters. We'll cover the rest later. Dr. Deming says in chapter three, "We saw in the last chapter that we are living under the tyranny of the revealing style of management. Most people imagine that this style has always existed, it is a fixture. Actually, it is a modern invention, a trap that has led us into decline. Transformation is required. Education and government, along with industry, are also in need of transformation. The System of Profound Knowledge to be introduced in the next chapter is a theory for transformation."

0:22:25.5 BB: And this is what we're trying to do with this NO MRB initiative, we are just trying to get executives to realize that if we keep doing what we're doing, we're not going to be able to achieve this goal. What I'll also say is, there was such a commercial demand for space at that time, that the Air Force didn't have to pay for the entire program. So they came in with a couple billion dollars. They asked the contractors to bring their money with the idea that these rockets would be used, like Elon Musk is using, for launching all these commercial satellites. So the Air Force excitement was, we can lay out these requirements of no Red Beads, but the reason we're going to make it work is, there's such a commercial demand for a military product. And so Dave referred to this, his push for everything must meet requirements. He called it a $2 billion ambush. And I said, "What do you mean by that?" He said, "I knew they couldn't achieve what we wanted without a transformation. And I knew they wouldn't... We knew they wanted the money. But we knew they couldn't do it without a transformation." And I was like, "Oh, that's ingenious. That is just ingenious." And he so loved what we were doing at Rocketdyne, when he retired from the Air Force, as the program was transitioning from one phase to another, he retired and came to work at Rocketdyne. And he became a huge asset for our efforts to initiate a transformation.

0:24:06.1 BB: Then Dr. Deming says, "The transformation affects family life. Parents who will not rank their children nor show special favors or rewards. Would parents wish for one child to be a loser? Would his brothers and sisters be happy to have a loser in the family? Transform the family will be a living demonstration of cooperation in the form of mutual support, love and respect." At home, Andrew, at home. All right, "The prevailing style of management must undergo a transformation, the system cannot understand itself. The transformation requires an outside view." This is chapter four. And then "The aim of this chapter is to provide a lens, an outside view, a lens that I call a System of Profound Knowledge." Well, here I want to get into the hologram. And this, so I was... Kevin and I were at a Idaho Manufacturing Alliance conference right after Thanksgiving. And we had a session with some people. And in one group I was working with, they said, "Why is that engineering just doesn't get it? It always seems to be engineering. It's always engineering." And I said, "No." I said, "Each part of the organization has their own... " And I tried to explain to them, they each fall into a different trap, but the traps are very similar.

0:25:27.6 BB: I said, "So engineering sets the requirements on each part, they create the silos. Manufacturing then runs off with those instructions and produces the parts as if they're separate, quality then inspects them, finance adds up the savings, adds up the cost." And I don't know to what degree we've discussed this yet, but addition is the belief, adding up the savings comes from a belief that these elements are separate, that if we save $10 here, save $10 here and $10 there, then as an organization we save $30. No, the savings only happen... You only get a $30 savings if those activities don't interfere with one another. So I explained to them, finance has issues. And then HR, they're the ones behind performance appraisals. And that's where this hologram thing came to mind, is that each of them might think, as they get exposed to Deming's work, that we got this figured out. But it's all of them required to tie together to transform the organization. And then more from chapter 4, the transformation. "The first step is transformation of the individual. Transformation is discontinuous. It comes from understanding of the System of Profound Knowledge. The individual transformed will perceive new meaning to his life, through numerous interactions between people. Once the individual understands the System of Profound Knowledge, he'll apply its principles in every kind of relationship." There's Siri.

[chuckle]

0:27:13.6 BB: "Once the individual understands the System of Profound Knowledge, he'll apply its principles in every kind of relationship with others. He'll have a basis for judging his own decisions and transformation of the organizations that he belongs to. The individual, once transformed," this is what we talked about last time. I said, "No. The individual, once the transformation begins...will set an example, be a good listener, but not compromise. Continually teach others, help people pull away from their current practice and beliefs and move into the new philosophy without guilt about the past." And here I just want to add. A person I was mentoring three or four years ago, and she went through a one-day program I was leading, and I then started to mentor her on a regular basis. And one of the first calls we had, she was distraught over looking at herself as being incredibly selfish. She said, "The way I treated my siblings, the way I treated my classmates when I was in college." she said, "It was all about me." And I said, so I showed her this, I said, "You have to move into the new philosophy without guilt about the past." I said, "I used to think I caused the grades all by myself," I said, "We each go through this transformation differently with this bit of... " I mean 'cause we're brought up in a world thinking that we caused the grades and all these other things, and I said, "You got to move past that." And I'm not saying it's easy.

0:28:41.5 AS: Well, we did the best we could with what we had at the time, I always like to remind myself...

0:28:45.1 BB: That's right.

0:28:45.4 AS: Myself that.

0:28:48.2 BB: So a couple of other things, then I'm going to... Then I'll just pause, we can close. But what I would tell the executives early, early on, we had from the Air Force this major program, a whole lot of money at Rocketdyne, we were developing the engines. McDonnell Douglas was acquired by Boeing. They got the contract for the vehicle. So eventually we were all under Boeing, and it was really, really cool to be able to get the engine people smart about all the things we're talking about in these calls, and then the vehicle people excited. And then there was a production schedule. We're going to ship the first vehicle X years out, and then it's going to go from a couple a month to a lot a month on and on. And one of the things I would tell the executives, if you want to know every day, how are we doing every day. So you want to know if we're making progress as an organization. So I just gave them a couple of visuals. And I said, "One thing you get... " 'Cause there's one thing, "Well, how are we doing, how are we doing?" I said, "Well, let me tell you what you can measure." I said, "Every time you walk into the restroom, count how many paper towels are on the floor next to the trash can, that can't quite get into the trash can, and let that be a measure of how we're doing on the shop floor in our ability to not deliver Red Beads."

0:30:15.7 BB: And that then becomes an everyday reminder within our respective organizations is, we can't get the trash into the trash can, we can't leave the conference room as we found it, we can't get rid of the science experiments in the refrigerators. And I don't know if I mentioned it to you, but one experiment I would have people do when they would come to class at Rocketdyne, visitors and whatnot. During a break, they need an escort to walk to the restroom a few minutes away, and I'd say to them, "Here, run an experiment to how we're doing as an organization." I said, "Take your empty cup of coffee and put it on top of a file cabinet somewhere between here and the restroom, and then see if it's still there during the next break. Or crumble a piece of paper, put it on the floor, and see how many people walk past that." And I just throw that out as everyday things people can do to get kind of a finger of the pulse. As you're trying to transform your organization one person at a time, what are the things you can look for in the organization, long before we're focusing on common causes versus special causes. What are we doing with performance appraisals? Are we looking at things in the system? There's a bunch of everyday indicators you could start to look at with a sense of, this is a hologram.

0:31:51.8 AS: So we started this off with wouldn't it be nice? And we've been through a lot of different topics in relation to that, how would you summarize the key takeaway that someone can now bring to their business or their life in relation to this topic?

0:32:08.4 BB: Well, let me, and I got some bullet points on the holograms and then the close from the article that I wrote for the Lean Management Journal. And from the hologram, holographic model from the showanotherway.org website, it says, "What do we need to be mindful of when working with this holographic model?" It said "in this model, we need to be aware of the whole, with the parts, their relationships, and the context." Okay? So that's, part of this transformation is keep looking at things and try to imagine what's the greater context for these decisions. That one part of the organization reflects the philosophy of the whole organization. So the idea that, stop thinking that it's just those people in operations that don't get it. Each part of the organization has taken the prevailing system of management and put it into their DNA. So it's everywhere, that members of the organization reflect the whole of the organization and their behaviors. And the idea is, how do we get them to think about the whole? And I think a lot of progress can be made just by sharing with people a common... Having them reveal their appreciation of the contrast between ME and WE organizations, and they'll be pretty obvious where they'd rather work.

0:33:41.3 BB: And then the, what I closed the Brian Wilson article for the Lean Management Journal with is, "wouldn't it be nice if we manage the variation in the parts as being the parts of a system. In the spirit of Brian Wilson's adolescent wishfulness, wouldn't it be nice if the great illusion of independent parts and components modules was replaced by the realism of unity and interconnectedness in amazing prospects for teamwork within any organization." And I think that's a nice way of talking about transformation, not just looking at systems, but understanding people, psychology, and the theory of knowledge.

0:34:25.1 AS: Well, that's a great place to wrap. Bill on behalf of everyone at the Deming Institute, I want to thank you again for this discussion. And for listeners, remember to go to deming.org to continue your journey. And if you want to keep in touch with Bill, just find him on LinkedIn. This is your host, Andrew Stotz, and I'll leave you with one of my favorite quotes from Dr. Deming. And people wonder, why do I repeat the same quote over and over again. Try to get it through our thick heads that people are entitled to joy in work.

If something is "good" is that good enough? Who decides? In this episode, Bill and Andrew discuss how people define "good," what interchangeability has to do with morale, and the problem with a "merit-based" culture. Bonus: Learn how Americans became the first to use the French idea of interchangeable parts in manufacturing.

Note: this episode was previously published as Part 5 in the Awaken Your Inner Deming series. 

TRANSCRIPT

0:00:02.3 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with Bill Bellows, who has spent 30 years helping people apply Dr. Deming's ideas to become aware of how their thinking is holding them back from their biggest opportunities. The topic for today is, Deming Distinctions: Beyond Looking Good. Bill, take it away.

0:00:30.4 Bill Bellows: Funny you mentioned that. You remind me that I've been at this for over 30 years, and coming up in July, I'll be celebrating 40 years of marriage. Like 30 years, 40, where do these numbers come from?

0:00:44.5 AS: Okay. Yeah. Who defines quality in a marriage, Bill?

0:00:47.0 BB: Alright.

0:00:50.8 AS: Okay, we won't go there. Take us, take it away.

0:00:52.2 BB: We won't go there. So we are gonna talk about who defines quality, and to get into "beyond looking good." As I shared with you, I've listened to each of the podcasts a few times. And before we get into who defines quality, I just wanna provide clarification on some of the things that came up in the first five episodes. And so, one, and I think these are kind of in order, but if they're not in order, okay, well, I made reference to black-and-white thinking versus shades-of-gray thinking. And I called black-and-white thinking - black and white data - category data, and the word I was searching for that just wasn't coming out was attribute data. So for those who are keeping score, attribute data is probably the most relevant statistician term in that regard.

0:01:44.9 BB: Attribute data versus variable data. And what I've made reference to, and we'll talk more in a future session, is looking at things in terms of categories. And categories are black and white, or it could be red, yellow, green, that's three categories, or looking at things on a continuum. So I'm still excited by the difference that comes about by understanding when we're in the black-and-white mode or the category mode or the attribute data mode versus the variable mode, and still have a belief that we can't have continuous improvement or continual improvement if we're stuck in an attribute mode.

0:02:22.9 BB: And more on that later, that's one. I talked about Thomas Jefferson meeting Honoré Blanc and getting excited about the concept of interchangeable parts. And I had the date wrong, that was 1785, if anyone's keeping score there. He was ambassador to France from 1785 to 1789, but it was in 1792 that he wrote a letter to John Jay, who was a...I think he was a Commerce Secretary. Anyway, he was in the administration of Washington and shared the idea. I was doing some research earlier and found out that even with the headstart that Blanc had in France, 'cause back in 1785, Jefferson was invited to this pretty high level meeting in Paris where Blanc took a, I guess, like the trigger mechanism of 50 different rifles. Not the entire rifle, but just the...let's just call it the trigger mechanism with springs and whatnot. And he took the 50 apart and he put all the springs in one box, all the other pieces in their respective boxes and then shook the boxes up and showed that he could just randomly pull a given spring, a given part, and put 'em all together. And that got Jefferson excited. And the...what it meant for Jefferson and the French was not just that you can repair rifles in the battlefield quickly.

0:03:56.9 BB: Now, what it meant for jobs in France was a really big deal, because what the French were liking was all the time it took to repair those guns with craftsmanship, and Blanc alienated a whole bunch of gunsmiths as a result of that. And it turns out, Blanc's effort didn't really go anywhere because there was such a pushback from the gunsmiths, the practicing craftsmanship that jobs would be taken away. But it did come to the States. And then in the early 1800s, it became known as the American System of Production. But credit goes back to Blanc. I also made reference to absolute versus relative interchangeability. And I wanna provide a little bit more clarification there, and I just wanna throw out three numbers, and ideally people can write the numbers down, I'll repeat 'em a few times. The first number is 5.001, second number is 5.999, and the third number is 6.001. So it's 5.001, 5.999, 6.001. And some of what I'm gonna explain will come up again later, but...so this will tie in pretty well. So, what I've been doing is I'll write those three words on the whiteboard or throw them on a screen, and I'll call...

0:05:28.9 AS: Those three numbers.

0:05:31.4 BB: A, B, and C. And I'll say, which two of the three are closest to being the same? And sure enough people will say the 5.999 and the 6.001, which is like B and C. And I say that's the most popular answer, but it's not the only answer. People are like, "well, what other answer are there?" Well, it could be A and C, 5.001 and 6.001, both end in 001. Or it could be the first two, A and B, 5.001 and 5.999. So what I like to point out is, if somebody answers 5.999 and 6.001, then when I say to them, "what is your definition of same?"

0:06:14.9 BB: 'Cause the question is, which two of the three are close to being the same? And it turns out there's three explanations of "same." There's same: they begin with five, there's same: they end in 001. And there's same in terms of proximity to each other. So I just wanna throw that out. Well, then a very common definition of "quality" is to say, does something meet requirements? And that's the black-and-white thinking. I've also explained in the past that requirements are not set in absolute terms. The meeting must start at exactly 1:00, or the thickness must be exactly one inch. What I've explained is that the one inch will have a plus or minus on it. And so let's say the plus and minus gives us two requirements, a minimum of five and a maximum of six. Well, then that means the 5.001 meets requirements and the 5.999 meets requirements.

0:07:15.4 BB: And so in terms of defining quality, in terms of meeting requirements, A and B are both good. And then what about the 5.999 and the 6.001? Well, those numbers are on opposite sides of the upper requirement of six. One's just a little bit to the left and one's a little bit to the right. Then I would ask people, and for some of you, this'll ring - I think you'll be smiling - and I would say to people, "what happens in manufacturing if, Andrew, if I come up with a measurement and it's 6.001?" Okay, relative to defining quality as "meeting requirements," 6.001 does not meet requirements. So what I'll ask people is, "what would a non-Deming company do with a 6.001?" And people will say, "we're gonna take a file out, we're gonna work on it, we're gonna hit it with a hammer." And I say, "no, too much work." And they say, "well, what's the answer?" "We're gonna measure it again."

0:08:25.7 AS: Until we get it right.

0:08:27.7 BB: We will measure it until we get it right. We will change the room temperature. We will take the easiest path. So then I said, get people to realize, they're like, yeah, that's what we do. We measure the 6.001 again. Well, then I say, "well Andrew, why don't we measure the 5.001 again?" And what's the answer to that, Andrew? [laughter]

0:08:51.5 AS: 4.999. [laughter]

0:08:54.7 BB: But what's interesting is, we'll measure the 6.001 again. But we won't measure the 5.001 again. We won't measure the 5.999 again. And so to me, this reinforces that when we define quality as "meeting requirements," that what we're essentially saying in terms of absolute interchangeability, what we're pretending is that there's no difference between the 5.001 and the 5.999. At opposite ends, we're saying that Blanc would find them to be interchangeable, and putting all the things together. I don't think so.

0:09:36.7 BB: I think there's a greater chance that he'd find negligible difference between the 5.999 and the 6.001. And that's what I mean by relative interchangeability, that the difference between B and C is nothing, that's relative interchangeability. The closer they are together, the more alike they are in terms of how they're integrated into the gun, into the rifle, into the downstream product. And I just throw out that what defining quality as "requirements" is saying is that the first two are...the person downstream can't tell the difference. Then I challenge, I think there's...in terms of not telling the difference, I think between 5.999 and 6.001, that difference is minuscule cause they are relatively interchangeable. The other two are implied to be absolutely interchangeable. And that I challenge, that's why I just want to throw that out. All right, another thing I want...go ahead, Andrew.

0:10:38.3 AS: One of the things I just highlight is, I remember from my political science classes at Long Beach State where I studied was The Communist Manifesto came out in 1848. And Karl Marx and Friedrich Engels were talking about the alienation of the worker. And what you're talking about is the kind of, the crushing of the craftsmen through interchangeable parts that was a lot like AI coming along and destroying something. And after 50 or 60 or 70 years of interchangeable parts, along comes The Communist Manifesto with the idea that when a person is just dealing with interchangeable parts, basically they're just a cog in the wheel and they have no connection to the aim of what's going on. They don't have any connection, and all of a sudden you lose the craftsmanship or the care for work. And I think that the reason why this is interesting is because that's, I think, a huge part of what Dr. Deming was trying to bring was bring back...it may not be craftsmanship for creating a shoe if you were a shoemaker, but it would be craftsmanship for producing the best you could for the part that you're playing in an ultimate aim of the system.

0:12:02.6 BB: Yes. And yes, and we'll talk more about that. That's brilliant. What you said also reminds me, and I don't think you and I spoke about it, you'll remind me. But have I shared with you the work of a Harvard philosopher by the name of Michael Sandel?

0:12:24.3 AS: I don't recall.

0:12:27.0 BB: He may be, yeah, from a distance, one of the most famous Harvard professors alive today. He's got a course on justice, which is I think 15 two- or three-hour lectures, which were recorded by public television in Boston. Anyway, he wrote a book at the beginning of the pandemic. It came out, it's called The Tyranny of Merit.

0:12:54.0 BB: And "merit" is this belief that "I did it all by myself." That "I deserve what I have because I made it happen. I had no help from you, Andrew. I had no help from the government. I didn't need the education system, the transportation system. I didn't need NASA research. I made it happen all by myself." And he said, what that belief does is it allows those who are successful to claim that they did it by themselves. It allows them to say those who didn't have only themselves to blame. And he sees that as a major destructive force in society, that belief. And I see it tied very well to Deming. Let me give you one anecdote. Dr. Deming was interviewed by Priscilla Petty for The Deming of America documentary, which was absolutely brilliant.

0:13:49.8 BB: And she's at his home, and he's sharing with her the medal he got from the Emperor of Japan, and he's holding it carefully, and I think he gives it to her, and she's looking at it, and she says to him something like, so what did it mean to you to receive that? And he said, "I was lucky. I made a contribution." He didn't say I did it all by myself. He was acknowledging that he was in the right place at the right time to make a contribution. And that's where Sandel is also heavily on, is don't deny the role of being born at the right time in the right situation, which is a greater system in which we are. Well, for one of the college courses, I was watching an interview between Sandel and one of his former students.

0:14:48.1 BB: And the point Sandel made that I wanted to bring up based on what you just said, he says, "what we really need to do is get people dignity in work." And that's what you're talking about, is allowing them to have pride in work, dignity in work instead of as they're making interchangeable parts, having them feel like an interchangeable part. And I'm really glad you brought that up because when we talk later about letter grades, I would bring back one of the reasons I find Deming's work astounding, is that he takes into account psychology in a way that I hope our listeners will really take heart to in a deeper way.

0:15:30.2 AS: And so for the listeners out there, just to reinforce, the book is called The Tyranny of Merit: What's Become of the Common Good. Published in 2020 by Michael Sandel. And the ratings on Amazon is 4.5 out of five with about 2,446 ratings. So it's a pretty well-rated book I'd say. And looks interesting. Now you got me wanting to read that one.

0:15:57.0 BB: Oh what I'll do is I'll send you a... Well, what I encourage our listeners to do is find the interview... Harvard Bookstore did an interview in 2020, 2021, with Michael Sandel being interviewed by his former student by the name of Preet Bharara. [laughter] Who used to be the...

0:16:24.3 AS: SEC...

0:16:24.4 BB: Head of these...no, well, he prosecuted a number of people for SEC crimes, but he headed the Justice Department's long oldest district, which is known as SDNY or the Southern District of New York. And so he was a...in one of the first classes his freshman year at Harvard, Preet Bharara's freshman year at Havard was one of Sandel's first years. And so they had an incredible conversation. So I would encourage the listeners to...

0:16:51.8 AS: Yeah, it's titled: Michael J Sandel with Preet Bharara at Harvard. And the channel is called Harvard Bookstore.

0:16:58.6 BB: Yes, absolutely. All right. So another topic I want to get to in terms of clarification and key points, last time we talked about tools and techniques and what I'm not sure I made much about.... First of all, I just wanna really reinforce that tools and techniques are not concepts and strategies. Tools are like a garden tool I use to dig a hole. Technique is how I go about using it, cleaning it, and whatnot. Not to be confused from a concept...and what is concept? We talked about last time is a concept is an abstract idea and a strategy is how do we apply it? So tools and techniques within Six Sigma quality could be control charts, could be design of experiments. And all, by the way, you're gonna find those tools and techniques within the Deming community. So it's not to say the tools and techniques are the differentiator.

0:17:50.8 BB: I think the concepts and strategies are the differentiators, but I don't wanna downplay tools. Lean has tools in terms of value streams, and you won't find value streams per se in Dr. Deming's work. Dr. Deming looks in terms of production viewed as a system. In a later session, I want to talk about value streams versus Deming's work. But I just wanna point out that I find it...it's easy to get lost in the weeds with all we find within Lean, Six Sigma, Deming and whatnot. And this is why last time I wanted to focus on tools and techniques as separate from concepts and strategies. And what I think we did speak about last time, again, for just as a reminder, is what's unique that we both enjoy with Dr. Deming's work is that KPIs are not caused by individual departments, assigned to individual departments.

0:18:46.0 BB: KPIs are viewed as measures of the overall system. And if you assign the KPIs across the organization and give every different function their own KPI, what you're likely to find - not likely - what you WILL find is that those assigned KPIs are interfering with others' abilities to get their KPIs met. And in the Deming philosophy, you don't have that problem because you understand that things are interdependent, not independent. And so I just wanna close by saying what I find in Deming's work to be most enlightening is this sense of "what does it mean to look at something as a system?" And it means everything is connected to everything else. When you define quality in terms of saying "this is good because it meets requirements," what you've just said is, "this is good in isolation." Whether it's the pass from the quarterback to the wide receiver, saying the pass met requirements.

0:19:52.0 BB: What I think Dr. Deming would ask is, "is the ball catchable?" [laughter] And yet, what I've seen in my aerospace experience is parts being measured for airplanes in Australia that they meet requirements because the measurements are taken early in the morning before the sun has had a chance to heat the part up. And we get the 6.001 is now 5.999. You know what that means, Andrew? It's - we can now ship it.

[laughter]

0:20:23.9 BB: And send it off to America for some airplane factory.

0:20:26.2 AS: When we shipped it, that's what it was.

0:20:28.9 BB: Exactly. And so, again, interdependence is everything. Go ahead, Andrew.

0:20:34.6 AS: I wanted to point on, there's a company in Thailand that really has gotten on the KPI bandwagon, and I was talking with some people that work there, and they were just talking about how they've been rolling out the KPIs for the last couple of years and down to the number of seconds that you're on the phone and everything that you do is tracked now. And then I just witnessed that company basically use that KPI as a way to basically knock out a whole group of people that they were trying to get rid of by coming in with tight KPIs and then saying, "you're not keeping up with 'em and therefore you're out." And I just thought...and the manager that was involved I was talking to, you could just see, he saw how KPI can just be weaponized for the purposes of the senior management when you're doing KPIs of individuals. And the thing that I was thinking about is, imagine the CEO of that company in a couple of years, in a couple of months, they happen to listen to this podcast, or they pick up a book of Dr. Deming and they think, "Oh my God, what did I just do over the last five years implementing KPIs down to the individual level?" [laughter]

0:21:48.5 BB: Oh, yeah. And that's what we talked about last time is...as I told you, I had a friend of a friend who's worked for Xerox, and he said there wasn't a KPI that was flowed down that they couldn't find a way to beat. And that's what happens, and you end up getting things done, but what's missing is: at whose expense? All right. So we talked about...now, let's get into beyond looking good, Deming distinctions. Who defines quality? Well, from Philip Crosby's perspective, quality's defined by the...it could be the designer. The designer puts a set of requirements on the component, whatever it is. The unit, the requirements have latitude we talked about. They're not exact. There's a minimum of six, a maximum of...or a minimum of five, maximum of six.

0:22:48.8 BB: There's a range you have to meet, is the traditional view of quality. And in my 30 years of experience, I've not seen quality defined any other way than that. It has to be in between these two values. Sometimes it has to be five or below or six or above, but there's a range. But also what we talked about last time is Dr. Deming said "a product or service possesses quality if it helps someone and enjoys a sustainable market." But what I found profound about that definition, it is not me defining quality and saying, "Andrew, the parts met requirements when I threw it. Now, it's your job to catch it." It's me saying, "I've thrown the ball and you tell me, how did I do? You tell me how did I do?" And if you said, "Bill, if you throw it just a little bit higher, a little bit further out, a little bit faster," that's about synchronicity. Now, I'm realizing that my ability to throw the ball doesn't really matter if you can't catch it. So if I practice in the off season, throwing it faster and faster, but don't clue you in, until the first game, how's that helping? So I've got a KPI to throw it really, really hard. And you're thinking, "how's that helping?" So that's...

0:24:19.9 AS: And can you just go back to that for a second? Quality is on a product or service, you were saying that how Dr. Deming defined that, it helps someone...

0:24:26.7 BB: Yeah. Dr. Deming said "a product or service possesses quality if it helps someone and enjoys a sustainable market." And so my interpretation of that is two things. One is, it's not me delivering a report and saying the report met requirements. It's saying, "I get the report to you, and I ask Andrew, how did I do?" And then you say to me, "I had some problem with this section, I had some problem...." But the important thing is that you become the judge of the quality of the report, not me. And it could be information I provide you with in a lecture. It's you letting me know as a student that you had a hard time with the examples. And I'm thinking, "well, I did a great job." So it's not what I think as the producer handing off to you. It's you giving me the feedback. So quality is not a one-way...in fact, first of all, quality's not defined by the producer. It's defined by the recipients saying, "I love this or not." And so that's one thing I wanna say, and does it enjoy a sustainable market? What I talked about in the past is my interpretation of that is, if I'm bending over backwards to provide incredible quality at an incredible price, and I'm going outta business, then it may be great for you, but it may not be great for me. So it has to be mutually beneficial. I just wanna... Go ahead, Andrew.

0:26:03.1 AS: You referenced the word synchronicity, which the meaning of that according to the dictionary is that "simultaneous occurrence of events which appear significantly related, but had no discernible causal connection." What were you meaning when you were saying synchronicity? Is it this that now you're communicating with the part of the process ahead of you, and they're communicating back to you and all of a sudden you're starting to really work together? Is that what you mean by that?

0:26:33.1 BB: Yeah. When I think of synchronicity, I'm thinking of the fluidity of watching a basketball game where I'm throwing blind passes to the left and to the right and to the observer in the stands are thinking: holy cow. That's what I'm talking about, is the ability that we're sharing information just like those passes in a basketball game where you're...I mean I cannot do that without being incredibly mindful of where you are, what information you need. That's what I meant. That's what I mean. As opposed to - I wait until the number is less than...I'm out there in the hot sun. I get the measurement, 6.001, no, no, no, wait. Now it's five. Where's the synchronicity in that? Am I concerned about how this is helping you, or am I concerned about how do I get this off my plate onto the next person? And I'd also say...

0:27:32.6 AS: Yep. And another word I was thinking about is coordination, the organization of the different elements of a complex body or activity so as to enable them to work together efficiently. You could also say that the state of flow or something like that?

0:27:48.7 BB: I'm glad you brought up the word "together." The big deal is: am I defining quality in a vacuum, or am I doing it with some sense of how this is being used? Which is also something we got into, I think in the, one of the very first podcasts, and you asked me what could our audience...give me an example of how the audience could use this. And I said you're delivering a report to the person down the street, around the corner. Go find out how they use it. I use the example of providing data for my consulting company to my CPA, and I called 'em up one day and I said, "how do you use this information? Maybe I can get it to you in an easier form." That's together. I mean relationships, we talked earlier about marriage, relationships are based on the concept of together, not separate, together. Saying something is good, without understanding how it's used is not about "together." It's about "separate."

0:28:54.1 BB: And so what I find is, in Lean, we look at: how can we get rid of the non-value-added tasks? Who defines value? Or I could say, and Lean folks will talk about the...they'll say this: "eliminate things that don't add value." My response to them is, if you tell me that this activity does not provide value in this room for the next hour, I'm okay with that. If you tell me this activity doesn't add value in this building for the next year, I'm okay with that. But if you don't define the size of the system when you tell me it doesn't add value, then you're implying that it doesn't add value, period.

0:29:43.4 BB: And I say, how do you know that? But this is the thinking, this is what baffles me on the thinking behind Lean and these concepts of non-value-added, value-added activities. I think all activities add value. The only question is where does a value show up? And likewise in Six Sigma quality, which is heavily based on conformist requirements and driving defects to zero, that's defining quality of the parts in isolation. What does that mean, Andrew? Separate. It means separate. Nothing about synchronicity. And so I'm glad you brought that point up because what I...this idea of "together" is throughout the Deming philosophy, a sense of together, defining quality in terms of a relationship.

0:30:31.1 AS: And I remember when I was young, I was working at Pepsi, and they sent me to learn with Dr. Deming. And then I came back, and what I was kind of looking for was tools, thinking that I would...and I came back of course, with something very different, with a new way of thinking. And then I realized that Dr. Deming is so far beyond tools. He's trying to think about how do we optimize this whole system? And once I started learning that about Dr. Deming, I could see the difference. Whereas, you may decide - let's say that you wanna learn about Lean and get a certification in Lean or something like that.

0:31:15.5 AS: Ultimately, you may go down a rabbit hole of a particular tool and become a master in that tool. Nothing wrong with that. But the point is, what is the objective? Who defines the quality? And Dr. Deming clearly stated in the seminars that I was in, and from readings that I've read, that the objective of quality isn't just to improve something in...you could improve something, the quality of something and go out of business. And so there's the bigger objective of it is: how does this serve the needs of our clients? So anyways, that's just some of my memories of those days.

0:31:52.4 BB: Yeah. But you're absolutely right. And the point I'm hoping to bring out in our sessions is: I'm not against tools and techniques. Tools and techniques are incredible. They're time savers, money savers, but let's use them with a sense of connections and relationships. And I agree with you, I've done plenty of seminars where people are coming in - they're all about tools and techniques. Tools and techniques is part of the reason I like to differentiate is to say....and again, I think people are hungrier for tools and techniques. Why? Because I don't think they've come to grips with what concepts and strategies are about. And I'm hoping our listeners can help us...can appreciate that they go together. Tools and techniques are about efficiency, doing things faster, doing things cheaper. Concepts and strategies are about doing the right thing. Ackoff would say "doing the right thing right." And short of that, we end up using tools to make things worse. And that's what I'm hoping people can avoid through the insights we can share from Dr. Deming.

0:33:05.4 AS: And I would say that, would it be the case that applying tools, and tools and techniques is kind of easy? You learn how they work, you practice with them, you measure, you give feedback, but actually going to figure out how we optimize this overall system is just so much harder. It's a complex situation, and I can imagine that there's some people that would retreat to tools and techniques and I saw it in the factory at Pepsi when people would basically just say, "well, I'm just doing my thing." That's it, 'cause it's too much trouble to go out and try to negotiate all of this with everybody.

0:33:50.7 BB: I think in part, I think as long as they're managing parts in isolation, which is the prevailing system of management, then, I agree with you. Becoming aware of interdependencies in the greater system, and I'll also point out is whatever system you're looking at is part of a bigger system, and then again, bigger system, then again, bigger system. What you define is the whole, is part of a bigger system. No matter how you define it, it's part of a bigger system because time goes to infinity. So your 10-year plan, well, why not a 20-year plan? Why not a 30-year plan? So no matter how big a system you look at, there is a bigger system. So let's not get overwhelmed. Let's take a system, which Ackoff would say, take a system which is not too big that you can't manage it, not too small, that you're not really giving it the good effort, but don't lose sight of whatever system you're looking at - you'll begin to realize it is actually bigger than that. Again, what Dr. Deming would say, the bigger the system, the more complicated, which is where you're coming from, but it also offers more opportunities. I think we're so used to tools and techniques.

0:35:14.3 BB: I don't think people have really given thought to the concepts and strategies of Deming's work as opposed to Lean and Six Sigma as being different, which is why I wanted to bring it up with our listeners, because I don't think people are defaulting on the tools. I just don't think they appreciate that concepts and strategies are different than tools and techniques. And I like to have them become aware of that difference and then understand where black-and-white thinking works, where continuum thinking has advantages. There's times to look at things as connected, and then there's times to just move on and make a decision, which is a lot easier because the implications aren't as important. But at least now we get back to choice, be conscious of the choice you're making, and then move on. All right, so also on the list we had, who defines quality?

