The Quality Imperative In
The New Economic Era

MYRON TRIBUS, Director
Center for Advanced Engineering Study
Massachusetts Institute of Technology

YOSHIKAZU TSUDA
Professor of Statistics
Rikkyo University
Tokyo
August 1985
THE Quality IMPERATIVE

In the last thirty-five years a new principle regarding competitive
advantage has emerged and is having a profound impact on
international trade. This principle runs counter to generally
accepted concepts in economics. Most economists seem unaware of its
validity, origin, theoretical basis or its evident impact on
international trade.

The new principle as yet has no name. Since so many concepts of
economics are reminiscent of thermodynamics, I suggest it bc called
the "Zeroeth Law of Quality Management".

THE ZEROETH LAW OF QUALITY MANAGEMENT:
THE PRODUCER OF HIGHEST QUALITY
IS LIKELY TO BE THE PRODUCER OF LOWEST COST

Appreciation of this principle requires that the word "quality" be
properly understood. As Pirsig (1) has demonstrated in his
delightful little book, "Zen and the Art of Motorcycle Maintenance'
the word "quality" cannot be defined by reference to more primitive
ideas. It is itself a primitive idea. To explain it requires that
examples be given of what is and is not meant when the word
"quality" is used.
 
To begin, it is possible to say what quality is not. For example: 

QUALITY IS NOT A SYNONYM FOR FEATURES

The features of a product or service are those attributes which are
designed into the product to meet special desires of the customer.
Features serve to define the market niche for which the product was
made. 

In homebuilding, for example, contractors will often say they are
building a house of "high quality" when, in fact, they mean they
are adding features to the house. A home builder once proudly
explained that his houses were of high quality because they boasted
air cleaners, music in every room, double glazed windows and
similar expensive features. However, when I visited the owners of
houses he had built I found that they complained of leaks in the
roof, floors that were not quite level, seepage of water in the
basement. The builder used the word "quality" in a way that was
deceiving to the uninitiated. People seem to think that if you
order many features, you will automatically obtain a quality
product. 

An air conditioner added to an automobile provides a feature. If
the air conditioner performs quietly, consistently and flawlessly,
it may be said to provide quality. 

Another example of a feature is color. When Henry Ford introduced
his automobiles he used to say that the customer could have any
color as long as it was black. The development of different colors
for automobiles introduced a feature. When the paints were improved
so that they did not fade in sunlight and when the finishes became
smooth and mirrorlike, they added quality.
 
Quality is associated, therefore, with integrity in delivering what
a customer has a legitimate right to expect in view of what was
promised at the time of the agreement to purchase. Even this
definition is inadequate. 

Some people try to define quality by saying: 

Quality is "conformance to specifications"
[A poor definition]

What I believe they mean to say is:

Non-Quality Is Non-Conformance to specifications.

As every student of logic knows, the definition of a negation does
not lead to the unambiguous definition of an assertion. 

Specifications cannot, as Pirsig has demonstrated, define quality
because quality itself is a primitive idea. Specifications provide
legal definitions of acceptability. In the marketplace to strive to
be merely acceptable is to opt for last place. Quality producers
know they must be constantly striving for improvement in quality. 

TO DEFINE QUALITY AS CONFORMANCE TO SPECIFICATIONS
IS TO CONFUSE THE CONCEPT OF QUALITY WITH ACCEPTABILITY.

TECHNOLOGY AND QUALITY 

There is a difference between an or craft on the one hand and a
technology on the other. An art or craft is a personal skill which
takes time and patience to master. It is associated with an
individual person. Not everyone can develop the necessary skill,
and it is found that some are much better than others. To obtain
the skill, you have to hire the person. 

A technology is a technique which has a scientific and logical
foundation to it. In a technology, the essential skills are
provided by a machine. Technology transfer consists of teaching
people to understand the underlying logic or science and how to use
the machine. A "high technology" is one in which the reduction to
practical use requires advanced education. We say a technology has
been "mastered" when it is reduced to a "low technology" status,
i.e., almost anyone can learn to use it. 

An art or craft is applied in a "cook book" style, in well
described circumstances and without the need for understanding by
the user. A technology, on the other hand, is expected to be
applicable to many circumstances. It requires the understanding of
the underlying theory and intelligence on the part of the
practitioner.
 

Technologies do not only pertain to hardware manufacture. We can
recognize at least five categories of technologies. 

     1. TECHNOLOGIES OF PRODUCTS (to provide improved features)
     [Aircraft., washing machines, computers . . .]

     2. TECHNOLOGIES OF PROCESSES (to provide qualities) [Cutting,
     imaging, heating,fastening . . . ]

     3. TECHNOLOGIES OF MANUFACTURE (to improve qualities)
     [Robotics, automation,testing . . .]

     4. TECHNOLOGIES OF ENGINEERING (features and quality) [CAD,
     CAM, optimization . . .]

     5. TECHNOLOGIES OF MANAGEMENT (to improve quality) [CPM, PERT,
     CWQC . . .]

Technologies of products enable new features, but they also make
possible higher quality. The introduction of a truly "new" product
usually involves a new feature. Steady improvement usually involves
improved quality. 

