Conference ilbbak::us_sales_service

    Deming's Seven Deadly Diseases
    
    1. Lack of constancy of purpose.
    
    2. Short-term thinking.  The emphasis is on short-term profits
    and quarterly dividends, and management's fear of takeover.
    (The goal of Japanese managers is to become the world's most
    efficient provider of whatever product or service it offers;
    profits will follow.)
    
    3. The annual performance rating for salaried employees.  Annual
    ratings and management by objective systems have been misused.
    Performance evaluation disregards the fact that employees work
    within a system, with natural variation and instability.
    
    4. Mobility of managment (which rewards short-term results).
    
    5. Management's use of visible figures only.  The most important
    data is unknown.
    
    6. Excessive medical costs.
    
    7. Excessive liability costs.
    
    Joel
    

    One more (self) reply: the view in the field is that DEC
    Engineering has been practicing statistical Quality 
    techniques for years.  I think our products are basically
    terrific, so I tend to believe this view.
    
    True or false?
    
    Joel
    

    I spent the last three years as a resident/sales support person for a
    large chemical company that started down the TQ (total quality,
    continuous improvement) road 5 years ago - from what I witnessed there,
    where Quality is 'EVERYONE'S job - we at DEC, have a LONG way to go - 
    I've only heard words so far...

    We give lip service to quality.  When it comes to hard choices
    (allocating people, equipment, money) I've never seen quality win the
    day over a management metric.
    
    Part of the problem is inability to trust employees at all levels to
    make decisions which enhance the quality of products and services
    even when it doesn't cost the company a dime: keep appointments,
    send out the literature in a timely manner, answer the phone and return
    calls to customers.  Small things that customers notice.
    
    People like you, me, and the readers of this conference have to balance
    cynicism and skepticism regarding the changes with hope.  The only
    problem is that I've gone from needing small hope to expecting now a
    world-class miracle over the last few years. 

    Amen, Pat.  We talk a lot about quality, but don't seem to see that
    most of our behavior and attitudes lead in other directions:
    
    The drive for short term profitability at all cost.
    
    An obsession with today's stock price.
    
    A frugal mindset that would rather save than invest.
    
    A tendency to choose metrics for ease of measurement  rather than
    importance.
    
    A deep-seated mistrust of subordinates, leading to multi-level
    micro-management.
    
    
    -dave

    You know...
    
    Quality is a funny thing.  I've worked in many different offices and
    functions at Digital.  The one thing I've always been most proud of was
    the QUALITY of the people I've known who worked for the company.  Sure,
    I've seen parochial behaviour on the part of a few short sighted
    individuals, but they haven't lasted long.
    
    There are many good people in our company who truly want to make the
    right decisions regarding the balance between profits and investments. 
    Making those right decisions, consistently and over some period of
    time, is what has set our company apart from most others in our
    Industry.  Nope, we're not always right... but we keep trying.
    
    TRUST must be implicit in our relationship with each other.  Life is
    too short for us to propagate an adverserial relationship within
    our extended working family.  I trust people to be hard working, to be
    honest, to do the best that they can do personally and to help each
    other succeed whenever possible.  I'm seldom disappointed.  
    
    Try to look beyond the examples of poor judgement and short-term
    thinking which too often is so obvious.  I hope you'll be pleasantly
    surprised to find a large number of people who truly care.
    
    -Neal
    

    I work closely with a software development group (which will remain
    unnamed), and I have seen no overt effort to elevate quality to a
    high priority pedestal.  Products are still shipped with known bugs,
    etc., and making schedule/time to market still appear to drive the
    whole process.
    
    There is another aspect of quality too that bothers me, and that is the
    incredibily decrepit state of our admin systems.  I am approaching my
    fifth anniversary as a service product manager for SPS.  I do business
    plans, I do pricing using models, I forecast revenue, etc., etc.,....
    and then I'm supposed to keep an eye on whether my products actually
    perform as I forecasted.  It is to laugh!  I have never once received
    an actual revenue and expense report on any product I support.  I KNOW
    some of them are losing money, but I can't prove it.
    