0:36:09.0 BB: We talked about that. What is meant by good: the requirements are met. Who defines good? Again, if you're looking at Phil Crosby, who defines good? Someone has to set, here are the requirements for being "good." I could be giving a term paper and me saying to the students, this is what "good" means. Next thing I wanted to look at is, "why stop at good?" And, I'm pretty sure we've talked about this. A question I like to ask people is how much time they spend every day in meetings, discussing parts, components, things that are good and going well. And what I find is people don't spend a whole lot of time discussing things that are good and going well. So why do they stop? Why not? Because they're stopping at "good."

0:36:57.1 BB: And that goes back to the black-and-white thinking. They're saying things are "bad" or they're "good." We focus on the bad to make it good, and then we stop at good. Why do we stop at good? Because there's no sense of "better." All right. And what does that mean? So again, we have why stop at good? Why go beyond good? And this is...'cause I think we're talking about really smart people that stop at "good." And I think to better understand what that means, what I like to do is ask people, what's the letter grade required for a company to ship their products to the customer? What letter grade does NASA expect from all their suppliers? And I asked a very senior NASA executive this question years ago. He was the highest ranking NASA executive in the quality field.

0:37:50.5 BB: And I said, "what letter grade do you expect from your contractors?" And he said, A+. A+. And I said, actually, it's not A+. And he is like, "What do you mean?" I said, "actually the letter grade, your requirement is actually D-." And he pushed back at me and I said, what...he says, "well, what do you mean?" I said, "how do you define quality?" And he said, "We define quality as requirements are met. That's what we require." I said, "so you think A+ is the only thing that meets requirements?" He's like, "well, where are you coming from?" I said a pass-fail system, now we get back to category thinking, if it's good or bad, what is good? Good is passing. What is passing? What I explained to him: passing is anything from an A+ down to a D-.

0:38:38.9 BB: And he got a little antsy with me. I said, "well, the alternative is an F, you don't want an F, right?" I said, "well, what you're saying is that you'll take anything but an F and that means your requirements are actually D-." And then when I pushed back and I said, "is a D- the same as an A+?" And he said, "no." I said, "well, that's what I meant earlier" in the conversation with him. And I told him that they weren't interchangeable. So when you begin to realize that black and white quality, Phil Crosby-quality, allows for D minuses to be shipped to customers. Again, in this one way I define quality, I hand it off to you. 'Cause in that world, Andrew, I make the measurement, it's 5.999, it meets requirements, I ship it to you, your only response when you receive it is to say, "thank you."

[laughter]

0:39:33.2 BB: For a D minus, right? Well, when you begin to understand relationship quality, then you begin to understand that to improve the relationship, what's behind improving the relationship, Andrew, is shifting from the D- to the A. And what does that mean? What that means is, when I pay attention to your ability to receive what I give you, whether it's the pass or the information, the more synchronously I can provide that, the letter grade is going up, [laughter] and it continues to go up. Now, again, what I'm hoping is that the effort I'm taking to provide you with the A is worthwhile. But that's how you can have continuous improvement, is stop...not stopping at the D minus.

0:40:17.6 BB: Again, there may be situations where D minus is all you really need, but I, that's not me delivering to you a D minus blindly. That's you saying to me, "Hey, I don't need an A+ over here. All I really need is a D minus." That's teamwork, Andrew. So on the one hand, and what I think is, our listeners may not appreciate it, is who defines the letter grade? So in your organization, I would say to people, you give everyone a set of requirements to go meet, what letter grade does each of them has to meet to hand off to a coworker, to another coworker, to a customer? Every single one of those people, all they have to do if they're feeling disenfranchised, as you mentioned earlier, they're feeling like an interchangeable part, well, under those circumstances, Andrew, I don't have to call you up, I just deliver a D minus. And you can't complain because I've met the requirements.

0:41:14.2 BB: So what I think it could be a little scary is to realize, what if everybody in the company comes to work tomorrow feeling no dignity in work and decides to hand off the minimum on every requirement, how does that help? And what I find exciting by Deming's work is that Dr. Deming understood that how people are treated affects their willingness to look up, pay attention to the person they're receiving and deliver to them the appropriate letter grade. So I'm hoping that helps our audience understand that if it's a black and white system, then we're saying that it's good or it's bad. What that misses is, keyword Andrew, variation in good. So the opportunities to improve when we realize that there's a range, that "good" has variation. Another point I wanna make is, what allows the Deming philosophy to go beyond looking good?

0:42:16.2 BB: Well, if you look at the last chapter 10, I think, yeah, chapter 10 of the New Economics is...like the last six pages of the New Economics is all about Dr. Taguchi's work, and it's what Dr. Deming learned from Dr. Taguchi about this very thought of looking at quality in terms of relationships, not just in isolation, Phil Crosby-style meeting requirements. And the last thing I wanna throw out is I was listening to a interview with Russ Ackoff earlier today, and he gave the three steps to being creative. This is a lecture he gave at Rocketdyne years ago. And he said, the first thing is you have to discover self-limiting constraints. Second, you have to remove the constraint. And third, you have to exploit that removal. And what I want to close on is what Deming is talking about is the self-limiting constraint is when we stop at good.

[laughter]

0:43:20.7 BB: And I'm hoping that this episode provides more insights as to the self-imposed constraint within our organizations to stop at "good." What happens when we go beyond that? And how do you go beyond that? By looking at how others receive your work and then expand that others and expand that others and expand that others. And then what I find exciting is, and the work I do with students and with clients is, how can we exploit every day that idea of synchronicity of quality, and not looking at quality from a category perspective? Again, unless that's all that's needed in that situation. So I don't want to throw out category thinking, use category thinking where it makes sense, use continuum thinking where it makes sense. So that's what I wanted to close with.

0:44:12.1 AS: Bill, on behalf of everyone at The Deming Institute, I want to thank you again for this discussion. For listeners, remember to go to deming.org to continue your journey. This is your host, Andrew Stotz, and I'm gonna leave you with one of my favorite quotes from Dr. Deming, and it's very appropriate for the discussion that we've had today. "People are entitled to joy in work."

Traditional management uses "carrots," like bonuses, and "sticks", like Performance Improvement Plans, to motivate employees. But are humans really built that way? In this episode, Jacob Stoller and Andrew Stotz dive into the myth surrounding that approach and talk about what actually motivates people at work.

TRANSCRIPT

0:00:02.7 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we dive deeper into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with Jacob Stoller, Shingo-Prize winning author of The Lean CEO and Productivity Reimagined, which explores applying Lean and Deming management principles at the enterprise level. The topic for today is myth number four, the myth of sticks and carrots. Jacob, take it away.

0:00:46.2 JS: Thank you, Andrew, and great to continue our conversation. Yeah, it is widely believed that people are motivated by threats and rewards. And to demonstrate that, all you have to do is go into an HR department and look at the job descriptions and the reward programs. And it's all assumes that people are motivated by externalities, right? And that goes back, actually, it's a very, very old way of looking at the world, that there's a term, it's a bit of Latin here, homo economicus. And it's the idea that humans are sort of goal seeking creatures. They seek what's better for them, and it's all material. They'll seek their material gain, and they will behave in very predictable ways, according to that. So you can set up external motivators, mainly money, and you can regulate the way people will behave.

0:01:38.2 JS: So that's the assumption that many businesses are built on. But science has proven that that's not the way human humans work. There've been a number... And starting really in the 1950s, a number of scientists have sort of poked serious holes in that thinking. One of them is Edward Deci, who talked about motivation and did a number of experiments to see that, to find out that people, you know, their motive for doing tasks really kind of transcends rewards. Often they'll do something, for the satisfaction of doing it, in spite of the rewards being greater. We have Frederick Herzberg who developed something called Hygiene Theory. And that's really that... He determined in an organization that money can't actually be a positive motivator. It can't motivate positive behavior, but lack of money can motivate negative behavior.

0:02:49.6 JS: So, you know, and a number of experiments to support that. And then we have, Mihaly Csikszentmihalyi, hard to pronounce, who talks about joy at work and really did experiments and kind of proved that joy at work isn't just some kind of fancy idea that somebody had. But it's actually a scientifically proven principle. Whereas when people have joy at work and they're fully engaged in their work, they do much higher quality work. So that's kind of the background really here. So what we want, when we manage, is we want people to be intrinsically motivated so that they do their best work. And Deming principles are very, very, I think representative of that. I think Dr. Deming understood that people are motivated when they feel a part of something, when they contribute, when they feel that their team members around them are supporting them. And so that's what we try to do. And Lean eorld tries to do that, and we try to do that with Deming principles.

0:04:06.8 AS: You know, when I start off my discussion on this with students and people that I teach in seminars and the like, I always ask them, you know, which, do you believe in, a carrot or a stick? Do you think more people are motivated by rewards or punishments? And it's a great...

0:04:18.1 Jacob Stoller: Oh, okay.

0:04:24.1 AS: Way to kick off a conversation. But, you know, obviously we're gonna get some people that say, I want people to be feeling, you know, positive rewards and feel positive. And then you have the other people that... What I invariably find is that people who are running large companies with lots of employees, it's sticks. Yes, because...

0:04:40.4 JS: Interesting.

0:04:41.8 AS: It's overwhelming. And then when I think about where it's easiest to do joy in work, and where it's easiest to get the intrinsic motivation is, you know, smaller companies where everybody's close and they're really working together. And that's a dilemma that I never really have had a great reconciling of, but I'm interested to learn more about it from the direction that you're coming. So continue on. But that's just something I have in my mind when heard you talk about it.

0:05:13.1 JS: It's tough to do with a big company, but I wanna tell you a big company story. And actually I'm gonna read, a page or two of the book just because it's, I don't want to, it's a complicated story and I wanna make sure you get all the...

0:05:32.5 AS: Well, you've it written so well. So might as well do that.

0:05:36.1 JS: Well, like, gosh, let's hope so. Let's hope so. But, anyway, this is actually by coincidence. I just, what appeared, this morning on their podcast, so, of this company called Barry-Wehmiller. So, but the CEO of Barry-Wehmiller is a gentleman named Bob Chapman. And he's become quite well known in the Lean world and outside of the Lean world because as a pioneer of what we could call human-centric leadership. So he believes in treating people in the company like family members. But he didn't start out that way. He started with a very traditional background. He took over his father's business and he had a typical MBA background with accounting. And so he grew that company in a traditional way. You know, it started, as one company, and it started really by acquisition.

0:06:25.5 JS: He got very, very good at finding undervalued companies and developing them. So the company grew and it became a sort of a multinational, diversified manufacturer of various kinds of machinery. And so he was a huge success. I mean, he was written up in Harvard Business Review, all this kind of stuff, but he had a feeling, he was very much a family man too, and he had a feeling that something wasn't quite right in the companies that he was running. And he's a... Bob is a very... He watches people, he's very sensitive about body language. And he told me of a time he was in the cafeteria of a company, and it was sort of basketball season, you know, March Madness. That's when the university teams, you know, have their finals and all that, and everybody's betting on them, you know, it's a big deal.

0:07:21.9 JS: So he remembers being in there, and the people in the cafeteria all just having a great time and watching them chatter. And then, he watched the... When the clock sort of moved, so it's a few minutes to having to go back to work, he said the body language changed, all of a sudden they just weren't that happy. You know, it just, all the joy kind of drained out of them. And then they went off to their jobs. And Bob said, you know, this is wrong. You know, that it shouldn't be this way. And he was a family man. He said, I wouldn't want my children who I care about to be working in this kind of environment. So how can we care for the people and how can we actually make that work? So here's what I'm gonna start to read, because here's where it gets complicated.

0:08:08.6 JS: "Chapman vowed to change how people were led at Barry-Wehmiller. His business background, however, didn't provide any help for this. 'When I was in business school, I was never taught to care,' he said. 'It was about creating economic value. It was all business models, market cap, market share. I don't remember in my undergraduate in accounting or my graduate school ever learning to care or inspire the people I had the privilege to lead. And I never read, never was told, never heard that the way I would run Barry-Wehmiller would impact the way people go home and treat their families and their health. But the biggest thing we've learned is that the way we learn impacts the way people live.' Working with a group of team members from across the organization, he developed a set of principles called the Guiding Principles of Leadership, or GPL, which put caring for people as front and center to the job for all leaders in the company.

0:09:05.2 JS: "But the question remained, how do we organize the work in a way that gives workers the experience of working in a caring environment? It happened that Barry-Wehmiller had recently acquired a Baltimore based manufacturer of corrugated paper machines called MarquipWardUnited the company had implemented a number of Lean tools and practices under the leadership of Jerry Solomon, who was also the author of several books on Lean accounting. In Chapman's first meeting with Solomon, he introduced him to the Guiding Principles of Leadership and Solomon immediately saw a connection with the challenges companies face when trying to create a Lean culture. Most companies practicing Lean, he noted, never get to the culture piece. The same concern that caused the Shingo Institute to revise its model in 2008." And by the way, I have to interject here. That was covered in a previous chapter, how Shingo Institute found that they had left out the people and the caring part.

0:10:14.4 JS: And that had caused a lot of companies that had adopted Shingo principles to actually, and had won Shingo prizes to actually fall off the ladder, so to speak. But that's another story. Anyway, "Solomon," Jerry Solomon, this is the, from MarquipWardUnited "felt that what the company needed was what he called a delivery mechanism to integrate the Guiding Principles of Leadership with the company's day-to-Day operations. How, for example, does a supervisor in the shop floor interact with the people doing the work? Solomon felt that Lean and GPL were an ideal fit. Chapman was skeptical, though, 'cause he'd heard that Lean is purely about reducing waste and increasing profits, but not about leading people ... passed.

0:11:06.2 JS: And the group that was working on it, this company in Green Bay, actually was ready to report on some of their results. So they invited Bob Chapman and Jerry to come, to fly in to see the report. So what they got was a sort of a typical consultant's report. They said, well, we've implemented this thing and we've got, we've shortened the lead time, we've reduced the defects, whatever. And Chapman's reaction was actually different than what you would expect. He was very, very upset. 'Cause he said, this is supposed to be about people and Guiding Principles of Leadership. That's what you told me Lean was about. But here all I hear is a bunch of numbers. So he was quite upset. He left the room, actually. And they sort of calmed him down, and they said, Bob, please give us another chance.

0:12:03.6 JS: And it so happened that, the next morning there was going to be a report out from people that were actually on the team that had made the improvements. So Bob says, okay, I'll give you another chance, but I want the people that were actually working on that project to come and report to the presidents. So, an incredible setup. You know, you can imagine, you have these people 7 o'clock in the morning. Well, that's not hard for you to imagine, with the hours you keep. But anyway, 7 in the morning, you have all the principals, presidents of these companies, and you have, a couple of, people in the team and a guy who's never presented to a group like that, getting up in front of a whole group of CEOs. So he had some notes, and he went through his presentation, which was very sort of, you know, what you would expect.

0:12:54.2 JS: It was, yeah, we've got the, pretty much what the consultants had said the day before, right? Yeah. We cut the lead time. We did this. And, Bob listened patiently. He said he listened for about 10 minutes, and then he says, and he says, I don't know where this came from. He stood up and said, Steve, that's the name of the guy presenting. How did this change your life? And there was a silence. And you imagine, right? All the CEOs and or the presidents. And then, and this guy who has never presented to a group like that. And Steve just sort of blurted out, my wife is talking to me more. And Bob said, help me, Steve. I don't understand. Please, please explain this. And Steve then went ahead and told, what Bob said was one of the most moving stories he'd ever heard, you know, and what Steve said is, well, Bob, you know how it is.

0:13:53.9 JS: You go to work and, you know, you punch in your clock. And then they give you some things to do. They give you a list of things to do, but they don't give you any support or anything, or they don't give you the tools you need, but you sort of figure it out. You know, you get through the day and you get nine out of 10 things, right? But then maybe that 10th thing you'll run into some problem. He said, and immediately what they do, they never thank you for the things you did right. They jump on you for the problem you have, that you confronted. They tell you, you didn't do things right. And then they complain about your salary and how they have to pay overtime and all these kinds of things.

0:14:41.6 JS: And he said, you know, at the end of the day, I wasn't feeling too good about myself. And I'd go home and I think it was rubbing off on me. I wasn't being very nice to my wife and she wasn't talking to me. But he said, now with this program we have, the Guiding Principles of Leadership with Lean, people, I'm part of something. I'm part of a team. We've worked on some things and I can see the results. And when I ask questions, these engineers are answering my questions. And when I say things, they listen to me. And, you know, we've got the satisfaction of this project where we see the flow now really working out in this area. So I go home and I'm feeling better about myself. And I think I'm nicer to my wife and she's talking to me. And at that point, Bob Chapman turned to Jerry Solomon and he said, we have a new metric for Lean's success. It's going to be the reduction of the divorce rate in America.

0:15:41.7 JS: So that's, I think, very, very central. That story to everything we're talking about here with intrinsic motivation. Because it's not about money. It's, you know, you've gotta pay people decently and then they have to be able to support their families. But it's about respect. It's about seeing yourself accomplish things. And this isn't just a frill, this is a basic human need. I think Dr. Deming recognized that. And he has a wonderful diagram in The New Economics where he talks about, he calls it Forces of Destruction. You know that diagram?

0:16:23.1 AS: Yeah.

0:16:27.5 JS: Yeah. It's the... How the school system and then the job environments just basically wear a person down, wear down their will and their enthusiasm. And, you know what, another CEO pointed out to me that, very interestingly, he said, we have a crisis in this country because people don't have purpose in their work. So they go from job to job when they don't like their job. It's, he said, it's like changing an app. Something goes wrong, they change it, but they got no purpose in their work.

0:17:03.3 JS: And this company, I should I call them out, 'cause he, mention his name is Mark Borsari. And it's a company that makes wire brushes in Massachusetts. But they do, you know... He said, you really have to find the purpose in the interactions of people. It's in the people and it's in the processes. You don't get people excited about wire brushes. You get people excited about being part of a work environment where your opinion is respected and where you can make improvements. So, he said, that's what people need in the workplace right now. And he said, the result is that people, you know, we have people just depressed and upset and, you know, it's a crisis that's perhaps underestimated, but really needs to be addressed. So that's why I feel maybe so passionate about this sticks and carrots myth, because I see how destructive it is to human beings. And I've experienced some of that myself in, you know, my early days in corporate life where you're kind of blamed and evaluated for things that often you have no control over. And it's, you know, you look at something like the Red Bead Game. There are people that actually live that.

0:18:31.0 AS: Just to highlight for the listeners and the viewers, the book that Bob Chapman wrote is called Everybody Matters: The Extraordinary Power of Caring for Your People Like Family, very highly rated on Amazon. And it looks like it's also in audible form, which would be a fun one. And you also mentioned about Jerry Solomon, his book, Who's Counting is another one on the topic.

0:18:32.5 AS: But you know, I was thinking about this for a moment. And I was thinking, you know, I was kind of inoculated to this, I was vaccinated against negative thinking by two things that happened to me when I was young. The first one is, you know, I went into rehab as as a young guy with drug addiction. And I came out of that when I was almost 18. And from that point till today, I've been drug free, alcohol free. And so I had to kind of face all the demons that I had, you know, accumulated at that time, but I left it with a really positive outlook on life.

0:19:29.7 AS: Like I wanted happiness.

0:19:29.8 JS: Interesting.

0:19:29.9 AS: I wanted serenity. And then and then I went to work... I went studied, enjoyed that, I went to work for Pepsi, I really enjoyed it. And then I met Dr. Deming when I was, you know, 24. And and he told me, you know, we should have joy in work. And from that moment on, it's like, that's what I wanted in life. And so I never, I never got caught up in this idea when I worked at Big Bank, you know, Citibank and other places, I just never, nobody could ever convince me that, you know, I should be unhappy with what I'm doing.

0:20:05.5 AS: Like, I really, really enjoyed it. And then I was just thinking about how painful it is, if you haven't been inoculated from the beginning, to have to go through this, and then you end up with, you know, it's it's 9 to 5, it's painful work, it's called work for a reason, it's hard, you know. And I think that before I come to the next questions, you know, about the question we always get on the topic of carrots and sticks, what do we do instead?

0:20:30.6 AS: Before I talk about that, I think I really wanna highlight that what's important is getting your thinking right about this. Whether it's the thinking about I wanna treat people like a family, I want people to enjoy work, I want work to be a source of pride, I want people to wanna work here. You know, if you can get those thoughts right, the solutions to the carrots and sticks, and how do we evaluate and all of those questions, you know, can kind of, they wither away to some extent. What are your thoughts on that?

0:21:02.4 JS: Well, I think Jerry Solomon said it very well, actually. He said, you need a delivery mechanism. And Lean provided that, you know, it has a bunch of tools and organizing principles. So does the Deming's System of Profound Knowledge, right, and the various frameworks that Dr. Deming put together. So that provides that kind of framework. It's not easy to do. I think one of the big hurdles, and this is kind of central to my book is that you're dealing with a lot of unlearning. And they say that it's harder to unlearn something than it is to learn new skills. So we really can't afford to underestimate that.

0:21:51.1 JS: And I think when we have managers and leaders facing massive unlearning challenges, I think what's needed is compassion, you know, we shouldn't be putting them down for applying what they learned, we should be understanding about the changes. And I think Dr. Deming, you know, from the stories I've heard was very good about that.

0:22:00.0 AS: Well, he had something he would say, which was kind of one of his methods of compassions, but I remember him saying, how could they know? How could they know, you know, like, they were brought up in this system, as you've just said, and so, but it's based upon the carrot and sticks and all of these different things. But I'm curious, you know, which I think we at some point we'll get to in our discussion is the, there's listeners and viewers out there. It's like, okay, Jacob, totally agree with you. Andrew, totally agree with you. I want people to have joy in work. But you know, I'm constrained by, you know, the performance appraisals that I got to do.

0:23:07.3 AS: I'm constrained by the punishments and rewards that my company does. And or a leader of a company says, if I let these things go, we're gonna fall apart. How do you respond to that?

0:23:11.6 JS: Well, gosh, I mean, I think you have to just look at the case studies of people that have let that go. And that's why I emphasize I one of the points I emphasize in the book with advice for companies moving forward is a very first step before you do anything is go visit companies that have been successful. You know, go visit Bama Foods, where they have a great culture. Go watch how people interact with people. Go to some of the great Lean companies. All these companies understand that the best gift they can give their employees is to allow them to share what they've learned with other people. It's a great motivator for people. So it's a real win win. So I think it begins with that you've got to see it first. And then you can start to assess where you stand.

0:24:13.6 JS: But we're talking about a transformation here, as Dr. Deming said. We're not talking about implementing a few tricks that we can superimpose on our management system. You've got to manage it completely differently to actually get this kind of intrinsic motivation to be a driving force in your workplace.

0:24:19.2 AS: It just made me think that I wanna come up with the five happiest companies in Bangkok and do a tour and take my students out and my teams out and my company managers out and let's go, you know, see how they're turning on intrinsic motivation, you know. And one thing about Thailand that's interesting is that what people want from work is very different than in the West.

0:24:50.1 JS: Right.

0:24:51.2 AS: And what people want from work is good relationships, harmony.

0:24:57.6 JS: Really.

0:24:57.8 AS: They want connection. They want meaning, more meaning from their work than the typical Western.

0:25:05.8 JS: Isn't that interesting? Interesting.

0:25:05.9 AS: And so when I see and I rail sometimes on to my students about, you know, be very careful about bringing this KPI disease into Thailand, where all of a sudden, you're setting up the Thai people to go against each other, which takes away from what is a core strength is their desire and ability to get along.

0:25:33.3 JS: Isn't that interesting? Wow, so they got a head start.

0:25:42.5 AS: Yeah. My first move to Thailand in 1992, I taught an MBA class. And the first thing I did is what was done with me in my MBA class is say, all right, here's a case study, break into groups, and then, you know, and then they came back and, and then after getting to know them in my first semester that I taught, now I've been teaching for 32 years in Thailand. The first lesson I learned is Thais do not need group work. They need individual work. And because they need to kind of flex that muscle.

0:26:08.8 AS: And then I thought, well, why are we do so much group work in America? Well, because it's Americans are trained and taught from the beginning to think independently, have their own idea, watch out for themselves. And they need help in, let's say, MBA classes to work together.

0:26:26.8 JS: Isn't that interesting?

0:26:26.9 AS: And so what I just saw was a very different dynamic.

0:26:30.3 JS: Wow.

0:26:30.9 AS: And it helped me also to understand that we... The good side of the American, let's say, I know, American worker, I know Americans, just 'cause that's where I grew up. But the good side of that is that there is a lot of independent thinking, they can come up with the good systems and all of that.

0:26:47.3 JS: Sure.

0:26:48.9 AS: But the bad side is that they're oftentimes fired up to be in competition with each other. And KPIs just ignite that fire that just...

0:26:58.2 JS: They do.

0:26:58.3 AS: Really causes, you know, a lot of damage.

0:27:00.5 JS: Well, I got to ask you something, then, do you think that that East versus West kind of mindset is why Dr. Deming's ideas were taken up in Japan when they had been kind of ignored in the US?

0:27:16.9 AS: Yeah, I mean, I definitely I mean, Japan is like an extreme example of Asia and trying to have harmony and everybody, the bigger mission is the company, the bigger mission is the community, the bigger mission is the country. I would say that Japan is like the ultimate in that. Thailand is less so there's more independence and people don't have to be completely allegiant to those things. But still, that desire to be happy at work is there, you know, I think it's there more, it's more innate, for some reason in Thailand, than I saw it in America.

0:27:55.8 AS: And I always explain that, when I worked in America, I think I never went out on a weekend with my colleagues.

0:28:04.5 JS: Really. Interesting.

0:28:05.3 AS: And in Thailand is a very common thing to arrange activities together with your workmates, and go bowling and do this and do that. And I thought, I saw that everywhere. And I was pretty, you know, that just was fascinating to me. So I really, you know, this discussion is all about opening up people's minds, that carrots and sticks are not the only way. And as you said, it's a transformation, it takes time, you got to think about it, you got to reconcile it.

0:28:37.8 JS: Well, and that brings up another really important point, Andrew. And that is that teamwork, team productivity really makes the difference in a company. And when you think about it, you've got a whole bunch of individuals that productivity is very often not gonna add up for reasons, you know, that we've already talked about, you know, it's not part of the system. So team productivity becomes really, really essential. But team productivity, and Kelly Allen actually pointed this out really well to me. And I mean, I'm gonna just look in my notes here to get his words exactly, 'cause he said it so well.

0:29:21.0 JS: Let's see here. And here's Kelly, "a useful operational definition of a team is the collaborative and coordinated efforts of people working together in an atmosphere of voluntary trust." So you got to build that. And, you know, that's kind of tough to do in a lot of North American companies.

0:29:48.5 AS: Yeah. It's such a great point. And I think I've recently been teaching a corporate strategy. And I talk about Michael Porter and all the he's taught about strategy. But one of the things that he mentions towards the end of his books is the idea of fit. And he's talking about how do the pieces fit together in the company. And everybody knows that feeling when the when the process before you or the process after you in your company is being run by somebody that you have a good fit with. It's like everything comes together. And so I think what I realize now is that the power of that coordination that Kelly Allen's talking about is all about how do we get these pieces fit together, working together, coordinating together. That's the magic.

0:30:37.3 AS: Interesting. But Porter, I mean, he talked about a lot of I think, you know, it's been a long time since I've looked at his books, but a lot of his stuff was either or, right? I mean, you know, you decide, am I gonna be a price leader or am I gonna be a quality leader? And I think a lot of what he did disregarded, you know, Deming's Chain Reaction, you know, where he where you actually invest in both. So I mean, that's got a problem and with strategy people in general. Now, I know you've taught strategy. So maybe you're gonna take me apart on this one. But it seems to me that the strategy folks are really missing something.

0:31:29.1 AS: Well, I think most people are missing the type of stuff that Dr. Deming's talking about, but I use an example of McDonald's and Starbucks.

0:31:35.5 JS: Okay.

0:31:37.3 AS: You know, one is a low cost leader. And one is a premium, you know, differentiated, you know, product and service. And we all know which one's which. So which one leads to a sustainable competitive advantage? Which one is better? I always talk to my students. And I say, the fact is, is that both of them have led to a competitive advantage. So part of what, you know, I would say, when I think about corporate strategy, from my perspective, is figure out the direction that fits your DNA, and then pursue that, whether that's about making, you know, I like to tell my students that think of a company run by an engineer, who may be focused on the processes and all that, who may create a very efficient operation, versus a business, let's say run by a marketing or sales person who has a much better contacting and messaging to the customer. Those two business owners should be developing their corporate strategy around their DNA, you know, and if they do that right, that, in theory, should lead to some competitive advantage.

0:31:58.9 AS: And to me, competitive advantage is how do we make sure that our company creates a level of profitability that is higher than the industry average over a sustained period of time. If we think we're doing a corporate strategy that works, and we're making a very low amount of profitability, I think that there's enough reason to argue that that's probably not achieving a competitive advantage.

0:32:37.1 JS: Yeah. And I think we have to put the word sustainable competitive advantage. But along the McDonald's, Starbucks, though, I have a very interesting twist. And I think this was done locally in Canada. But somebody did a blind test of coffees from various outlets to see what rated the highest. And I have to tell you that McDonald's coffee rated very high, higher than Starbucks. So...

0:33:47.1 AS: But it's definitely the case in Bangkok that McDonald's coffee is fantastic.

0:33:50.8 JS: Really.

0:33:51.8 AS: I happen to know very much about that. But I highly recommend that.

0:33:55.7 JS: Yeah. Well, I think we're, you know, we are focusing in this book, essentially on, you know, productivity. Now, marketing, marketing strategy and stuff like that is yeah, I'll acknowledge that. Sure. And that's maybe, you know, I think what Michael Porter was talking about it's very true in terms of marketing. But in terms of quality, output of quality, I think that's where the Deming magic and the Lean magic all come into play.

0:34:12.2 AS: Yeah, I mean, it took me a long time to figure out that what Dr. Deming saying is, if we are continually improving our products and service and our quality, we're driving down costs, and we're making people happier, and we're bringing more value to the market. How... Shall we wrap this up? And how would you summarize what you want people to take away from this?

0:34:26.1 JS: I would say that intrinsic motivation is underestimated in workplaces, it's misunderstood. It's not reflected in the way most companies are organized or their strategies. So it's a big learning curve for companies to create the kind of environment where intrinsic motivation is connected with the workplace. But I think it's worthwhile, it's a very, very important thing. And we have a lot of unhappiness in society. And a lot of it can be traced to a lack of that. So, you know, I hope that more companies will see the importance of this.

0:35:16.6 AS: You know, it's my, my friend who never... He was helping me when I was writing my book, Transform your Business with Dr. Deming's 14 points.

0:36:02.2 JS: That's a great book.

0:36:02.7 AS: And he was editing a book.

0:36:02.8 JS: I love that book, by the way.

0:36:04.3 AS: Thank you. I was trying to make it as simple as possible for the 14 points. But my friend, as he was helping me edit it, he turned to me after many hours of working together over many weeks, he said to me, I figured it out. Dr. Deming is a humanist, he cares about people. And that was just so funny, because he thought going into it, it's all gonna be about, you know, charts and graphs and statistics. And I think that's, you know, that's the key, it's the mindset. I wanna wrap up by by just going through some of Dr. Deming's 14 points that apply to what we're talking about. And, you know...

0:36:39.2 JS: Great.

0:36:39.6 AS: The question really is, you know, when my friend said that Dr. Deming was a humanist, it's 'cause as he started working on the 14 points with me, he started to realize, just listen to these points. Here's point number eight, drive out fear. Yeah, that's critical to having a joyful workplace. Number nine, break down barriers between department. That's the source of so much trouble for people at work is that they're working in silos. Number 10, eliminate slogans and targets and exhortations. Stop focusing on pushing the workers constantly. Figure out how to improve the system.

0:37:10.2 AS: Number 11, eliminate work standards or quotas, eliminate management by objective, management by numbers, substitute leadership. And number 12, remove barriers that rob the hourly worker of the right to pride of workmanship. Remove barriers that rob people in management and engineering of their right of pride of workmanship. My goodness, from eight, nine, 10, 11, 12, all focused on this concept of intrinsic motivation. And to me, that thinking, changing that thinking is what's so critical. Anything you would add as we wrap up?

0:37:25.0 JS: Yeah, I will add one thing to that. And this is very strongly in the book. That is why the first step if you're gonna transform your company is making everybody feel safe. That's got to be the first step, even before you start training them with methods and things like that. You have to build safety, then you can build trust.

