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The New Economics for Industry, Government, Education

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In this book W. Edwards Deming details the system of transformation that underlies the 14 Points for Management presented in Out of the Crisis. ... competition, we see now, is destructive. It would be better if everyone would work together as a system, with the aim for everybody to win. What we need is cooperation and transformation to a new style of management. In this book In this book W. Edwards Deming details the system of transformation that underlies the 14 Points for Management presented in Out of the Crisis. ... competition, we see now, is destructive. It would be better if everyone would work together as a system, with the aim for everybody to win. What we need is cooperation and transformation to a new style of management. In this book W. Edwards Deming details the system of transformation that underlies the 14 Points for Management presented in Out of the Crisis. The system of profound knowledge, as it is called, consists of four parts: appreciation for a system, knowledge about variation, theory of knowledge, and psychology. Describing prevailing management style as a prison, Deming shows how a style based on cooperation rather than competition can help people develop joy in work and learning at the same time that it brings about long-term success in the market. Indicative of Deming's philosophy is his advice to abolish performance reviews on the job and grades in school. Previously published by MIT-CAES


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In this book W. Edwards Deming details the system of transformation that underlies the 14 Points for Management presented in Out of the Crisis. ... competition, we see now, is destructive. It would be better if everyone would work together as a system, with the aim for everybody to win. What we need is cooperation and transformation to a new style of management. In this book In this book W. Edwards Deming details the system of transformation that underlies the 14 Points for Management presented in Out of the Crisis. ... competition, we see now, is destructive. It would be better if everyone would work together as a system, with the aim for everybody to win. What we need is cooperation and transformation to a new style of management. In this book W. Edwards Deming details the system of transformation that underlies the 14 Points for Management presented in Out of the Crisis. The system of profound knowledge, as it is called, consists of four parts: appreciation for a system, knowledge about variation, theory of knowledge, and psychology. Describing prevailing management style as a prison, Deming shows how a style based on cooperation rather than competition can help people develop joy in work and learning at the same time that it brings about long-term success in the market. Indicative of Deming's philosophy is his advice to abolish performance reviews on the job and grades in school. Previously published by MIT-CAES

30 review for The New Economics for Industry, Government, Education

  1. 5 out of 5

    Ash Moran

    I didn't know what to expect from this - and it turned out to be one of the strangest reads I've had for a long time. The tone of the whole book reads like the translation I have of The Art of War. Despite being brief, Deming covers a huge amount here. The key topics are: * systems - treating organisations as wholes rather than bags of parts * variation - understanding why the output of a system is not perfectly uniform, and the impact this has on correct management * knowledge - building theories t I didn't know what to expect from this - and it turned out to be one of the strangest reads I've had for a long time. The tone of the whole book reads like the translation I have of The Art of War. Despite being brief, Deming covers a huge amount here. The key topics are: * systems - treating organisations as wholes rather than bags of parts * variation - understanding why the output of a system is not perfectly uniform, and the impact this has on correct management * knowledge - building theories to predict the future over merely consuming information noise * competition - why it is harmful to systems, and how it can be avoided * leadership - and the importance of human psychology in this Deming draws on many powerful anecdotes to explain his point. I prefer, however, the more coherent approach to describing systems found in The Goal. Where Deming gets real leverage is in his descriptions of the Red Bead and Funnel experiments. The Red Bead experiment is more famous, and illustrates the futility of judging people according to their part in a system they are largely helpless to control. But I found the Funnel experiment even more enlightening - illustrating not only the terrible consequences of naively managing by results, but how this can distract from simple solutions to improve a process. Slightly disappointing is the emphasis on manufacturing/repeatable process over design/creative process. Deming makes one reference to design but does not directly tie this into his management style. Deming has an agenda. He wants to replace the current system of management - isolated, competing business units; reward schemes; ignorance of theory, variation and psychology - with one of co-operation, intrinsic motivation and understanding of systems. And he wants to replace it in all forms of organisation. But as a social manifesto it has one alarming omission: biology. Deming appears to think that the problem of growing larger and larger co-operative systems is just one of more difficult management. But this assumes that all people want to co-operate in this way, that nobody has a personal, conflicting agenda. While a monopoly may be more efficient than a marketplace, and while it may be in the long-term harmful to abuse a monopoly position, that doesn't stop someone manipulating their way into a position of power and taking short-term advantage. The weakness of Deming's vision is, in my opinion, that it does not contain the assumption that some people will always be selfish and/or evil. Overall, The New Economics is an immensely valuable collection of ideas for anyone in management (or suffering mismanagement), or with an interest in social change. But I suggest having some skepticism for its idealism.

