An answer to a puzzle: why is that some businesses go down the Deming path, become data driven, achieve operational excellence, and die, and others acquire Process Power and win?
In Making Sense of Deming I wrote:
Why is it that some Deming-influenced manufacturing companies can survive long enough to acquire process power, whilst others go down the Deming path and die? I wish I have an answer for you, but the honest truth is that I don’t know. This requires a lot more investigation than I’ve had time for in the writing of this essay. But it’s a question that’s been occupying my mind for a few months now — and I’m likely going to think about it for years afterwards. Perhaps, one day, I will find satisfactory answers.
The simple form of this question is: “what are the limits of Lean?” or perhaps “what are the limits of Deming’s ideas?” The more interesting question is “when is operational excellence important for business success ... and when is it irrelevant?”
I’m pleased to report that I have found an answer to all three questions — and earlier than expected. Though I’m a little abashed to say this: the answer should not be surprising. This is well-explored territory, and the clues have been available to me all along.
In order to make this answer more memorable, I want to tell you a story. This is a case that I’d read years ago, long before my current Deming deep-dive; it is the story of a remarkable American manufacturer, a component member of the S&P 100 (with a stock return of 4,500% over the past 25 years), and one of the best manufacturing companies in the world.
Originally published , last updated .
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