    As far as NMS is concerned, well I hate to be the nay-sayer, but I
    think management will find a way around it.  Strict application of
    NMS criteria would cause the elimination of most of our PCU's, especi-
    ally on the hardware side.....and I'm not so sure about sofware.  My
    experience may be unique, but I have worked with five consecutive V1.0
    money-losers in a row....and I've got a feeling I'm involved with a
    couple more right now.  Meanwhile the product creation machine chugs
    on with a full head of steam.  I can't imagine how sales keeps up with
    it.  Sigh..........

    Re: -1
    
    Sounds so familiar... I don't know how sales keeps up with it either,
    but as a technical writer in Digital since 1987, let me tell you that
    those of us in this profession can get pretty demotivated by these
    recurrent scenarios (or is it scenaria ?)
    
    Best regards,
    
    	Eva Luraschi-Miche @TXA
    	Geneva, Switzerland

    I have read this string over many times before replying to it.  There
    is one exciting aspect of TQM that makes it different - each of us can
    practice Quality and can become involved without ANYONE's permission.
    
    As part of the DELTA program I have seen tremendous progress in
    involvement and teaming over the last year - what other major effort in
    DEC has taken such a short amount of time to prove itself?  And it 
    proves itself because the payback at the individual level is
    enormous.
    
    Each of us has the capability within us to make our work as effective
    and efficient as possible - to continuously improve what we control.
    We have the capability to bring Quality to each interactive we
    participate in.  
    
    No senior manager in this company can "empower" us.  We have all the
    power we need and may be choosing not to exercise it.
    
    To the managers out there - want to be a star?? Just ask your team to
    help.  Encourage creativity in your organization.  The payback will
    be tremendous for all of your metrics and for the morale of your
    organization.
     
    

    re: .9
    
    What you say is true in the sense that Quality can be done 
    locally to improve local processes.  But the major 
    problems of any large organization are unfortunately 
    global.  Listen to Kaoru Ishikawa: (from _What Is Total
    Quality Control?/The Japanese Way_)
    
    	Unless the person in charge, the one who has the full
    	power, that is, the president or chairman, takes the
    	initiative and assumes leadership in implementing quality
    	control, the program cannot succeed.
    
    Even more to the point, he says: "If there is no leadership from
    the top, stop promoting TQC."
    
    Now why would he, and every other Quality professional, say 
    something like that?  It has to do with the fact that the
    vast majority of defects (between 85% and 95% to be exact)
    are produced by the system.  And "the system" is the whole
    ball of wax.  The whole way of organizing and measuring and
    doing business.  Local efforts can touch the 5%-15%.  They
    cannot touch the real problems.
    
    Let me illustrate this by describing a vivid demonstration
    I once participated in.  Ever see the red bead/white bead
    demo?
    
    To give the most succinct summary I can: a tub containing
    4,000 little beads, 80% white and 20% red is placed in front
    of the group.  Volunteers are recruited to use a spatula-type
    object to scoop groups of 50 beads from the tub.  Red beads
    are considered "defects" and great pains are taken to ensure
    that the spatula will scoop only white beads.
    
    Prizes and bonuses are offered.  Quality inspectors are recruited.
    Training methods are improved.  New scooping techniques are
    brainstormed.  Everything short of actually removing the
    "defects" - the red beads - is done, time permitting.
    
    Naturally, the red beads are scooped out no matter what anyone
    says or does.  The only way to get rid of the beads is to
    get rid of the beads.  Take them out.  Which means change the
    entire system.
    
    Well, at DEC, and at (IMO) most large organizations, we are
    scooping red beads all day long.  The systems we work with
    are down between 20% and 57% of the time.  Simple decisions
    can take weeks, because an I/AT or something didn't reach
    the right desk, was mis-routed, or was simply written in
    a way that someone didn't like.  Sales reps can't do quotes
    because the AQS system is down.  And so on, ad infinitum.
    
    The *system* at DEC produces defects.  And this is not to
    say that I regard DEC as "bad" or anything of the kind.
    I truly think DEC does better than most, under the 
    circumstances.  And I do agree with previous notes about
    the quality and committment of the typical DEC employee.
    We are a great company with much to be proud of.
    
