These are my notes on Deming’s Journey to Profound Knowledge: How Deming Helped Win a War, Altered the Face of Industry, and Holds the Key to Our Future by John Willis with Derek Lewis.

“This book is truly about how the lens of Profound Knowledge was found”.

Key Insights

• Deming is the foundation of Lean, Agile and DevOps.
• Variability is a fact of life.
• Elements of the System of Profound Knowledge:
  1. A Theory of Knowledge: How we know what we believe we know?
  2. A Theory of Variation: How do we analyze and understand what we know?
  3. A Theory of Psychology: How do we account for human behaviour?
  4. An Appreciation of Systems/Systems Thinking: Are we seeing the bigger picture?
• The opposite of analytic thinking is systems thinking.
• Japanese workers believed they were doing something that mattered.
• No matter how precise the machines and the processes, the outputs all slightly varied from each other.
• Less waste allowed manufacturers to do more and more with less and less.
• Shewhart’s method enabled management to see defects as result of process instead of the workers.
• Defect classification:
  1. Common cause: variations that could be predicted and should be planned for.
  2. Special cause: couldn’t be predicted and shouldn’t be planned for.
• The real value of Statistical Process Control is that it allows you to observe variation and look at random vs non-random patterns:
  • A random pattern represents a stable process, aka a process “under control”.
  • A non-random pattern is a useful predictor of potential defects, signaling an amount of uncertainly in the process.
  • And here is the root of all evil: misidentifying variation.
• Under-performing and brand-new operators would have 100% of their work inspected until their work fell within the control limits.
• We really didn’t believe. We did what we were told and it worked.
• They shouldn’t strive to be better than others but to strive to be better than themselves - that is true competition.
• Management by means (MBM):
  • If you don’t know how you achieved your objective, how do you know if you can do it again?
• 14 Points for Management
• A common disease that afflicts management is the impression that “our problems are different”.
• Only 6% of problems are due to human error. 94% are system error. And since the system is the responsibility of management, 94% of problems are caused by bad management.

• Quality is not so much about improving the product as it is about improving the process.

  In God we trust. All others must bring data. Dr. Deming

• Organizations need to be a place where people can teach themselves.
• Perfection is not for this world.

TOC

• Preface
• Introduction
• Part I - Foundations of Profound Knowledge
  • Chapter 1 - Humble Origins & Non-Determinism
  • Chapter 2 - The Jungle in Paradise
  • Chapter 3 - The Birth of Quality Control & Standardization
  • Chapter 4 - The Root of All Evil
  • Chapter 5 - Pragmatist
• Part II - Applications of Profound Knowledge
  • Chapter 6 - Dr. Deming Goes to Washington
  • Chapter 7 - Rosie & World War II
  • Chapter 8 - CLASSIFIED
• Part III - International Implications of Profound Knowledge
  • Chapter 9 - Samurai Statistics
  • Chapter 10 - JUSE & the Gentle Giant
  • Chapter 11 - The Butterfly Effect
  • Chapter 12 - Made in Japan
  • Chapter 13 - Rising Sun, Falling Eagle
  • Chapter 14 - Demingmania
  • Chapter 15 - Dr. Quinn, Medicine Woman
• Part IV - The Next Generation of Profound Knowledge
  • Chapter 16 - The Digital Cambrian Explosion
  • Chapter 17 - What Would Deming Do?
  • Chapter 18 - Deming’s Dark Legacy
  • Chapter 19 - Out of the Cyber Crisis

Preface

• Eliyahu Goldratt books:
  • The Goal.
  • Theory of Constraints.
  • Critical Chain.
  • It’s Not Luck.
  • Necessary but Not Sufficient.
• Deming is the foundation of Lean, Agile and DevOps.

Introduction

• The Allies won because the US outproduced the rest of the world:
  • Despite the absence of millions of skilled American workers and managers.
  • Thanks to the statistical process control method.
• The very nature of reality is random.
• Variability is a fact of life.
• Elements of the System of Profound Knowledge:
  1. A Theory of Knowledge: How we know what we believe we know?
  2. A Theory of Variation: How do we analyze and understand what we know?
  3. A Theory of Psychology: How do we account for human behaviour?
  4. An Appreciation of Systems/Systems Thinking: Are we seeing the bigger picture?
• Deming’s mission was to work himself out of a job.