0:37:47.2 AS: Fantastic. Well, Jacob, on behalf of everyone at the Deming Institute, I wanna thank you again for this discussion. And for listeners, remember to go to deming.org to continue your journey. So much happening there. You can find Jacob's book, Productivity Reimagined at jacobstoller.com. And this is your host, Andrew Stotz. And I'll leave you with one of my favorite quotes from Dr. Deming that I just never stop talking about. And today we talked about it a lot. And that is, "People are entitled to joy in work."

Paula Marshall is the CEO of the Bama Companies, Inc., a company that may be best known for being the single supplier of the famous Apple dessert pies to McDonalds. They are also "...an innovator and manufacturer of bakery products to some of the most well-known restaurant chains on the planet."

In this episode Paula discusses with Tripp her amazing journey as a CEO that took her company from being on the verge of going out of business to the thriving powerhouse it is today. The transformation of Paula and her company started when she attended her first Deming seminar. That seminar and the subsequent meetings and friendship with Dr. Deming, shaped the future of the company in a way she never imagined. Paula shares her journey with Dr. Deming and how personally difficult it was to go against the very status quo management ideas she had learned and was using; in particular, learning the hard way how detrimental performance appraisals and the incentive based system are to an organization.

See http://www.bama.com for more information on Paula and the company.  Paula is also an author of several books, including her personal story in Sweet as Pie, Tough as Nails.

In part 5 of this series, David and Andrew discuss the pitfalls of managers acting as judges versus the benefits of acting as a coach. They explore the history of traditional management practices, and how Dr. Deming's philosophy creates happier, healthier, and more productive workplaces.

TRANSCRIPT

0:00:02.2 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with David P. Langford, who has devoted his life to applying Dr. Deming's philosophy to education and he offers us his practical advice for implementation. The topic for today is: management through coaching and counseling. And as a reminder, we are reviewing the role of a manager of people in The New Economics that Dr. Deming wrote. And if you are in the third edition, this is on page 86, if you're in the second edition, this is on page 125. Now we've been through steps or the list, let's say, all the way up to number four was our last one, and now we're into number five. And what Dr. Deming says pretty short to the point, and that is the new manager, a transformed manager is a coach. He is coach and counsel, not a judge. David, take it away.

0:01:07.7 David Langford: Okay, thank you, Andrew. Yeah, so this seems like a pretty short point and pretty obvious on the surface, but the more you get into it, the more you start to really think about, Well, how do you do that on a daily basis? And once again, I'm applying all this to the field of education, so when we're talking about the management of people, we're talking about teachers, we're talking about principles, professors, we're talking about administrators, so we're not... It's not just corporate thinking that we're after here. So what does that mean managing through your, somebody's a coach and counselor? Well, why, I had to always think about Why did Deming say this? Why did he make that as a point? Well, through his lifetime, 80 years in applied management, he constantly saw people that were, sometimes is called Boss management. It's: either my way or the highway management. There were the years during World War II where there's military management, and if you didn't follow orders, you could be court marshaled, or shot or whatever. And so really after World War II, all those people in the military came back, and people who had been in the service went right back into management positions in corporations, and so what philosophy are they bringing back with them. Well, they're bringing back military management.

0:02:54.1 DL: It's my way or the highway kind of thinking. And all these phrases that have bounced around for the last 50, 60 years, you're not getting paid to think, you're getting paid to do. Well, Deming was just the opposite. He was always trying to get people to think. In the previous point, we spent quite a bit of time talking about creating training and learning for people, and on the job, all kinds of training and learning, not just things that are gonna help you with your job because you wanted people to think. And why. Why would he want people to think? Because that's where creativity comes from. You get everybody in an organization and you have a Thinking Organization going on, you've really got something fantastic happening.

0:03:48.8 DL: If you don't have that and you got boss management and everybody's just waiting around for the boss to tell them what to do, you're not gonna get creativity, you're not gonna get new thoughts. In fact, creativity gets shut down in a situation like that. I'll never forget, a friend of mine talked about working in an auto plant in California during the 1960s, and his job was to put in screws. And as the cars came by, he'd put in these screws and he kept noticing that the tool that he had to put the screws in was stripping the screws out every tenth screw or so. So he actually took his time to create a special little attachment and a tool to make sure that every screw that he put in would be perfect, and he wouldn't be stripping those screws out in these vehicles, and he was so excited that when his manager came around, he's shared with him this idea about...

0:04:50.2 DL: Look what I've done, I've created this tool that goes on the end of the rivet gun or whatever it is, and to make sure that the screws are always in perfectly. Well, he got in huge trouble. Manager just ate him out and one side down the other. You're not getting paid to think, you put it back on. And that was prominent thinking then and probably management thinking that Deming encountered in our auto industry and why the Japanese suddenly started beating us in the auto industry is because they had people that were thinking and not just doing. So Deming wanted... What does that mean for like a teacher? Well, you're trying to get students always to think on their own. I've helped teachers many times, especially young kids to come up with a flow chart with their students, what to do when you don't know what to do. And there's a lot of thought in that. Right. I have a whole flow chart, well, what do you do when you don't know what to do. Do you just sit around and goof around and bother other people? Do you... What happens in those kinds of situations?

0:06:11.5 DL: Or have you gone through a process to try to solve the problem yourself? I know after a couple of years of working like this with students in classrooms, I'd have students come up to me and they'd get ready to ask a question, and then they'd look at me and they'd go, never mind. I said, No, I'd say, No, wait a minute, don't leave, why don't you wanna ask your question? And... Well, I haven't really gone through the process of trying to solve it myself yet. Oh, okay, well, let me know how that goes. Because until you do that, you're not really thinking and you're not really... The neurons are not gonna connect in a pattern that next time around, you can actually think through and solve the problem yourself. And so there's steps to going through those things and getting students of all ages to be able to think and solve problems themselves, and unfortunately, we're not getting better at this in organizations, we are still reverting and going backwards in many cases, partly because once you become a manager, there's power in that and control. And if I think that people don't need me, does that make my job sort of worthless? Maybe I don't need to be there.

0:07:39.8 DL: Well, it's actually just the opposite, that if you have people taking autonomy, solving problems, figuring things out on their own, and when they come to you, you're giving them coaching and counseling. Have you thought about this, have you thought about this way? And what do you think would happen if you did this? And rather than judging them about it, you get people thinking on a higher level all the time. I'll never forget... I can't remember if I told the story or not, but the school district I was working in, in Texas, the State Board of Education asked me to come and speak to the state board and talk about what I was doing with the schools in Texas. And I said, Well, I won't come unless I can bring a hundred of my friends. And he said, What are you talking about? And I said, Well, I won't come unless I can bring some of these students that are already in classrooms functioning this way with Deming thinking. And he said, Oh yeah, that'd be great. We never get to see any students. Isn't that odd? State board of education never sees their customers. Anyway, so a school district brought a bus load students, and in that bus load of students was a teacher and her kindergarten, five and six-year-old students, and they had told me at the state board that I had 10 minutes to make a presentation.

0:09:16.3 DL: So I talked about 3 minutes, and it's about who was Deming and applied thinking, etcetera, and then I had these kids talk. Well, I'll never forget these kindergarten kids were at the microphones and they're talking about how autonomous they are in their classroom, how they solve their own problems, how they work together, how they support each other, they're just amazing. Going on and on. And one of the state board members says, "Now, I understand that you have a lot of control and responsibility in your classroom," and all these kids are shaking their heads, yes. And she said, "Well, if you have all this control and responsibility over what you do every day, what's your teacher doing?" And this little boy without hesitating grabbed a microphone and looked right at her, and he said, The teacher is not in the closet, you know. It was stun silence. There's like 300 people in the room, it's dead silence and you hear all those whispering, What did he just say? Deming said profound knowledge is not limited to age. At five and six, he knew that he'd had a coach and a counselor in the classroom, and he was able to do this and take this kind of responsibility because of the teacher, not in spite of the teacher.

0:10:44.4 DL: So if you're not allowing your students to take responsibility and own their own situation, then you can have a rebellion going on. And you might never even know it because it could be an underground rebellion going on.

0:11:00.1 AS: Yeah, by the time you know it, it's too late. I was just thinking about some of these words, just to make sure that we're super clear, like I was looking at the word coach online, and one dictionary says someone whose job is to teach people to improve at a sport or skill or a school subject. Another one was counsel, which is to give advice, especially on social or personal problems. Another one was judge: to form, give or have an opinion or decide about something or someone. And I'm also reminded of a very good book that I found helpful in the coaching space, written by Michael Bungay Stanier, and he has some questions, it's called The Coaching Habit, and he had the questions that being a coach, he said You should ask, what's on your mind? What else is on your mind? And another question is, what's the real challenge for you that you're facing? What do you want? How can I help? If you're saying yes to this, what are you saying no to? And what was the most useful for you in that process? So those are some of the words, and I'm just curious, can you really be a coach in school? Or do you need to be kind of authoritarian to control a classroom? That's one of the questions that I'm sure some people are like, Yeah, that sounds great, David.

0:12:24.9 AS: But my classroom is out of control and I've gotta really... I've gotta squeeze down here to get things together.

0:12:32.8 DL: We need some discipline around here.

0:12:34.8 AS: Exactly.

0:12:39.2 DL: Yeah, the beatings will continue around here until morale improves.

0:12:43.4 AS: Exactly.

0:12:43.5 DL: Yeah, exactly. Yeah, every time I hear educators talking about, Oh, we got a discipline plan, or these kids need more discipline or... Every generation says, These kids today, they don't understand discipline. And I often will tell teachers, have you ever looked up discipline in a dictionary? Most dictionaries, the first definition of discipline is training.

0:13:11.0 DL: So you have a discipline problem, Oh, you got a training problem. And that totally changes things, and it actually goes to Deming's point when he says, Don't sit around and judge people. Train people in the way that you want them to go and what you want them to do and how you want them to act and let them make decisions and... Don't just judge them and heap so many demerits, this is gonna happen to you, and three tardies equal an absence, and three absences is equal this, and that's judging people and you're not actually improving the situation at all. I just read an article that Los Angeles has a chronic absentee problem. Well, partly because nobody wants to go to school there, right? You're not gonna miss something you think is fun and you're involved in, and you're actually learning. Learning is the most motivating thing that could be happening, and if students are going to school and they're not learning, then why am I even bothering?

0:14:27.8 DL: Now, you can try to discipline by heaping judgments and punishments and all kinds of things on people, but the bottom line is people are gonna vote with their feet and they're just... They just don't wanna put up with it over time or they'll show up, they won't do anything, they won't learn anything, they won't get involved. And the thing is that we always wanna blame the people and not the system, and that's what Deming is talking about, not being a judge, stop judging and blaming the people in this system and start fixing the system. And you'll get a different result.

0:15:10.4 AS: I went on the dictionary again to look at discipline, once you said that, I'm your handy-dandy fact checker here, and in fact, the first word in the description in the dictionary is training, and it says, training that makes people more willing to obey or more willing or more able to control themselves.

0:15:30.7 DL: Yes, and that's ultimately what you're after is to get people to control themselves instead of you thinking that you have to do everything.

0:15:43.9 AS: Another way of looking at this too, is to think about, How would you like to be treated? I think one of the best questions in a job interview that I've learned to ask is, What's the best way to manage you? And sometimes, I'll ask it by saying, if I was to talk to your last boss and ask them, what's the best way to manage you, to get the most out of you? And then it's amazing what that opens up. Some people say, like for me, I often explain that I'm kind of an incrementalist, so if I have a project, I want to check that it's on track, and I wanna work on a bit of it at a time, and then go from there, whereas there's some other people like, Just leave me alone and I'll produce this thing at the end of the... And when a boss or a colleague understands that that's the way my mind works, then it's easier for them to understand that doing a project with me, it's better to have daily check-ins versus someone else that may not want that, so think about how you would describe yourself to your boss, to your administrator, and describe how you would like to be treated, and surprisingly, it may be the way you should be treating other people too.

0:17:04.0 DL: Yeah. So take that same thinking and translate it to a second grade classroom. Do you really know your students and know how to coach and counsel each of those students either collectively or separately? And rather than thinking that since I'm bigger and have a stronger voice, and I'm the authoritarian person here, I can just tell you what to do and if you don't do it, I'm just gonna make your life miserable until you do do it. It's not a really good way to manage, and...

0:17:36.1 AS: Yeah. I'm imagining a little kid saying, and a teacher in that classroom saying, So how do you learn? How do you learn to memorize something? And they say, I take the first letter and then I make a rhyme. Alice likes such and such, and then I sing it in my head, and then people are like, Wow, okay, I never even thought about doing it that way. I know for me, I write out, let's say the first letter of something that I wanna memorize and think about it as a neumonic, but the idea of sharing those things in classrooms, and that's one way to coach, Counsel and discuss.

0:18:16.0 DL: Well, when you hear athletes in interviews and there's great coaches and that these athletes have worked for and they say, what about this guy? What makes him a great coach? Invariably, they'll say things like, he's a teacher, or she's a teacher. And just an incredible teacher. So when you're a manager of people like that, like whole groups of people, whether in a classroom, a team or a company or whatever it might be, and over time, you are a coach and a counselor versus being a judge with people. What does that do for you? Well, when times of crisis do come along, Covid, whatever it might be, if you've trained people up well, discipline them to think and understand and to work well with each other and support each other to a very high degree, you are now capable of taking on challenges that just across the street, the same kind of organization, they can't cope with it, they just fold because they have no internal ability to work together to a high degree to support each other to get through a crisis kind of a situation.

0:19:34.9 AS: When I think about Coach, I think about my dad and my mom to some extent, because they kicked me out when I was 18, and they said, Go make it on your own, but the deal was at that point, that was when they stopped giving any advice, it's like, You gotta do it. And we don't have any right to say, No, you've gotta make it on your own. My parents were never big on advice, but what they did is they listened to me, and then they tried to understand and all that, but I don't really remember my parents giving me advice specifically, and I can say that I remember when I had a girlfriend a long time ago in Thailand and I had some difficulty in my life that was pretty bad. It was pretty tough. And she said, You know what did you do? And I said, Well, I called my dad. And she's like, You talk to your dad about something like that!?

0:20:27.9 DL: Oh, wow.

0:20:30.5 AS: Yeah, and I learned in Asian culture, dads are not necessarily as approachable as they may be in the Western culture, which was a real surprise to me because I had seen Asian families as being very, very close, but what I just recall is just the comfort of being able to talk honestly and openly about a problem that I was facing. That was half of the solution, right there is to get rid of the anxiety and then start to think through. And so from a coaching perspective, I feel like coaching and counseling is really all about listening.

0:21:10.5 DL: Yeah, you made me think about... I grew up on a farm, and my father intuitively understood a lot of these things, even though his father was never like that with him, but my dad would take me out, we'd go to, put in a new fence or would repair something or do something, and one of the first things he'd say is, Okay, now what are we trying to do here? And the first few times, I remember thinking, Oh, don't you know? [chuckle]

0:21:42.5 AS: Fixing this fence. What are you talking about?

0:21:43.5 DL: Right, that's right. But he was trying to get me to think, and then by the time I was like 15 years old, he could just send me out to go, Hey, go down there and fix that fence or put that fence in. And he knew it was gonna be done right and done well. Because he taught me to think about situations and work through it.

0:22:04.9 AS: Well, maybe I'll wrap up this topic by... First of all, I think highlighting... We're on point number five. And that's... These points that Dr. Deming has highlighted. There's 14 of them. It's different from The 14 Points. And remember, if you're in the third edition, this is on page 86 of the new economics, if you're in the second edition, it's on page 125, and before I summarize point number five, I do wanna go back to point number four because you highlighted that, the point about being an unceasing learner, and let's just review point number four. He is... So we're talking about the transform manager, he is an unceasing learner, he encourages people to study, he provides when possible and feasible seminars and courses for advancement of learning, he encourages continued education in college or university for people that are so inclined, and that brings us to number five, which we've just been wrapping up, and that is he is coach and counsel. Not a judge. You highlighted the idea that particularly coming out of World War II, when military management, boss management or this management style of trying to tell people what to do was brought back into American industry, and all of a sudden it didn't lead to the result that it was supposed to or maybe people didn't even think about that, but what Dr. Deming is trying to teach us is that you really wanna get people to think.

0:23:34.0 AS: Particularly I was thinking as you were talking about that, the idea of continual improvement in The 14 Points, he's talking about making a long-term commitment to continual improvement. You can't get to continual improvement if people are not thinking. And so that's where I think this coaching and counseling rather than judging, is all about getting people to think and getting people involved in it, and so you've raised some really interesting points in academic setting, such as talking with the kids and that type of thing, and getting them involved. Is there anything you'd add to this summary?

0:24:12.4 DL: No, I think that's basically it. And sometimes we think that it's so difficult to give up that power of controlling people and things and making all the decisions, but when you do give it up and you train and discipline people to know what to do, when they have that power, you see a level of performance and really a joy in learning and work at a level that you never thought was possible before. Over the years, I've seen teachers over and over and over, tell me just that, that... I'll say, How is it going this year? And then say, I'm having such a great time. This is the best year I've ever had in my whole career. And they say, Well, what's happening? He says, Well, everybody just seems happier because we all work together and support each other, and instead of the other way around that we use to work.

0:25:10.9 AS: Yeah, and that's a great way to end it by also just refocusing all of us on the point that there is always an opportunity to improve, and in order to see the next improvement down the road, we can't see it until we get through our latest work that we're doing that then opens our eyes to the next opportunity. So I really wanna challenge the listeners to be focused and remember there's always opportunity to improve. David, on behalf of everyone at the Deming Institute, I wanna thank you again for our discussion. For listeners, remember to go to Deming.org to continue your journey. Listeners can also learn more about David at Langfordlearning.com. This is your host Andrew Stotz and I'll leave you with one of my favorite quotes from Dr. Deming. People are entitled to joy in work.

In our first podcast in April 2017, Doug Hall, Eureka! Ranch CEO and Founder, shares ruminations on leadership from his wide-ranging conversations with business leaders, as he stretches his imagination to ask "What is the new talk track to engage a leadership person who is feeling chaotic?"

With a 30+ year background in Deming management, Doug well appreciates the potential for "joy in work," yet asks "Where's the joy (to be found today)?.   In his meetings with senior executives, he finds tell-tale signs of broken interactions, systems likely to fail slow and expensively rather than "fast and cheap."   Upon probing them, he learned "they have no idea" what to do when the existing platforms (systems) are not working.   Worse yet, he finds executives overwhelmed by the speed of change in the world today, often consumed by chaos.

On the bright side, he hears of a need for systems that enable workers, not control them, as executives ponder "What the new type of leadership needs to be?" and the need, now more than ever, for openness to change, with women leading the way, per Doug's experience.   

For those having similar thoughts on helping leadership and change in a rapidly changing world, with ample opportunities for infusing Deming management, Tripp's latest podcast offers serious food for thought from a master innovator.

In our second interview podcast of November 2018, Doug Hall provides an overview of his latest book, “Driving Eureka!: Problem-Solving with Data-Driven Methods & the Innovation Engineering System”

(This is Tripp's third interview with Doug.  Link here for the first interview and here for the second.)

Highlights include:

• Inventing “big ideas” for clients, as they entered the “Killing Zone”
• Applied innovation, using the Deming Philosophy
• How to “Find, Filter, and Fast-Track” big ideas
• Happy clients, paying big money, but the ideas did not happen
• Half the potential value of the big ideas is lost in internal development efforts
• The independent parts of organizations work to promote their own silo
• The average new product idea has a 95% failure rate in the market place
• What’s wrong with project management?
• Innovation projects have uncertainty
• Problem solving with data-driven methods
• Big ideas are easy – making them real is hard
• A major obstacle is a reliance on opinions vs data
• Shifting innovation from an art to a science
• What to take away from this book?
• All products follow a life cycle, from birth to death
• Innovation for extending product life
• How to create an innovation culture
• Innovate or die
• Obstacles to innovation – Lack of Leadership and Lack of a Process
• Brain Brew Whiskeys for mass customization
• Don't feel you need to do "all" of the Deming Philosophy
• Just get started!
• How to receive a special gift from Doug - go to gift

This week's podcast features David Langford, CEO and founder of Langford International, Inc. and Deming Institute Advisory Council member.

David discusses "Education as a System" and using the four parts of Deming's "System of Profound Knowledge" to make a systemic change to the current education system. He talks about the "aim" and "product" of the education system. "What are we trying to accomplish?" "Are we just trying to improve test scores or are we trying to teach kids to think?"

David talks about the difference between studying and learning and the diminishing returns you receive when you have a whole system based on memorization. And why attempts to improve the system through programs such as "No Child Left Behind" and "Race to the Top" do not work.

Listen as David explores "what is good learning" and how changing the education system through "continual improvement thinking" (rather than just adding programs) will lead to better results for students and teachers; a win-win for all. 

For more information about David's current work, with Ingenium Schools, please visit ingeniumfoundation.org

This week's Podcast features Gordon McGilton, Director of a Private Equity Fund with investment in multiple industries. Gordon shares the humorous and unique way he was introduced to Dr. Deming's philosophies. He provides an example of a company that is using The Deming System of Profound Knowledge with great success, as well as how one can begin their own journey.

Gordon starts with, "every business is just a system and that system delivers some change of state that customers are willing to pay for. Everything else in between is just by what method to do it."

Listen as Gordon shares the Jet-Hot, Inc. story, a real example of how he applied the Deming System of Profound Knowledge and systems thinking to a coatings company on the verge of insolvency. After three years, with the same people, the company is prospering and the employees are proud of what they do, the company they work for and the solutions they provide the customers.

We step back and hear how Gordon was introduced to Dr. Deming's philosophies while working in the auto industry in 1980, when the documentary "If Japan Can, Why Can't We" aired on NBC-TV. This is a must listen podcast, as Gordon shares the tale of his initial resistance to attending Dr. Deming's 4-Day Seminar; and his subsequent understanding that everything he had learned in management, up to that point, was wrong.

Gordon explores his Aha! Moments, the first of which was, "you can't increase someone's capability by offering them money or by threatening them." This was a huge breakthrough, as he was raised on an intimidation model believing that's how you got things done. The breakthrough came once he saw that providing employees with the instructions, tools, information and support they needed, is what actually improved their performance.

This week's podcast features David Langford, CEO and Founder of Langford International, Inc. and Deming Institute Advisory Council member.

In David's third podcast he explores ways to get started in employing the Deming philosophy in education. In many instances this requires an "out of body experience"; stop playing the blame game, stop being a victim. He tells us to stop worrying about the bigger system and start optimizing the performance of the group, which you have influence over. 

David shares an example of a student whose "new" knowledge and appreciation for a system led to a study of the most common systemic questions asked by students. Listen as he reviews what they learned - to stop wasting time on things that are not meaningful, to start concentrating on things that are and get those to a higher degree of performance and to concentrate on deep learning experiences with lasting impact.

David explores how a small group of committed people working in a consistent fashion can transform an organization. You don't have to be "all in" to create transformation. It can start with you.

For more information about David's current work, with Ingenium Schools, please visit ingeniumfoundation.org

In this second episode of the Motivation series, Andrew and David P. Langford discuss how power dynamics impact motivation and why autonomy is a big factor in motivation. 

TRANSCRIPT

0:00:02.6 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I am continuing my discussion with David P. Langford, who has devoted his life to applying Dr. Deming's philosophy to education, and he offers us his practical advice for implementation. Today's topic is, Who Controls Motivation? David, take it away.

0:00:29.4 David P. Langford: Thanks, Andrew. So we're starting this five podcast series. In the last podcast, we talked a lot about the difference between intrinsic motivation and extrinsic motivation. Here in this five-podcast series, we're gonna discuss how do you actually create intrinsic motivation environments so that people want to do [chuckle] the work or the learning or whatever it is you might be getting them to do [chuckle] or task them to do. Right? So the first element, and I've been researching this for now over 40 years, and I've never found anything that contradicts what I'm gonna share with the listeners over these five podcasts. And these are five elements of intrinsic motivation that I guarantee you, if you start applying these, you will see either your students, your own children, employees, yourself, [chuckle] you will see people more motivated to do the work that they're doing, if you think about these five factors that we're gonna be going over.

0:01:48.8 DL: So the first factor that I wanna talk about today is the element of control or autonomy in situation. So when I have control over a situation, I have autonomy, I'm self-motivating. I'm doing things in that environment by myself. So we have a lot of buzzwords in management words like empowerment. And well, even a word like empowerment means I have all the power, and so I'm gonna give you some of it. [laughter] I'm gonna empower you to... But you can only do this a little bit, I don't want you to do a lot of stuff. I just want you to do... Be empowered to just do this thing, kind of a thing, and that's also an element of control, so.

0:02:38.6 DL: But control is... Our economy is built into the human condition, and when we tap into that in managing people in either in a classroom or a workforce or a whole group of teachers, whoever it might be, yes, the more I set up an environment where I'm allowing people to take control or have autonomy over what they're doing, the more I will see them be motivated. The more I take that away, and I start controlling everything and running stuff, I start to be really motivated, [chuckle] and I see this a lot with teachers. They're really motivated by controlling everything, controlling all those kids, controlling the process, controlling having... And they have total autonomy in the classroom to do whatever they wanna do basically, and so they're really motivated by that. Well, when they start giving up that control or that autonomy to children, a lot of times, they become de-motivated.

0:03:43.5 DL: [chuckle] I'll never forget this story. I was working with a university,in California, and I had one of the teachers, one of the professors, that really wanted to learn about this and how to run a classroom, so we talked a lot about... I've worked with him individually and talked about, "How do you set up your classroom so that when the students come to your classroom, basically they start to have autonomy and control over the process and what's happening?" Well, one day I get a phone call, and I answered the phone, and this guy is whispering to me. He said, "I think I need some quality therapy." And I said, [chuckle] "Why? What, what's going on?" And he said, "Well, I had a flat tire on the way to school. And so the university has a policy if the professor doesn't show up in the first 10 minutes, everybody can leave. So I was 30 minutes late, and I was just sure I was gonna walk into the room and everybody's gonna be gone." But he said, "I walked into the room and nobody even knew that I was missing.They were all working in teams and working on their projects and discussing stuff and doing what is they're doing?" He said, "I need some therapy." [chuckle] Because for him, that was de-motivating that they didn't need him. Right? So it's a very powerful, powerful concept once you start to get it, but you also have to understand that you, as the manager, of that situation are part of the equation, that as well, right? So you almost have to start the... Your motivation by seeing other people taking on the control of the situation and having autonomy to do what it is that they need to do. I was in a kindergarten classroom in North Carolina years ago, and the teacher had been through my training and stuff, and she invited me to come to her classroom.

0:05:34.6 DL: And so I went there early in the morning and just watched, and those little kids came in and they just knew what to do. And they all went to their tables and they got their stuff out. They were talking with each other and interrelating. And it was probably at least 40 minutes before the teacher intervened in some way. It's the kinda thing where I have to interrupt your learning to [chuckle] motivate you or tell you something. But those little kids had... Five and six-year-olds just had total control of that first 40 minutes. And were happy about it. And yeah, there was a child or two that weren't quite doing what it is they were supposed to do, and what'd the teacher do? She goes over and sits down beside them and starts working with them and explaining stuff and, "Oh, I see you might be having a little trouble with this and... " Right?

0:06:36.4 AS: Maybe just had a bad family day.

0:06:39.0 DL: Yeah. Now, that's totally different than, "Everybody get in here, sit down, be quiet, don't talk to each other, don't touch him. I'm gonna control this situation, and I'm gonna tell you what to do and... Okay, this is what I want you to do, and you go do it, and once you've done that, come back and sit down again." Well, that's the old teacher mentality [chuckle] that I have to control the situation, and there are times where you need to exert that kind of control. If there's a fire in the building, you might have to control the situation, but sometimes teachers will bring that up to me and I'll say, "Look, what if there's a fire in the building and you were incapacitated or taken out by the fire? Would all your students know what to do? [chuckle] Or maybe you were out of the classroom when that erupted, that... Would they all know what they're supposed to do, regardless of whether you were there or not?"

0:07:40.1 AS: Right.

0:07:41.6 DL: Or are they just gonna burn up, because they're waiting for somebody to tell them what to do? So, that's the element of control. So, how do you get that? One of the ways to get that is to give people more knowledge of the situation. Just the example that I just gave you. When those students have the knowledge of what to do if there's something that goes on or something happens, and they have the autonomy to do it, and so maybe you actually practice that. Well, I'm giving you knowledge of what to do in that kind of situation. And when people become more and more knowledgeable about what's going on, they feel like they have much more control over their situation, what's happening. That makes sense?

0:08:36.9 AS: Yeah, and I think what I'm thinking about then is talking with kids like, what's the objective? If there's a fire, get out of the building. And, we have... That's our objective. How do we do that? Well, we try to stay in line because we hold hands, and that helps us keep, but...

0:08:52.8 DL: And we don't wanna run over each other, and... Right?

0:08:55.1 AS: It reminds me of this story of when Dr. Deming talked about cleaning a table. And he was saying something like, "How could a worker really know how to clean a table if you don't tell them what the table is gonna be used for?"

0:09:13.0 DL: That's right. So that's knowledge, right? Are we gonna operate on this table? We're just gonna eat lunch on it? Oh, well, just... Those are two different types of cleaning, aren't they? [chuckle] And so, how can I do a good job if I don't know? I don't have knowledge of that situation or... And, you see this in little children. They're asking why. You're telling them to do this and they say, "Well, why?" Well, because...

0:09:43.4 AS: 'Cause I said so.

0:09:45.1 DL: 'Cause I said so, right? Well, and if you don't do it, I'm just gonna make your life so difficult that you wish you would have.

0:09:52.0 AS: Right.

0:09:52.6 DL: That's not good management, that's just manipulation of somebody. And yeah, you can get the result. But in the end, somebody's not gonna wanna... They're not gonna wanna do what you want them to do on their own. I remember a teacher came up to me one time, said that in the 1960s, he was working in an auto factory in California, and his job was to put these types of rivets in some part of the automobile. But he noticed that the machine that he was using to put the rivets in, would strip the rivets out every once in a while, and he got really tired of having to re-work this situation. Not rivets, they were screws, I think it was.

0:10:45.1 AS: Right.

0:10:45.5 DL: So he actually built his own little tool so that it would only go in at the proper depth and every screw was going in perfectly, and he was very proud of it. So proud of it that when his supervisor came by, he showed him, he said, "Look, look what I built, I built this, and you may wanna think about doing this for everybody," and well, his supervisor just lit into him and told him, "Your job is not to think. Your job is to put these screws in and you go back to doing what you were told to do in the first place." And I asked him, I said, "Well, so what did you do?" He said, "When the supervisor was around, I used the tool that did a bad job, and every time he would leave, I would get my tool out and do it properly." So he was still in that environment, intrinsically motivated to do a good job, but because the supervisor wanted that autonomy or control of that situation, and it's the "not invented here syndrome" that...

0:11:49.1 AS: Yeah.

0:11:49.3 DL: "I didn't invent it, I didn't tell you to do that, so therefore, it can't be a good idea," kind of a thing.

0:11:56.7 AS: And I'm thinking about... There's some teachers out there that are... Have a really hard time. "If I give up control, this classroom is gonna go chaos." They are making themselves really important in that, and let's say... Let's put those people aside for just a minute and let's just take the people that are kind of in the middle, they're open to that and all that. And I just wanna tell a quick story in my life. I remember, my father never... My father didn't tell me his personal problems. He talked to my mom about that, and occasionally, I knew a little bit of what was going on. But I remember, when I turned about, I don't know, 25, and I really had become a much more mature guy, and my dad started telling me some of the things he was dealing with, some of the ways he felt about things, and it's like the whole thing flipped. I just really saw a different side, a human side.

0:12:49.1 DL: They're human. [chuckle]

0:12:50.9 AS: Yeah. And I saw a different side of him, but also I've wanted to be a different participant in that. I wanted to be a participant and someone that could listen and understand where my dad was coming from. And I think about classroom, then I'm thinking about what you're talking about, a classroom. So for a teacher who's kind of open to try some new things, part of what you... Maybe what you're saying is, flip the script a little bit and talk about why are we here, what are we trying to do? What am I trying to do. What's my job? What's...

0:13:17.8 DL: Yeah. When I see intrinsic motivation emerge, it's there, right? It's there. All you have to do is manage the situation differently, and you'll start to see it emerge and come out. So you can take something so simple like the start of a classroom. Well, I could just have all the children come in and talk and goof around and everything else, until I stand up and tell them what to do. That's a way to control the situation or like I was saying, I could start to give them the knowledge of what to do. So let's talk about... Let's do a flowchart. Let's do a flowchart about what to do when you come in the door. Where do you go? What do you do? How do you get things set up? Well, I've now just transferred a level of control to them or a situation like, somebody doesn't know what to do next.