    But I say very seriously that if we do not begin a
    company-wide effort to make Quality the absolute metric
    for one and all, and take the long and pains-taking steps
    required to actualize such a vision, we are simply going to
    fall behind our competitors.
    
    I think DEC is worth fighting for.  Even if the battle is
    long and hard.  
    
    Joel
    

re Note 21.9   by CAPNET::CROWTHER 
>                  -< No one knows we're not in charge . . . >-

Right on, Maxine.

Each of us has to start where we are to make a difference.  Just realizing 
that "do the right thing" means look for the most efficient way to do one's 
job is a major refocusing for most of us.  

I don't care whether its called "TQM" or "QIP", each individual has the 
ability to make "local improvements" without waiting for "the system" to 
change.

Its fun to try to guess where the organizational changes are going to take 
us, but that's not what we're paid for.

Dick

    re: .11
    
    But the problem is that local solutions cannot be comprehensive.
    Sure, we all have to do our part with local solutions.  We invest
    a lot of time doing that.  But it isn't enough.
    
    Systemic problems must be addressed systemically.
    
    Joel
    

    re .10                                                           
    
    Yes systemic problems need wide-reaching solutions, but we cannot be
    paralyzed into inaction by that fact.  Just because it isn't coming 
    from the top doesn't mean it can't be done.
    
    I stand in awe of what Japan has accomplished in the last couple of decades
    but I'm not sure that we should take everything from Japan as
    applicable in the US and especially at Digital.
    
    We need to take their solutions and apply them to our situation. 
    I agree that it would be a lot easier for us if senior management
    would change their behavior, but I can't let that get in the way.
    The work is too important, and if they won't lead, then I'll
    ask them to get out of the way. Eventually they'll figure it out.
    
    This is new work and we aren't, in all cases, smart enough to figure
    out what to ask senior managers to do.  I will tell you that
    everything that DELTA has asked for over the last year has been done 
    willingly by senior management all the way up to Jack Smith, John Sims, 
    Win Hindle, and Ken.  So we'll keep asking.
       

    I had a similar experience in the Manufacturing Resource Planning
    program.  Every consultant in the business tells you, "It won't work
    without senior management".  I read them all.  I believed them until we
    learned why they say that.  Their fees are big bucks.  Only senior
    management can sign for them.  _That_ plus letting people get on with
    the job without interference is what is required of senior management.
    
    The truth is that senior management is too far away to understand the
    nitty-gritty.  But they got where they are by paying their dues in the
    real world.  Any senior manager worth his salt will recognize his
    impotence and incompetence with today's nitty-gritty.  It's all changed
    from when s/he was in the trenches.  So, what Maxine says is right.  We
    don't really know anything for them to do but to get out of the way.
    
    Dick

    Reply to 21.9
    
       You referenced Digital's DELTA program in your memo but did
    not say how to access this wonderful program. Different systems
    have different ways to log-in, but I believe the following
    should work for most:
    
         At the $ prompt, type VTX.  Select Corportate VTX Library.
    
     Once at that menu do a GOLD/SENT. Then when the systems asks
    
    you for key word, enter DELTA.
     
         This system is an excellent mechanism for implementing change
    and getting visibiltiy to areas in need.

    Glad to see some discussion going on this important issue.
    
    re: .13
    
    You are correct that "we cannot be paralyzed into anaction by"
    the fact that systemic problems need wide-reaching solutions.
    If I see anyone who fits that description I will send them
    that message.
    
    Interestingly, what Japan did was import an American expert,
    Deming, to help lead them out of national bankruptcy.  The
    wheel turns, and now we worry about using "Japanese" methods!
    
    re: .14
    
    Fortunately, not being an employee of a Quality Consulting firm,
    I am above suspicion as to being motivated by "big bucks" in
    suggesting that Quality must be totally endorsed by the top.
    