Part I - Foundations of Profound Knowledge

Chapter 1 - Humble Origins & Non-Determinism

• Determinism (Newtonian Physics): World operates solely on cause and effect.
• Non-Determinism:
  • No matter how much you know, there is an infinite amount of change and randomness in the universe.
  • No such thing as absolute certainty.
  • Crucial role in shaping Deming’s worldview:
    1. Long-established and long-held beliefs weren’t necessarily true.
    2. Underpinnings of our very existence are random.
    3. Forced him to look at problems as multifaceted, complex systems.
• The opposite of analytic thinking is systems thinking.

Chapter 2 - The Jungle in Paradise

• Hawthorne Works:
  • Treated its workers more like partners than peasants. And it worked.
  • Corporate success forged a bond of loyalty with its employees.
  • “Hawthorne Effect”:
    • The act of subjects changing their behaviour in response to being observed.
• Japanese workers believed they were doing something that mattered.
• Workers:
  • Ford:
    • Saw them as inconvenient cogs in the machine.
    • Standardize to make them interchangeable.
  • Taylor:
    • Scientific management.
    • Saw them as machines themselves.
    • Optimize them for maximum efficiency, through right physical and psychological conditions.
  • Both:
    • Think that workers don’t want to work.
    • Antagonism between workers and managers.
• Piecework is man’s lowest degradation:
  • Incentivices workers to focus on quantity, not quality.

Chapter 3 - The Birth of Quality Control & Standardization

• The eternal question of quality has always been this: “How good is good enough?”
• Machine age: standardization was the catalyst.
• Interchangeable parts were the turning point in the history of quality control and led to the theory of variation.
• No matter how precise the machines and the processes, the outputs all slightly varied from each other:
  • This spawned a need to allow for variance in product specifications.
  • This is more in line with a non-deterministic approach.

Chapter 4 - The Root of All Evil

• Statistics is about how confident you feel when dealing with uncertainty.
• Operational definition: procedure agreed upon to translate a concept into a precise measurement.
• If you can track variation, then you can trace variation to better understand why a production line creates defects and detect it much earlier in the process.
• Statistical Process Control (SPC) let managers compare variation across workers and machines.
• Less waste allowed manufacturers to do more and more with less and less.
• Shewhart’s method enabled management to see defects as result of process instead of the workers.
• Plan, do, check, study.
• Defect classification:
  1. Common cause: variations that could be predicted and should be planned for.
  2. Special cause: couldn’t be predicted and shouldn’t be planned for.
• Shewhart: as long as the variance fell within standard-deviation limits, the variance was inherent to the manufacturing process (common cause).
• The real value of SPC is that it allows you to observe variation and look at random vs non-random patterns:
  • A random pattern represents a stable process, aka a process “under control”.
  • A non-random pattern is a useful predictor of potential defects, signaling an amount of uncertainly in the process.
  • And here is the root of all evil: misidentifying variation.
  • As a result, managers can spend their time on things they can control.
• SPC allows you to statistically predict defects before they occur.

Chapter 5 - Pragmatist

• The philosophy of pragmatism, what Deming would later call the Theory of Knowledge.
• A meter would be defined as the cord length needed for a clock’s pendulum to travel one swing per second.
• Two types of knowledge: a priori and a posteriori.
• A posteriori thinkers or “pragmatists”:
  • Experience is the best teacher.
  • Begin with observations and empirical data (hard evidence) and then work their way backwards.
• A standard is a measurement that suffices and that everybody agrees upon.

Part II - Applications of Profound Knowledge

Chapter 6 - Dr. Deming Goes to Washington

• Under-performing and brand-new operators would have 100% of their work inspected until their work fell within the control limits.

Chapter 7 - Rosie & World War II

• Victory came because the US outproduced the rest of the world.

Chapter 8 - CLASSIFIED

• Bounded rationality: humans can process only so much information at a time.
• David Woods: Anomaly response situations frequently involved time pressure, multiple interacting goals, high consequences of failure, and multiple interleaved tasks.

Part III - International Implications of Profound Knowledge

Chapter 9 - Samurai Statistics

• The US used statistics to win the war, even as Japan threw statistics out of the windows. Afterwards, Japan used statistics to win the economic war, even as the US threw statistics out the window.

Chapter 10 - JUSE & the Gentle Giant

• SPC wasn’t just about applying statistics to output. Quality touched everything in the process, including the quality of raw materials and components received from supplier and vendors.
• Ed knew that unless it included top management, the classes were unlikely to succeed.
• JUSE used the proceeds from the lecture fees and book royalties to fund a prize in Deming’s honor. Accomplished three critical purposes:
  1. Associated JUSE with one of the most famous statisticians in the world.
  2. Laid a sort of territorial claim to the man.
  3. Guaranteed Deming’s involvement in Japan.
• Deming: They wanted more conferences, so we had more. It was a terrifying experience for me because I was new at it. I was a technical man.
• We really didn’t believe. We did what we were told and it worked.
• He inspired hope, if not confidence.