0:14:24.3 DL: So we talk as a class and maybe we come up with a flowchart that's what to do. What to do when you don't know what to do. So we're now giving them knowledge about that situation and being able to take action. So then if I have a child that says, "Well, I don't know what to do." "Oh, have you looked at the flowchart?" Let's talk about that. Remember we talked about, okay, the first thing you wanna do is do this and then do that and maybe talk to somebody else and see if they know what to do. But there's a process of what to do when you don't know what to do. Now, that's different than me saying, "Well, if you don't know what to do, come up and ask me." 'Cause it's putting me...

0:15:11.2 AS: And then I'll tell you.

0:15:12.1 DL: Yeah. It's putting me in total control of that situation and that's very motivating for me. But it's very demotivating for the individual because they can't take control because they don't know what to do next.

0:15:24.1 AS: Yeah.

0:15:25.3 DL: So change the situation, watch how behavior changes versus what we've been taught to do, especially in schools, is leave the situation alone and then manage the behavior that it's producing. See?

0:15:40.2 AS: So we're back to the system

0:15:42.2 DL: Yeah, absolutely. So, couple of other factors, before getting control of the situation. The more you have people self-evaluate their own progress, you'll start to see intrinsic motivation emerge. So as long as I'm evaluating you, write this paper, hand it in. I'll grade it. I'll go over it, I'll find the mistakes, and then I'll put a grade on it and I'll hand it back to you, well, that gives me as a teacher total control of that situation. I reverse that, and I set up processes for you to self-evaluate your own work, so when you think you're finished with this, here are the steps that you wanna go through, so check to see if it's this or nowadays, have you run it through Grammarly, online? But I'm putting you in a position where you have autonomy to self-evaluate your own work. And then if you think it's finished and you've finished your self-evaluation, you might wanna share it with somebody else. I'm gonna look at it, see if you can get some feedback from them. See feedback is very motivating, but evaluation is not.

0:17:00.7 DL: I can give you some feedback on the job that you're doing and support you and how you can do a better job. That's much different than me saying, "You're doing a lousy job, Andrew." Or, "I'm gonna put B on this paper." No matter how hard you worked, you're gonna get a B. So the example you gave in the last Podcast about only 10 students are gonna get A's. Well, that's an artificial scarcity of top performance. And so I'm pretty certain people looked around the room and they said, "I'm not one of those 10 people, I know that."

0:17:37.0 AS: I'm outta here.

0:17:38.4 DL: I'm outta here.

0:17:39.5 AS: And that's not achieving the goal...

0:17:40.9 DL: Right.

0:17:41.5 AS: Or the aim.

0:17:42.3 DL: Or we have other ways that people get control of their situation when they feel out of control. We call it cheating. So when the situation won't allow me actually to achieve what I'm supposed to achieve, maybe I'm a university class and I have to have this grade, have to have this class to get my degree, but the class is so horrible, I'm not learning anything, there's no way I'm gonna pass this test, and so I end up sacrificing my integrity and cheating 'cause it's worth the risk. Because the system is not gonna allow me to learn this material and get to the level I need to get to. So that's when we start to see the effective behavior emerge. It starts really very early in schools. Kids feel like, "I can't get this, I can't understand it, so I'm just gonna have to cheat, copy somebody else's paper, or steal it or something." And we wanna manage that behavior, wow, oh, we caught that, we're gonna... So we come up with sophisticated methods of catching the cheaters. Right?

0:19:00.0 DL: So you see it in the SAT tests and all kinds of things. What? You got to have monitors. It has to be one monitor for every 50 students or because we gotta catch those cheaters. [chuckle] But nobody's looking at the situation or the system and saying, "What's causing people to cheat?" Because they're feeling helpless and hopeless and, "I can't get this. And so, the only way I can get it is to cheat." There's some other ways that we can impart or get people to have more control in situations. So when you think about neuroscience, the human brain taps into mapping and patterns and systems actually. And again, we're back to Deming's work. And Deming tapped into that, actually. So when I put learning into maps or patterns or gestault kinds of things, the human brain actually responds to it better.

0:20:00.9 DL: So in a classroom, instead of me just verbally talking about stuff all the time, if I take that same information I want people to know and understand, and I put it into some kind of a map or a pattern or a flowchart, I'll see a new level of intrinsic motivation or ownership start to emerge, because I've just changed the situation and tapped into something. So I'm not just dealing with just the auditory learners, I'm really tapping into... I'm giving control of everybody over to learn. I created a tool to do that, actually, to take curriculum and put in into a map or a pattern and then give that to students at the beginning of a learning experience. And all of a sudden, you see ownership, this is all the stuff that you need to know and learn in this two weeks or whatever the time has to be. That's much different than me saying, "Well, read this book. Well, what do I need to know in this book? What's gonna be on the test?" "Well, read it just in case I put something on the test." That's a school game that puts the teacher or the system in control, but it makes the learner feel helpless in that environment.

0:21:21.9 AS: You used a word, ownership. How do we think of ownership versus intrinsic motivation? What does that... What does that mean?

0:21:29.0 DL: Ownership, autonomy, control of the situation, those are all of the same kinds of concepts that you're trying to get people just to have more ownership of their own learning, their own situation. And my job is to manage the whole system, right? So if I've got 30 kids in my class, I want all 30 to be well motivated [chuckle] to learn whatever it is that we're working on and going through. So another level of control is choice. The more choice I give people in a situation, I'll see their intrinsic motivation emerge. And it can be so simple that you can choose to do this, or you can choose to do that. [chuckle] That's an element of choice.

0:22:14.4 AS: Mom, mom, you can either walk after breakfast or twice in the afternoon. [chuckle]

0:22:20.7 DL: Yeah. But that's a level of intrinsic motivation, right? You're giving her the control of that situation. "Well, no, I'd rather do it in the afternoon." Okay. Right? That I'm managing differently by giving people choice, or in a classroom, you have the choice to choose what you wanna write about or how you wanna write it or... And now, for some children that can be overwhelming, right?

0:22:48.3 AS: Yeah.

0:22:48.6 DL: So I can say, "Well, you can choose whatever you wanna do, or I'll choose it for... Or you can have me choose it for you." Right?

0:23:00.5 AS: Right.

0:23:00.6 DL: If you want me just to give you a topic, I'll be glad to do that. Maybe it's you can't really think about what you wanna do, right?

0:23:05.5 AS: Right. That may take some pressure off of them.

0:23:07.7 DL: But still it's your choice, right?

0:23:10.3 AS: Yep.

0:23:10.9 DL: So you start to see rebellion go away when you incorporate levels of choice because I can't really rebel against myself. [chuckle]

0:23:21.6 AS: Right, yep.

0:23:21.9 DL: I chose to do this, but no, I really don't wanna do this. [laughter] But you chose it, right?

0:23:27.9 AS: And that circles back to the title, which was Who Controls Motivation? Maybe I'll just summarize some of the things that I took away. We're talking about five elements of intrinsic motivation and a lot of it has to do with creating the environment so that people wanna learn and they want to get the benefit of that. And the first element is control. And the point is when you give someone... You, if you're holding onto the control, you're not really empowering or you're not really giving autonomy and control. Just give that control to the other people, to the kids, to the other people at the company. They're gonna know what to do with it. And help them and guide them. How do I... What do I do? Give them autonomy. And also you talked about the idea that give people more knowledge. And I think that that's part of what I was telling my story about my father, is like the idea he was giving me more knowledge of what's going on. There's more there than I knew. And the more knowledge that someone has, the more they can really figure out what to do with that. You also said a good one, which was intrinsic motivation, it's there. Just change some things and watch it emerge.

0:24:41.1 DL: That's right.

0:24:42.2 AS: And then you went through a couple of different things that are really helpful for helping people take control, to get that intrinsic motivation. You talked about self-evaluation of your own progress and that helps people. And feedback is motivating, but evaluation is not. So think about constant feedback. "Hey, that was good. Oh, did you see why that happened? Why do you think that happened?" That, and also you said when people lose control, they often cheat to cope. And I liked... One of the things that you said was that the brain taps into maps, patterns, and systems. And I use that a lot when teaching. I need that to see how does this all connect? And then you alluded to the idea of appealing to maybe the left brain and the right brain type of people in the room that maybe some people are seeing things more logically, whereas other people will see things less linearly and that type of stuff. And then final thing that you talked about is choice gives control. Anything you would add to that?

0:25:55.0 DL: Yeah, there's a couple of other factors quickly. One is just-in-time learning, so when I'm getting the knowledge I need just in time. So I'm working on a project or something, and I need to know a level of skill to complete this project, well, when I discover that I need that knowledge, right, that's just-in-time learning. So if you need to know this, come to the back of the room and I'll explain it, but if you don't need to know this right now, then just keep on working and keep doing what you're doing 'cause I don't wanna interrupt you. Well, that's an element of choice. It's also a just-in-time learning. "So when I'm ready, I'm gonna go get that," versus, "I'm gonna teach this now whether you need it or not." Well, that's when you get kids sleeping in class, bored out of their minds, because maybe they don't need that at all. They don't need that explanation.

0:26:54.7 DL: I already know this, right? So I'm just gonna screw around and pass notes or do something else that's more fun than sitting and listening to you. And the last thing for control is time. So the more you have an understanding of how to manage time or teach people to manage their own time, the more, yeah, control that they'll feel like they have over a situation. They'll understand how to work it through. So I often use the example, when you have a two-year-old, right? And you have an appointment that you have to get to, and so you gotta get the two-year-old in the car and get him buckled in the car seat and you gotta go, right? And so you're in a hurry, and so you grab them up and they're yelling and they're fighting you to get in the car seat 'cause they don't wanna go, and... Right? And so, "Well, if you get in your car seat, I'm gonna give you a lolly or a sucker or a piece of candy, or... I'm gonna bribe you to do what it is, what I wanna do.

0:27:54.8 DL: Or I'm just bigger, so I'm just gonna force you into that seat and buckle you in, Right?" Well, that is a way to accomplish the task, or you could do something differently. At breakfast, you're saying, "In about an hour, we're gonna get ready to go, and we're gonna go to the doctor's office, and it's gonna be really interesting for you to see the doctor's office, and we're gonna talk about everything we're gonna do and everything else. So now we're gonna get our coats on and we're gonna walk out, and I'm gonna wait for you to climb up into your car seat, and what do you need to do now? We need to get buckled," right? That's all gonna take a lot more time than me grabbing you and forcefully [chuckle] putting you in that car seat and buckling you. You see, but the urgency of the situation was not that two-year-old's problem. It was yours. Your lack of planning [chuckle] caused the crisis. And if I change any element of that, I see that two-year-old be more intrinsically motivated to do what I want them to do, right?

0:29:05.6 AS: Yeah.

0:29:05.7 DL: 'Cause we're doing something together, and that's the relationship that they're craving more than anything. So I'll leave you with that.

0:29:12.4 AS: So just-in-time learning and teaching people how to manage their own time and it gives them control?

0:29:19.0 DL: That's right.

0:29:19.5 AS: Fantastic. That's a lot of stuff that we covered in that, and personally, I learned a lot. I did like the just-in-time learning 'cause I feel like that's my job. As a financial analyst in the stock market, I come across things I don't really know much about, and I was just looking at, "Well, green energy doesn't seem to work." Germany tried to do it, and they weren't able to replace what they lost in traditional energy. What about nuclear energy? Okay, where does that come from? It comes from uranium. Okay, where is uranium? The country that has 40% of uranium production is Kazakhstan, a former Soviet Republic. And now, all of a sudden, I put together that, wow, Russia and Kazakhstan together all control 50% of the uranium in the world. All of a sudden, you realize that Putin has control of the supply chain for nuclear power. So now, what is this country, Kazakhstan? I remember studying it 'cause I had to, but now I'm interested just-in-time to learn, "Okay, how does this all fit together?" And that to me, I just went through that process for a global investment strategy report, and I was able to tell my clients, "I don't know a lot about Kazakhstan, but here's what I've learned, and I have a feeling this will become a name of a country that we're all gonna know in the next 10 years."

0:30:42.5 DL: Well, you know, Kazakhstan is right next to, "Don't-Understand," so.

[laughter]

0:30:50.2 AS: Yes, right? Under... Understand. Yeah, that's right. [laughter] So David, on behalf of everyone at the Deming Institute, I wanna thank you again for this discussion. And for listeners, remember to go to deming.org to continue your journey. This is your host, Andrew Stotz. And I wanna remind you that listeners can learn more about David at langfordlearning.com, and I'll leave you with one of my favorite quotes from Dr. Deming, "People are entitled to joy in work."

In this new series, John Dues and Andrew Stotz discuss John's model for improvement. This episode includes an overview of the model and how John uses it for goal-setting and planning in his school.

0:00:02.4 Andrew Stotz: My name is Andrew Stotz and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with John Dues, who is part of the new generation of educators striving to apply Dr. Deming's principles to unleash student joy in learning. The topic for today is building an improvement model. John, take it away.

0:00:24.8 John Dues: It's good to be back, Andrew. Yeah, so we sort of wrapped up this last series. We had a six-part series on organizational goal setting. And we, if you remember, we talked through those four conditions that are important for organizational goal setting, especially healthy goal setting, where before we set a goal, we understand sort of how capable our system is. We understand how our data is varying within our system. We are looking at our system and seeing if it's stable or unstable. And then, of course, we want to have a method for how we go about improving. And so you kind of have to have an understanding of those four conditions before you set a goal.

0:01:03.6 JD: And I thought sort of as an extension of that, or possibly a new series, we could kind of take a look at an improvement model that would help us sort of better set ambitious goals. Because when we did those four conditions, it kind of leaves you wondering, well, how ambitious should my goals be? Should I still do stretch goals, those types of things? And I think this improvement model that we're building here at United Schools sort of addresses that. And it's something we're building.

0:01:34.4 JD: And so I think the listeners kind of get like a little bit of behind the scenes on what it looks like now. I think we'll see a version of it. And perhaps through this dialogue, through the series, we'll even think about ways to improve it.

0:01:48.4 AS: Can I ask you a question about that?

0:01:49.6 JD: Sure.

0:01:50.0 AS: One of the things, I do a lot of lectures on corporate strategy and workshops, and the lingo gets so confusing, vision, mission, values, and all kinds of different ways that people refer to things. But when I talk to my clients and my students, I oftentimes just tell them a vision is a long-term goal. And it could be a five-year or a 10-year goal. And because it's long-term, it's a little bit more of a vision as opposed to, you can see it very clearly. Like my goal is to get an A in this particular class, this particular semester. Whereas what I try to say is, a vision is: I want to be in the top of that mountain. And I want us all to be at the top of that mountain in five years. And I kind of interchangeably call that a long-term goal and a vision. And I'm just curious what your thoughts are on long-term versus short and medium as we go into this discussion.

0:02:53.8 JD: Yeah. I think as we get into the model, we'll actually see both of those things, sort of a long-term sort of goal, sort of a more intermediate thing, and then how you work back and forth between those two things. So I think that's a good segue.

0:03:08.4 AS: Let's get in it.

0:03:08.4 JD: Yeah. And so just maybe just a few other things about the model before we get right into it. So one thing to know I've come to appreciate is when when I say a model, I just mean something visually representative that helps us understand and communicate how we think things should be functioning in reality. So when I say improvement model, I'm actually like talking about a diagram on a piece of paper that you can put in front of everybody on your team. So everybody has an understanding for how you're approaching goal setting in this case.

0:03:38.1 AS: Would you call it an improvement visualization? Or what's the difference between what you mean by model and like something that I would call, let's say, a visualization?

0:03:49.5 JD: Yeah, I'd say it's a type of visualization when I say model.

0:03:52.8 AS: Okay. Excellent.

0:03:53.8 JD: Yeah, that's what I'm talking about. And I think you'll see it when we get into the model that definitely there's credit due to Mike Rother and his concept of Improvement Kata because this model heavily borrows from the work that he's done, if you're familiar with that four-step Improvement Kata process.

0:04:15.1 AS: Yeah. Very.

0:04:19.7 JD: But anytime, whatever the thing is that you call like key performance metrics, key metrics, whatever you call that thing that we all set in our organizations, there's always this gap between what we want and what we're currently getting. And this model gives us the scientific way of thinking and working to close basically that gap. In this world, the gap between the voice of the process and the voice of the customer, how do we close that gap? So that's sort of what the model is addressing. So I'll share my screen so you can see that and anybody that's watching can see what the model looks like. And I'll just kind of leave that up as I'm talking about it, put it in slideshow.

0:05:08.7 AS: Great. We can see that now.

0:05:14.6 JD: Great. So we can just start by just kind of giving an overview, especially for those people who are listening, but you can kind of picture like a path going up a mountain and that path has twists and turns. It has obstacles. In this particular diagram or model, there's rocks in the way of the path. There's a water hazard, there's trees in the way, there's a roadblock. And as you go, it's kind of strange because you're working your way up. And I'll explain this all as we go through it kind of one step at a time. But as you're working from left to right in the model, this four-step improvement model, you have a team over on the left. This team's working on a goal that you're setting. And then over on the left, you actually have step two, which is grasp the current condition. And then you have this big crack in the path that's called the threshold of knowledge. And I'll talk about what that is.

0:06:11.1 JD: And sort of the next step is actually step four, experiment to overcome obstacles as you're working left to right. You go further up this path, up this mountain. And number three, the step three is establish your next target condition. And then when you get all the way up the mountain and you have this challenge or direction. So that's what you were just talking about. So what's that long-term thing that you're trying to accomplish? We call that a challenge or direction. So the steps that you're taking actually chronologically are you're going to do number one first.

0:06:43.2 JD: You're going to set that challenge or direction, but it actually is the thing that you're working toward. That's the sort of beginning with the end in mind. So that's why it's way up on the mountain, but you're going to do that first. And the next thing you're going to do is go all the way back down to the start of the path and grasp whatever that current condition is in your organization. And then you're going to run experiments on the way to trying to get to the next sort of intermediate step, that next target condition. So four steps, and then you have this team working on it.

0:07:16.8 AS: Which I would say for the traditional American style, as from my perspective, it can be a bit confusing because you're starting with number one at the farthest point away instead of closest to you. Then you're going to come to number two. From a timeline perspective, it feels like you're kind of zigzagging back and forth in your thinking.

0:07:38.8 JD: Yep. You definitely are. And it takes a little bit to wrap your head around it, but we'll kind of work through this piece by piece. So let's start with the team. So you have these people on the left-hand side of this diagram. There's sort of three different groups within that team. And we've talked about this a number of times, but remember that there's this key concept when you're going to take a thinking systems or a systems view of an organization. That you have to have these three different groups of people. You have to have the people that are working on the system, the people that are working in the system, and then from Dr. Deming's perspective, you have to have somebody that has profound knowledge, has that lens. So again, someone from the outside that has profound knowledge. And then in our case, the people working in the system, generally speaking, are the students. And then you have to have the managers that have the authority to work on the system. So in our system, that would be teachers and school leaders. But this model is not specific to educational organizations. You could translate this to any other type of organization.

0:08:50.4 JD: So if we were a hospital, then perhaps the people working in the system, depending on the improvement project, could be nurses. And then the managers that have the authority to work on the system, maybe the hospital management team. And then someone from outside with profound knowledge could be either someone internally that has familiarity with the System of Profound Knowledge or someone that they bring in externally, like a consultant to help out. So the point is, is that, again, this team, whoever's working in the system is going to differ by the organizational sector that you're working in. But it translates in the system basically.

0:09:31.0 AS: It's interesting that I've seen this type of diagram or concept about work on the system, work in the system and a System of Profound Knowledge coach. But it just kind of clicked for me to think about it. It obviously, like when I work with a company, I'm working with the owners and the top management. And when I do that, we're working on the system.

0:09:58.5 JD: Yep.

0:10:00.2 AS: And I have the knowledge of the System of Profound Lnowledge. So I'm coaching them about the system. And then within the system, they have the employees who are executing on what they're trying to improve and do, but it just perfectly explains it. So I love that diagram.

0:10:17.8 JD: Yeah. And I have the same experience. And I think we've mentioned on this podcast before that in my world, we often have school or district-based improvement teams. And it's typically leaders of the organization, sometimes teachers, but almost never is it students working in the system that are a part of, or, providing significant input into the improvement. So, I think if you can combine, in our case, students working in the system, because they have things that they can identify in terms of how they experience the system that are different than the people that work on the system. And then having that third group that, or that person that has that outside profound knowledge, if you put all the three of those things together, I think you have a much better chance to improve. But I think in schools, that's probably never happening. I'm assuming that's the same in other industries as well.

0:11:08.3 AS: And this also explains why when Dr. Deming would see slogans and things like that, encouraging the workers to do better and higher quality, he was like, they don't have the authority to change the system.

0:11:22.5 JD: Right.

0:11:24.1 AS: And what you've said is the group that's working on the system has the authority or the ability to change the system.

0:11:35.4 JD: Yeah. This is one...the makeup of this team that's using this four-step process, that's one innovation that we've done to this model that would be different from the Improvement Kata. So in the Improvement Kata, there's just coach and learner. Usually sometimes there's a coach of the coach, a coach and a learner, depending on how it's represented, but this is in my view, an innovation where you have the work on the system group, the work in the system group, and then the System of Profound Knowledge coach. I haven't seen that in this model.

0:12:07.4 AS: And could that be because when Mike Rother was writing his book, he was particularly referring to Toyota.

0:12:18.7 JD: Could be. Could be.

0:12:19.5 AS: Where the workers have more authority to impact the system. Whereas in the typical American system, the worker doesn't really have the authority to stop the production line or something like that to the extent of the Japanese. So interesting point.

0:12:36.1 JD: Yeah, that's a really good point. My understanding of Mike Rother's work is he sort of derived this improvement model by watching, observing, working with Toyota over a very long period of time. So that very well could be the case. Cool. So we have the team, so let's go to step one, that's the challenge or direction. And I really like that because again, when we did that six part series on Goal Setting is Often an Act of Desperation, one thing that I did think was missing was like, well, still as an organization, we want to move forward. We want to improve. We want to be ambitious in how we're setting our goals, but I don't think that fully came through in the four conditions. And so I think layering this model on top of the four conditions really helps because I think it is important to be ambitious, especially when we're talking about like a mission driven organization, we need to be setting ambitious targets for student learning, coming to school, those types of things.

0:13:39.6 JD: So really what we're doing in step one of the model is we're asking the question, where do we want to be in the long run? So this is a long term goal. This is a longer range goal that would differentiate us from other schools if we achieved it. But currently when we think about this goal, it actually seems nearly impossible because it's so far from where we are currently performing. We don't know how we're going to get there. So an example in my world is, schools have been paying much closer attention to chronic absenteeism, which is when a student misses 10% or more of the school year. And those numbers basically skyrocketed towards the end of the pandemic and then for the last several years. So that's something we're focusing on as an organization. So our chronic absenteeism rate is really high, like 52%, something like that over the last several years. And we want to get that down to 5%. So there's this huge gap.

0:14:53.6 AS: That's a huge move.

0:14:54.5 JD: Huge gap, order of magnitude, right? To go from 52%, that's the voice of the process. That's what's actually happening. And the voice of the customer, what we want is 5%. And we really don't know how to get there. And that's going to be the case at the point where you're at step one, but you're doing that first. You're setting that challenge or direction. And that really is something that needs to be set, in my view, at the leadership level, at the management level. So, that's step one.

0:15:22.9 AS: And you just said something that's interesting is we really don't know how to get there.

0:15:25.6 JD: And we really don't know...

0:15:26.9 AS: I mean, if we knew how to get there, we'd probably be there.

0:15:28.6 JD: Yeah. Yep. Yep. So that's step one. That's why if you're able to view the model and you're watching the podcast and you can see the video, that's why number one happens first, even though it's on the far right hand in the upper right hand corner at the top of the mountain in the model.

0:15:45.8 AS: And is there a reason why it's a relatively vague thing, right? Challenge or direction.

0:15:54.0 JD: Yeah.

0:15:55.5 AS: Why is it vague as opposed to specific target, goal or saying something like that?

0:16:03.7 JD: Yeah. I mean, I think, I like challenge or direction. One, it fits on the page. And it sort of conveys that it's going to be a challenge. And it also, if you're going to work in this way to achieve something like that, that it's actually setting the direction of the organization, the direction that the organization is moving toward. So.

0:16:24.0 AS: In other words, is it acknowledging that we really won't, we really don't know that target. We think we know it, we see that mountain, but as we go closer to it, we want to go in that direction, but as we get closer, it'll become more clear exactly where we're going to be or want to be.

0:16:44.7 JD: Well, I think this would be something that... I think in my view, we're still learning. But when we set that challenge or direction, I guess I could see some circumstances where we would come off that, but I think we kind of want to set it in a way that really pushes us. Right. So I'd be, I mean, I think you could learn some things that would say, okay, maybe that wasn't the exact right number to set, but I'd also be careful about just adjusting it because it's hard.

0:17:13.2 AS: Okay. So you mentioned 5%.

0:17:17.9 JD: Yeah.

0:17:19.1 AS: Would that be, would you state it as achieve 5%?

0:17:25.9 JD: Yeah. 5% or less of our students are chronically absent.

0:17:30.4 AS: Okay. Keep going. I don't want to slow it down. But listeners may get it faster than I do. I'm a little bit slow and I have a lot of questions as we go along.

0:17:37.0 JD: No, no. And I think what we could do in future episodes is dig into each of the steps a little bit more too, and use this as an overview session.

0:17:46.9 AS: Yep.

0:17:48.3 JD: So that was step one. So now what's going to happen in step two, you're going to come all the way back down. Now you're at the very start of the path.

0:17:56.6 AS: Back to reality.

0:18:00.6 JD: Back to reality, step two. And the first thing you have to do, okay, we've set the target, this very challenging direction we want to head into because it's the right thing to do. The next thing we're going to do is grasp the current condition. And so in step two of the model, we're going to ask, where are we now? So we know the long-term goal and now we need to study the current process and how it operates basically. So basically this study represents our current knowledge threshold about the process. And then it's going to contribute to how we define the next target condition we've set that sort of intermediate step on the way to the challenge. And so a lot of that six-part series on goal setting is often an act of desperation, a lot of that learning is right here at what we're doing at step two, because we're creating a process behavior chart in a lot of cases, and understanding how our data is performing over time in this particular area. That's what grasping the current condition means.

0:19:02.6 JD: So part of it, it's a data thing. So in this chronic absenteeism example, what I'm gonna do is I know where I want to be. Now I need to understand where are we historically. And then also as a part of grasping the current condition, I may wanna do some things like interview students and families that are chronically absent, then sort of dig into why that is. Interview teachers about why they think that is. There's a number of things that you could do at this step on the ground where the work happens to grasp the current condition. And I think there can be a sort of quantitative component to that and a qualitative component to that. Also, we sort of understand like how are things actually working on the ground that contribute to us not being where we want to in this particular area.

0:19:56.7 JD: So that's step two. That's what we're gonna do next. After we've set the challenge or direction, we wanna sort of understand the situation on the ground, grasp the current condition. And then next what we're gonna do is step three, which is establish your next target condition. So in step three of the model, we ask where do we want to be next? So we know we can't make this leap, from 52% to, 'cause we wanna decrease it down to 5%. We know we're not, that's too big a step that we're just gonna get there somehow magically. So our target condition, then it's our next goal, usually within a time bound, achieve by date. In Mike Rother's work, he suggests something on a pretty short term scale. Something like one week or one month. So something like chronic absenteeism, I think one month would be sort of where I would set the next target condition. Just having experience with something like attendance rates.

0:21:07.0 JD: And at this point we don't exactly know how we'll achieve the next target condition, but it also, it doesn't feel as impossible as the challenge. So it's a step towards the challenge. So we're gonna do that next. So we set the big challenge that may take us three years to get to. Then we understand the current conditions on the ground and we use that knowledge to set our next target condition. So that's step three. And then the fourth step is we're gonna experiment to overcome obstacles.

0:21:45.9 AS: And before you go to fourth, let me just ask a question about establish your next target condition. One of the things that's missing from that, obviously is, you know, coming from a different perspective, is that when we say, all right, here's where we want to be, and let's go back to reality, and here's where we are. Sometimes, when people work like myself and others, work with people who say, okay, let's map out all the steps to get to that vision. What are the next five things we have to do? Whereas here you're saying, let's focus on the next target condition rather than the next five.

0:22:25.4 JD: Yep. And keep in mind when I say establish the next target condition, what I literally mean is what's our next intermediate goal that we're gonna shoot for? So if we're trying to get all the way down to 5% from 52, remember decrease is good in this case, establish my next target condition, maybe over the next month, I wanna see if I can get that from 52% down to 35% or down to 40%. Part of what I would look at when I set that next target condition is what did the variation look like when I was charting in step two? So the magnitude of that variation will give me some indication of what would be a reasonable sort of next step target for step three basically.

0:23:11.9 AS: And maybe just explain for those people not familiar with Mike Rother's work and, you know, terminology that you're using, why do you say establish your next target condition?

0:23:28.0 JD: I think, I don't know. I think that, you know, really what I mean is just establish the next target, establish the next intermediate goal, basically. Now, I think using the word condition is because when you think about something like chronic absenteeism, there's conditions that probably contribute to that and part of that condition may be the things that you wanna work on. So I kind of think of like, you know, 'cause when you look at step four, you're gonna experiment. So you're creating a new set of realities, a new set of conditions in your organization. And so sort of that coincides with the metric that you're shooting for. So it's not just the metrics, it's also like what are the conditions surrounding that metric. If that makes sense.

0:24:15.8 AS: Yep.

0:24:16.9 JD: Cool. And then step four then is experiment to overcome obstacles. So basically in step four of the model, we move toward the target condition with experiments. And by experiments, what I'm talking about is Plan, Do, Study, Act cycles or PDSA cycles, which uncover obstacles we'll need to work on. So the path, and that's the path in the model is windy 'cause it's this path to the target condition is not gonna be straight line, but it's gonna require this rapid learning to move in that direction basically. And so let's say we've set that next target condition to be one month from now, that's what we're shooting for. And we're gonna run a series of experiments. Maybe it's four one-week PSDA cycles, maybe it's two, two week PSDA cycles. Maybe it's one one month cycle. It depends on sort of the nature of the Plan, Do Study, Act cycle. But running these cycles where we make a plan, including a prediction, run the experiment, and then study what happens and see if it's moving us in the direction of the target condition.

0:25:40.0 JD: And so in that way, we're rapidly learning what it's gonna take to hit that next target condition. And the other important part of this, you'll see in between the grasping of the current condition at step two and running those experiments, there's this huge fault line, this huge crack in the path that you can't just jump over. And it's kinda labeled there, it says Threshold of Knowledge. And basically it's the point at which you have no facts and data to go on. That's the threshold of knowledge. There's always a threshold of knowledge. And so to see further beyond that threshold of knowledge, that's where you conduct your next experiment.

0:26:28.7 AS: Interesting.

0:26:29.8 JD: So because you, like you were saying, we wanna outline these five steps that we're gonna do. So with chronic absenteeism, I read somewhere a Harvard study where if you text parents what a kid's attendance rate is on a regular basis, they're then more likely to come to school on a frequent basis. So you could see where a school system would spend all this money to get a texting system, maybe even allocate a person or a half of a FTE of a person to run this system. And they faithfully implement this texting system, and it has no impact at their school to impact those chronic, because it had nothing to do with what the actual problem was in that context. And you've spent all this money. And that was just a hypothetical.

0:27:21.2 AS: And you could have done a pilot test of 10 parents or 20 and done it manually and sent out some messages and just tested a little bit.

0:27:31.1 JD: Yeah. You run a test with 10 chronically absent kids. Just to see if you can improve their attendance for a week. And maybe you learn something or for a month and maybe you learn something. And then if the early evidence is pointing in the right direction, then you can run that experiment with more kids or for a longer period of time or under slightly different conditions. Those types of things.

0:27:54.6 AS: So an example that I would say in relation to this for one of my clients is that we've identified that they need to get a higher gross profit margin.

0:28:04.7 JD: Okay.

0:28:05.5 JD: And their gross profit margin is about 23%. And I know that the average is about 30 in the industry. And so my work with them is how are we gonna get that profit margin to be 30 or 35%? 35 would be showing that you've really got pricing power because of something that we've done. And so, I'm pounding away that we've gotta improve this, but you know what? We don't have data to understand the current condition. And this week we've... It's taken us about a couple months to pull that data together. But now we have absolutely comprehensive data that my team has calculated on the profitability of every product, the profitability of every customer, and the profitability of every process. We know the capacity utilization of each part of the production process. So now we have the knowledge that we didn't have before that's gonna, that once get, digest this knowledge, it's gonna give us the indication of what to do next. Which is it's gonna be shut down a particular production process or increase price there. We may lose customers, but it's not worth doing it at this low price or so, but without that knowledge, we're just, it's a dream.

0:29:21.4 JD: Yeah. It sounds like you guys have done step one and step two in that process.