    You are absolutely correct in saying: "The truth is that senior
    management is too far away to understand the nitty-gritty" etc.
    The role of senior management in a TQM environment is to
    empower *all* employees to work cross-functionally to achieve
    process improvements.  This means things like DELTA, which are
    cost-cutters, and local process improvements.
    
    But it also means addressing the Jackie Gleason ("really biiiig
    show!") issues as well.  TQM means starting out with the
    nitty-gritty details and working *up* to senior management for
    global implementation.  Not the other way around.
    
    If you see what I mean.
    
    Joel
    

    re .16
    
    Though Deming was certainly the source of a lot of the work done
    in Japan, his work was adapted to the Japanese style of doing business.
    As much as Japan is hyped, their structure is not our structure, their
    rules are not our rules.
    
    I've never considered why Deming was not successful in the US, perhaps
    because the topdown approach is so difficult???
    
    To clarify the role of DELTA - we are this company's Employee
    Involvement program (though I hate that term program).  We are supporting 
    all efforts from individual ideas through high-performance work teams.
    Our association with cost-cutting is no more our definition than our
    association with revenue enhancements, market share, environmental
    issues, employee satisifaction, customer satisifaction. etc.
    
    Thanks to Sue for the plug of VTX DELTA which we use to share what
    others have accomplished for adoption in any organization or function.
    In addition we have notesfiles for the discussion of ideas and team
    efforts (CAPNET::DELTA_IDEAS and CAPNET::DELTA_TEAMS) and print
    articles in almost every major publication in the company.  Believe
    it or not we haven't asked permission yet!! 8-)

    re. .9, .15 and .17
    
    We are thinking about adding DELTA to the ACCESS menu structure too!
    
    

    re: .17
    
    Again, good points.
    
    As for Deming and success, his methods have in fact achieved
    success wherever they have been tried, including in the U.S.
    It is hardly a "top down" approach; on the contrary.  What 
    Deming et. al. say is that the top needs to empower the bottom
    to create change.  Your DELTA program is an example of how
    portions of this idea can achieve success.
    
    But the real "meat" of a TQM program is the statistical quality
    control process.  In the customer services environment that
    means you define quality in terms of what customers (in response
    to sophisticated survey techniques) expect.  Customers externally,
    customers internally.  You use the surveys to create measurable
    metrics.  You measure performance against those metrics to see
    if the process is in statistical control.  Then you change the
    process, if necessary, to improve the performance of the entire
    system.
    
    Statistical control is not a cultural phenomenon.
    
    My understanding (see .3) is that engineering at DEC has been
    using TQM-type tools for years and that they have been very
    successful doing this.  My understanding is also that DEC
    has made the winning of the Malcolm Baldridge Award a
    Corporate goal.  My position is that we need to move TQM-type
    tools/management into the customer services environment if we
    are going to achieve that Corporate goal.  And, further, that
    if we do not do this, Award or not, we will fall behind those
    of our competitors who use these tools to improve their
    processes.
    
    You know, you can call the U.S. Commerce Department to request
    a copy of the Deming Award application booklet.  Judge for
    yourself if DEC, as a corporation, is yet in a position to
    apply, let alone win.
    
    Joel
    

    RE .19
    
    Joel you also have good points, the only point of discussion we have is
    "Is it enough to move out the tools without setting the environment in
    which they can be successful?"  I have watched over the last few years
    as the Field has put hundreds, maybe thousands through BPST without
    the payback that we should have had.  Why - because the classroom is one
    thing and the back on the job is something different.  We have layers
    of management who, for whatever reason, are terrified of allowing their
    best resources to suggest new and creative ways to do things.  Or if
    they are not afraid then they haven't got the time or whatever other
    rationalization they can come up with.
    
    We have to make the ground fertile, we have to prove success, we have
    to communicate constantly and we will make it.  Digital is nowhere near
    Baldrige level as a corporation. Will we get there without management?
    I don't know but we have try.  Will we get there without TQM tools?
    Not a prayer, but we aren't even close enough in the Field to consider
    Statistical methods until we realize that Customers keep us in business
    not internal metrics.
    

    re: .20
    
    Absolutely!  And I agree with you 100% about the mistaken BPST
    approach we have taken.  Classroom BPST training is not at all
    an effective way to teach the statistical methods, unless the
    class is either concurrently or immediately paired with the
    tackling of real problems.  Not only real problems, but problems
    the students can affect.  
    