Chapter 11 - The Butterfly Effect

• He demonstrated how even competitors working together benefited their respective companies and, more importantly, their customers.
• What is Deming’s real legacy? It is seeing the grander scheme and preaching cooperation instead of competition.
• They shouldn’t strive to be better than others but to strive to be better than themselves - that is true competition.

Chapter 12 - Made in Japan

• Because demand and profit margins were so high, US companies could afford waste, rework, stockpiling inventory, and other inefficiencies.
• Taylorism focused on eliminating individual waste. Ohno focused on systemic waste.
• Assembly-line workers were cross-trained in different positions.
• Machines were make multipurpose.
• Kanban:
  • The aim was to produce only what was needed, when it was needed, and in the amount needed.
  • It went against everything Henry Ford believed and practiced.

Chapter 13 - Rising Sun, Falling Eagle

• Kaizen: a process of deliberate, patient, continual refinement.
• How long do you think it will take the US to catch up with Japan?
  • Do you think Japan is standing still?
• What made one manufacturing plant better than others? Adopting a lean manufacturing philosophy trumped all those other factors.
• US companies focused on the process but forgot the people.

Chapter 14 - Demingmania

• Management by means (MBM):
  • If you don’t know how you achieved your objective, how do you know if you can do it again?
• 14 Points for Management:
  • Improve constantly and forever the system.
  • Eliminate slogans, exhortations, and targets for the workforce asking for zero defects and new levels of productivity. Such exhortations only create adversarial relationships, as the build of the causes of low quality and low productivity belong to the system and thus lie beyond the power of the workforce.
• Waraniak didn’t focus on the race: he looked at the preparations and training leading up to it:
  • By using two cars and two teams in the design, training, and setup phases, GM could prototype twice the number of ideas and innovations.

Chapter 15 - Dr. Quinn, Medicine Woman

Part IV - The Next Generation of Profound Knowledge

Chapter 16 - The Digital Cambrian Explosion

• Dr. Deming reaction to someone who was complaning that he had changed something in his teaching: “I will never apologize for learning”.
• Lean development focus on waste, whereas agile focus on delivery.
• Steve Blank, The Lean Startup: putting together build, measure, learn and MVP with agile and lean methodologies.
• DevOps: collaboration between devs and ops, and automation of agile and lean principles.
• Read Deming’s 14 Points of Management to understand the roots of DevOps.

Chapter 17 - What Would Deming Do?

• A common disease that afflicts management is the impression that “our problems are different”:
  • They are different, to be sure, but the principles that will help are universal in nature.
• To profoundly change a system, requires know-how outside of that system.
  • If the system had the knowledge, then it would change itself on its own.
  • Ed’s System of Profound Knowledge does not require someone from the outside.
• Only 6% of problems are due to human error. 94% are system error.
  • And since the system is the responsibility of management, 94% of problems are caused by bad management.

Chapter 18 - Deming’s Dark Legacy

• From 2021, federal government’s vendors are required to supply a software bill of materials.

Chapter 19 - Out of the Cyber Crisis

• When you silo cybersecurity, seeing it as an independent component instead of a system, you put your entire organization at risk.

• Shannon Lietz: security needs to be designed into an organization’s system.

  It is not necessary to change. Survival is not mandatory. Dr. Deming

• Today, leaders wait until there is a problem before they fix it.
• Quality is not so much about improving the product as it is about improving the process.
• Tighter relationships with fewer suppliers lead to increased process alignment and lower overall costs.
• In God we trust. All others must bring data.
• Instead of looking at incidents through arbitrary categories (P1 to P4), System of Profound Knowledge could be used to identify common-cause and special-cause patterns across all incidents.
• Blameless post-mortem: instead of assigning a problem to a certain person, blame would be placed on the system.
• “I didn’t question it”: famous last words.
• Plenty of executive managers still don’t understand the nature of the digital world and demand “zero defects” or “never fail” software.
• Maginot Line thinking is when you expend considerable resources in an effort to counteract a past threat.
• The security industry should assume that hackers will gain access to the system. We should plan for the inevitability of them getting in.
• Too often, managing by hard numbers sacrifices quality.
• Organizations need to be a place where people can teach themselves.
• Perfection is not for this world.