  2. 5 out of 5

    John Stepper

    Delicious Deming. Even better (or at least more concise) than Out of the Crisis. Inspires me to keep digging and read the related reading by Scherkenbach, Orsini, and others.

  3. 5 out of 5

    Michael Burnam-Fink

    The New Economics is a series of flashcards, carrying telegraphic versions of Deming's Big Ideas. Deming, of course, was an American economist who helped trained the Japanese in a new style of quality management that arguably lead to decades of Japanese dominance in high technology. His ideas lay behind the Toyota Production System, and the maligned TPS reports of Office Space. He also passed away in 1993, just as Japan entered its lost decade. The New Economics was his last book. The center of h The New Economics is a series of flashcards, carrying telegraphic versions of Deming's Big Ideas. Deming, of course, was an American economist who helped trained the Japanese in a new style of quality management that arguably lead to decades of Japanese dominance in high technology. His ideas lay behind the Toyota Production System, and the maligned TPS reports of Office Space. He also passed away in 1993, just as Japan entered its lost decade. The New Economics was his last book. The center of his ideas holds up. Think of a company as a system, with management's role being to organize the system for quality. Understanding that there is natural variation in a system, and don't go chasing randomness. Treat workers as humans beings and approach their psychology as high-morale team members, rather than creating self-defeating 'meritocratic' ranking systems. But this book is scattered, organized anecdotally rather than thematically. It's one thing to proclaim that 'the firm is a system', but Deming lacks the theoretical tools to describe how systems self-organize and can be governed. It's a little unfair to argue that a dead man should be current with the latest research, but this book would be so much better in conversation with the Sante Fe Institute (see Mitchell's Complexity: A Guided Tour, John Boyd's OODA loop (Richard's Certain to Win, or even the intersection of epistemology and ecology (Miller et al. 2006. Epistemological Pluralism: Reorganizing Interdisciplinary Research, particularly the figure on the adaptive cycle from Reorganization, Growth, Conservation, and Release). Deming is still a name to conjure with, but there are likely better books on the area.

  4. 5 out of 5

    Kasey

    Despite looking like it’ll read like a free market libertarian book, Deming actually puts forward a refreshing and interesting take on production models, everything should be based on cooperation, not competition. Keep costs low, even if it digs into the profit of one department, to keep quality and enjoyment high, and that will keep business. How everything in management should set up as a win-win relationship, how ranking should be rid of due making a loser in the competitive action. All and a Despite looking like it’ll read like a free market libertarian book, Deming actually puts forward a refreshing and interesting take on production models, everything should be based on cooperation, not competition. Keep costs low, even if it digs into the profit of one department, to keep quality and enjoyment high, and that will keep business. How everything in management should set up as a win-win relationship, how ranking should be rid of due making a loser in the competitive action. All and all Not bad. I would read again and recommend this to people in management positions who aren’t left-leaning or Marxist in order to dissuade competition in between departments in a company.

  5. 4 out of 5

    John

    Last book of a knowledgeable senior citizen. Much wisdom. More of an introduction (admittedly) to whet your appetite. It did. Jump in. Read what you can. Join the Deming Institute when they discuss the book. (Very helpful to fill in the gaps and get over obstacles!) https://deming.org/events/21-the-new-... Last book of a knowledgeable senior citizen. Much wisdom. More of an introduction (admittedly) to whet your appetite. It did. Jump in. Read what you can. Join the Deming Institute when they discuss the book. (Very helpful to fill in the gaps and get over obstacles!) https://deming.org/events/21-the-new-...

  6. 4 out of 5

    Zachary

    Deming’s body of work represents the path not taken by economic policy makers in the United States. If policy makers had listened to the advice of Edwards Deming, it is quite possible that America’s economic standing would have been much different. The message still make sense but the target audience has changed. There was a time when management teams needed to hear it now. Now, it’s the owner/operators.