    In my own space, we were doing things like looking for ways to
    reduce the number of change orders.  A noble goal, to be sure,
    as excessive change orders cost DEC millions.  But there is no
    way a few OMS reps are going to "solve" this problem.  The causes
    are cross-functional and company-wide.  Highly de-motivating
    to spend your time on a project you know, up front, is guaranteed
    to fail.
    
    Your comments about the metrics are also 100% accurate.  If statistics
    are the meat of a quality program, "Quality" metrics are the
    heart.  We will be at the Baldridge level when everyone at DEC
    is goaled using goals specifically defined by customers, internal
    and external.
    
    Last comment: I don't mean to imply here that somehow "the field"
    has all the Quality wisdom, while senior management uses 
    broadswords.  One of my buddies, a cost center manager, in another
    function, blandly informed me the other day that "you can't
    measure quality."  (!)  
    
    We'll get there, sooner or later.
    
    Joel
    

The competitive comparison between Japanese and US computer firms is accurate. 
The Japanese are kicking our butts and doing it rapidly.

Many are suggesting that we utilize total quality techniques to catch up with
the Japanese.  This is the current popular thinking.  While we need to design
more learning time into our days and value the "bad news" (all of these are
noble goals), how will we produce the desired outcomes?  There is a clear
distinction between espousing the positive aspects of change and producing
productive and lasting change in action.  

There is a flaw in the total quality reasoning as being applied in 
Digital.  If you consider that a significant gap already exists between the US 
and Japan, what leads us to think that by duplicating what the Japanese 
having been doing for the last 40 years will close the gap?  Consider how the 
Japanese got ahead of us in the first place.  They got ahead of us, by doing 
something we weren't, e.g. SPC and total quality methods.  Now, we have to do 
something the Japanese aren't doing so we can make a quantum leap beyond them.  
We have to go beyond total quality.  The total quality strategy suggests that 
the most we can hope to do is maintain the spread of the gap, not close it, let 
alone leap the Japanese.  The Japanese are not going to quit learning.

    We currently employ salesmanship as our consulting technique in which
    we guess at the real set of problems by analysing what were hear, and
    assuming other messages are there by inference. Can you imagine the
    dialogue that takes place between a Digital account manager and a
    customer CEO? The account manager derives his strategy by reading
    between the lines of what the CEO says. Is this any way to run a
    partnership? 

    We can produce the needed quantum leap by espousing a collaborative
    framework that brings us closer to the client, closer to their intended
    message, by eliminating the need to make guesses at what our clients
    want. The "world class" consultant will teach his client how to do this
    kind of collaberation, opening the door to ego-less problem-solving.
    I'd like to see us spend more time in helping our customers change
    their group dynamic, establish new rules for communicating, and
    collaborate at a new tier, a higher plane. 

    We are falling into our usual trap of negleting the implementation.
    My experience has shown me that people want to participate in and
    improve processes, the sales process included. I am convinced top
    management knows we need to change but are confused about how to 
    implement change, other than organizational.
    
    For years(decades) the field organization has been bred in a culture
    that reinforces autonomy and divides teams. I see NMS as an attempt
    to provide an organizational structure that supports teams.
    
    The problem?
    
    	What is a quality sales organization like? Sales people tend to 
    gravitate toward metric driven assignments, that's why their in sales
    to begin with. Quality to a sales person is measured in achievement
    of certifications and now, revenue. 
    
    	Manufacturing learned that to get particiaption in quality the
    human side of the problem was the biggest. We are just learning that in 
    sales now. When many of our managers cannot deal with change, how can
    we expect them to manage change in others? I can look at manufacturing
    and find a definition of a quality plant, process, or manager. I would
    be hard pressed to find the same definitions in sales at Digital or
    anywhere else. 
    
