"Productivity"

It’s clear that the original motivation for origin of the Quality Sciences by Walter A. Shewhart, in the 1930s was "Doing better with less," or, "Showing that productivity does indeed improve as variation is reduced" (Shewhart, 1931). The title of Dr. W. Edwards Deming’s first chapter in his classic book Out of the Crisis is "Chain Reaction: Quality, Productivity, Lower Costs, Capture the Market" (Deming, 1982, 1986).

Productivity is the ratio of output to input where input consists of labor, material, capital and services and outputs are measurements of results in products or services (Juran and Gryna, 1988, 8.20).

Productivity increases have remained a consistent fundamental for the quality movement over the past fifty years. The quality theories developed by the pioneers all have productivity improvement as goals. Any new quality control or management tool that failed to achieve increased productivity has faded from use. The #7, and final, category of the Malcolm Baldrige National Quality Award (MBNQA) criteria over the years has always been Results and has increased in weighting for the total 1,000 points score to 480 or 48% of the scoring to earn the award. Results are productivity and quality improvements. Data on industrial and national productivity are widely compiled and published. They get the attention of economists, industrial leaders, university business professors and political leaders.

The conclusion in the year 2003 is that the Quality Sciences and Quality Management have become the leading catalysts for better resource management. Productivity increases insure against failure, guarantee profitability, and meet stakeholders return-on-investment (ROI) and competition goals as well as conserve valuable resources. All of that leads to success in business, government, health care, schools, foundations, or non-profit entities. But productivity is only one measurable component that determines quality and not always associated with quality depending on how the system is defined. Significant productivity differences among nations and regions can lead to unemployment and social trauma in some, which is one of the outcomes of unregulated globalization.

Productivity increases across a nation produce economic, social and military advantages. The avoidance of serious recession by the United States from the events beginning in the year 1997 in Asia and accelerating after the terrorist attacks on 11 September 2001 is largely attributable to the ever increasing productivity achieved by quality engineering, control, auditing, and management that occurred beginning in the 1960s and increased exponentially with the technology of the digital age in the 1990s. Similar increases have not been achieved globally, which has contributed to the rich-poor gap increase among nations over the past twenty years.

What about the future? A mind-jolting projection is that the continued convergence of quality, science and technology, especially nanotechnology and automation, over the next 50 years, will produce productivity increases that dwarf the ones of the last 50 years. But there is an overriding question about ever increasing productivity. That question is "Productivity for what?"

Let me take you back 42 years to 1961. As a United States Air Force officer I was fortunate to be a member of the Naval War College student body when, on 3 October 1961, Dwight Eisenhower was the speaker. It was nine months after President Eisenhower had transferred the title of Commander-in-Chief to John F. Kennedy. He spoke under the traditional "privileged" sanctuary of the Naval War College and knew that his comments would not appear in the following morning’s newspapers. The predominantly military audience included Admiral Chester W. Nimitz, U.S. Navy (retired), and Vice Admiral Bernard L. Austin, President of the Naval War College.

Ike discussed the military-industrial complex and what he had meant a few months earlier when he coined the phrase. He talked of dissent within the military; of the race to the moon and national priorities; of the components of national interest; of the meaning of representative government; and the role of religion, morale, and freedom in the American way of life. He elaborated his views on strategy toward Communism, on decision-making in a democracy, on leadership and responsibility, and on the problem of classified information in a free society. He mused on the problems he faced in coordination of a joint unified military command, on the structure of the military services, and he gave us his ideas concerning political integration in Western Europe (Krone, 1971). Even Ike did not predict the expansion of NATO to 26 nations, including members of the Cold War Warsaw Pact, as has occurred recently.

Ike addressed productivity in his answer to the question "General Eisenhower, do you consider the Russian economic growth a serious challenge to the United States?" Ike answered:

"We are far more productive than the Russians, but since they started from a very low point their rate of growth is quite good. The big danger is this: they, by their dictatorial methods, can direct all their productivity toward the particular things that they want to use. It is interesting, for example, to talk to a Russian about automobiles. I think that they produced about 100,000 last year, we produced 6 ½ million. I took Mr. Kruschev for a chopper ride around Washington, and he was amazed at the number of big roads running out of the city. He said "We don’t need roads like this." And I said, "How do your people get around?" and he said, "They don’t want to travel." …You can be sure that the things toward which they are directing their productivity are those things which they think will frighten us, that will tend to divide us from our allies, or that they can use in uncommitted countries. … if they finally get us to responding so much to every threat that we hysterically raise our spending and spend ourselves into bankruptcy—this will be the biggest victory they will ever need, and they can stack arms. … the use you make of the productivity really does pose a problem. We must accept only those things we know we need and we must look at every other dollar of expenditure and ask. "Was this dollar necessary?" (Krone, 1971, p.24)

Tremendous changes have occurred since Ike made these comments in 1961. But his point that the question "Productivity for what?" is critical should remain basic to Quality Managers as well as national leaders.

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"Quality Classics" is a project of the American Society for Quality (ASQ) Inland Empire Section 0711. This Quality Classic was published in the Inland Empire Quality Newsletter, Vol 10, Issue 3 (Jan-Feb-Mar, 2003). Quality Classics meet the criterion of documenting a concept, model, tool, formula or algorithm that has 50 years or more validated utility in the Quality Movement begun in the 1950s. Readers can access the entire series of Quality Classics at: http://www.asq711.org.

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"Surveying for Systems Improvements"

If you want to find out what’s wrong, and how to fix it ….. ask those who do the work. That is a lesson learned centuries ago by the apprentice system in Europe, the family business systems in Asia and by business and management practitioners and scholars in the Americas. I was fortunate to be involved in the first and most prestigious academic program in Systems Management. It was the University of Southern California’s Master of Science in Systems Management (the MSSM). It began from a 1963 RFP by the United States Air Force to provide a new masters program for Department of Defense professionals that would take to the global field advanced education in Management, Psychology, Systems, Computers and Innovation. By 1987 the program had grown to 70 locations in the Pacific, throughout the U.S. and Germany and enrolled over 2000 students (in and out of DOD) simultaneously. Although the curriculum was cross-disciplinary one basic goal propelled it to being the most successful of its kind: the Systems Improvement Fundamental. I helped integrate Quality Management into that program in the 1980s as well as the Crawford Slip Method for Surveying Groups (See #6 and #9 in this Quality Classics series). Continuous improvement is a classic of Quality Management as well as the principle of those survey methods that survive to be classics. There is a simple reason for the survival of successful concepts and tools for all the fields (public or private) of Business & Management. That reason is that there is always the need to: a) identify problems; b) find solutions; and c) improve the system.

It was the March 2003 issue of The American Society for Quality’s journal, Quality Progress that was the catalyst for me to add this classic to our series. See in it the article by John Cravenho and Bill Sandvig (pp. 63-68) titled, "Survey for Action, Not Satisfaction." Cravenho and Sandvig put their analysis on the weak point of Customer Satisfaction by stating (p. 63):

"Organizations must stop asking what customers like about what’s been done in the past and move to a process that clearly identifies what action must be taken to improve." 

I agree. The tendency to place 100% of efforts on customer satisfaction has bothered me as it has grown. Customer Satisfaction is a useful independent variable in our analyses. But the dependent variable is always Systems Improvement. Those survey tools that only aggregate or count attitudes should not, in my opinion, be deterministic for strategy or policy. They may be very useful for marketing and production planning. The survey tools, like Ideas Unlimited™, that are based in gathering recommendations for improvement will continue to be the essential ones used as the Quality Sciences and Management Sciences progress over the next 50 years. Look at the last 50 years for evidence.

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