  7. 4 out of 5

    Erik

    I don't really know how this book got into my Audible listening queue, I didn't purchase it, and I can't remember having anyone recommend it to me. But I started listening to give it a try, and found that it is quite interesting. Deming's philosphies on business management have been around for a while. This book claims that it was implementation of Deming's theories that put Japan into it's place as the first-rate electronics and auto manufacturing company in the world. I don't know enough to be I don't really know how this book got into my Audible listening queue, I didn't purchase it, and I can't remember having anyone recommend it to me. But I started listening to give it a try, and found that it is quite interesting. Deming's philosphies on business management have been around for a while. This book claims that it was implementation of Deming's theories that put Japan into it's place as the first-rate electronics and auto manufacturing company in the world. I don't know enough to be able to confirm or refute that claim. From my own experience in industry, I can see the truth of many of Deming's assertions about our society's desire to always make everything a competition, and the damage that causes. The section about performance ratings at work was interesting. I agree with Deming that performance ratings are not meaningful, and likely cause more overall harm than good. I have gone through the rigmarole of being judged at the end of the year on how well I have achieved my objectives, and what I have found is that the rating I get bears no real relation to overall how much of a contribution I made to the company, nor does it have any relation to how valued I am by the people I work with. Also, the extra money I can get in my end-of-year bonus by getting a higher rating has absolutely no motivational power in causing me to want to change the way I do things. Before reading this book I understood without having put it into words for myself, that I could work many more hours each week and wouldn't have any more chance at getting a higher performance rating. This is because in the past I have seen no relationship between how hard I have worked and the rating I got. The book spends a fairly large proportion of the pages talking about special versus common causes of variability in a process. I don't know if Deming invented this concept, but it has been commonly implemented in all of the three major companies I have worked for in my career. All of the examples used to illustrate the point are too simple to add anything to my current understanding of controlling a process.

  8. 5 out of 5

    Hans

    Score: 2/5 (Portions worth listening once) ************ Themes: economics, quality systems, management ************ Summary: I'm a quality professional familiar with Mr Deming's work and its influence. This is, however the first book I have read by him (with contributions from other authors) and it is now harder for me to value the good portions of his teaching because I disliked this book so much. I wished to give it one star, but my metric reserves that for books with no valuable ideas at all and Score: 2/5 (Portions worth listening once) ************ Themes: economics, quality systems, management ************ Summary: I'm a quality professional familiar with Mr Deming's work and its influence. This is, however the first book I have read by him (with contributions from other authors) and it is now harder for me to value the good portions of his teaching because I disliked this book so much. I wished to give it one star, but my metric reserves that for books with no valuable ideas at all and this one does repeat some worthwhile ones. This text is an admixture of bad ideas, contentious (but arguable) ideas, and good ideas. Bad ideas include but are not limited to: The balance of trade fallacy, the virtues of monopolies and monopsonies, and the need to abolish academic rankings of any kind. Contentious ideas include but are not limited to: forbidding the ranking of employees, the way in which variation is approached, and the ultimate responsibility of managers. Good ideas include the concept that "you get the behavior you incentivise" (borrowed from psychology) and the Taguchi loss function (borrowed, rather obviously, from Dr Taguchi). When the authors bother to include counter examples or arguments, they are invariably dismissed with the ad-hoc hypothesis fallacy (in which some outside factor makes the counter example invalid-- favored excuses are "the government got involved" or "they weren't *really* implementing Deming's philosophy"). The book also includes "real life examples" but this section is so packed with sycophantic boosterism as to be entirely useless to any fair-minded reader. Not recommended as a source for ideas on economics, quality systems, or management.

  9. 4 out of 5

    Jens Comiotto-Mayer

    What strucks me every time I read Deming is how valuable his ideas are still today, and how few of the transformations in government, industry and education he longed for only have happened until now. Deming was a (systems) thinker way ahead of his times, and one can only imagine what the working world would look like if his thoughts and insights had been taken into account on a broad basis from earlier on. (While he was already an influence to the Japanese economy and especially the Toyota Prod What strucks me every time I read Deming is how valuable his ideas are still today, and how few of the transformations in government, industry and education he longed for only have happened until now. Deming was a (systems) thinker way ahead of his times, and one can only imagine what the working world would look like if his thoughts and insights had been taken into account on a broad basis from earlier on. (While he was already an influence to the Japanese economy and especially the Toyota Production System in the 1950s, he gained perception in the US as late as in the 1980s). "The New Economics" is a book with a style that is a bit hard to get used to, but it is full of gems, and large parts could have been written only years ago. Naturally, Deming often focusses on the repetitive nature of manufacturing, which might be less interesting in environments where variation is not necessarily a bad thing per se, but he touches so many different topics here that this might indeed be one of the best introductions to his work, albeit many prefer "Out of the Crisis" in that regard. Anyways, W. Edwards Deming should be a mandatory read for everyone involved in management.