    	If we don't have a goal for the quality of our people, how will
    we ever get there? 
    
    	Feedback is important in the quest for quality, some of you have
    mentioned that information is needed. In manufacturing plants that
    are making progress toward quality, information is available all the
    time on how the plant is doing. In fact, anyone in the plant who tryed
    to get a way from it couldn't. Posters, training sessions, management 
    meetings all deal with trends, performance, and feedback. EVERYONE gets
    this feedback, not just managers. Information is shared by management
    to all employees.
    
    	This behavior is not happening in the sales function, yet, which
    is why the human factors side of the issues is so important still.
    
    regards- Bob Cohen

    Reply to Note 21.23
    
    Bob, it was listed in the registration note that you are part of the AET
    Selling Team organization and should therefore know that Bob Schmitt
    (Sales Support) and Steve Mahoney (Sales) were brought on board
    specifically to address the issues referenced in your note which you
    feel are being ignored.  Pick a process you want to help fix, and volunteer
    your time and energy.  Give Bob and Steve a chance to comment on YOUR
    PROPOSAL to fix things.  

    Thanks for the two names, (Schmitt and Mahoney), I will get in touch
    with them and volunteer my effort.
    
    regards

Bob Hughes and Don Zereski, what are your feelings on Deming's suggestions as 
listed in the following? If you agree, how do we get there? If you disagree, 
what is our get-well plan?

Regards,

Jim


            <<< HUMANE::HUMANE$DUA1:[NOTES$LIBRARY]DIGITAL.NOTE;1 >>>
                          -< The DEC way of working >-
================================================================================
Note 1797.118              The Metrics Are Killing Us                 118 of 118
HAAG::HAAG "Dreamin' on WY high country"            330 lines   3-APR-1992 20:08
                     -< Read the Following. It's Goodness >-
--------------------------------------------------------------------------------

    
    
    
    There is a LOT we (DEC) can learn from the following document. It talks
    a lot about the subject of this topic. It's long, but definitely worth
    reading. I encourage one and all to feel free to extract and forward it
    at will. Please keep in mind this document is making the rounds thru
    the mail systems on the EASYnet. IMHO, we (DEC) desperately need to
    implement just about every evaluation stated in the following.
    
    Rgds,
    
    Gene.
    
    
************************************************************************
    These notes were written by a Dupont employee who attended the Deming 
    seminar in February. There are many thought provoking remarks herein 
    regarding variable compensation for Sales, on performance management in 
    general, and the value of performance ratings. This is a long document, 
    but well worth reading.
    
    
    
    
                            DEMING SEMINAR
                           FEB 17-21, 1992
                           ---------------
     
         These are my notes from attending a seminar led by the
    legendary Quality guru, Dr. W. Edward Deming. 
    
         There were about 600 people there including
    representatives from: AT&T, Eastman Kodak, Exxon, GE, IBM, &
    Merck. The session was sponsored by the Philadelphia Area
    Council for Excellence (PACE) which is part of the
    Philadelphia Chamber of Commerce. PACE's mission is for the
    Delaware Valley to have world-renowned business success
    through the teachings of Dr. Deming. PACE consists of
    hundreds of organizations throughout the Delaware Valley area
    including Hercules and ICI; Dupont is not a member.  The
    seminar was the 10th that PACE has sponsored featuring Dr.
    Deming.
     
         Key learnings from the seminar were:
     
         * Although Dr. Deming is noted for Quality and
    statistical process control, his central message is that we
    must transform our approach to management of our businesses
    in order to compete in the world.
     
         * One must think of a business as a system. Following is
    a simple model of key parts of a business system:
     
     
     
        F <--------F <----------F <------------F <------------ F
        !         /\ !         /\ !           /\ !             !
        !          ! !          ! !            ! !             !
        !          ! !          ! !            ! !             !
        V          ! V          ! V            ! V             !
        A ---------> B ---------> C -----------> D ----------> E
     
     
    WHERE:
      A: Suppliers
      B: Production
      C: Sales
      D: Distribution
      E: Customers
      F: Feedback to all parts of the system
     
         The point is that all people in a system must think of
    themselves as within a system since they can't realistically
    isolate themselves from the system. The Aim (Purpose) of
    the system and everyone in the system should be to work
    together to optimize the system as a whole. That way everyone
    wins.
     