0:29:28.0 AS: Yeah. Which is exciting. 'Cause now Friday's meeting is gonna be about, all right, how do we take this huge amount of data and effort that we've put in and now it's time to come up with what are the steps that we're gonna take?

0:29:40.4 JD: Yeah. And I think even just in that situation, even just acknowledging that there's the threshold of knowledge. Even just getting people to acknowledge that in a room that they actually don't know what's gonna happen. That's the power of the PDSA because it makes you predict, okay, you say this thing is gonna work and when you put in this plan in place, this is your prediction. And then when you come back next week and it doesn't work, then you have to explain that, you know, it's not a gotcha, but it very quickly makes you think in a different way.

0:30:13.0 AS: It keeps a record so someone has gone back, well, I didn't think it was gonna work, you know, for sure.

0:30:18.8 JD: Well, right. And it's usually very like, some of the things that I found in that is when people are off on their predictions, it's very mundane things that they didn't account for. We're in student recruitment season and we set a goal for the number of calls we're gonna make to prospective families. And then hypothetically a recruitment director could fall short and it's like, well what happened? It's like, well, oh, the two part-time people that we had, I forgot they are actually out two days last week right? And so it's usually things like that are actually getting in the way of us accomplishing these grand targets that we have set.

0:31:05.5 AS: By the way, where does the threshold of knowledge fit? We've got number one challenge or direction, number two, grasp the current condition. It's after the grasp the current condition that we come to the threshold of knowledge.

0:31:17.7 JD: Yeah. Because, well, we have somewhat of an understanding of the condition on the ground, but we don't know what's gonna improve it until we run the experiments. So we start running the experiments and we try to sort of narrow that knowledge gap basically. And this is sort of the final part is basically like what do you do when you get to that experiment and when you hit that target condition, when you reach that by the achieve-by date, well now there's a new condition and you repeat the four steps because you haven't reached the challenge or the direction. You just met that sort of intermediate goal. And you basically keep running this four step cycle until that learned long-term challenge is achieved.

0:32:12.5 AS: Okay. Great. So we've got the establish your next condition down where it could be one week, it could be one month, in some cases it could be longer, but it's really our next intermediate goal. Where do we wanna go next? What's the next right step?

0:32:28.5 JD: Yeah. Well, so you go back to step two 'cause you're not gonna change the challenge or direction. Now there's a new set of conditions 'cause you've moved ahead, right? And now you're gonna go back and say, okay, what are the current conditions like? And now we're gonna, okay, let's say we move from 52% to 42%. Now we go back and sort of understand the experiments from that last cycle. And we're gonna set that next target condition. So maybe now we wanna get it down to 25%. And we're gonna run another round of experiments in a certain amount of time to see if it hits that next target condition. And basically you're just gonna keep doing this over and over again. That's really the continual improvement model that we're operating under.

0:33:22.7 AS: So how would we wrap this up?

0:33:24.4 JD: So the big thing for me is, you sort of have to have a model to bridge that gap between current conditions and future aspirations. Beause there's always a gap between those two things. And what this model does is it gives us a scientific way of thinking and working to close this gap. It's a more powerful model than I've ever sort of seen anywhere. And then literally you put it on a piece of paper like this and then you have to explain it to people over and over and over. And then you have to actually do it with people. So we're actually doing this, getting people excited about running PDSAs. And the most important thing is that the challenge or direction, especially for leaders that are listening to this, you don't stand on this mountaintop and set it and then say, go do it. That's why this team aspect is so important. We're setting this challenge or direction as a team, and then we're working together on the ground. Putting that work in, running those experiments to try to bring this thing about, is a completely different way of working. It's not an accountability system, it's an improvement system.

0:34:39.4 AS: Yeah. That's a great overview of this system that you guys are applying and it's exciting to learn more. So I wanna thank you on behalf of everyone at The Deming Institute, John. And I thought the discussion was very interesting myself. And for listeners, remember to go to deming.org to continue your journey. You can find John's book win-win W. Edwards Deming, the System of Profound Knowledge and the Science of Improving Schools on amazon.com. This is your host, Andrew Stotz, and I wanna leave you with one of my favorite quotes from Dr. Deming. "People are entitled to joy in work."

In this episode, David and Andrew ask: should we tell people when they make mistakes? How do educators manage mistakes in a classroom setting, after their organization/classroom is transformed by learning and implementing Deming?

0:00:00.0 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today I'm continuing my discussion with David P. Langford, who has devoted his life to applying Dr. Deming's philosophy to education, and he offers us his practical advice for implementation. The topic for the day is, "should we tell people when they make mistakes?" We are continuing a discussion about Dr. Deming's section of the book, The New Economics. If you have the 3rd edition, that's page 86. If you have the 2nd edition, that's page 125. And this is a list that Dr. Deming has given us of 14 points. It's not The 14 points that we normally talk about, but these are... The title of this 14 points is called Role of a Manager of People. This is the new role of a manager of people after transformation, and we are on point number six. And I'll just read it before we get David to start talking on it, and that is this.

0:01:02.7 AS: "The role of a manager in a new style," basically he's saying, "If he understands a stable system. He understands... " And I know we can also say she, "understands the interaction between people and the circumstances that they work in. He understands that the performance of anyone that can learn a skill will come to a stable state upon which further lessons will not bring improvement of performance. A manager of people knows that in this stable state it is distracting to tell the worker about a mistake." David, take it away.

0:01:41.2 David P. Langford: Thank you, Andrew. It's good to be back again. Yeah, I was just reflecting on this list is... It's such a great list. I'm sure that when people first read through this book they kinda just take 30 seconds to read through the list and then you go on. I've been studying Dr. Deming's work for over 40 years now and still find so much insight into all these things. So if you go through this and you start thinking about, "Well, what can I do differently and where do I begin?" I was also thinking that, when I got my Master's in Administration, I never heard of any of this. I never heard of a stable state, control charts, theory. I never got any of this or had a list on to how to manage people, which would have been very helpful, very insightful. So if you're working at a university right now and you're a teacher of classes of administration, here's some good advice, take people through this list and they'll actually come out with capability of what to do. But now back to the list. So, the first thing he says is you have to understand a stable system.

0:03:01.1 DL: So we did a couple of previous podcasts on stable and unstable systems, and on face value, a lot of people think: "Okay, well, stable system, okay, well, it's working well." But Deming's thinking around a stable system is much, much deeper than that, and it has to do with statistical stability. And so if you understand a stable system, then the first thing you're gonna have to do is you have to find out, "Do I have a stable system?" And so often when I work with people, I'll just start with sort of disarming questions and say, "Hey, how are things going?"

[chuckle]

0:03:45.4 DL: And they'll usually say, "Well, it's going pretty good." And, "Okay, well, how do you know?" "Well, 'cause people are telling me that it goes pretty good." "Well, how many people do you manage? Oh well, I have like 30 people on the staff." So you're telling me that 30 people are telling you every day that things are going really well? "Well, no, one person told me." "Well, do we know what the other 29 think?" So, right there you realize a manager does not understand a stable system. They have no idea what they're doing, and the phrase in America is "you're flying by the seat of your pants" which basically means you're just…whatever is happening from day to day, you're just going with the flow, but you're not managing a stable system nor do you really understand it.

0:04:39.7 DL: So the first thing I wanna point out is that this is telling you, before you do anything, you have to understand the system. So you have to figure out, "Okay, what am I gonna collect data on? What's really important? How do I really understand if I have a stable system?" Then you're gonna have to set up that process and you're gonna have to do that for at least 12 data points, if not 20 data points. And in education that could mean 12 days, 12 months. It could mean long periods of time. Or the other thing is you have to go back into history and get that data for previous years. That's another way you can get the data points, put them on a run chart and see, "Is this system stable?"

0:05:32.7 DL: So what does that mean? Well, once you do that, you'll find out you have average performance over a long period of time. Okay? And usually there will be variation in that. Some data points will be higher and some will be lower. There are only three possibilities for a data point, up, down or the same. And that's called variability in a process over time. And so you have to understand that, and you can't understand that just by intuitively sort of going day by day going through things, because psychologically you're constantly reacting to a situation.

0:06:17.6 DL: You go home at the end of the day and your wife or your husband says, "How was your day, dear?" And, "Oh I've had a terrible day," and duh, duh, duh. But they usually don't say, "Well, how do you know it was a terrible day? How do you know it was worse than any other day, or better than any other day, or..." Well, until you actually understand a stable system and understand what's going on, you don't know really. You're reacting psychologically to that, and that's part of human nature.

0:06:47.5 AS: I wonder, David, would it be...do you think it would be...would it be proper to say that most systems that are kind of running, and haven't been looked at as to whether they're stable or not, are probably unstable?

0:07:04.3 DL: Not... My experience, I'd say 90% of my work has been in education, not business, etcetera, but what I found out is that intuitively people will stabilize a system over time. If they don't unintentionally do that, they kinda go nuts, they go crazy. Because one day they're in euphoria and the next day they're in hell, and then they're just... The roller coaster swings are so great that they'll usually leave the profession, go find something else. I used to see that a lot with new teachers, brand new teachers. And they call it the Fall Wall. So you start school and everything seems really great, and then you start to realizing, "Wow, this is work, and this is managing people, and this is every day, this is..." You're on and you're working through that, and then there's the Fall Wall of this huge depression cycle, and...teachers that stay with it and really have a love of kids and a purpose behind why they're there, they'll start to normally just stabilize the system. They may not get great results, but on average they're no worse or not much worse today than they were yesterday, or vice versa. But they're not gonna get a breakthrough in that system.

0:08:35.4 AS: Yeah, and I'm thinking about even when I recently did like a fast and my weight went down, and I had it down for a little while, and then I went back to eating, of course, and then all of a sudden you've realized there's this rebound and now that you're back, and now I'm back up to where I was and it's stable. It's not what where I really want it to be, but it's stable. And so you realize like there's a...as you're saying, people can't deal with chaos every day, so it stabilizes at some point, but that point may be far from the optimum of what that system could produce or something like that, I guess.

0:09:13.4 DL: Well, that's a good example, 'cause the person says he understands the stable system. Well, before you started to do that fast and actually track your weight, you were probably...your weight was probably in a normal range. That's the way it is for me. If I don't track it at all, it's usually within five or six pounds, given what's going on over a long period of time. But as soon as I track it and I start to understand what's happening and I see what the average weight is, then I have to think about, okay, am I happy with the average? So, again, this is back to the stable system. I always tell teachers, if you're happy with your average and you know it, clap your hands.

[laughter]

0:10:00.8 AS: If you're happy with your average, and you know it, clap your hands. [singing]

0:10:03.4 DL: And you know it, clap your hands. Yeah.

0:10:06.7 AS: There you go.

0:10:06.8 DL: So yeah. And they all laugh and everything else, but how do you know if you're happy with your average? Well, you're gonna have to collect some data. So it really doesn't matter what system you're thinking about managing, you have to understand...do you understand a the stable system? So let's say that: "Well, these kids today, they're always late to class." Okay, well, set up a run chart, track that for 12 days or 20 days, and find out what you're talking about. Find out. Are all the kids late to class? "Well, no, they're...no, they're not all late to class." Well, okay, well how many are late to class and what's happening with the data over time?

0:10:46.7 DL: So you have to figure it out what's important to you and how you're gonna go about that. The example I often give is, I worked with a middle school principal and he said, "Oh well, the teachers are complaining that the buses are always late." And I said: "Okay, well, that's pretty easy to track, so let's set up a run chart and you track the buses for 30 days, the arrival times of buses." Well, he did that, and not only were they not late, they were consistently really good. It was a stable system.

0:11:23.6 DL: 20 buses were arriving within a five-minute span. These people knew their jobs. But then one day they had fog, and one of the buses got delayed with the fog for like two hours before they arrived, and then all...so all these kids get off the bus and they're two hours late, and everybody in the front office has to get them caught up, the teachers have to get them caught up, it's a big emotional deal. But that's what everybody is responding to. They're not thinking about the stable system. They're responding to this one special cause, and psychologically it was a big problem, therefore "these buses are always late."

0:12:05.3 AS: Recency bias.

0:12:07.0 DL: Yeah, there you go.

0:12:08.3 AS: And it's an emotional attachment. I had two quick stories I wanna tell you, David, about this, and then maybe you can help me understand them. But the first one was that I was teaching at...I teach a program called Masters in Marketing at a university here in - Thammasat University in Thailand. 75 students that are studying in the class. And then I teach at another program in another place. And one of the things you notice is that in the other program, the students are late. You just count on it. And so you kind of don't start until five minutes after, or 10 minutes after, and let them drift in. And with the Master's in Marketing students, I've never ever seen any of the 75 students late. And here we have Bangkok traffic, you got something to blame it on. And it's never late. So is it different students or is it a different system? Well, when I investigated it more, many years ago, to try to understand it, I realized that they set a rule. They said if you're not in the classroom five minutes before, we're locking the door. Come back next time.

0:13:14.1 AS: And for some people that was really harsh, but once people signed up and they knew that that's the way the system worked, the output of the individuals was very different, the activity of what they did, just because they knew what to respond.

0:13:29.4 DL: Well, you bring up... Yeah, you bring up a good point. One way that people often stabilize systems is to make more rules. Well, let's just make a rule like that, and if you show up late something bad is gonna happen to you, or you can't get into the door or something like that, and if it doesn't work then just make it harsher. And public schools...or not public schools, but all schools, K through 12 schools especially, go through that. So if somebody's late, what happens to you? Well, you know, this is gonna happen, and then if you're late three times then this happens, and if you're late six times then this, and then so many times you're gonna lose credit and.... Does it work? It will stabilize the system to a point, but every administrator knows, there's just students that are like, "I don't care. Do whatever you want. Because I don't wanna be here in the first place."

0:14:31.8 DL: "The system you're running is so terrible and I hate it so bad, that [laughter] only reason I'm here is to avoid the punishment". And if that's the system that you're running, and soon as you stop doing those things, the variation is just gonna go back to where it was before.

0:14:51.2 AS: And is there a difference when it's...in the case of the Masters in Marketing students, they're all kind of voluntarily there, they paid a lot of money to get this education. Does that make any difference? Do you have to handle it differently or would you do pretty much the same and say, well, just squeezing down on people may stabilize, but it may not actually solve the root problem?

0:15:16.3 DL: Well, the answer to it actually is in this point that we're talking about here. Because the next sentence, he [Deming] says, "The manager understands the interaction between people and the circumstances that they work in." Okay? "Understands that the performance of anyone...they can learn a skill in a stable state." And so the answer to the question is right there. I would like to think about, you're starting class, if you want everybody there immediately, you're starting class immediately. So if I'm late to class, and you better make darn sure that what you're doing immediately is really important and really fun and really interesting. So if I walk into class late, I know immediately I've missed something. But the reverse...

0:16:06.5 AS: So it makes me think of start with a hook, start with something that's a grabbing activity that they wanna be a part of.

0:16:12.7 DL: Yeah, it could be. And sometimes I've been in situations where I had to manage like that, and so I would just start the class outside. If you're late, you came to class, you'd show up and there's nobody there, and you're like, "Where is everybody, what happened?" So the next class, you're probably thinking, "Well, I better get there on time because they're gonna be doing something." Or what I used to always, or still do, is tell teachers is, "Start class before class starts." What's that? Well, that means, well, when people are on their way to class, what do you want them to be thinking about, getting ready to do? Well, that's probably gonna have to start at the end of the previous class.

0:17:02.4 AS: Hold on, David, that's so valuable. I'm just thinking about my own students tonight, that I have my Valuation Masterclass Bootcamp, and starting class before class with the idea, I have a communication channel and I know what I'm gonna talk about tonight, and I know what we're gonna be doing. So maybe in that channel I should be throwing out some things that get them excited about, "What are we gonna do tonight?"

0:17:31.2 DL: Yeah, or you actually go through a quick process with them to set up a little flow chart, how to start class before class starts, and get their feedback about, "Well, what should you be doing when you're stuck in traffic in Thailand and trying to get to the university on time? What should you be doing?" I should be going over about, "Hey, what are they gonna be talking about this time and what's gonna be happening?" "Well, how am I gonna know that?" Well, somehow through the syllabus or the previous class. Or that's why ending a class by going over what are we gonna start with next time, is really a good thing, because people are like, "Oh yeah, okay, and now I know what's gonna happen as soon as I hit the door."

0:18:14.1 AS: So that's another practical thing right there, and I learned this from attending an online course of a guy named Brandon Gale, and he had at the end of each of his presentations, he'd say, "Up next, I'm gonna show you da, da, da." And I was just like, "Okay, that just absolutely made me wanna go to the next one." So now in all of my presentations I always have this one slide that says, "Congratulations, you've made it to the end of this section. Up next, you're gonna learn the one thing that da, da, da." And then that really helps people. And I have another...

0:18:47.4 AS: Okay, so now here's another actionable thing that a friend of mine does. He issues podcasts out to the world, but they're directed at his students. And think about following up - a preview podcast about this material that then is published out there to the world, but his students know they need to listen to it when they're in the car on the way to the class. So, yeah. Okay, these are some great, great ideas, let's continue.

0:19:15.6 DL: Yeah, So that's a really great example that: here's the process that we're gonna go through. And so you need to have listened to this podcast because when you hit the door, you're gonna be put into random groups and you're gonna be asked to start a discussion immediately on the podcast that you were supposed to listen to. See? So now the responsibility is shifted from me as the instructor to them as the students: it's your responsibility, as soon as you hit the door, get together with three other people, you got 10 minutes to go over the podcast, and what were the significant points that you got out of that.

0:19:53.0 DL: Well, somebody that didn't listen to it, is gonna be in that group and they're gonna feel very foolish once or twice, and then they're gonna start actually paying attention and doing the podcast.

0:20:05.8 AS: So for the listeners and the viewers out there, here's a challenge, here's a challenge to you: take some of these actionable ideas and play with them, enjoy them, bring them to your students, bring that into the classroom. You highlighted something that I didn't think about either, but the idea of starting class with something like pleasurable, rewarding, something like that, and when I start...

0:20:31.3 DL: It doesn't necessarily even have to be that. It has to be something that needs to be relevant, needs to be timely and it needs to be engaging. So I have to do something as soon as I hit the door. I have a responsibility as soon as I get there or online, if it's an online class, and what do you want them to do immediately as they're sitting there waiting for the online session to start or something, right? Those are all processes that's gonna get you a different stable state than if you just wait and you're gonna tell them what to do when things start. And people learn from that too, because they'll learn that, "Oh well, don't bother to read the syllabus or understand what's going on because he's gonna tell us what to do as soon as we get there." They'll learn really quick that they don't have to think or plan, or do anything, because you're gonna tell people when they get there.

0:21:38.7 AS: Right. One of the other things that I tried something kind of bold, I know my team was a little bit worried about it when we did it with the Valuation Masterclass Bootcamp, we do live sessions at 6 o'clock, two or three nights a week, and basically, what we started was a breathing exercise and I recorded it as an audio clip where I just say, breathe in for four seconds, count one, two, three, four, hold it for four seconds, one, two, three, four, let it out for four seconds, one, two, three, four, and then we go through that cycle three times and it was a risk to bring that out. I felt like some people may think, "Oh, come on."

0:22:15.2 DL: It's a yoga class or what?

0:22:18.3 AS: What's that?

0:22:19.4 DL: Is this a yoga class?

0:22:21.8 AS: Exactly, so I went... By the time we got to the end of that first class where I tested this new idea, I asked them, "What did you think about that?" And they just absolutely loved it. And I know that breathing can actually stop your intensity that you've had from your day and kind of separate that from the actual class, but I can say for myself as the teacher, I enjoy that moment that we all have together where we breathe together. And I know it puts me in a different state, and I know that the value of that is, so that is something that I think students like to be a part of, they see the value in that, they feel the value of it, and therefore they wanna be on time to be in that. So that's an idea.

0:23:03.8 DL: There you go, there you go. So I wanna get back to this. So he [Deming] says he understands that the performance of anyone that can learn a skill will come to a stable state. So that's what we've been discussing, you've taught people a skill and now you stabilized it and it's coming to a stable state, that this is what we're gonna be doing. "Further lessons will not bring improvement or performance, a manager of people that in this stable state, it is distracting to tell the worker about a mistake." And so that's the topic for our session today, are way supposed to be telling people about mistakes?

0:23:40.4 DL: Well, Deming's thinking around a stable...the interaction to create a stable system goes also to why he was so adamant against grading people. That it's not just you doing your own work in a system, it's the interaction of all these people within the system that gets the result. So if you set up a system where you are doing that, you're actually forcing individual, individuals to work alone, don't share anything, don't talk to anybody, don't... Well, what's gonna happen is you'll have an isolated few people that'll really do well, right? They get the A's, they get the top marks, the top grades, whatever it might ever be, and then you'll have everybody else stratified layers, B, C, D and F or whatever you wanna say, on down within that, because what you're really doing is shutting down the interaction of people to create a different result.

0:24:51.1 DL: Well, even in that kind of a world, teachers learn to create a stable system within that. "I got rules and no, you can't do make up work and you can't do this, and you can't do that, because I've got my stable system that I must maintain the system over everything else," which flies in the face of understanding why people are there in the first place, right? They're supposed to be there to learn not to play this game or figure out what the game is for people to go through the system.

0:25:31.1 DL: So what [Deming] he's talking about is that if you're in a system and somebody's making mistake within that system, you're actually...and you're pointing it out or whatever you're doing, you're actually blaming them, the individual.... This is what I believe he's talking about. You're blaming the individual for that mistake when the mistake may have come from the system itself and they can't change the system, only the manager can change the system, whether that's the teacher or a supervisor in a company, or a vice president, a principal, whoever it might be. The individuals typically can't just change the system, right? They can't just come up to the teacher and say, "well, I'm just not gonna play your system anymore, but I'm gonna do this system 'cause it gets better results." Most teachers would kind of freak out about that and, "No, you're not. You're not doing that."

0:26:26.3 DL: If somebody did that to me though, I'd say, "Well, tell me about it, tell me about what you're talking about and why does it get better results, and maybe we should try that as a class and maybe we should learn from that and try to figure out...maybe we will all do that, if we can figure out that's gonna get a different result."

0:26:46.9 AS: And what would happen if you have a worker who just makes a mistake, they're supposed to have done a particular step and they didn't do that step or something like that, some people would feel like, "Oh, well, he should be blamed or she should be blamed for that."

0:27:03.5 DL: Deming often talked about, he went and visited a company, I think in Ireland or something like that, and a big sign in the company, that says "465 days without an accident" in the company, right? And then they go to walk up the stairs and the railing on the stairs was so loose that he almost fell off the stairs, going up the stairs. Well, that would have been an accident, and is that the individual's fault or is that the system? And when you start thinking like that, especially in a classroom, it's the same kind of thing: if somebody doesn't understand a concept, let's say you go through a process where you train people and everything else, but then you've got one or two people out of the group that didn't do it right, don't understand, etcetera.

0:28:00.9 DL: Well, whose problem is that? Well, that's a level of variability, a variation, that eventually you want to limit that variation, so instead of having one or two people every class period that don't understand, now I'm down to once a month, somebody doesn't understand. Now I'm down to once a year, somebody doesn't understand. Now I'm down to about once every five or 10 years, I'll run into somebody [chuckle] that doesn't respond to the process I've set up, and they really are a special cause and I need to treat them like a special cause. I'm not going to change the whole system for that one individual, but I am gonna help them individually because they're not part of the stable state that I've set up and that I'm working within that over time.

0:28:51.8 AS: And so would it be right to say that, okay, once we reach a stable state, really a lot of all the variability and the mistakes, people are gonna make mistakes, that's all kind of noise that's not.... That there's nothing meaningful about that, and therefore pointing out this mistake or that and why did this happen? It's just chasing around common cause variation, and truthfully, the job of a manager should be able to be to think way beyond that, and you wanna encourage everybody through education, not training, we're talking a lot about training here of getting people to a standard stable state, but then the idea is, come on, well look at the opportunities are huge ahead of us, and that is just normal variation.

0:29:37.2 DL: Yeah, I'll give you a personal example [chuckle] from me. I was in an honors English class when I was a junior in high school, and we're all supposed to be top kids in the school, and these English class and working very hard. Well, I was sick for the whole week. And we were studying Arthur Miller, the famous playwright.

0:29:58.5 AS: Death of a Salesman.

0:30:00.1 DL: Yeah, and I came back and I had missed what the assignment was and everything else, and I went up to the teacher real quickly and said, "What did I miss? And what am I supposed to do?" And she said, "Well, everybody in the class was assigned a different aspect of Arthur Miller where things through...so she said, "What I like you to do is I'd like you to make a bibliography of Arthur Miller." Well, whether it was because I was sick or whatever, I heard her say, biography. So I went home and spent a week writing a 14-page biography of Arthur Miller's life and everything, and even hand wrote it out three times to make sure it was all clean and everything else, I was so proud of it at the end of the week, brought it back in and handed it to her before her class started.

0:30:54.5 DL: And she looked at it, she says, "What's this?" And I said, "Well, it's my assignment," and she looked at it and she threw it in the trash can, and she said you were supposed to write a bibliography," and [chuckle] I was just like stunned. I'd made a mistake, but whose mistake was it? So verbally, those two things sound a lot alike and etcetera. I turned around and walked out of the class and went up to the principal's office, and I was gonna change this situation and get it changed. So I mean there's a good example that she was pointing out a mistake that was the interaction of parts to the whole within the process. Simple change would have been to have all the students listed out and all the things that they were supposed to do on a piece of paper and not just verbal announcements about what you're going to do, right? Because there's a certain amount of variability, obviously in a verbal announcement. That make sense?

0:32:04.1 AS: Yep.

0:32:05.2 DL: And so if you keep operating like that, it makes you as the manager in total control of everything, but it actually turns everybody else into victims to some degree.

0:32:17.3 AS: Well, let's wrap this up. I just wanna go back through this one and read it again, because there's just so much to it. Number six: "He understands a stable system. He understands the interaction between people in the circumstances that they work in, he understands that the performance of anyone that can learn a skill will come to a stable state upon which further lessons will not bring improvement of performance." And finally, to wrap it up in relation to what we titled this, "A manager of people knows that in this stable state it is distracting to tell the worker about a mistake."

0:32:51.0 AS: What a great discussion. I appreciate it. I got some actionable ideas out of it, and I think for everybody out there, put some of these ideas into place. And David, on behalf of everyone at the Deming Institute, I wanna thank you again for this discussion. For listeners remember to go to deming.org to continue your journey. And listeners can also learn more about David at Langfordlearning.com. This is your host, Andrew Stotz, and I'll leave you with one of my favorite quotes from Dr. Deming, "People are entitled to joy in work."

In our June 2018 interview podcast, his 1st session with Tripp, Jean-Marie Gogue reflects on his interactions and memories of working with Dr. Deming, beginning in November 1978 in Tokyo.

Highlights include:

• Inviting Dr. Deming to speak in Paris in 1980
• Dr. Deming's commentary on leadership
• Use of control charts
• Attending Dr. Deming's Four-Day Seminar in Switzerland in 1993
• Attending first Four-Day Seminar in the UK in 1987
• Starting the French Deming Association in 1988

In this new series, Jacob Stoller and Andrew Stotz discuss five major management and productivity myths and how Lean and Deming thinking solve them. This first episode offers an overview and Jacob shares his journey from traditional management to a better way.

Jacob Stoller is the author of The Lean CEO: Leading the Way to World-Class Excellence and Productivity Reimagined: Shattering Performance Myths to Achieve Sustainable Growth.

TRANSCRIPT

0:00:02.3 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'll be talking with Jacob Stoller, who is a journalist and Shingo prize-winning author of The Lean CEO, which provides a boardroom perspective of Lean initiatives. Now, he connected with Dr. Deming's criticism of command and control management and recently wrote Productivity Reimagined to explore the reasons why organizations fail to apply the Lean and Deming style of management at the enterprise level. Jacob, welcome to the show.

0:00:37.8 Jacob Stoller: Well, thank you, Andrew. It's great to be here.

0:00:40.5 AS: Yeah it was actually really fun to talk to you before we even turned on the recorder to kind of really help people understand where you come from and why you are here. So maybe you can just explain a little bit of your journey of how you got to this point in relation to Deming.

0:00:58.2 JS: Okay, well, interestingly, I started out in sales. I was a corporate sales rep selling services and software and all that kind of high-tech stuff. And I did that for quite a while. But what I liked best about corporate sales was the dialogue that I had with customers, being able to talk to people and ask questions and explore topics. So fortunately, I was able to turn that into a career. I left that profession about 2001 and became a writer, journalist, did research projects, gave talks, did some training, did all the things I wanted to do. And through that, I discovered Lean by accident. And that, I think, wasn't probably till about 2010. And I was writing for a magazine, and someone told me to write about this Lean thing. What is it? And I started to ask questions and talk to people and eventually discovered this wonderful way of running companies. I was totally impressed, not just with how efficient they were and all that, but how they treated people. I thought, this is, boy, I would have liked to have worked at some of these companies.

0:02:14.6 AS: And for someone who's never even heard, let's just imagine someone's never heard the word Lean. What does that mean anyway? And what did it mean when you first saw it and after you really became an expert in it? What does it mean to you now?

0:02:28.4 JS: Well, I thought it was going to be super high tech. That's what I first thought. As a matter of fact, when I went to Japan to actually see it firsthand, I was expecting just flashing screens and everything. And of course, it was a very different thing. It was a lot of people, very, very people-oriented environment, people talking to each other, lots of communication. So I thought, wow. And I started to learn that it was really all about people. And so that was a gradual transformation for me. But it was very rewarding to see the human side of this. So that led me, really led me to some writing. I started working with some lean organizations like the Kaizen Institute, and I started doing writing for them, writing newsletters. I also wrote, helped Misaki Yumi the late Misaki Yumi, a very well-known Lean promoter, write the new edition of his latest book. And I did all the case studies for that. And I also helped various other initiatives. But the main thing was that I decided to write my own book, and that was The Lean CEO.

0:03:57.2 JS: And what I was interested in at the time was I saw that people doing Lean were running into all this resistance, and I was interested in exploring that a little more. And I thought, well, the people that really understand that will be the CEOs because they'll been there. They've been in the boardroom discussions. So that's how The Lean CEO came to be. And in that process, I was asking questions about management and the various practices. Now, I was expecting that there would be a sort of a standard executive playbook for Lean. That was my hypothesis, I guess. And it would have been really nice, very, very easy to write the book and neat and tidy and all that, but it didn't work out that way. They were all different. They all had different ideas. And interestingly, a lot of the thinking that went into their work, actually, they had learned before they even discovered Lean. That had been stuff that they believed in. They learned about teamwork early on, so they were somehow predisposed towards the people side of Lean. So I was really fascinated by that. But my conclusion really was that there was no one way to implement Lean, that there were just many, many different variations on it.

0:05:20.5 JS: And that's when I became and started to discover that there was a lot of the thinking that made these people successful at leading Lean outside of the Lean community. And that's where I started to get interested in some other. How the tech sector was handling change, how the sustainability people doing sustainability projects were handling change. And one speaker that spoke out loud and clearly to me was Dr. Deming, because Dr. Deming understood the fundamentals behind the thinking. I think that makes Lean successful. He understood what was wrong with conventional management and the barriers that people were running into. So, Andrew, I don't know if you remember, but the 1980s, everybody was talking about this ABC show, If Japan Can, Why Can't We? And here we are looking at a productivity crisis. I mean the US was their crown jewels in the US industry had been trounced by the Japanese. They were being outproduced two to one, right? I mean, and so this was recognized as a crisis. It was an election issue at the time. And I, they got Dr. Deming on television and they asked him what are we doing wrong? And Deming was very clear.

0:06:51.1 JS: He said you're not going to learn this, you're not going to be able to imitate the Japanese, and you're not going to learn a few production tricks. You've got to fundamentally change the way you manage. So that was a very, very strong message that I picked up when I was writing that book. And what's wrong with conventional management? What's wrong with command and control management? And why does it not why does it create companies that are so wasteful and do such a bad job at being productive?

0:07:22.6 AS: And as a devil's advocate, if I think about a Lean a company that's trying to adopt Lean, what I would assume was that at the management level, the objective of management is really to reduce resources, to reduce, if you could reduce the cost of electricity, your profit margin would go up. If you could reduce the raw materials that you have in your production process, your profits would go up, as an example, and the value of your business would go up. So how could there be any resistance to a young engineer that's picked up Lean and is bringing it through the organization? It's a little bit odd to think why would there be resistance to that?