  10. 5 out of 5

    Peter Wolfley

    You have no idea who Dr. Deming is but he has had a huge impact on your life. He's basically the main reason that Japan went from nearly wiped off the face of the Earth 80 years ago to a an economic, technological, and cultural powerhouse which has forced American companies to change the way they do business which in turn has improved your life. The principles he's developed for better workplaces are extremely powerful and I am a transformed worker thanks to these ideas. The Deming Way should be You have no idea who Dr. Deming is but he has had a huge impact on your life. He's basically the main reason that Japan went from nearly wiped off the face of the Earth 80 years ago to a an economic, technological, and cultural powerhouse which has forced American companies to change the way they do business which in turn has improved your life. The principles he's developed for better workplaces are extremely powerful and I am a transformed worker thanks to these ideas. The Deming Way should be taught in all schools. It provides such incredible mental models. I am so fortunate to have stumbled into his work through a COVID relief program at SUU taught by the one and only Bill Bellows. I know I'm gushing here but I really can't say enough good things about it all.

  11. 4 out of 5

    Gary Boland

    Deming is the architect of the Toyota Production System and his work has directly influenced thinking such as 6 sigma. However I feel that the book that should be read is his earlier work "Out of the crisis", which is heavily referenced in this text. If you are looking to understand how Japan went from a low industrial base to the world leader in both quality and quantity for electronic goods and vehicles by the late 60s then this is the place to start Deming is the architect of the Toyota Production System and his work has directly influenced thinking such as 6 sigma. However I feel that the book that should be read is his earlier work "Out of the crisis", which is heavily referenced in this text. If you are looking to understand how Japan went from a low industrial base to the world leader in both quality and quantity for electronic goods and vehicles by the late 60s then this is the place to start

  12. 4 out of 5

    Daniel Cahill

    After a mentor recommended this book to me, I started the audiobook as I was driving to do errands on Saturday morning. I found time the rest of the day to listen to the rest. I especially loved the discussion of how industries can come together to come up with better opportunities for everyone rather than just the individual and the individual organization.

  13. 5 out of 5

    Reza Ghoorkhanian

    There are so many references to "Out of Crisis" that I feel I should have just read that book instead. Despite this, New economics is still and enlightening book, but perhaps it should be the second of Deming's books that one should read. There are so many references to "Out of Crisis" that I feel I should have just read that book instead. Despite this, New economics is still and enlightening book, but perhaps it should be the second of Deming's books that one should read.

  14. 5 out of 5

    Bob Mash

    Another book reflecting the period some 30 and more years ago. It reminds me a movie The Irishman. Very good critiques, high rating.. but I just wondered why does it exist? What was the point? I don't feel the nostalgia.. Someone might enjoy this book, and I am happy to donate it. Another book reflecting the period some 30 and more years ago. It reminds me a movie The Irishman. Very good critiques, high rating.. but I just wondered why does it exist? What was the point? I don't feel the nostalgia.. Someone might enjoy this book, and I am happy to donate it.

  15. 4 out of 5

    Carl Douglas

    Systems Clearly a stalwart of quality. For me, this book opened my eyes to his deep understanding of systems. The integration and cross connections that bring desperate components into a cohesive functional system. Ranks in the must read category.

  16. 5 out of 5

    Jeremiah Dunham

    The first ten chapters were great -- lots of original, contrary ideas about management that resonated with me. The last chapter was a giant ad for working with the Deming Institute, which was super annoying. You can skip that; I did.

  17. 5 out of 5

    Anath lee Wales

    I really liked it and recommend it to everyone at all levels. Prior to reading many books and due to my many other personal responsibilities, I couldn't get enough time to really write a personalized review, but this is really a good book you have to read. I really liked it and recommend it to everyone at all levels. Prior to reading many books and due to my many other personal responsibilities, I couldn't get enough time to really write a personalized review, but this is really a good book you have to read.

  18. 5 out of 5

    Sophie Smithburg

    A surprisingly insightful book, if a little light on the technical details. Will have to read another book or two to get the real depth, but I suspect there is some applicability to SRE in here.

  19. 5 out of 5

    Cliff Hazell

    This wisdom stands the test of time. Sadly few are following it yet.

  20. 4 out of 5

    Phil Eaton

    Very subtle points. Worth a reread and comparison with both Peter Drucker and more modern thought.

  21. 5 out of 5

    Lennie Noiles

    This old advice is still valid today.

  22. 4 out of 5

    Mariela Kehaiova

    Totally outdated, very simple writing, absolute nonsense and total waste of my time..

  23. 5 out of 5

    Brennan Lauritzen

    A good alternative to recommend to your conservative coworker who assumes organizational psychology is a recent hippie invention, but I think there's more updated books out there. A good alternative to recommend to your conservative coworker who assumes organizational psychology is a recent hippie invention, but I think there's more updated books out there.