         * The key to improving a system is the method. It is
    better to focus on a method of improvement rather than goals,
    objectives or results. The numbers can be manipulated
    especially in an environment of fear. He recommends companies
    eliminate the MBO approach to management. A key question to
    ask about improvement is: "By what method?"
     
         * Deming recommends companies work to drive our fear.
    Fear inhibits innovation and productivity.
     
         * We must stop management tampering with the system.
    Usually this is caused by lack of understanding of the
    difference between special cause and common cause. This
    results in management taking inappropriate action which
    causes waste and lower productivity which is exactly the
    opposite of what they hope to accomplish.
     
         * Deming recommends that organizations become learning
    organizations. We should create a "yearning for learning."
    There is no substitute for knowledge.
     
         * Deming recommends we create a constancy of purpose. We
    need to stop short-term thinking and short term programs.
    There is no instant pudding! We need a long-term commitment.
     
         * We need LEADERSHIP not management or supervision to
    accomplish the transformation. We need leaders that listen to
    and serve the people.
     
         * America is being ruined by "best efforts." Everyone
    doing their best is not enough! The key is to work together
    to improve the system as a whole. Deming conducted the famous
    "Red bead experiment" where willing workers doing their best
    produced red beads (defects) even though they were not
    wanted.  Deming's point is that we should not punish the
    people for only doing their best; they can only produce what
    the system will deliver. We must focus efforts on improving
    the system.
     
         * There is a natural distribution of capabilities &
    contributions of people in a business system. The key is to
    enhance and develop everyone and not destroy the will of
    people to contribute to improvement of the system as a whole.
     
         * Dr. Deming strongly recommends eliminating performance
    ratings and rankings of individual people. He mentioned it
    dozens of times during the session. He directed people to go
    back to their work places and eliminate performance ratings
    Monday Morning! Some of the key reasons discussed in the
    seminar were:
     
           - Ratings foster competition within the system.
     
           - Ratings inhibit teamwork (limit interdependence and
             cooperation).
     
           - Ratings foster mediocrity. People tend to set safe
             goals they can easily meet.
     
           - Ratings increase variability since they represent
             what Dr. Deming calls management tampering with the
             system.
     
           - Ratings cause focus on the short-term. Why try to
             develop something for the long-term health of the
             business if one is rated on annual objectives?
     
           - Ratings tend to destroy intrinsic motivation (joy
             and pride in work).
     
           - One cannot separate people from the system. What we
             might really be rating is the results of the system
             and the "style" of the person. Dr. Deming says
             that since people work within a system, only 3% of
             the perceived performance is due to the people and
             97% is due to the system!
     
           - Ratings inhibit risk-taking and innovation. People
             are afraid to admit mistakes especially to their
             bosses.
     
           - Ratings tend to destroy self-esteem.
     
           - Ratings cause focus on pleasing the boss vs.
             pleasing the customer.
     
           - Ratings foster sub-optimization. This means that
             people are not focused on the purpose of
             optimizing the system as a whole. Individuals are
             more worried about "What's in it for me?"
     
           - Ratings focus on goals and objectives without
             consideration of "By what method?"
     
           - Ratings tend to reward style not true contribution.
     
           - An individual's "performance" really can't be
             measured.
     
           - Ratings tend to focus on quantity not Quality.
     
           - Ratings destroy morale and joy in work.
     
           - Judging people does not help them do a better job.
     
           - Ranking people is a FARCE. Apparent "performance" is
             actually attributable mostly to the system not to
             the individual.
     
           - Ratings don't focus on improving the system.
     
           - Having workers doing their best is not good enough
             for business success.
     
           - The ratings system punishes people; it creates
             winners and losers.
     
           - Ratings instill fear in people (carrot & stick
             approach to motivating people).
     
           - Ratings cause people to deny their true needs
             for personal growth; they don't want to admit
             weaknesses.
     
