6 ideas
Deming lays out a sequence: improving quality lowers costs because there is less rework, fewer mistakes, fewer delays and snags, and better use of machine time and materials. Productivity therefore rises. With better quality and a lower price the company can capture the market, stay in business, and provide more jobs. This reverses the assumption that quality and cost trade off against each other.
Deming separates variation into common causes, which are built into the system and belong to management, and special causes, which arise from specific, identifiable events. He estimates from his experience that something like 94% of troubles and opportunities for improvement belong to the system and 6% are special. Blaming workers for system-driven variation is therefore usually misdirected.
Deming argues that routine 100% inspection to catch defects is too late, ineffective, and costly. It pays people to make defects and then to correct them. Quality comes from improving the production process itself, so organisations should cease depending on mass inspection and build quality in from the start.
Deming lists evaluation of performance, merit rating, and the annual review among the deadly diseases of Western management. Because much of the difference between people's results comes from the system rather than the individual, these rankings reward and punish people for things they do not control. He argues this nourishes short-term performance, builds fear, demolishes teamwork, and leaves people bitter.
Deming calls for eliminating work standards, numerical quotas, and management by numerical goals, and for substituting leadership. A quota fixes attention on hitting a number rather than on understanding and improving the process. When a goal lies beyond what the system can deliver, it gives no method for reaching it and encourages people to meet the figure at the expense of quality.
Deming argues that awarding business on lowest bid ignores total cost, including the cost of the variation and defects that cheap inputs bring into downstream processes. He urges buyers to move toward a single supplier for any one item. That relationship should rest on long-term loyalty and trust, so the buyer and supplier can work together to reduce variation.