0:08:04.1 JS: Well, the resistance is that people are used to doing what they're doing, for one thing. And Dr. Deming has identified with his knowledge of complex adaptive systems a fatal flaw in the hierarchical structures that corporations are run by. You see, if you're using corporate logic, you assume that every department and every work group is like an independent component and that if each component functions as intended and according to measured objectives, then the corporation will succeed. And Deming said that that is completely false, and he had the evidence to prove that. So what people are resisting is not that, people aren't resisting the idea of reducing costs and being efficient, but they're measuring efficiency in the wrong way. They're measuring efficiency of independent assets. And they say if these independent components produce efficiently, then the sum of the total will have an efficient corporation. But that's not true. That's only true according to 17th century logic. If you follow Newton and Newton's laws, that seems to be the case. And it's intuitively, we do tend to think that way. But if you're running a company, a company is not a simple system. It's a complex adaptive system.

0:09:38.7 JS: And it's the interdependence of all these entities and all these components that determine the success of your company. And that's what Deming was trying to teach, and that's what people didn't want to hear.

0:09:50.7 AS: So if I hear you correctly, the first thing is kind of the first wall that someone would come to at the board level or at the management level is just trying to overcome inertia. This is the way we do things. Why do we need to change? It takes effort to change. And then the second thing you're talking about is the lack of systems thinking, thinking that if we could just optimize every part, we're going to get the optimal output of this system. They didn't understand that, as you said, it's a complex adaptive system, that it's much more difficult than just saying, everybody do your best. Is there any other resistance that you saw? So the inertia is number one that I saw. The second one is a lack of systems thinking. Is there any other things that you discovered as you were working on The Lean CEO?

0:10:38.3 JS: Oh, yeah. Well, there's the elephant in the room. And this is that most large corporations anyway are focused on short-term shareholder value. Right. And the way to make your short-term numbers is not to be productive. It's not to invest in good long-term strategies to develop a long-term competitive advantage. It's to make your quarterly numbers. And that can be manipulated fairly easily. Well, maybe not easily, but it can be manipulated by creating perceptions about value, about market value and that sort of thing.

0:11:17.3 AS: And even more, even more than manipulated, it's just that if you don't follow, if all you do is just try to hit numbers on a quarterly basis, you're losing your focus on the long term.

0:11:27.1 JS: Absolutely. And there was a study, and this goes way back to 2005, but it said that corporate CEOs would sacrifice or 74% would sacrifice a long-term profitable initiative to make their quarterly numbers. They would throw it out the window. I think, if anything, that was 2005. I would think if anything, things have gotten worse since then. So we're actually talking about a slice of companies that really do want to be productive, where long-term productivity is their strategy. And that is, a lot of these are privately owned companies, manufacturers, and perhaps, there's some smattering of public companies that are doing this kind of thing, but it's rare.

0:12:24.7 AS: So let's just. So what we've been talking about is kind of the wall that you started to see, the ceiling that was Lean had a challenge, or Deming's teachings had a challenge, and that was this, overcoming the inertia, the lack of systems thinking, and this focus on short-term quality, sorry quarterly numbers. And very few companies were able to really focus on long-term goals of being productive. Now, maybe you can just take a moment to explain how your newest book, your latest book, then took what you saw from a Lean CEO and Deming and then brought it to another level.

0:13:07.8 JS: Okay, well, I interviewed about 60 people, and it's interesting. I thought it might be fairly easy, I would say. What are the basic myths? What do people get wrong? Usually, these are people that are pretty smart about Lean stuff, and people found that surprisingly hard to answer. And I think that was because a lot of these people I talked to had already been practicing this approach for a long time, so they really had to think about it. So it took some digging and a lot of interviews, but I found the thread was in five sort of primary areas, and one was the systems thinking, the pyramid that we talked about.

0:13:50.4 JS: That Deming so articulately talked about. Also, and then the other myths, I think, are somewhat derivative of that. But there's finance. The myth that the bottom line tells you what you need to know about the productivity of your company and it doesn't show up in the finances. So I did a chapter about that. The notion that the boss knows best, and that's not just the boss, it's also professionals. This idea of professional knowledge. Someone can go to school, learn how to tell people what to do, and that will accurately create the right procedures, the right kind of work.

0:14:32.6 JS: And when people follow directions from professionals, they will be the most productive. So that's a myth. Myth number four is the myth that people are motivated by sticks and carrots. And psychologists have disproved this about 70 years ago, I guess, but people still, if you look at compensation plans and you look at the way companies are managed and you look at structures, it's still assumed that people are going to be motivated by externals, by threats and rewards. So we talk about that and some companies that have dealt with that one. And then finally, there's this myth of tech omnipotence. We tend to have way more optimism about technology than is warranted, and we're seeing a lot of that in AI now. We're seeing a lot of disappointment with things not turning out the way people expected. So I really explored those five myths and how they stymie productivity and how companies can build a strategy around count.. what's the word I want? Counterattacking those myths or whatever.

0:15:45.5 AS: And then for the person who reads it, what is the outcome? So once they understand these risks, like number one, you mentioned about the pyramid and not understanding systems thinking. You mentioned number two about finance, you mentioned number three, about the professional or the boss knows best. And number four, people are motivated by sticks and carrots. And number five, tech omnipotence. Once they understand those myths, where do they go from there? How can they then apply that into their life and their work?

0:16:16.2 JS: Well, I suggest that they go into companies that are actually successful at dispelling these myths. You got to see it. But I have a last chapter, a long chapter, but I provide a sort of a roadmap for moving in. But there is really no alternative. If you want to build long-term productivity, there is no alternative to continuous improvement because you're just going to have to keep improving. And Dr. Deming explained that very well in terms of variation. It's always going to be there, and you're always going to have to be dealing with it. So you're going to have to create a culture, and it's going to be people-based. I don't care what kind of technology you have, long-term productivity gain is going to have to come from building the culture in your company.

0:17:10.1 AS: And I want to wrap up our discussion about this just so the audience understands. When you say productivity reimagined, what do you mean by the word productivity?

0:17:23.5 JS: Productivity is customarily just used as sort of a ratio. You know, people say, "Oh, yeah, I'll just take the total sales and divide it by the number of employees" or something like that. So it's seen as a sort of an indicator rather than something that you have to actually do. Right? That's something you have to actually pursue in a direct sort of way. And another, I'll make another side point, is economists like to say that take the GDP and divide it by the number of worker hours or whatever and say that's productivity. But it really, you know when you, the US government website defines productivity as increasing output with a given set of inputs. So from time A to time B, you've got to actually make more with what you have. And that's these indicators that people use for productivity don't reflect that at all. So you've really gotta... Productivity is not that easy to measure, and there's some, actually, some qualitative sides of it, right? I mean, if I'm making, say, ballpoint pens, and let's suppose I increase the production by 10% using the equivalent amount of materials and all the machinery.

0:18:51.9 JS: Well, that's great, but what if the quality goes down? You know, I haven't really gained anything. So it's kind of tricky to measure productivity. You have to get right down there in the processes to understand it. And so I would tell the finance people that it's inside that black box. You have to be in, understand what's going on inside that black box of operations to really understand whether, which direction your productivity is going.

0:19:20.2 AS: Okay. So if I hear that right, I think a lot of us could get lost in some sort of ratios or something like that and think about a measure. But in fact, what you're talking about is to really do productivity right, it sounds like you also really have to understand trade-offs. If you cut in a particular area, that's going to cause another problem, and that's going to...you may not be able to get more out of your existing resources. In addition, it's going to require work because you're organizing your company in a certain way to get a certain level of output with the inputs that you have. But in order to get a much higher level of that, you've got to rethink: How do I get the maximum out of this organization, which is a real challenge.

0:20:09.8 JS: Well, I think this is where this is, you know, it depends on how you do it, right? I mean, you can do it in a siloed way, which says, I have a quality department, I have an operations department, I have a maintenance department. And you can invest in all these and play around with your investments and see what works out. Or you can get into the process, and you can, by really, really understanding the process and letting people in the process improve it. That's where you get Deming's magic chain reaction, which is that you improve quality, and then your efficiency is going to improve and your costs are going to go down. But that's only if you're looking at productivity in a very broad way. It's not looking at quality in terms of the tolerances that I made on my grinding or whatever I'm doing. It's about the quality of the processes themselves. Right? So Deming was looking at quality with a big Q that encapsulates a lot of things.

0:21:16.0 AS: Well, I think what, what's, this is very interesting. And I know we're going to have a series that we're going to start doing, going through more detail of what you've discovered and what you want to share. So I'm really looking forward to that. And so, I appreciate this introductory discussion. And Jacob, on behalf of everyone at the Deming Institute, I want to thank you again for this discussion and for listeners, remember to go to deming.org to continue your journey. You can find Jacob's book, Productivity Reimagined, at jacobstoller.com. This is your host, Andrew Stotz. And I'm going to leave you with one of my favorite quotes from Dr. Deming: "People are entitled to joy in work."

The W. Edwards Deming Institute® is pleased to announce the Deming Podcast.  We have created a new Twitter account specifically for the podcasts @DemingPodcast, maintaining @DemingInstitute as our primary Twitter account).

Deming podcast episode number one starts off our series with moderator Tripp Babbitt interviewing Kevin Cahill, the President of The W. Edwards Deming Institute® and the grandson of Dr. Deming. Kevin talks about growing up with Dr. Deming and Kevin's current work with The W. Edwards Deming Institute®.

Do you struggle to meet your goals or targets? Find out how you can change your thinking about goals and your process for setting them so you can keep moving forward. In this episode, John Dues and host Andrew Stotz discuss the first five of John's 10 Key Lessons for Data Analysis.

TRANSCRIPT

0:00:03.0 Andrew Stotz: My name is Andrew Stotz and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today I'm continuing my discussion with John Dues, who is part of the new generation of educators striving to apply Dr. Deming's principles to unleash student joy in learning. This is episode two of four in a mini-series on why goal setting is often an act of desperation. John, take it away.

0:00:32.3 John Dues: Hey, Andrew, it's good to be back. Yeah, in that last episode, that first episode in this mini-series, we talked about why goal setting is often an act of desperation and I basically proposed these four conditions that organizations should understand prior to setting a goal. So it's not the goals in and of themselves that are bad, but it's with this important understanding that's often lacking. So those four things that organizations should understand, one, what's the capability of a system under study? So that's the first thing, how capable is the system or the process? The second thing is what's the variation within that system or process under study? So that's the second thing we talked about last time. The third thing is understanding if that system or process is stable. And then the fourth thing was, if we know all of those things, by what method are we going to approach improvement after we set the goal, basically? So you gotta have those four things, understanding the capability of the system, the variation of the system, the stability of the system, and then by what method, prior to setting a goal. And so I think I've mentioned this before, but absent of an understanding of those conditions, what I see is goals that are, what I call it, arbitrary and capricious.

0:01:48.8 JD: That's a legal characterization. You look that up in the law dictionary. And it basically says that an "arbitrary and capricious law is willful and unreasonable action without consideration or in disregard of facts or law." So I'm just now taking that same characterization from a legal world and applying it to educational organizations and accountability systems, and I just switched it to "a willful and unreasonable goal without consideration or in disregard of system capability, variability, and/or stability." And we see these all over the place for education organizations, for schools, school districts, teachers, that type of thing.

0:02:31.6 JD: And so what I tried to do in the book and tried to do here in my work in Columbus is develop some sort of countermeasures to that type of goal setting and develop the 10 key lessons for data analysis. An antidote to the arbitrary and capricious goals seen throughout our sector. And this process behavior chart tool, looking at data in that format is central to these lessons. So what I thought we would do in this episode and the next is outline those 10 key lessons. So five today and then do another five in the next episode. And in the fourth episode of the series, what we would do is then apply those examples to a real life improvement project from one of our schools. It's helpful, I think too, to sort of, to understand the origin of the key lessons. So there's the lessons that I'll outline are really derived from three primary sources.

0:03:36.0 JD: So the first two come from Dr. Donald Wheeler, who I've mentioned on here before, a lot of Deming folks will, of course, have heard of Dr. Wheeler, who's a statistician in Tennessee, a colleague of Dr. Deming when Dr. Deming was alive and then has carried on that work to this day. The two books, two really great books that he wrote, one is called Understanding Variation, a thin little book, a good primer, a good place to start. And then he's got a thicker textbook called Making Sense of Data, where you get in really into the technical side of using process behavior charts. So I'd highly recommend those. And then the third resource is a book from a gentleman, an engineer named Mark Graban called Measures of Success. And I really like his book because he has applied it, the process behavior chart methodology, to his work and he's really done it in a very contemporary way. So he's got some really nice color-coded charts in the Measures of Success book and I think they're really easy to understand with modern examples, like traffic on my website, for example, in a process behavior chart, really easy to understand modern example. But all three of the books, all three of the resources are built on the foundation of Dr. Deming's work. They're, you know, Graban and Wheeler are fairly similar and I think Graban would say he's a student of Wheeler.

0:05:00.4 JD: He learned of this mindset, this approach to data analysis by finding a Donald Wheeler book on his own dad's bookshelf when he was in college and starting down that path as a young engineer to study this stuff. And basically what I've done is take the information from those three resources and make some modifications so they can be understood by educators, basically. I think it's also worth noting again that process behavior chart methodology is right in the center of this, really for three reasons. One, when you plot your data that way, you can start to understand messages in your data, I think that's really important. Second, you can then start to differentiate between special and common causes, special and common causes, translate that into regular language. I can translate between something that I should pay attention to and something that's not significant basically in my data. And then in so doing, I know the difference between when I'm reacting to noise versus when I'm reacting to signals in my data, so I think that's really important. So the process behavior chart is at the center of all this. So we'll go through five of these lessons, one by one, I'll outline the lesson and then give a little context for why I think that particular lesson is important.

0:06:25.4 AS: That sounds like a plan. So capability, variation, stability and method. You've talked about Donald Wheeler, excellent book on Understanding Variation, that's the one I've seen. And of course, Mark Graban's book, Measures of Success, very well rated on Amazon and a podcaster himself, too.

0:06:49.6 JD: Yeah. And if I was a person studying this and wanting to get into process behavior charts and really knowing how to look at data the right way, I would read Understanding Variation first because it's a good primer, but it's fairly easy to understand. And then I would read Measures of Success 'cause it's got those practical applications now that I have a little bit of a baseline, and then if I wanna go deep into the technical stuff, the Making Sense of Data, that's the textbook that drives everything home. Yeah. So we'll dive into the lesson then.

0:07:19.5 AS: Let's do it.

0:07:20.0 JD: Yeah. Okay. So the first lesson, and I've talked about this in various episodes before, but lesson one, the very first lesson is, "data have no meaning apart from their context." So this seems commonsensical, but I see this all the time where these things aren't taken care of. And what I'm talking about is answering some basic questions. So for anyone looking at my data, they should be able to answer some basic questions, very simply, anybody that looks at my data. First thing is who collected the data? That should be apparent. How were the data collected? When were the data collected? Where were the data collected? And then what do these values represent? So oftentimes I see data either in a chart or in some type of visualization and almost none of those things are known from looking at the data, all important questions.

0:08:18.6 JD: The second question would be, well, that first set goes together. The second question is what's the operational definition of the concept being measured? So we have to be on the same page about what it is exactly being measured in this data that I've collected. I also wanna know how were the values of any computed data derived from the raw inputs? That's important. And then the last thing is, have there been any changes made over time that impact the data set? For example, perhaps the operational definition has changed over time for some reason. Maybe there's been a change in formula being used to compute the data.

0:09:05.4 JD: So an example would be, from my world, high school graduation rates. You know, 20 years ago there was one definition of how you calculated a high school graduation rate, now there's a different definition. So when you compare those two sets of data, you've gotta be careful because you're actually, you're actually working from different definitions and I think that happens all the time. More recently here in Ohio, what it means to be proficient on a state test, that definition changed about 10 years ago. And so if you look at test results from 2024 and try to compare them to 2014, you're really comparing apples and oranges 'cause there's two different definitions of proficiency, but no one remembers those things a decade later. So you have...

0:09:52.3 AS: And then a chart will be presented where the different methodologies are shown as one line that says...

0:10:00.8 JD: Yes.

0:10:00.8 AS: That no one's differentiated the fact that at this point it changed.

0:10:04.6 JD: Yeah, at this point it changed. So first lesson, data have no meaning apart from their context. Second lesson is we don't manage or control the data, the data is the voice of the process. What we control is the system and the processes from which the data come. There's a difference there. Right? So I think this is one of the key conceptions of that system's view, that system's thinking in an organization. When we wanna make improvements in our schools, we need a few things in place. We need the people working in the system. So that would be the students for us, they're working in the system, people that have the authority to work on the system, so that'd be teachers if we're talking about an individual classroom, at the school building level, maybe we're talking about the principal. And those two things are, at least the teacher principal thing is usually in place, the students being a part of improvement projects, definitely less so, but maybe there are places where that's happening. But the third thing is someone with an understanding of the System of Profound Knowledge, I'd say that's almost always lacking in the education sector, at least. And I think the reason the System of Profound Knowledge becomes important, 'cause that's really the theoretical foundation for all the things that we're talking about when we're looking at data in this way.

0:11:38.8 JD: If you lack that conception, then it's hard to bring about any improvement, because you don't understand how to look at that data, how to interpret that data, you don't understand how to run a plan-do-study-act cycle. Because what you're gonna ultimately have to do is change some process in your system and there's some knowledge that you're gonna need to be able to do that, and that's, that third component of an improvement team has to be in place to do that. But I think the most important thing is that we're not in control of the data, we're in control of the processes that ultimately lead to the data. It's a distinction, maybe a fine distinction, but I think it's an important one.

0:12:17.5 AS: The idea of the System of Profound Knowledge and understanding what to do with the data and really understanding the whole thing, I was just thinking what would... An analogy I was thinking about is rain. Everybody understands rain as it comes out of the sky, but not everybody understands how to use that to make a pond, to make an aqueduct, to feed a farm, to, whatever that is. And so having that big picture is key, so, okay. So number...

0:12:57.8 JD: Yeah. Well, and a part of that is something really simple is constantly understanding data is the voice of the process. And so when you're looking at data, what often happens is I'm gonna walk into a meeting with my boss, and I'm looking for some data point, maybe we just got some type of performance data back or survey results or something. I'm gonna pick one of those items where the plot, where the dot from last time has improved when we look at it this time, and I take that and say, "Look how we've improved in this thing." And you need someone to say, "Well, wait a second, while there is a difference between those data points, if I look at the last 12, things are just moving up and down." And there's gotta be someone in the room that constantly points back to that, constantly. And that's where that person with the Profound Knowledge is helpful in improvement work.

0:13:54.5 AS: So the voice of the process is a great way of phrasing it that's been used for a while now and I think it's really good. I remember when I worked at Pepsi as a young supervisor, I saw some problem on the production line and I raised it to the maintenance guys. And they kept coming and fixing it and it would break and they'd fix it and it would break, and I basically got mad at him and I was like, "What the hell?" And he's like, "Bosses won't pay for the things that I need to fix this permanently, so get used to it constantly breaking down."

0:14:33.4 JD: And that's the best I can do.

0:14:34.0 AS: That's the voice of the system, here's what I can produce with what you've given me to produce.

0:14:40.8 JD: Yep. Yep. Yeah. Those guys had a very keen understanding of the system, no doubt in that example. Yeah. Yeah. And that kind of thing happens all the time, I think. That was lesson two. Lesson three is plot the dots for any data that incurs in time order. So a lot of people in this world know Dr. Donald Berwick, he started the Institute for Healthcare Improvement. He was a student of Dr. Deming's, he's done a lot of work in this area. He has a great quote where he says, "Plotting measurements over time turns out, in my view, to be one of the most powerful things we have for systemic learning." And that's what really plot the dots is all about, it's all about turning your data into a visualization that you can learn from. And the National Health Service in England has this #plotthedots. And I think the whole point is that plotting the dots, plotting the data over time helps us understand variation and it leads us to take more appropriate action when we do that. So whether it's a run chart or a process behavior chart, just connecting the consecutive data points with a line makes analysis far more intuitive than if we store that data in a table.

0:16:03.6 AS: Yeah. And I was thinking about if you're a runner and you wanna compete in a marathon, plotting the dots like that is so valuable because you can see when changes happen. For instance, let's just say one night you didn't eat and then you ran the next morning and then your performance was better. Was it just a noise variation or is there something that we can learn from that? And then just watching things over time just give you ideas about what... Of potential impacts of what something could do to change that.

0:16:42.0 JD: Yeah. And we can start with a simple run chart, it doesn't have the limits, it's just a line chart. And then once we have enough of the data collected, enough plotted dots, then we can turn it into the process behavior chart.

0:16:56.3 AS: Some people don't even want to see that, John, like when we looked at your weight chart, remember that?

0:17:03.0 JD: I do remember that. Yeah.

0:17:04.0 AS: So for the people out there that really wanna let's say, control your weight, put a dot plot chart on your wall and measure it each day and just the awareness of doing that is huge.

0:17:18.7 JD: Yep. It is huge. It really is huge. And that works for any data that occurs over time, so almost everything that we're interested in improving occurs in some type of time order, time sequence. So these charts are appropriate for a wide array of data. But the bottom line is that... Oh, yeah, sorry, go ahead.

0:17:33.5 AS: The bottom line?

0:17:35.0 JD: Well, I was just saying the bottom line, whether you're using a run chart or a process behavior chart, it's always gonna tell us more than a list or a table of numbers, basically.

0:17:44.5 AS: I was gonna explain this, a situation I had when I was head of research at a research firm, a broker here in Thailand. I, my goal was to get more output from the analysts, they needed to write more and we needed to get more out. So what I did and I had already learned so much about Deming and stuff at that time. So what I did is I just made a chart showing each person's, what each person wrote each week, and it was a run chart in that sense where people could see over time what they wrote and they could see what other people were writing. And I purposely made no comments on this chart and I'd never really discussed it, I just put it up and updated it every week. And one of the staff that worked for me, an analyst, a really smart Thai woman asked, she said, she went to... She said, "I wanna see you in your office." I was like, "Oh, shit, I'm in trouble." And so she came to my office and said, "You know I went to, so this was maybe six months after I had put that chart up, she said, "I went out to lunch with my counterpart, my competitor, and she's writing research just like me on the same sector, and she asked me how many research reports do you write in a week, and I told her my number, and she was like, "Oh my God, that's a huge number."

0:19:16.6 AS: And she said, "Oh, I didn't really even think about it. But okay." And then she says, "What is Andrew's goal or target for you?" And she had naturally had thought that I had set a target of that amount, that's where she said, "I think I really figured you out." And I was like, "Well, what do you mean?" She said, "You just put that chart up there and you didn't give us any goal, but you knew that we were looking at it, and then it would provide us information and incentive and excitement, and the fact that you said nothing about it, got us to probably a higher level of production than if you had said, "I want everybody to read my reports."

0:19:57.9 JD: Right. Yeah, that's great.

0:20:01.0 AS: The magic of data. What's number four?

0:20:02.4 JD: The magic of data. Number four, so two or three data points are not a trend. So the first thing is, as soon as you've decided to collect some set of data, plot the dots, that should start right away. And again, this really includes all data that we're interested in improving in schools. And I know before I understood this way of thinking, this way of data analysis, I often relied on just comparing two points, that's the most common form of data analysis. What did last month look like, what does month look like? What did last year look like, what does this year look like? What did last week look like, what does this week look like? So that limited comparison is the most typical form of data analysis, especially when you're talking about something like management reports or board reports, revenue over time, those types of things. What was revenue last January? That type of thing. But the problem with looking at just two or three data points is that it tells you nothing about trends, it also doesn't tell you anything about how the data varies naturally.

0:21:17.5 JD: I remember looking at attendance data at one of our schools, and they had up... Last month was 92%, and then had gone up to 94%, but then I just said, well, what did it look like... January is 92, February is 94 in this particular school year, and I just said, well, what did it look like before, and then when you plotted it, what saw very quickly is there was no improvement, the data was literally going like this, up, down, up, down, up, down, up down, right? But no one had that picture, because all you could see was, Here's January and here's February, just numbers written in percentage form, that's almost all the data that I see in schools is in a similar format.

0:22:02.7 AS: On this one, in the stock market, my area of expertise. People always see the up data, the people who have made a lot of money in the stock market, and they see that as evidence that they could make money in the stock market, or they attribute that to skill of that particular person as we want to, with Warren Buffett as an example. And I have, in fact in my class, I asked the students, "Do you think that Warren Buffet outperformed, underperformed, or performed in line with the market over the last 20 years?" And the answer to that is, he performed in line with the market, and I proved that by doing a demonstration through a website that I can do that with, but it was shocking because obviously he's gonna end up with the most amount of money because he let his money compound, and he made huge gains in the beginning years, which compounded over many years.

0:23:02.0 AS: And still he's doing very well, but the point is, is that... The reason why I say this, I also tell the story of, if you had 10,000 people in a stadium and you flipped coins, and asked them if they flipped heads consecutively or tails consecutively to remain standing, and you're gonna end up with 10 people at the end of 10 flips with 10,000, and if you've got a million, you can end up with 20 or 30 or 40 flips that could potentially be heads consecutively or tails consecutively. So my question is, given that long streaks can happen through just plain probability, what if two to three data points are not a trend, can we definitively say, what is a trend?

0:23:50.9 JD: Well, not with certainty, but what this type of data analysis does is it gives you some patterns in the data to look for that are so mathematically improbable that you can be reasonably assured that some changes happened.

0:24:09.4 AS: Right so this is enough of a trend that I'm gonna go with the assumption that there's something significant here.

0:24:21.9 JD: Yeah. I mean it's...well, think back to that attendance example that I just used, so if I went from... If I'm writing this up on, let's say a whiteboard that's in a teacher work room, it says, this month and next month, or last month and this month, and I write those attendance rates up and remember, it's a dry erase board, and I'm gonna erase the last month to put this month's up and so I'm not gonna be able to see that one anymore, I'll have two data points and I'll erase the old one, and so in that example, I used where they went from 92%. It was actually like 92.4% to 94.1%. So it wasn't even two full percentage points. And then you celebrate that as a win, as an improvement, but like I said, you didn't know what happened before, and then you didn't chart after, so you don't really know how things are just bouncing around naturally versus if you had it on a run chart and you did see, let's say, eight points in a row that are above the average attendance for that school, that's one of the patterns that suggest that something different has happened. So you just have increased mathematical probability that there has been meaningful improvement.

0:25:39.4 AS: So it sounds like what you mean in this number four is a little bit more on the end of, Hey, just a couple of data points doesn't have anything, you need to get more rather than somebody looking at a lot of data and trying to understand what is a trend or not?

0:25:56.9 JD: That's exactly right. That's exactly right. And that actually is a segue to Lesson 5, which is "show enough data in your baseline to illustrate the previous level of variation," basically. So this is gonna get a little technical for a second, but the non-technical thing is, we talked about when you have a run chart when you're starting and you have, let's say, three or four or five, six data points at a certain point, you can now have a process behavior chart, which is the addition of that upper and lower natural process limit that defines the bounds of the system, so the limits are not a part of the run chart.

0:26:34.9 JD: In making sense of data what Donald Wheeler basically says is that if you're using an average line, the mean for your central line, then those limits, you begin to have limits that solidify when you have 17 or more values, and then if you're using a median for that central line, that solidification starts to happen when you have 23 or more values. So there's a mathematical theory behind that. But the point is, at a certain point, you start to get enough data to be able to add the limits and feel confident that those limits actually represent the bounds of your current system. But that's getting fairly technical and what Wheeler does go on to say is that, in real life we often have fewer data points to work with.

0:27:31.4 JD: So you can actually compute limits with as few as five or six values, and they can still be meaningful, now they're gonna be not a solid, meaning that each individual data point for a while that you add could potentially shift those limits more than you'd like, because there are a few data points that the limits are based on. But once you get to 17, 18, 19, 20 points, they start to solidify pretty good unless there's some significant change, like one of those patterns I talked about in your data. But an important thing to keep in mind is, is we're using a process behavior chart for continual improvement, so we're taking improvement measurements, not accountability measurements. I'm not trying to paint a certain picture of what my system looks like, I'm not trying to write a fiction about what's happening in my system, I'm actually trying to improve, so I don't really care what the data looks like. I'm not worried about being judged or rated or ranked, it's not an accountability thing, it's an improvement thing. And so I'm just trying to represent the system accurately so that I actually know that what I'm trying is working or not working. It's a completely different mindset. That whole sort of like trying to look better is completely removed from the picture through this type of mindset.

0:28:55.7 AS: I'm just picturing some sort of process where there's a measurement of temperature and the temperature keeps rising, but the worker says, "Boss there's a fire." And the boss said, "There's not enough data yet to confirm that." It only seems like a small fire right now, so I need more data points. Well, sometimes you have to act without thinking about the data and make an assumption that you may be wrong. You turn on the fire sprinklers, boom, and it wasn't a fire, but the damage of letting that go for long and saying I need more data doesn't make sense.

0:29:34.1 JD: Yeah, yeah, that doesn't really work. But the idea with the baseline is, basically, if you wanna improve something, the first thing you do is before you try anything, just gather some baseline data first so you can understand the current conditions. And in that attendance as an example, maybe you don't wanna wait for monthly attendance data, maybe wanna look at daily attendance day, what you have in a school, and just plot that over 12 days, 15 days, two or three weeks, and you can start to get a sense for what this looks like on a daily basis, and then you could try to improve it and see if that improvement has an impact on the data over time.

0:30:15.6 AS: Good, well, let me summarize this, but I have to start off with... My grammar is not particularly great, and since you're more of a school teacher than I am, I may need help with what you said. I think what I got correctly was data have no meaning apart from their context.

0:30:33.6 JD: Yeah, what did I say? Let me see.

0:30:38.5 AS: I always get confused if data is plural or singular.

0:30:41.8 JD: Yeah. Well, it can be either. So in this case, I was using data as a plural, so that's my point. I think technically the singular of data is actually datum. Obviously, nobody uses that 'cause it sounds really weird, but data can be plural, I think so.

0:30:57.4 AS: That sounds awfully Latin of you, alright. Number two, the data is the voice of the process, and that we control the process, not the data, and number 3 we plot the data in time order. Number four, two or three data points are not a trend. And number five is show enough data to illustrate the baseline. Anything you need to say to wrap all this up.

0:31:20.4 JD: Yeah, I just think that... I've mentioned this multiple times. I think when you're talking about continual improvement, primary tool is that process behavior chart, it allows you to visualize your data in a way that makes sense, and then the skill set that you have to learn is how to interpret the process behavior chart. How to use them effectively, how to create useful charts and then underlying... Understanding that underlying logic of process behavior charts. There's other tools, obviously in the improvement tool kit, but I actually think that that particular chart is the most important in my view. And I think with those charts, that tool in hand, we can avoid then those arbitrary and capricious goals that are so pervasive in our sector, basically.

0:32:10.6 AS: Well, that's exciting, and I'm excited for our next session when we talk about the final five. So John, on behalf of everyone at The Deming Institute, I wanna thank you again for this discussion, and for listeners remember to go to deming.org to continue your journey. And you can find John's book, Win-Win: W. Edwards Deming, the System of Profound Knowledge and the Science of Improving Schools on Amazon.com. This is your host, Andrew Stotz and I'll leave you with one of my favorite quotes from Dr. Deming, "People are entitled to joy in work."

What causes fear in an organization? How is fear hurting employee morale, productivity, and overall performance? What great things can happen when you remove fear? In this episode, John Dues and host Andrew Stotz talk about fear, and how managers can get rid of it.

TRANSCRIPT

0:00:02.6 Andrew Stotz: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today I'm continuing my discussion with John Dues, who is part of the new generation of educators striving to apply Dr. Deming's principles to unleash student joy in learning. This is Episode 14, and we are continuing our discussion about the shift from management myths to principles for the transformation of school systems. John, take it away.

0:00:32.9 John Dues: Andrew, it's good to be back. Yeah, we've been talking about these principles. We've sort of shifted from the myths to the principles that, you know, especially education systems leaders can use to guide their transformation work. I think we're up to Principle 8 today, and most recently I think last time we did, "institute training on the job" and "adopt and institute leadership." So we'll move on to Principle 8, which is "Drive Out Fear." So I'll start with just reading the principle verbatim from the book. So Principle 8: "Drive out fear so that everyone may work effectively for the school system. No one can perform their best unless they feel secure to express ideas, ask questions, and make mistakes." So I think maybe for me, when you look at the 14 principles, I haven't done this analysis, but I would venture a wager that Dr. Deming spent more time on this particular principle and related topics than any of the other ones.

0:01:44.6 JD: He discussed it numerous times in Out of the Crisis, numerous times in The New Economics. And one of the quotes that really stands out for me on this topic was in Out of the Crisis where Deming said, "Where there is fear, there will be wrong figures." And I don't think that... I don't think people sort of fully appreciate just how much sort of... "Writing fiction" is sort of how I've framed this in the past in one of our earlier episodes, but just sort of how much made-up data there is in every organization. And that can be wrong figures in the form of qualitative descriptions of important work, it can be quantitative data. But in either case, it makes it nearly impossible to improve our organizations. Because how would you even know where to start improvement if the figures and the descriptions of the work are inaccurate? So that'd be a good topic for today.

