As Americans and supposed leaders of the free world, we need to transform the way we do business. Traditional models; focused on short-term profits, cost-cutting, and rigid hierarchies, are no longer sustainable in a rapidly changing world. W. Edwards Deming saw this decades ago. His insights are more relevant than ever. Here are a few reasons why transformation is critical:
1. Short-Term Thinking is Killing Long-Term Success
- Many American companies prioritize quarterly earnings over long-term investment in quality, innovation, and people.
- This leads to outsourcing, layoffs, and cost-cutting that damage competitiveness over time.
- In contrast, companies in Japan (influenced by Deming) built sustainable success through continuous improvement (Kaizen) and long-term planning.
2. We Focus on Blame Instead of Systems
- U.S. businesses often blame workers for failures instead of improving systems.
- Deming taught that 94% of problems come from the system, not the workers.
- Transforming business means fixing broken processes rather than punishing individuals.
3. Quality is an Afterthought Instead of a Priority
- Many companies see quality as a cost, not an investment.
- This leads to defects, recalls, and customer dissatisfaction.
- Deming’s philosophy showed that building quality into the process reduces waste and increases profits in the long run.
4. We Manage by Numbers Instead of People and Processes
- Traditional management relies too much on arbitrary targets, quotas, and performance reviews instead of improving the actual work.
- Employees game the system to meet metrics instead of focusing on meaningful improvements.
- True transformation requires understanding variation, investing in training, and leading with purpose—not just data.
5. Innovation is Stifled by Fear and Bureaucracy
- A culture of fear prevents employees from speaking up, trying new ideas, and learning from failure.
- Deming emphasized psychological safety—where people feel secure to innovate and improve.
- Organizations that foster learning and adaptability will survive; those that punish mistakes will fail.
6. American Businesses Are Losing Global Competitiveness
- Countries that embraced continual improvement and systems thinking (e.g., Japan, Germany, South Korea) have outperformed in industries like manufacturing and technology.
- The U.S. must shift from low-cost competition to high-quality, innovative value creation.
- Companies that apply Deming’s principles—like Toyota and Ford (when it followed Deming in the ’80s)—win in the long run.
7. Leadership Must Change from Command-and-Control to Servant Leadership
- Many American executives focus on control, compliance, and short-term profits.
- Transformational leadership, inspired by Deming, means coaching, mentoring, and creating a culture of learning.
- Leaders should remove barriers, empower teams, and focus on continual improvement.
How Do We Transform?
- Shift from short-term profits to long-term sustainability.
- Redesign systems to support quality, not blame individuals.
- Make continual improvement (Kaizen) a core part of business.
- Invest in employees and trust them as problem-solvers.
- Eliminate fear and create a culture of learning and innovation.
- Replace arbitrary targets with meaningful process improvements.
- Lead with purpose, not just numbers.
The transformation is not just about making businesses more profitable. It is about creating organizations that are resilient, innovative, and built to last.
One of the biggest problems in U.S. business today is the overemphasis on short-term gains at the expense of long-term value.
Many companies prioritize quarterly earnings, stock buybacks, and cost-cutting measures to satisfy investors rather than investing in innovation, employee development, and sustainable growth.
This short-term focus leads to:
- Poor quality and service: Cutting costs often means cutting corners, which results in worse products and customer experiences.
- Lack of innovation: Companies play it safe instead of taking the risks necessary to create groundbreaking products and services.
- Employee dissatisfaction: Workers are often seen as expendable, leading to low morale, high turnover, and reduced productivity.
- Market volatility: The obsession with stock prices creates instability and bubbles that can crash economies.
This is exactly where Deming’s philosophy comes in.
Businesses should focus on continual improvement, long-term thinking, and quality.
Instead of squeezing profits out of existing systems, they should build better ones.