           - Ratings destroy trust between people and managers.
     
           - Ratings cause bosses to be judges rather than
             coaches and counselors.
     
           - Ratings causes bosses to talk more than they listen
             to their people because of the power inequity.
     
           - Ratings become a label that sticks with the employee
             and limits growth and development. Top rated people
             don't feel like they need to improve.
     
           - Ratings cause humiliation of people who don't get a
             top rating. It causes destruction of the will to
             contribute.
     
           - Bosses don't really know what people do and
             accomplish even though they argue that they do!
     
           - There is a lack of feedback from others in other
             parts of the system as to an individual's true
             contribution; note those others might be outside the
             company.
     
           - Employees get blamed for faults of the system.
     
           - You really can't measure the contribution of an
             individual within a system.
     
     
         * Dr. Deming held up for public ridicule the recently
    announced approach of IBM with forced-ranking of its people
    and dismissal of the lowest ranked people! It sounds like the
    early warning signal of the demise of IBM a once leading
    people-oriented company.
     
         * An American Cyanamid representative mentioned that
    their R&D organization plans to eliminate performance ratings
    for the Chemicals organization. The key contact was not
    present so I plan to follow up.
     
         * Representatives of many other organizations mentioned
    privately considerable resistance with eliminating
    performance ratings in their companies. The key seems to be
    management's unwillingness to give up something they feel is
    vital. Dr. Deming really challenged their thinking.
     
         * Dr. Deming is also opposed to incentive pay for sales
    people. Many of the reasons are similar to what is discussed
    above but include:
     
           - Sales people work in a system; they don't work in a
             vacuum. It's unfair and arrogant to only reward
             sales people with extra pay.  Many other people
             contribute to the sales but are excluded. This
             causes anger of the others and does not work towards
             optimization of the system as a whole. The notion of
             "pay at risk" for the sales people is not an answer
             to the dilemma; sales incentives for sales people is
             a divisive program!
     
           - Sales incentives may cause the wrong behaviors on
             part of the sales personnel, eg: they might oversell
             a low profit item just to boost sales. Any attempt
             to design around this can be beaten by the sales
             people. After all they are clever, hard-working
             people!
     
           - Sales incentives can't truly measure contribution
             to the system as a whole, eg: mentoring, developing
             future markets, etc.
     
           - Sales incentives tend to cause sub-optimization.
     
           - Sales incentives foster internal competition and
             interfere with "Doing the right thing."
     
           - Sales incentives create expectations and once
             achieved may create negative feelings if managed
             in what is perceived as an arbitrary way.
     
           - Sales incentives lose incentive over time and can
             demotivate.
     
           - Money tends to be the value system in business. It's
             a poor replacement for emotional valuing that people
             need so much.
     
           - Managers claim that sales incentives measure the
             performance of individuals but they're really
             measuring the result of the system in which the
             individuals work.
     
           - Sales incentives bring out the worst in people. They
             create a short-sighted, selfish behavior focused on:
             "What's in it for me?"
     
         * Deming recommends that profits of the business be
    shared equitably with all people in the business.
     
         * He recommended that in a business downturn we take
    action in the following order:
     
           1. Reduce dividends.
           2. Reduce bonuses of top management.
           3. Reduce management salaries starting from the top
              down to the middle of the hierarchy.
           4. Workers are asked to accept pay cuts or a reduction
              in force through attrition or voluntary discharge.
     
         My personal recommendation to anyone reading this is to
    try to attend a Deming seminar as soon as you can. Dr Deming
    has tremendous wisdom to impart focused on what will make
    business successful. Since he is 91, he won't be with us for
    long. He has an amazing schedule of 18 seminars left in 1992;
    if you'd like to attend one, I'd be glad to send a copy of
    the schedule.
     
         Further, I came away more convinced than ever that
    eliminating performance ratings is an important part of
    Dupont achieving its vision of becoming a GREAT GLOBAL
    COMPANY THROUGH PEOPLE. It's an important part of creating:
     
     
                DUPONT: A GREAT PLACE TO WORK