0:02:53.3 AS: Sometimes this one about fear is, sometimes it's easy for people to understand and sometimes it's hard. You know, like, when you think about fear, you can think about physical fear like, "Well, okay, am I in physical danger here?" Like, what are we talking about? Or, "Am I in fear that I'm gonna lose my job?" And some people may think that that's a good thing. And one of the first things I want to just think about is, what are the specific things in a school or in a school environment that causes people to be fearful? Maybe we could identify what you see, because you've talked about the outcome of fear is made-up data, wrong figures. It's all kinds of outcomes from fear, but what are the sources of fear?

0:03:47.2 JD: Yeah. Well, one thing I think of is you certainly can have sort of a tyrannical boss or manager. That certainly exists where there's actual fear, they yell, they threaten, passive-aggressive, those types of things. So that certainly can exist.

0:04:05.4 AS: Yep.

0:04:05.9 JD: I've definitely witnessed that in my almost 25 years in terms of career, you're gonna witness things like that. But I think more often what I'm talking about is sort of more subtle versions of fear that permeate throughout organizations. So sources, there can be different sources. I think they can come internally from some of the systems and processes you've set up in your own school or school system. Some of them are external, so, I mean, a go-to source of fear for a lot of people is, "How do my kids that I'm teaching perform on the state test?" That can be a source of fear, for sure. There is sort of internal to your system. I think the fear... I think a lot of people have sort of apprehension when the principal comes to your classroom to observe your class, and then there's sort of the ratings and rankings that go with a typical performance evaluation. So I think that can be another source of fear in a school system. And there's probably many other sort of versions of that. But I was thinking of...

0:05:25.4 JD: A lot of times when you hear people talk about driving out fear, you sort of get the negative stories. I think, not related to schools, but I think of a classic example of fear in the form of an unwillingness to speak up and say something is the Challenger space shuttle explosion. I think that's a classic sort of example of where people did see issues along the way and really nobody spoke up. So I think that's a sort of a classic example. But I was thinking of... And I was thinking about driving out fear in my own organization. At United Schools Network, one of the anecdotes in the book that I tell is actually a sort of a more positive example. So I was gonna maybe share that and talk about some of the details there. And it's sort of a combination of Appreciation for a System and Driving Out Fear, sort of working together.

0:06:32.0 JD: But I'm going back to the summer of 2013. So I was a school director or principal at that time of a middle school. And to put that in context, we were grades six through eight. I was entering my sort of fifth year leading Columbus Collegiate Academy. It's a fully built out middle school, six, seven, eight, serving the East Side of Columbus. And I was sitting in my office with my colleague, her name's Kathryn Anstaett. She was the principal on the other side of town. Kathryn and I had a working relationship because she previously had served on my team as a teacher and then as sort of an assistant principal for curriculum and instruction. So we knew each other well. And then she had been tapped to lead our new middle school on the West Side. And she had just wrapped up that first year. It was growing from just serving sixth grade, and now they gonna serve sixth and seventh grade for the 2013-14 school year.

0:07:37.1 JD: And just like today, 10 years ago, sort of similar, limited pool of prospective teaching candidates. And sometimes Kathryn and I, we would interview a person and we'd both want to hire that same teacher. And we had come to the sort of agreement where across the hiring season, for us, the fairest approach was just to alternate turns. So Kathryn would get first choice on a particular set of interviews, and then I would get first choice on the next set. But on this particular day, we both wanted to hire this same reading teacher, and it was my turn in that rotation. Kathryn and I were sitting and looking at both school's staff rosters, and we literally said, "In order to sort of make a decision that's best for the system, this hire should really go to Kathryn." I wanted the person, I needed the person, but I also had this capable group of reading and writing teachers, despite the one teacher opening, but she was just building this new team. So she really needed a really outstanding reading teacher.

0:08:53.4 JD: And I think thinking through this sort of whole system's lens gave my turn to Kathryn. And I think it's important to say here, I actually hadn't heard of the Deming philosophy at this point. I hadn't been exposed to this idea for appreciation for a system, but really the decision making was pretty simple. Kathryn and I were colleagues, we were on a small team working to build this new network of schools, and one of the best ways to sort of bring that network to fruition was to, you know, allow her to hire this particular teacher for her school across town.

0:09:31.4 AS: Now where this connects with Drive Out Fear is that there were a number of things in place that sort of gave me the confidence as a school director or principal to make this decision. I was employee Number 2 in our organization, so I was sort of on that founding team. That gave me some, I guess, some standing in the organization. By this time I had been there for five years, and I was pretty well established as a leader. I had a close working relationship with our staff. I had a close working relationship with our founder and superintendent. But even in that context, if I was being honest, this sort of whole system thinking was not easy because we're still a relatively young organization. We're just five years old. Really the question for a startup in its fifth year is still survival. Are we gonna survive as an organization? And there was a lot of pressure on me as a school leader to achieve high test scores and really establish the reputation of the school as a strong option on the East Side of the city.

0:10:44.9 JD: And thankfully, I had the backing of my superintendent, I had the backing of our board to make this decision, but I was fearful. I was fearful because it is very possible that even with that support, what would happen if I had been held accountable for our reading results, let's say, after this decision had been made? Unless I reminded people a year from now when kids take the state test and they get their scores back, they might not even remember that, "Hey, remember when we had sort of collaborated and made this decision?" They're likely, and some organizations are gonna come to me and say, "Hey, John, what's up with the reading scores?" That's not actually what happened, but that certainly was a plausible possibility.

0:11:40.7 JD: But my point is, and I think most organizations, it is really hard to make decisions like that. Was I fearful of my boss? No, of course not, not in this situation. Was I fearful of my colleague across town? No. Of the board? No. But in the back of my mind, I'm sitting there thinking, "I'm gonna make this decision. I really wanted this teacher. It was actually my turn. But I think it's the best thing for the whole system if this particular teacher goes across town and helps this new school."

0:12:18.0 JD: I think I feel better today making that decision 'cause we've more explicitly made the Deming philosophy and these 14 principles a part of our system. However, I can imagine, for many people sitting there thinking if they're a school leader, could you make this same decision in the absence of having these principles in place beforehand? So I thought that was a good example of Drive Out Fear. Again, with all these things in place, even with all those things in place, a startup early employee close relationship with the superintendent, board, I was still sort of wondering if I should make that decision as a young leader.

0:13:04.8 AS: So it's interesting because I was thinking about, what is the source of fear? The source of fear is that we are personally going to be injured. If we think about the source of physical fear of an animal or of a human when we're in a dangerous situation, it's that we're gonna personally be injured. Now you could also extend that to the family. If you are a pride of lions or you're a group of animals and the mother or father instinctively knows to try to protect itself but also its family. But it's this, it's the ultimate selfishness for survival. And that's where... One of the things I was thinking about when you were talking is like, why does Deming use this word "fear?" I mean, it's a pretty intense word. It is something that's visceral.

0:14:00.2 JD: Yeah.

0:14:00.3 AS: You know, to be fearful is a scary thing. And...But what you're describing is the idea that if we don't think about the business or the school or the education as a system, then what we're gonna be doing is everybody for themselves.

0:14:24.0 JD: Yeah.

0:14:24.6 AS: Protecting themselves and rewarding the protection of themselves and their areas. And when you view things as a system, then you have to give space for people to do the not necessarily natural thing. I mean, it's strange to say "not natural" 'cause I also think that people want to work together. People do not wanna be pitted against other people. Nobody wants that. Nobody has that as a natural instinct. If that instinct to be pitted against other people is in someone, it's quite possible it's in them because of something that maybe happened in their past where they realized, "To survive in this situation, I've gotta be pitted against other people and gotta overcome that." But I would say that people naturally wanna work together, and it's like we come in and we put in structures that we think are good management, but actually cause people to be pitted against each other.

0:15:28.9 JD: Yeah. I think you have to draw this out a lot of times in terms of... Because I think a natural reaction for someone listening to this, for some people, some leaders may say, "There's no fear in my organization. I'm a good guy," or, "I'm nice," those types of things. But as soon as I would hear a leader say that, that would be a dark pink flag, if not a red flag for me. Because there is, without a doubt, there is fear in every single organization. Now, the level of that fear is gonna vary based on the culture at that particular organization. But there is some form of fear in every organization. If you've ever sat in a meeting and you have withheld a thought that you think that was important to share because you are afraid of what the response is gonna be from the people in that room or a person in that room, then there is fear in that particular organization.

0:16:30.8 JD: And I think a lot of it has to do with people are making judgements all the time based on the system that they are living in. They observe what happens to other people that make similar decisions or behave in a similar way. So that's why something like Appreciation for a System and Driving Out Fear, these things have to work in concert with each other, right? Because if I was gonna be held accountable at all costs, if the board and the superintendent that I were reporting to in that situation, that hiring situation, were solely focused on management-by-results or management-by-objective, and I had this let's say a performance evaluation tied to that, I'm not sure even in retrospect if I would've made the same decision. 'Cause all those things have to work together to facilitate the individual's being willing to collaborate like this. The system has to facilitate it. I think that's sort of the point that all these principles have to work together hand in hand in order to bring something like Drive Out Fear to fruition.

0:17:45.9 AS: And I think one of the hardest things for people that are new to this thinking is that almost everything that we do drives in fear.

0:17:55.4 JD: Yeah. [chuckle]

0:17:57.2 JD: It's "I want results. We're about accountability around here." And there's plenty of schools I'm sure that put up a sign like "Personal Accountability," and, "We want measurable results and I don't want to hear excuses and you're not responsible for another department. You're responsible for your department." And it's just everything that we are given, and everything... We are rugged individualists, particularly in the American sense. That's kind of the foundation. So to come and say, "I'm not so concerned about your individual, I'm concerned about your contribution to the whole team," it just doesn't happen that much.

0:18:41.0 JD: Right. Yeah. Yeah. I mean, I think the first thing you have to do as leaders is recognize that fear is present in your organization, and then the next step is sort of figuring out the pervasiveness or severity of that fear. And a lot of that's, again, determined by the culture of your organization. But I think it is a natural byproduct. If you're doing anything that's the management-by-objective, management-by-results, performance appraisal, rating and ranking; if you are doing any form of those things, then there's no doubt that fear is pervasive in your organization. Because you're incentivizing people to optimize their individual classroom or their corner of the organization, whether that's classroom, grade level, an individual school building within a system, a department within the system, whatever it is; you are optimizing that behavior versus optimizing the aim of the the total organization.

0:19:39.0 AS: And the last part of this that I just wanted to think about was, when someone first hears this and then they start seeing the connection between personally incentivizing people through performance appraisals and merit pay and these types of things related to individual performance, the first question is, what do I do instead? I got performance appraisals and I've got pay for performance and I got beliefs about accountability and all that. And maybe a good way to wrap up this Drive Out Fear is kind of, what are some steps that you can do instead of or in replacement of or maybe you don't even necessarily have to replace something? What are your thoughts about how you can help somebody who's just coming aware of all this stuff but is a little bit overwhelmed because they're used to the traditional structures?

0:20:39.0 JD: Yeah. That's a good question. I think one thing is this idea of you have to... If you are a management or a leader or set of leaders, you have to stop blaming employees and looking at problems as systems problems instead of problems of individuals sort of serving in the system. So that may be one of the hardest things is that, then if that's true, which I think it is, then faults of the system are the responsibility then of management 'cause they're the ones that have the authority to design the system, redesign the system, change the system. I think that there has to be some type of concrete mechanism by which, in a school system whether it's teachers or students, that they can ask questions and offer suggestions for improvement. There has to be that mechanism in place.

0:21:31.7 JD: It doesn't mean that every suggestion necessarily leads to a change in the system, but there has to be a system in place that elicits those suggestions, and then some type of follow up. "I heard this. I studied it with you. We're not gonna make this change but here's the reason why." Or, "We looked into this. We studied it together over time. We gathered some data and this is actually a really good idea and we're gonna change that." So one very concrete, small thing that I do for every improvement team and every committee I lead in an organization, there's always sort of a meeting tracker document. And one of the tabs within that is just a Google Sheet. Each meeting is on a tab. One of the tabs is always a parking lot, where that every member of that committee or every member of that improvement team can drop in suggestions for improvement all along so we could make improvements in real time if we need to. So that's one very simple thing that I do. And then I also have a written record and for committees that I lead year in and year out, I just constantly, continually improve them over time based on those suggestions. So that's one concrete thing.

0:22:44.7 JD: A bigger thing for management, I think, is because things get hard when you get into a time crunch or a high stress situation, it is easy to sort of make decisions based on, "It is just easier short term to do this." So ahead of that, what I would strongly suggest is have a written set of guiding principles. That's why I like the 14 principles so much because they are a concrete written set of principles you can fall back on and you can then... You can test any idea or any direction that you're moving against those sort of foundational principles. And if the principles are violated, then you know you're moving in the wrong direction. But it's much harder to sort of do that in the high stress situation where you're reacting to something. In the absence of those foundational principles, you're more likely to sort of take the easy way out. So that's a little bit of longer process to put those principles in place. And I think that's probably a concrete thing that a leadership team or a superintendent and the board can do, so that you can facilitate having the Deming philosophy take root in your organization.

0:24:03.0 AS: So let me summarize what we've talked about in this Principle 8 about Drive Out Fear. The idea of course is to drive out fear for the effectiveness of the system, the school system, the business, whatever that is. And you talked about having the ability for people to... People to have the ability to express ideas and ask questions and make mistakes. And you mentioned that Dr. Deming said, where there is fear, there will be wrong figures. And you said, a lot of made-up data.

0:24:35.2 JD: Yep.

0:24:36.1 AS: That you see a lot of made-up data or that's what we end up. And we talked about sources of fear and we talked about tyrannical boss and possibly yelling and threatening. Those are like overt types of fears. But you also talked about subtle versions like internally driven, maybe ratings and rankings. People are fearful of speaking up. Or maybe they're externally driven by the test scores that your students get in maybe state tests as an example. And then we wrapped up by trying to think about, what are some ways to improve the situation, particularly for someone relatively new to this. And one of the things you mentioned is allowing employees or teachers to make suggestions on how to improve. And you also talked about having the written set of guiding principles which is what you've created through your book.

0:25:29.2 AS: And I like that one because that also is a longer term way of building some constancy in the business. But I just really want to end my summary by saying, for those people who are listening that think, "I haven't heard of this Deming stuff and I'm dealing with all these different problems but it's a bit overwhelming," so I think the best way to end my summary of this is - if that's the case, if you're in that situation where you're just starting to adopt this type of stuff, just start with stop blaming employees.

0:26:01.8 JD: Yeah.

0:26:03.5 AS: Anything you would add to that?

0:26:05.0 JD: Yeah, just taking that mindset of, most of the things that you're seeing are not a result of individual employees but rather they're created by the system itself. So three words. When you run into a problem, what's the system? What's the system? In the vast majority of cases, 95% plus, it's the system that is producing those results, not the individuals working in the system.

0:26:32.5 AS: Well, John, on behalf of everyone at the Deming Institute, I wanna thank you again for this discussion. And for our listeners, remember to go to deming.org to continue your journey. You can find John's book, "Win-Win: W. Edwards Deming, the System of Profound Knowledge and the Science of Improving Schools" on Amazon.com. This is your host, Andrew Stotz, and I'll leave you with one of my favorite quotes from Dr. Deming, "People are entitled to joy in work."

"When you do Six Sigma, you're basically outsourcing your quality to an external source, providing the training, the titles, and all of that. You can cut it off any time. But when you do the [Deming] theory of knowledge and the Plan-Do-Study-Act, you have to commit. The commitment is really the big deal here...the component that is missing [from Six Sigma] is a commitment to quality."

SHOW NOTES
4:30 Variation
12:40 The problem with Six Sigma
20:40 Statical Process Control Charts
25:44 Deming chain reaction
30:03 Suboptimizing departments
43:01 Management by visible figures
40:05 Why Deming, why now? Driving out fear
50:52 Continuous improvement and Plan-Do-Study-Act

TRANSCRIPT
Download the complete transcript here.

0:00:04.1 Andrew: My name is Andrew Stotz, and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today I'm here with featured guest, Mustafa Shraim. Mustafa, are you ready to share your Deming journey?

0:00:19.8 Mustafa: Absolutely, let's go for it. Thank you.

0:00:21.5 Andrew: I'm excited. Well, let me introduce you to the audience. Mustafa Shraim is an Assistant Professor at Ohio University teaching quality management and leadership. Professor Shraim has over 20 years of experience as a quality engineer, corporate quality manager, and consultant. His PhD is in Industrial Engineering. He publishes widely, and he has a passion for Dr. Deming's system of profound knowledge. Mustafa, why don't we start off by you telling us the story about how you first came to learn of the teachings of Dr. Deming and what hooked you in?

0:00:57.5 Mustafa: Yeah. Thank you, Andrew. Thank you for inviting me back. So...

0:01:01.9 Andrew: Yeah.

[chuckle]

0:01:06.1 Mustafa: The whole thing started when I was doing my master's and that was the late '80s, at Ohio University, and I was concentrating on the area of quality. So, I was doing research, and my research touched up on what Dr. Deming was doing. I was doing it in design of experiments and quality tools and things like that. But of course, you come across Dr. Deming's work when you talk about quality control, in general, and statistical quality. So, that was the first encounter of learning about what Dr. Deming did in Japan and how he used statistical process control and things of that nature to teach how you can improve your processes, your products, and later on, the management. But at the beginning, I did not really get into his management philosophy so I was more on the technical end of Dr. Deming's teaching which was mainly quality control and SPC, and just improving quality in general.

0:02:24.1 Mustafa: So, as I went... So I went, and I started my first job as a quality engineer, and quickly after that, maybe after one year, I moved to another company, and I became a statistical quality engineer, and I was doing... I was a part of a training program there. I was doing training on SPC as a part of a training for employees at that company. It was a union shop, it was automotive, and so we utilized statistical process control and what Dr. Deming was teaching. So, that was the beginning of it, but later on in the '90s, I started learning more about Dr. Deming after I read "Out of the Crisis" and then "The New Economics" about his management method. In fact, his management methods just captured me. I knew I got hooked on the quality part first, but the management method just brought it together for me. And since then, I've been reading and practicing, trying to at least, what Dr. Deming has taught.

0:03:41.9 Andrew: And would you say... One of the things that I started realizing was that the statistical... What I thought was the end was the statistical tools. And what I started to learn is that, actually, the statistical tools start to have limitations if you're not doing the management of the whole operation in a good way. And I think that that's something that really resonated with me when I started putting the pieces together. How do you see the role... And in a little bit I'm gonna ask you about some more specific tools, but just generally, we have statistical tools, but we also have management. Many people may think that you can just apply statistical tools and solve all the problems, but I'm curious how you see that interaction between the tools and the management style.

0:04:30.2 Mustafa: Well, as you know and many, probably, of your listeners already know that Dr. Deming had understanding variation, or some variation, as a part of his system of profound knowledge. So, understanding variation, under it, is really learning how to distinguish between the types of variation that you would have in any situation, managerial or process situation. So, that interaction there is really big. That really captured me because what Dr. Deming says is like, more than 80% of the application for statistical process control is actually, should be in management, and not necessarily just on the line, controlling quality of the product. So that was... It captured me, and because of explaining how many managers, many supervisors, don't understand the difference between common cause and special cause variations, and they start managing people with common cause variation going up and down, and they reprimand if it goes down, and they praise if it goes up, and that actually just makes things even worse in the future. As you probably know, it's tampering with the process.

0:06:08.8 Andrew: The best way that I've ever come up to try to explain this is to say to people, "Imagine there's 10,000 people in a stadium. They all flip a coin, and you say, 'Hey, if you flip heads, go to one side of the stadium. You flip tails, you go to the other. Everybody sit down. Okay, now... '" Or basically say, "Flip the coin again, and if you flip heads again, so two times, stay standing. And if you flip tails two times, then stay standing, but if you hit the heads and tails, then sit down." And now, your audience is getting smaller and smaller. If you do this 10 times, you will have 10 people, generally, you're gonna have 10 people that have flipped heads consecutively 10 times, and people that flip tails consecutively 10 times.

0:06:54.1 Andrew: And if we said, if we started off the whole game by saying, "Tails is bad." Now you've got some people that have done bad 10 times in a row, and some people that have done good 10 times in a row. But we know, because of the design of that example, that it's purely random. So, the question... So, we can understand that, but when we think about random variation, what Dr. Deming started to do is show us how that fits into management and psychology and how we're missing that. I'm just curious if you can help us to understand how that variation fits into that management 'cause you started talking about rewarding and all that. So, just curious about how those things fit together.

0:07:38.7 Mustafa: Right. For example, within the control limits, and those are the limits that are on a control chart, and they are spaced three standard deviations up and three standard deviations down. All the variation within is mostly a common cause variation, and it's due to the system. It's a system variation. It's not attributed to any special cause whether it's operator or something else that changed. So, distinguishing between the two becomes very important because if you don't look at variation from the perspective of a control chart, what happens is that you are in the weeds, and you look at every point as either really high up or high down cause you don't have any perspective as to how to evaluate or filter this type of variation. On the other side, also you don't want to not react to something that is special. For example, if you don't have the control limits, and if you don't have a proper way of looking at the variation, then you might end up also passing a special cause as a common cause, or not reacting to it enough to fix it and to make it a part of your controllable system before moving on.

0:09:16.7 Mustafa: From both perspective, I think it's very important for managers, for leadership, to understand why we do this. It's not just something that you have to do on the production line. It is something that you have to do in management based on performance. Look at your data and see if it's a stable process in control or if it's not, then you need to start eliminating those special causes. Like Dr. Deming said that, "Nothing really is born perfect as far as the processes." I'm paraphrasing here. But when you start a new manufacturing process, it doesn't mean that it's going to be in control; you have to work at it. You have to eliminate one by one all these special causes that come up before you start seeing a stability. And then after stability, then you will be able to work on the system part of the process, which is a long-term continuous improvement projects.

0:10:29.9 Andrew: Yeah, it's interesting. I remember a story. When I was working at Pepsi, we had a bottling plant in Los Angeles that I worked at. And the management were putting pressure on the people that were running the bottling machine because the variation of the level of the liquid in the bottle was getting wider and wider. And so, as a supervisor on the factory floor, my job was to go and kick ass, basically, and tell the guy, "Hey, come on, what are you doing here? You're messing around." And he just said, "Look, Andrew," and I was a young guy who listened to what these guys said, and he said, "Look, look at that machine over there. They spent the money to buy that filling machine over there, and you see there's no variation. Look at the old machine that they've got, and they haven't bought the parts to repair it. I keep telling them, if they don't buy these parts, I can't get to that point." And he was like... And I realized at that point that it was a management decision that needed to be made to reduce that variation at that point. It wasn't an operator that we should be punishing for that. And I think I wasn't that popular bringing that information back to management 'cause they wanted to say, "Well, no. It's the worker," and that's where I started to think about that common cause variation, and how do you improve and reduce variation?

0:11:48.3 Mustafa: Right, right. And if you leave it also to the worker, sometimes if they don't know what to do, they start tampering with the, actually, production process, and it makes it worse. So, a training for them on variation is also important. It's not only for management but also for workers as well.

0:12:08.2 Andrew: Yeah, good point. I know your expertise in this area is so valuable, and I think that it's great to have you maybe break down the following four terms that we hear, and maybe just generally discuss the differences, and then we'll talk about them in more detail. But the first term is Lean or continuous flow, the second is Six Sigma, the third is 14 points, and the fourth is system of profound knowledge. So, maybe just give an overview. What are these things? What do they mean?

0:12:40.0 Mustafa: Okay. Well, the Six Sigma part came about in the mid '80s and started in Motorola, and a lot of people already know that. And the reason it came out is because Dr. Deming's contribution in the '80s just brought a lot of attention to variation. In addition, you have also some big issues like the Ford transmission issue that came up. And there was a study about variation, and so there was a lot of attention being focused on variation. So Motorola... Somebody at Motorola, Bill Smith, an engineer over there, actually, came up with this idea of Six Sigma. And what that means, in general, is that if you have a spec that is a certain width, like upper and lower spec limits, then you want your process to operate in about half that space. Basically, that gives you good capability of the process, and then you don't have to worry about it. The first problem that came about from Six Sigma was the controversy about the shift. The people who invented Six Sigma, or packaged it together, said, "Okay. Well, we know you wanna operate exactly in the middle, but, normally, processes shift like one-and-a-half standard deviation here, or one-and-a-half standard deviation there so we want to allow that."

0:14:18.7 Mustafa: So, that is one of the biggest controversy because when you shift something like that, the process may be out of control without knowing. So, they did not really take that into consideration, although they are teaching control charts within the Six Sigma body of knowledge, so that was not really taken care of there. But that was one of the flaws that is out there in Six Sigma. Now, there are topics in Six Sigma that are... They're okay. We can teach certain topics on continuous improvement, root cause analysis, things of that nature. But the statistical thing here was wrong. And again, the reason Six Sigma was popular is because it is packaged the way it was packaged. You have companies buying this, and you have all the titles that came with it, and you know how companies love titles, especially here in the United States. So, you got all the belts; everybody must have a belt. You gotta go through training, you gotta... And then after you get your belt, what happens? You're gonna save us money. You're gonna have to do projects, and your job is to save me 20, 30, 40, 50,000 or 100,000 sometimes. So, that was the Six Sigma part of the whole thing.

0:15:51.6 Mustafa: And so, the Lean later became Lean Six Sigma. But Lean, by itself, came from Japan, originally. It's eliminating waste. Think about things like over-production, waiting, inventory, extra motion, all of these little things that you think they're little, but when you put them together, that's a lot of waste. So, to make the process flow better, you need to eliminate all of this waste. It's more about productivity and moving things faster within the organization. Then, when we contrast that with the 14 points, the 14 points are the system for management. It's all about... It's about management. It's also about quality, like improving forever the processes and systems for example, and have a constancy of purpose like the first point says. This was the application of what then became the system of profound knowledge as we know it. I don't know... I don't wanna go too far with definitions and things like that, but the Lean Six Sigma, they had the problem of the statistical flow from the Six Sigma part, and then you have all the management by numbers, management by objectives from both the Lean and Six Sigma.

0:17:30.3 Andrew: And I'm gonna try to summarize what you just explained by talking about the Six Sigma. Is what you're saying the flaw or the issue was is that, in order to try to get good quality, why don't we just set our expectations of what we're gonna get out of the system so tight that when we actually produce, we're in a narrow range, but we're never... Let's say we don't allow... We built the system with so much margin of error that even if we move around in our output, that that still is within a very tight range. Is that the concept?

0:18:10.5 Mustafa: Yeah. That is the concept. But the problem with that concept is, if you move around, if you let the process move around one-and-a-half standard deviation, for example, which, what it says, this indicates that you could have special causes that you don't react to. You don't know at that point because you have moved the process. You end up having special cause variation based on that shift because that shift could be real, a special cause and not just allowing natural... Naturally, the process does not move one-and-a-half standard deviation

0:18:53.0 Mustafa: all of a sudden because there are tests on control charts that if the process... For shift. So, if the process, for example, gives you nine points in a row on one side of the center line, that's a flag because that's a shift. That's a shift in the process. Now the process shifted on you, and you're not reacting. You're not doing anything about it, so you have to stop and take a look at it. So, what Six Sigma is saying is, "Yeah, the process could shift one-and-a-half standard deviation." But in statistical process control terms, it can't without reacting to it.

0:19:37.5 Andrew: And a simple control chart, or run chart, will probably reveal this better than looking at a histogram type of chart, like a Six Sigma type of chart where you're observing the output of the system moment by moment. Would that be correct to say?

0:19:56.5 Mustafa: Right, right. So, the control chart... And I did a paper... And there are people that are out there and doing the same thing. I did a paper and showed that if you move the system one-and-a-half standard deviation, you will see all these points beyond the control limits by simulation, simulation of the process. You move it, and you'll start observing so many points being out of the control. And so, if you allow it, then all of a sudden you start seeing all these points beyond the control. And what do you do? So, there is nothing to cover that within the Six Sigma body of knowledge.

0:20:40.7 Andrew: And maybe it's a good point just to talk briefly about the control charts and what Dr. Deming taught about that. I think when I started seeing the control charts as he was describing them, I started to see a real intense focus on looking at... at trying to understand what's really happening with this system and trying to observe it in real-time. And the more that you did that, the more you really start to understand what's driving the performance of that system. So, maybe could you just take a moment, think about the listener or the viewer that doesn't understand the control charts yet, maybe just give a big picture about what those are, and what's the value of them?

0:21:27.7 Mustafa: So, the control chart is basically... If you think about plotting points over time, that would be a run chart. So, just looking at your performance over time and just plotting points, that's a run chart. A control chart is basically taking the run chart and creating control limits on it. And the control limits came from Dr. Shewhart who invented the control charts. And he put those control limits to minimize a couple of mistakes: not reacting enough when you have to, and not over-reacting when you see something. They were more economics. They were not statistical in nature. They don't really depend on statistical distribution or anything like that. They are very robust. They can be used in a variety of applications without having to look at the distribution of the data. And they tell you when to react to a special cause and when to leave the process alone.

0:22:41.3 Mustafa: So, when you leave the process alone, it means that you have common cause variation, just the systemic type of variation that occurs over time. But that doesn't mean that you don't work on it as management. This is a management part of the work. So, when you have a stable process, it means that this is a time for management to initiate, maybe, continuous improvement project or initiative to reduce that variation, and not... Because you can be stable and in control, but you still have a lot of variation in the process. So, the spread is very wide in the process or, in the control chart, it will be going all over with a lot of variation, but it's still within the control limits. It could have this kind of scenario. And that's when management has to step in and say, "Okay, we need to look at this from a big picture and try to look at all the causes and do some kind of continual improvement."

0:23:53.3 Andrew: Mustafa, I would think that when you look at it, it turns out that it's like a continuous experiment. And you're looking at the outcome in a control chart, and you're trying to think, "Okay, if we... " Let's just say that we add a new piece of machinery. We upgrade a particular part. Then we look and say, "Okay, how did that impact the output of the process?" And then you start to see that what you're talking about, and I think what Dr. Deming is talking about was the idea that, start to get this intense focus on how do we improve this process? And how do we reduce that variation to a point? There's no point in reducing it beyond a certain point. But just that focus. Whereas with Six Sigma, it's kind of a theoretical thing, and there's other aspects that you've talked about. But just that, a control chart really allows you just to focus on testing and understanding that the whole... The output is a function, not only of the people on the production line. Let's say if it's in a factory, and it's the machinery, it's the way you organize, it's the shifts that you work. It's all of these things. So, I can't help but think that it's kind of like the fun of testing and seeing the result coming out of it.

0:25:09.1 Mustafa: Right. When you say a special cause, it doesn't mean always that it's bad. It could be good. But you have to study it, and you have to see what happened. So, was it intentional? Was it unintentional? But at least you would stop and look and study. And that's the idea. It's not just to let it go without studying it. On the other hand, the common cause, you're just looking at the width of the variation in general. And you try to reduce that, like you just mentioned, over the long run.

0:25:42.0 Andrew: So... Go ahead.

0:25:44.8 Mustafa: No, I was just gonna go back to Dr. Deming before I move to Dr. Deming's chain reaction model. I use that all the time. I use it when I was doing workshops in industry, and I use it now in my classes. And I put that... The chain reaction model. And what the chain reaction model for those of the listeners who are not familiar with it, Dr. Deming says that, "You have to start with improving quality, and the rest is just a chain reaction." So what happens is, when you improve quality, and that is, and what he's talking about here, is a commitment by management to quality. It's not just a one-time improvement of quality, it's a commitment on improving quality. Then you start seeing defect decreasing. You start utilizing equipment better. Errors decrease and all of this becomes much less. Your productivity, as a result, goes up because the cost is down, or your input cost is down so now your output is better, and you have a good productivity which keeps you in business, and you provide better jobs to your community. I think...

0:27:18.8 Andrew: That topic is so interesting because I think most people, at the time of Dr. Deming and even now, think quality is a department; quality is something we apply in a certain area. And when you think about setting the purpose of a company to improve quality, it's a very risky thing. Most people think, "No way. Our company is about sales. Our company is about profit. Our company is about customer satisfaction," or whatever that is. Those things all are the intuitive things that we come up with to say, "That's what drives our business." And Dr. Deming, what you're saying is that... Dr. Deming says, actually, the chain reaction that starts from quality leads to all of those things. Can you elaborate a little bit more on that?

