A Key Reason Why Total Quality Management Worked: Trust

A colleague shared the following instructive story with me.  It has apparently been circulating around the internet via email so I can’t identify an author, and while it may be completely fictional or simply exaggerated, the story suggests some key reasons why Total Quality Management (TQM), prevalent in the 1980’s but mostly forgotten today, actually worked.  First, the story, taken verbatim (with spelling errors) from my email: A Short Story for The Engineers

Replace Pay-for-Performance and Annual Reviews with Leadership for Meaningful Improvement

Pay-for-performance, merit pay, and annual reviews have not worked out well.  W. Edwards Deming started as a statistician but became one of the greatest business thinkers in human history. His ability to penetrate common business issues and get to the fundamental truths and fallacies behind them was amazing. His research clearly illuminated what most of us had already felt, if we took the time to think about it: pay-for-performance and periodic performance reviews, while often yielding us pay increases and other rewards, almost always left us feeling mistreated and angry, and sometimes in competition with our colleagues – not a good feeling.  Why is this?

Business Process Standardization in Complex Organizations – Making It Work

Standardization of internal business processes, like any other tool (and a concept or procedure can be viewed as a tool), can be a double-edged sword. It can have many benefits if used properly, or can be harmful if poorly designed or misapplied. One of the great challenges for any organization, especially large ones within which many divisions produce different products for different markets, is knowing when and where to standardize processes, structure, and tools. This entry is intended to address standardization in the most difficult circumstances: large corporations with many, diverse divisions. To clarify, horizontal divisions might consist of a marketing group who define customer needs, a design group who dream up products to meet those needs, an engineering group who design the parts of the products and make sure they fit together, a production group who assemble the products in quantity, a logistics group that transports products to customer locations, and a sales group to complete the transactions with customers. Vertical divisions could exist to address parallel product or customer types, or unrelated products that shared other synergies such as a common resource or common technologies. So what do you need to know to use standards effectively?