  24. 4 out of 5

    John Amador

    This book is an excellent introduction to Deming’s management Machiavellian observations and his system of profound knowledge.

  25. 5 out of 5

    Martin Olesen

    Every leader should read this classic.

  26. 4 out of 5

    Megan Byars

    Good content. Ideal for those who have taken six sigma or sigma science training since he uses a lot of that terminology. Slightly dated but mostly still relevant.

  27. 5 out of 5

    John Rogers

    An Utopians vision of the world.

  28. 5 out of 5

    Bob Wallner

    2021 update.... Never ceases to amaze me. No matter how many times I listen to this book I gain a little knowledge. The source for Dr. Deming’s System of Profound Knowledge; The New Economics, has become one of my favorite books and I regret not reading it sooner in my career. It combines a deep understanding of what a system is and how to manage within the system. The first time I read the book was in 2017 and now, in 2019, I can listen to the audiobook on a frequent basis. The New Economics is 2021 update.... Never ceases to amaze me. No matter how many times I listen to this book I gain a little knowledge. The source for Dr. Deming’s System of Profound Knowledge; The New Economics, has become one of my favorite books and I regret not reading it sooner in my career. It combines a deep understanding of what a system is and how to manage within the system. The first time I read the book was in 2017 and now, in 2019, I can listen to the audiobook on a frequent basis. The New Economics is more than a book about quality and statistical control, it’s a book about leadership. Dr. Deming goes into depth about what a system entails and who is responsible for quality within a system- Spoiler alert it’s Management. Several revolutionary ideas are openly written about such as eliminating merit pay and performance appraisals. Deming is adamant that 90-95% of quality is a result of the system and not the operator and he uses his famous Red Bead Experiment to demonstrate that. From my experience, the lessons from the Red Bead have not permeated the work force other than in a few small pockets. Specific numeric targets still define success. Employee blame is still the norm. Managing with sticks and carrots still surround the landscape. Process control is seldom, if ever, discussed. I entered the professional job market in 1993 and I’ve not seen any noticeable improvements that Dr. Deming has advocated. There is only one thing I need to mention about the audiobook, the narrator is slow. I was able to speed the narration up by 30%.

  29. 4 out of 5

    Aaron

    I'm a fan of Deming's ideas, and I think they are better conveyed it other sources - even Wikipedia. I read Out of the Crisis some years ago and I've read bits and pieces of his writing as I came across them since then. Generally his writing is clear and concise, and his examples are relevant and illustrative. I don't know what happened here. I can recognize the usual themes and ideas that characterize all his work, but only because I'm already familiar. If this were my first exposure, I'd proba I'm a fan of Deming's ideas, and I think they are better conveyed it other sources - even Wikipedia. I read Out of the Crisis some years ago and I've read bits and pieces of his writing as I came across them since then. Generally his writing is clear and concise, and his examples are relevant and illustrative. I don't know what happened here. I can recognize the usual themes and ideas that characterize all his work, but only because I'm already familiar. If this were my first exposure, I'd probably have a dismissive attitude toward the rest of it. There wasn't anything wrong with the ideas themselves. However, the explanations were short and sometimes muddled. I got the point of the bead game at the end, but I don't get why it was presented so. The instructions weren't clear enough for most readers to actually practice, so I don't think it was meant to be carried out. But it wasn't written as a case study either. I don't know. Honestly, it looked like some editor wanted to get one last book in print, grabbed whatever loose notes he could find, and go Deming to sign off on a copy. The whole book looks rushed and could have benefited from another round of editing. Deming the man: 5/5 Deming's ideas in practice: 5/5 The New Economics the book: 2/5

  30. 5 out of 5

    Dan Gunter

    First book by Deming I've read. In broad and somewhat wandering strokes, he provides a vision for industry, education and beyond. It is part philosophy and part call to action. I find much of what he says about the responsibility of the system, and not the individual, for the quality of a collaborative product to ring true even in the remote tropical islands of scientific software. However, this book reads more like a conclusion than an initial statement of purpose and I think it might be good t First book by Deming I've read. In broad and somewhat wandering strokes, he provides a vision for industry, education and beyond. It is part philosophy and part call to action. I find much of what he says about the responsibility of the system, and not the individual, for the quality of a collaborative product to ring true even in the remote tropical islands of scientific software. However, this book reads more like a conclusion than an initial statement of purpose and I think it might be good to go back and read "Out of the Crisis", or one of the many collaborative works from his earlier career.

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