0:28:07.5 Mustafa: Right. So, we know that we have to start on quality. But take, for example, companies that are engaged in Lean projects. So, what they do in Lean projects, you try to eliminate waste. And eliminating waste could also be a risky business if you just arbitrarily start cutting costs of material, of employee hours, or eliminating jobs, for example. If you take it from the productivity block of the chain reaction model, you go nowhere. You gotta go back from the quality, improving quality, and that's where the chain reaction starts. But for many Lean projects, they actually start from the productivity block. So, improve productivity from the productivity block, that doesn't really work because you are not committed to quality at that point. So, what happens is, you start maybe buying cheaper material or eliminating jobs. That might help you in the short run. The short run may be the next quarter. It's going to help you out. You're gonna improve the bottomline. Later on, all of this is going to come back as customer complaints, returns, issues with employees, lack of motivation because now they have to do more with less hours, and so on and so forth. But it creates a whole set of problems that are addressed in the system of profound knowledge from the psychology part to the learning part, and knowledge and the PDSA.

0:30:00.4 Andrew: So, let's go back to then now. I wanna talk about the system of profound knowledge so that the listeners out there, some of them understand it very well, but some of them may not understand what that means at all. So, now we've kind of been through a little bit about Lean. We've been through Six Sigma. We talked a little bit about the 14 points, and I think the point that you're just making is that when you look at Dr. Deming's 14 point, first one is create constancy of purpose. The second one is to adopt a new philosophy, and the third one is to end dependence on quality inspections. It's like those top three are telling the senior management, "Your job is to improve quality." That is what's going to lead this chain reaction. And I think you've illustrated that in your discussion really well. So, take a moment and tell us about system of profound knowledge as you see it.

0:30:49.8 Mustafa: Okay. So, the system of profound knowledge is... There are four pillars or four components to it. And the first one is appreciation for a system, meaning that you have to see systems in place. You have to do a connection of different parts together, that you cannot do things in silos. You cannot suboptimize. You have to look at the aim of the system, and you try to work for the aim of the system, not the aim of each department. But with that comes the idea of creating the variation part, and what is systemic variation and what is a special cause variation? Systemic variation is a part of management's decisions. They have to make improvement on that in the long term. And how you react to variation. So, if the system has a certain capability, and then you ask somebody, "Okay, I want you to get me that which is up here, way up. That's your objective." If the system is not capable, what is the employee going to do? They're going to try to create that number to please the boss. As Dr. Deming was referring to, they tried to please their manager or the boss. So, you might take risky steps to do that, including maybe fudging numbers or coming up with ideas to create that number.

0:32:37.1 Mustafa: And that goes to psychology, so now you are... You don't feel good about it. You have to keep your job. You have to do all kinds of stuff to make sure that you don't lose your job because you could not achieve that. Now you become less motivated. You're not really engaged. And what happens? They provide you with incentives, outside incentives. Bonus is based on work that you have to do, but the system is incapable. You cannot perform beyond what the system is capable of. So, that creates all kinds of problems. And the last part is the learning part or theory of knowledge, and that you have to have a method. You have to have clear definitions and, basically, you have to know what you need to accomplish, and by what method and how you know when you get there. That's a theory of knowledge. There is no knowledge without a theory, and it has to be... It has a temporal element in it, meaning that you revise the theory, and you create more knowledge. So, that's in a nutshell how you... How all of these components are related to each other. But to me, the systems and variation, they're just out there, and I see it everywhere as a problem.

0:34:14.3 Andrew: Yeah. So, to summarize, the system of profound knowledge, as you've explained, is appreciation for a system. Number two is knowledge of variation, number three is a theory of knowledge, and number four is psychology. And one of the things that I came to learn about Dr. Deming is, I always say he's a humanist. He's a person that really sees that people should have joy in work, and he wants to see people reach their full potential, and he understood the powers of incentives like you just explained. So, now that we understand a little bit of the theory of the system of profound knowledge, what is going wrong out there in this world? Let's talk just briefly about, why is this so significant? Come on, I just go get my black belt in Lean Six Sigma and the problems will be solved, but what is it about the theory of profound knowledge that... Or the system of profound knowledge that people should pay attention to now?

0:35:21.5 Mustafa: Well, with... For example, let me just take it from a different perspective. If you look at Lean projects, and you eliminate. for example, waste. if you don't have a system of profound knowledge to check all of the things that needs to be checked, like variation and psychology and making sure that people are not fearful to do their job, then you're creating other problems, not only just... You're not just reducing waste, you are actually, maybe having... overburdening the employees with removing waste because when you remove waste, you may be removing jobs, you may be removing hours, you may be removing employees. That would create a overburden. You could also create problems for the customers and fluctuation and defects and variation.

0:36:21.8 Mustafa: That's why the system of profound knowledge is an integrated system. It's not a just one piece. Once you start going from one door, you gotta address all the other components that are tied together to it. So to me, from whatever door you go in in the system of profound knowledge, let's say you go from the psychology which is you drive out fear. You create a good climate. You do all of these things, then you start seeing people coming up with innovations, reducing variation, and working together collaboratively which creates a good system. So, whatever door you go in, you're going to get to it because they are connected. There is no way that you're not going to address the other points if you have knowledge about the other points.

0:37:15.0 Andrew: It's an interesting thing that I would say in modern management, in modern life, people are trying to compartmentalize things and thinking that being a specialist in a particular area, whether that's medicine or whatever in business, that by compartmentalizing, it gives us comfort that we can become an expert in this area and all that. But what you can see... And I'll tell you, Mustafa, about my mother who I take care of. She's 83. And if we have a problem with her foot, the doctor may say, "Okay, don't walk for a little while." Well, that causes another problem. You start to risk bedsores. You start to have problems with GI system. And what you find nowadays in medicine is it's getting more and more narrow where doctors are not seeing the holistic pieces, and I see myself always constantly thinking about the whole picture to that. And I think what I'm hearing from you is that, that we should be looking at things more holistically, and that's what the system of profound knowledge is teaching, is that... Would you say that?

0:38:24.1 Mustafa: That's exactly right. That's exactly right. So, you have to... The main thing there is, companies, traditionally, they try to just suboptimize through their management by objective, "We want each department to save so much money," and then, once they start doing that, everybody affects the other negatively, but they don't know until later on that they have done that. You might gain the objectives in the short run, but in the long run, it's going to be disastrous for the aim of the organization.

0:39:03.9 Andrew: So, you just raised another point that Dr. Deming teaches about is suboptimization. And what he tried to teach was that the objective of the senior management of the company is to optimize the system, not its component parts. Have you seen...

0:39:19.9 Mustafa: Right.

0:39:20.9 Andrew: In theory, people should know that, but how is that going wrong in this world these days? And why is it important to be thinking in this holistic way that Dr. Deming was teaching?

0:39:32.5 Mustafa: Because companies, if they don't do things systematically, and they don't apply the whole system of profound knowledge, altogether, they're going to rush into money-saving exercises, and those money-saving exercises could be replacing material with lower-grade material. It could be, maybe, not hiring experts and hiring somebody who doesn't know what they're doing, and not providing training, or cutting training, or foregoing maintenance. There are so many things that you can start focusing on because you have issues. So, you have issues with a customer, and you start focusing on cutting costs, arbitrarily, not with a method, arbitrarily starting cutting costs in different departments. When you put it all together, just things don't merge well together because you're trying to suboptimize. You're trying to lower the cost in each department and not really improve the aim, or attain the aim of the organization as a whole.

0:40:48.3 Andrew: We've covered so many different topics. It's pretty exciting, like this sub-optimization. I think is a really interesting one. And I wanna raise a new topic that is the opposite of one of the topics that you raised. You talked about the chain reaction. Let's talk about the opposite chain reaction. I'll tell you a story in my own coffee business. We had put some pressure on some of the people in the procurement part of the business to reduce cost. That's reasonable. Management wants to reduce cost so there we go. We put pressure on them, and we told them... We incentivized them. And what we saw was that they ended up proposing a lower quality coffee bean, green coffee bean. The production people didn't like it because all of a sudden they had to recalibrate the machines. So, there was already a cost right there because the... It was harder to hit the client's demand of what taste that they want, consistently hit it.

0:41:47.9 Andrew: Then the people that were delivering, when we delivered the product to the customer, we had some returns where the customer is like, "No, I don't like this taste," or that we would have much more variability. And all of a sudden, we had customer complaints. And then we started to realize that, "Okay, now we gotta go and replace that with the proper stuff," and then all of a sudden there was all kinds of cost. So, the chain reaction you talked about was, start with quality and you start to reduce costs throughout the chain. And a reverse chain reaction is when you start by trying to optimize one point and not realize that it's a whole system, and therefore what you've caused is a negative chain reaction of cost just when you thought you were cutting costs, you're actually raising costs.

0:42:33.7 Mustafa: Right. That is a great example of that because what you've done is maybe just looking at the productivity part, you wanted to make sure that the costs were down so trying to turn the knobs on certain things, and then it just backfired on the quality part, increasing errors, increasing customer dissatisfaction and all of that, and that happens all the time.

0:43:01.4 Andrew: And that's what Dr. Deming says, "How can you measure the cost of a lost customer? How can you measure the dissatisfaction and the frustration?" Some things are just unmeasurable. So, I wanna...

0:43:15.2 Mustafa: Right. So, that brings about the issue of visible figures. You're managed by visible figures only, and not really the stuff that are behind the total cost, which some of it is unknowable or unknown.

0:43:34.2 Andrew: Now, Professor, this is really strange. Here we are, talking about quality. You're such an expert in all of these statistical methods, and now you're saying, "Wait a minute, you can't just measure by visible figures." So, this is again a paradox of Dr. Deming where you come into his teaching, seeing all of these numbers and all that, and now what you're telling me is it's not just visible figures. Could you just elaborate on that?

0:44:02.7 Mustafa: Yeah, absolutely. Visible figures are figures that are available right there for you, and you just react to it. If things go up, you wanna reduce costs. You just take action. But visible figures are really a limited part of the whole story because the total cost of not doing things right or not following the Deming management method. They're not going to be... You're not gonna see them until later on. You may be able save for a quarter or two but, beyond that, things are going to start accumulating in terms of defects, returns, and things of that nature. So, from the Deming point of view, the visible figures are only a smaller portion of the total figures which cannot be measured at the time you're looking at the numbers and taking action.

0:45:04.3 Andrew: It's interesting because we hear sayings like, "What gets measured gets managed," and those types of sayings. And one of the things that I... When I teach young people about this, I oftentimes say, "Well, let's just look at a simple thing. What is the value of a hug? Measure it." It's immeasurable. Particularly, in a particular situation when someone is traumatized, or in a really painful situation, and that hug made a huge difference in their life that could actually have kept them alive and led them to another so that... I think that's the visible figures that you're raising. It's such a small part of this world. The bigger part is how it all fits together. And so, I think you really inspire me to rethink about this concept; that it's way beyond just visible figures.

0:46:03.5 Mustafa: Absolutely, absolutely. This thing is just... One of the things that really captured me with the Deming philosophy is visible versus invisible figures, and the sub-optimization part versus the aim of the system. And those things are just so powerful when you think about them, when you think about why we're promoting, or why we're talking about Deming, and why now and all of that. It's these things that are very common these days. And they have... To have a good system, to have good management, you have to eliminate management by visible figures on... You still have to have visible figures, but visible figures-only is what Deming is... What it was Deming opposing. What he was against, I guess.

0:46:57.8 Andrew: Yup. And you said, "Why Deming? Why now?" And I'm thinking about it myself. And my answer to that is that we have a whole generation of young people who think that successful management is, maybe, sitting at their desk behind a computer looking at KPIs. And then, when someone is down on their KPI, send them an email, kick their butt. And when someone is up on a KPI, give them a bonus, and that's it. And then you go home at the end of the day. And they're so lacking in the psychology aspect of the system of profound knowledge, but just in what management truly is. So, from my perspective, "Why Deming? Why now?" is because we have the risk of it turning into some kind of automation system of management that will always end up underperforming. Why would you say, "Why Deming? Why now?"

0:48:00.5 Mustafa: So, as you can see that, for me, "Why Deming? Why now?" is I don't see management using variation as a way to distinguish between the common cause and special cause, and also their reaction to it, or the mistakes that they make as a part of it. So, that's a big thing. The other thing is the fear that people are experiencing at the workplace. Recently, we've heard about the great resignation. People just don't wanna go back to work anymore. And a lot of people expressed that they just don't like the environment that they work in. And we know that most people, about 70% of people who quit, they don't quit because of a pay or anything like that. It's because of relationship with their bosses and the company, and they just don't feel that. So that the environment has a fear in it. So, when you create fear, you're not going to have people that contribute and collaborate, and I think that's big. If we learn anything from this whole pandemic, it is that you have to create an environment of trust because if people are away working virtually or work in the office, you shouldn't have to worry about them if you have created that environment or the trust.

0:49:34.6 Andrew: Yup. And you mentioned about the pandemic. If there's one thing we've learned, fear is a massive motivator. The level of things that people have gone through in a state of fear, things that people would have never imagined that they would have done. And so, I think what you're talking about is just one more of the many Deming principles, which is to drive out fear. And I just wanna summarize some of what we've gone through, and then we'll wrap up. So, we've talked about the differences between Lean and Six Sigma and Lean Six Sigma. We've talked about Deming's 14 points. We've talked about the system of profound knowledge. We've talked about optimizing versus sub-optimizing. We've talked about the chain reaction, and I gave the example of a reverse chain reaction. And then, we talked about visible figures and understanding that there's much more than that, which is such a paradox for me when I first started learning Deming's teaching because I thought I was gonna take comfort in those numbers and the visible figures, but he told me, "No, no, no. There's much more." And finally, we talk about fear. Is there anything else that you would add to this final wrap-up of the conversation?

0:50:52.3 Mustafa: So, we started talking about Lean and Six Sigma and... Six Sigma is a continuous improvement process, but you don't really need to use it to... You can use the Plan-Do-Study-Act to it. There is no problem if you use it, and you recognize what's wrong with it, and you try to fix it. There's no problem with that. But, I think the Plan-Do-Study-Act and the theory of knowledge is sufficient for you to start working on things. But, like I mentioned, some companies, they like the titles and the tags and the big investment because then they use that as a motivator to get people to start working on projects to bring money back, to save the company the money that was spent on them. So, that's the only thing I wanted to add is just like you can't just rely on something that is big. The Plan-Do-Study-Act was good enough, and I think it's good for any organization. The problem with applying the Plan-Do-Study Act is that you have to have management's commitment because remember, when you do Six Sigma, you're basically outsourcing your quality to an external source, providing the training, the titles and all of that. You can cut it off any time. But when you do the theory of knowledge and the Plan-Do-Study-Act, you have to commit. The commitment is really the big deal here, or the component that is missing is a commitment to quality.

0:52:44.9 Andrew: Well, in wrapping this up, I wanna come back to where we started. Where we started was you were a young master's student and coming out of studying about these tools of statistical methods and all of that stuff, and you entered into our conversation, and you entered into the introduction to Dr. Deming through these tools. But here we are at the end of this interview, and now you're talking about such much bigger issues, and I think, for me, that inspires me about what Dr. Deming has taught because it is expansive. And the more you study it, the more you see it's way beyond just tools. So, Mustafa, on behalf of everyone at The Deming Institute, I wanna thank you again for coming on the show and sharing your experience with Dr. Deming's teachings. Do you have any parting words for the audience?

0:53:41.5 Mustafa: All I have to say, you gotta get started somewhere, and the system of profound knowledge is it. So, I would definitely recommend... I have been through many of the seminars that the Institute offers, and I would highly recommend that and also getting Dr. Deming's book "The New Economics." That's a good start. Of course, the follow-up is also just as important and continuing with the journey.

0:54:15.7 Andrew: Well, great advice. Get "The New Economics;" read it. It really sums up a lot of Dr. Deming's teachings. He put it together right at the end of his life. And that concludes another great discussion within our worldwide Deming community. Remember to go to deming.org to continue your journey. This is your host, Andrew Stotz, and I will leave you with one of my favorite quotes from Dr. Deming, "People are entitled to joy in work."

Listening to understand and learn is often harder than not-really-listening because you're thinking about what to say. Dr. Deming emphasized learning and was excited about ideas he heard from others every day. In this episode, David Langford and Andrew Stotz talk about why and how managers, including teachers, should listen to staff or students.

TRANSCRIPT

0:00:03.4 Andrew Stotz: My name is Andrew Stotz and I'll be your host as we continue our journey into the teachings of Dr. W. Edwards Deming. Today, I'm continuing my discussion with David P. Langford who has devoted his life to applying Dr. Deming's philosophy to education and he offers us his practical advice for implementation. Today, we continue going through Dr. Deming's 14 items that he discuss in New Economics about the role of a manager of people after transformation. In the third edition, that's page 86. In the second edition, that's page 125. And we're talking about point number 12 and that is "he listens and learns without passing judgment on him that he listens to." And we decided to title this one, Do You Listen to Speak or Listen to Learn? David, take it away.

0:00:56.8 David P. Langford: Yeah. Well, thanks. It's good to be back, Andrew. Yeah, I was just, I was just thinking that when I was at Deming's conferences and a couple of times sat with him either after the end of the day or even at lunchtime, etc. Or just watching him interact with other people, it was often pretty amazing that he'd be chatting with somebody and then he'd pull out these little notebooks and he's all of a sudden just writing down something that somebody told him or that somebody said or... And later in the day, a lot of times he'd pull out the notebook and say to somebody, "Look what I learned today." And I was always just so impressed with that. And I don't know how many four-day conferences I was at with him, at least half a dozen, and always the same, always swan with that little notebook, always writing stuff down.

0:02:02.9 DL: And so this point comes to mind about how special that made you feel that here you have the master of the third industrial revolution, writing down what, what you say, people that he doesn't really know that well or something, but just a point that somebody made and how important that was to him and to keep track of that. And a lot of times I think we've lost that skill. And I like the title of this session because a lot of times when people are having even casual conversations, they're not really listening to what the person is saying. They're thinking about what they're going to say next or how they're going to respond to a point that was made. And when I really started taking these points to heart and thinking about it, even as a classroom teacher, I began to realize that I really wasn't listening to my students. I was preparing to talk at them. [laughter] I remember...

0:03:16.0 AS: And they were preparing to be talked at.

0:03:18.6 DL: Yeah. They're ready to take notes, and you know, but they weren't ready to think and offer opinions and to go through that whole process of working through it. I'll never forget my friend Dr. Myron Tribus, he was a professor at Dartmouth, I think in the engineering school. And for some reason, his whole lecture that he was going to do one day was just either lost or something just before he was ready to walk out in his classroom of 200 kids, students that he was working with and everything. And he thought, "Oh my God, what am I going to do? I don't have my notes. I don't have all this stuff and everything else." Anyway, he just started asking them questions and put them into groups and had the groups discuss things and then come back and pose questions and debate each other and talk and work through. And he told me he'd never had so many students on the way out of classes. "Wow, that was the best class we've ever had." [laughter]

0:04:21.7 AS: Such a great, a great opportunity when you come unprepared, but you've got a group of people in front of you with all kinds of opportunities to pull out discussions.

0:04:37.3 DL: It's sort of like, are you prepared to be unprepared? [laughter] So there's a difference, there's incompetence where you just come in and you don't know what you're doing and, you know, you're lost, or you're prepared, this is a plan that you're going to come in and actually listen to people and present and go through things. I remember even in a high school class that I had, one of the most successful things we did is, I may have told you this story before, but anyway, the library would get all the newspapers and then after a day they're no good. And so coming into class, I would just get all the newspapers from the previous day. And the challenge for the students was to go quickly through the newspapers and pick out relevant events happening around the world and be prepared to discuss that in small groups and stuff. At first, I just thought of it as an activity. And it turned into be so profound that students really thought deeply about stuff.

0:05:43.1 DL: And then they would take Deming principles and apply that to that situation, whether you're talking about world wars, or you're talking about the economics or business or education or whatever it might be. And I remember even just a few years ago, a student of mine, 35 years ago, ran into me and said, "I still remember doing that. I still remember those discussions going through." And most of the time, I was just sitting and listening to them discuss about things. And maybe I'd ask a few questions now and then about things or try to get them to think differently about something. But it was, there were no right or wrong answers, it was just getting people to think.

0:06:30.9 AS: There's so many different things going on in my head as you're talking about this. The first thing is I was thinking... I was thinking about three things. The first is, in order to achieve what he's talking about, first, you have to stop talking. And the second thing is what I've learned over the years is, the best way to stop, the next thing you have to do is stop thinking, because my mind's racing to think about what am I going to say next. And the best way to stop thinking is to take notes of what the person is saying, from my experience. Yesterday, I went to visit a, a prospective client, and I asked him to tell me about his pain that he's feeling in his business and why he's asked me to come. And I have in my notebook here, I've got it all listed out. And then I went back and I read them back to him. And it was kind of funny because I said, "Unfortunately, I just don't think this is enough pain." [laughter] But I don't think I could have said that if I hadn't really understood what his pain was. And so, we had a further conversation going deeper.

0:07:42.5 AS: But then the third part that Dr. Deming is talking about is not passing judgment. Wait a minute. Come on. I'm all about judgment. I know what's right. I formed my beliefs over many years. And you can also say that Dr. Deming passed some pretty tough judgment, you know. So, I'm just curious, as I think about those three things, how do you put that all together in your mind?

0:08:09.2 DL: Well, I was just thinking about one of the conferences that we were at. He always had an education day after one of his conferences. And so, there'd be educators from all over the state would come to his one-day conference. And I'll never forget the room was filled with like 300 school administrators, principals, some teachers, et cetera. And then there was a time to ask Dr. Deming questions. And this fairly young man got up and described the high school that he was a principal of, and there were 52 different languages spoken, and the gang violence that he was dealing with, and all just really detailed and clear. And he had data, and he really understood what was going on. He says, "So Dr. Deming, I need your advice about what, where I should go from here, what I should do." And Dr. Deming is sitting up on this big stage. He's probably 89 years old at the time, and he's got his arms folded, and he looks down, and he looks up at the ceiling.

0:09:14.1 DL: The silence is just deafening with 300 people there. And started to think, well, maybe he didn't hear the question or realize he's supposed to [laughter] he's supposed to answer or something. And finally, the guy couldn't stand it anymore at the microphone. He says, "Well, Dr. Deming, do you have an answer to my question?" And Dr. Deming said, "It's not the answer that's important. It's the question. And you've got that right." [laughter] Next question. [laughter] And there was just this ripple in the audience, like, "What does that mean? Oh, my gosh." Yeah. So when you're able to actually ask the right questions, then you're probably on the right track of figuring out what to do yourself. It's the people that aren't listening and aren't thinking about what is the next question? Or what question should I be answering?

0:10:10.3 AS: And what do you think about when he says... Now, we have to understand that, we're talking about managing your people here. So it's not like he's talking about when you're going out and speaking in the public necessarily, but he's talking about how you're developing your people and interacting with your people. And he's saying, without passing judgment. And I guess the first thing he said, if the way you interact with the people that you manage is to pass judgment on them, you're probably going to lose trust right away. And we've already seen that trust was number 10. So I guess what he's trying to say is, you know, listen and accept what you hear. I don't know.

0:10:55.2 DL: Yeah, I think what I've often taught teachers a lot is to learn to be comfortable with silence, too. You think you're the leader of people so you have to fill all the silence all the time. And you may ask a question, and then you have to just wait. And I'll never forget when I was working with Alaska Native students in Alaska, high school students, read a study that said the average time it takes for an Anglo Saxon teacher to ask a question and then answer their own question is like three seconds. You know, not really listening at all. The average wait time, response time for Alaska Native students was something like 20 seconds. So, here you have all these teachers that have come in from the outside that are starting to work with Alaska Native kids. And they, I remember vividly teachers saying, "Well, these kids just don't respond. They just don't talk. They just don't." Well, give them time. [laughter] It's not in their culture just to respond instantly every time you ask a question or like a game show host or something like that of how many questions can we get through in one hour or something.

0:12:19.3 DL: And I just noticed for myself that I had to do little things like learn to put my hand on my watch, while I, as a cue just ask... I asked somebody a question just to wait until I got that response. And sure enough, when I would wait, I would get really good thought out well...good responses. I didn't wait and I get just cheap answers that people are trying to give you what they think you want to hear.

0:12:53.8 AS: I just thought about how being a podcast host has helped me a lot in listening because, I'm doing two things, one is I'm shutting up. And there's so many times that I feel like, you know I think my discussions with you are a little bit different from my discussions I do on my other podcasts where here I think there's a lot more... We're going back and forth on a lot of things, which I really enjoy. But still, it's just, it's a lesson in being quiet. And what you just said reminded me of something I always said to people that came to Thailand, either managers or teachers, and I said, "Just because Thai people don't respond to your question doesn't mean they don't have an opinion." And I think it's the same thing as what you're saying. And therefore, you've got to use different ways. So in the case of Thailand, one of the ways you do that is you have... And I just saw a presentation recently by a Thai person and they messed up themselves because what they did is they asked the audience, "Raise your hand and ask a question."

0:14:05.0 AS: Which they knew that that's not how Thai people respond. They're not so brave as to do that. But luckily, that person also had a little venue that they could type in a question. And instead of in, they could have saved time by just not even saying, "Shout out your question," they could have just said, "Go to the app, type in your question now." And then people would have really... Eventually they got it. But it was just interesting to see even a native person not really realizing the way people respond.

0:14:39.4 DL: I just know, even in my own family have five children. Well, my wife and I have five children. [laughter] But when they were really little, by the time we got to probably the third one, we had to sort of just hold back the older kids, because we found out that they were just filling in all the blanks for the little ones that couldn't answer or couldn't answer incomplete sentences, or they were actually just completing their thoughts for them and things and just had to explain to them, "Look, you just have to wait and let them formulate an answer and let them talk, let them speak." Because they didn't realize that they didn't have that problem when they were that age. [laughter] They just had parents that were just doting on them and there weren't any other children around. So.

0:15:31.6 AS: Let the process happen.

0:15:33.8 DL: Yeah, it worked out really well because then we'd have fantastic dinner conversations in which all five of them at different ages could enter in and talk about it and enjoy experiences.

0:15:48.3 AS: One other thing I recently did in one of my classes that maybe I would talk about because there's an aspect of listening to it. Originally, this is my ethics in finance class, and it's a 15 hour class. And I can teach for 15 hours on the ethics material, but after COVID happened, it's like, why not just put it all on video. And so what I'm teaching is exactly mirrored to what's in the videos. So now what I did is I told the students, "Look, you're responsible for going through this material. I'm going to carry you through a portion of it. But from day one, I'm telling you, it's all in the videos. And then there's practice questions and things like that." So now what I do is I did... Originally, what I did is I taught for half the three hour session I would teach and then I would have them do case studies. But I realized that I wasn't happy with what the case studies were bringing out and so I switched it to debates.

0:16:47.4 AS: And now I give them topics and they have teams that debate. And I still had the problem that the audience wasn't participating or asking really great questions, it's almost like, it's the other team. So I required all teams to submit one, let's say two arguments with some sort of link to some evidence and two arguments against linked to some evidence, and they all have to submit that by Monday. And then I release that to the whole group, so that the teams that were preparing for Wednesday can see even wider view before they get up on stage. But the key thing is that what's happened now is that I don't have to ask any questions at the end. So I'm just listening. And it's fantastic, because the audience now, they've got good questions. And I just feel like when you talk about listening for me to be able to spend the second half of the class, I don't say anything.

0:17:44.3 DL: Yeah, so it seems like such a simple point. But I think when you really think about it, there's just a lot of depth there and reasoning. And you also made me think about, because you were referring back to the one of the previous points to and trust and stuff, but all of Deming's work was always an interrelationship of parts to the whole. So whether you're talking about the 14 points in his New Eco... Or the Out of the Crisis book, or you're talking about these 14 items for managers or whatever it might be. I was always so impressed that he always saw these things as an interrelated parts to the whole. So it's not like, "Hey, if you just start listening and just do this, then everything is just going to be great." Well, that's a piece of the puzzle, that's not the whole puzzle.

0:18:31.0 AS: It's a progression. Well, is there anything that you would add in wrapping up about listen and learn without passing judgment on the person that you're listening to?

0:18:46.5 DL: I think, I think the last thing is that as a manager of people, whether it's a teacher in a classroom or whatever it might be, you have to actually formally make time to do that. And I know that's really hard to do, but you think of a normal like classroom teacher, like K through 12 classroom teacher, maybe you have 30 kids in a class, how are you going to set up a system so that you're actually getting some time to listen and learn from individual students? And that's really hard to do. It can be done if you think about, "Okay, well, I got 25 kids, if I set up a time to listen to five a day, by the end of the week, I've actually got some one-on-one time with everybody involved with that." Or we've talked about too, in moving to small groups or even whole group kinds of sessions. But the whole point is that you are listening, and think how proud it makes people that you are listening.

0:19:56.3 DL: That's why I told that story about Dr. Deming, because I always felt really proud that he was really listening to what I was trying to say or explain or ask a question about.

0:20:07.9 AS: Yeah, I can't help but add to that, that I do one-on-ones with every one of my students in the Valuation Masterclass Bootcamp. Now, it's a 70% pass rate. So, I don't do those until the end of the course, but people line up video meetings, and we do it virtually because it's kind of, it's easier. But what I have is I have a series of about eight questions that I ask them. And then what I do is I just get them on the line and I say, "Okay, let's look at your first question I asked you, and here's your answer." And I read it back, and then I say, "Tell me more about that." It's incredible.

0:20:47.2 DL: And you have to be real quiet and listen. [laughter]

0:20:51.1 AS: Just tell me more about that. That's all you have to do. And I think that's what your last wrap up there just reminded me. And I think for all the listeners and the viewers out there, you know, "tell me more about that." Well, David, on behalf of everyone at the Deming Institute, I want to thank you again for this discussion. And for listeners, remember to go to Deming.org to continue your journey. Listeners can learn more about David at Langfordlearning.com. This is your host, Andrew Stotz, and I'll leave you with one of my favorite quotes from Dr. Deming, "People are entitled to joy in work."

In this episode, Bill and Andrew discuss variation, the impossibility of true interchangeability and why we need to apply "shades of gray" thinking at work. Bill shares the key question that will take your organization beyond "meets specifications" and help improve your processes, so you can delight your customers.

TRANSCRIPT

0:00:02.8 Andrew Stotz: My name is Andrew Stotz. I'll be your host as we continue our journey into the teachings of Dr. W Edwards Deming. Today, I'm continuing my discussion with Bill Bellows, who has spent 30 years helping people apply Dr. Deming's ideas to become aware of how their thinking is holding them back from their biggest opportunities. The topic for today is 20th century quality, Bill take it away.

0:00:28.2 Bill Bellows: Thank you, Andrew. So the running joke on the 20th century quality is we could have said 19th century, and sadly it's still 21st century. And what do I mean by that? In our second episode, we've talked about the two questions of quality management. Question one, does this characteristic, does this product, does this thing meet requirements? There's only two answers. That's 19th century quality, that's 20th century quality, and by and large, that's 21st century quality. And my hope is that our conversation inspires people to move into question two, which opened opportunities for as you're talking about opportunities for investment, opportunities for doing amazing things, when we get out of the black and white of question one into the shades of gray, of question two. That's, that's so...

0:01:26.5 AS: So what century are we in now?

0:01:29.1 BB: I think the 21st.

0:01:30.5 AS: 21st. My goodness. People always get, I always get confused. We're in the two thousands, but that's a 21st century. And 19th century is the 1800s.

0:01:46.7 BB: Well...

0:01:47.5 AS: 20th century would then be from 1900s until 2000 or 1999.

0:01:54.3 BB: The... And just for some more clarity, and I was doing some research earlier today, but there's a great tie between question one and 19th century 20th centuries still: question number one, does this meet requirements? A lot of that ties back to this whole concept of interchangeable parts. Which is not what we do in the garage when we're in the garage building something - that's 21st century quality, because we design it, we buy the stuff again, whether you're building something in the kitchen, in the backyard, and we put it all together with a 21st century, a Deming-Taguchi approach to quality, which means we're not looking at the parts in isolation we're looking at how they come together, the idea of interchangeable parts, and the... A name that I usually find as being the father of this concept of interchangeable parts. People talk about Eli Whitney.

0:03:02.3 BB: But Eli Whitney heard about interchangeable parts from the first American to hear about this concept, who was Thomas Jefferson. And he heard about it when he was US Ambassador to France, in 1802 timeframe, he was Jeff, he was George Washington's ambassador to France. And while there he came across a Frenchman by the name of Andre Blanc, B-L-A-N-C. And Blanc is considered the... Not the father of interchangeable parts. There's a French general in the 1770s had this idea of you're in the battlefield, you've got all these broken weapon systems and I can't cobble together this cannon with these wheels to be able to continue fighting the battle because they're all crafts built with craftsmanship, which means these things don't come together. So this general had the idea, and I like to tell people, Blanc is the one who got the marching orders to go put this concept into practice. And so he's given credit for being the one to work through the details.