New technologies of manufacture often make it possible to supply a
quality that was not attainable before. New methods of spray
painting, for example, make it possible to produce new surfaces.
New methods of microchip manufacture make possible more features in
a small volume. 

When an attempt is made to improve the quality of the output of a
system by purchasing advanced machinery, we speak of it as a
"technology fix". When US manufacturers first became aware that
Japanese goods were being produced with higher quality and
productivity they thought it was a combination of cultural and
technical advantages. When they went to Japan to investigate they
were surprised to find that the equipment was the same as at home.
Many of them concluded that the differences were "cultural". They
did not find the "technology fixes" they had expected. 

Garvin (2) has compared the propensity to make errors and produce
flaws in comparable companies in the US and Japan. He found that in
similarly equipped factories that the error rate in the US was 500
to 1000 times higher. Other observers have commented that in the US
flaws are measured in parts per thousands; in Japan they are
measured in parts per million. 

In 1979 Makoto Takamiya (3) made a study of four factories in Great
Britain. Two were owned by Japanese, one by Americans and one by
the British. In each case the ranks of management (except for the
very top posts) were British. Table 1 shows the characteristics of
the companies studied. 



Dr. Takamiya remarks that the popular image is that Japanese
managers create a "family" in which the workers find greater
happiness and that this contributes to the greater productivity and
quality. In the surveys, however, the morale of American managed
workers was negligibly different from the Japanese managed workers.
Deliberate attempts to make workers unhappy undoubtedly can lead to
lower productivity. However, efforts to increase worker happiness
per se does not automatically increase the productivity of the
system. Table 3 reviews the incentives used in the four companies. 

Dr. Takamiya attributes the differences in productivity and quality
to management and identifies these areas of difference.

Product selection 
    The British had 60 types of products, the Japanese had 4 or 8, 
    and the Americans 6.

Attention to "minor" details
    The Japanese were meticulous with respect to details. American 
    and British managers were lax. 

Work practices/supervision
    Japanese worker assignments were flexible. If necessary       
    secretaries would fill in for workers as occurred in one      
    emergency. By contrast, the jobs of workers in American run   
    plants were governed by "job descriptions". In the British run
    plants, jobs were determined by agreements with the union. 

Discipline
    The Japanese insisted on strict discipline. Both the Americans 
    and British were much more relaxed. 

Interdepartmental coordination
    The Japanese plants had strong interdepartmental coordination, 
    enhanced by policies of frequent rotation of managers among   
     departments. Interdepartmental relations were more formal in 
     American run plants. In the British run plant some departments 
    considered the other to be the "enemy". 

It was observed that in Japanese run plants the employees were
responsible to clean up their own areas. They were involved in job
improvement, were constantly monitoring their own quality and
involved in discussions with supervisors about improving the
workstation. There was a turnover of 28% in new hires in the
Japanese plants which Takamiya attributes to encountering the
strict discipline. 

The Takamiya study makes it quite clear that the adoption of
managerial technologies makes the difference. Except for a few top
spots, the management of all four companies was British. These
British managers had adopted the technologies of their bosses. 

THE ADVANTAGES OF THE JAPANESE COMPANIES IN GREAT
BRITAIN IS NOT CULTURAL.

THEIR ADVANTAGE LIES IN THE USE OF IMPROVED MANAGERIAL
TECHNOLOGIES BY UPPER, LOWER AND MIDDLE MANAGERS.

THESE TECHNOLOGIES ARE TRANSFERRABLE TO MANAGERS
WHO CHOOSE TO LEARN THEM.

THE COST Quality CONNECTION 

The foregoing discussion has laid the basis to explain why the
quality principle works and why it is of such importance in
economics. 

Suppose two producers design their products for the same market
niche. They present the customer with the same choice of features.
The customer will decide which one to purchase based upon
perceptions of quality and cost. Suppose the product is a fire
extinguisher for use in the home. Let both have the same capacity,
as testified to by Underwriters Laboratory on the label. Suppose
one product has a smooth finish and the handle is free of burrs and
scratches while the other shows an ''orange peel" effect in the
painting and the handle is not so smooth. The customer will
certainly prefer the product that exhibits superior craftsmanship.
This is a subtle indicator of the aspects of the product that
cannot be seen. 

If we were to go to the factory of the first producer we would be
likely to find that the spray system is much cleaner than the
competitor's. The person doing the spraying will have been trained
to mix the ingredients of the paint so as to get the viscosity
correct, to keep the spray gun the proper distance from the
product, to keep the system clean and to inspect it periodically.
It will probably be found that the competitor has not trained the
operator properly and does not know what viscosity or spray
pressure is best. The equipment is likely to be down for unexpected
repairs. In short, the quality of the product reflects how well the
manufacturing process is managed. 

Can anyone who examines the data of Garvin or of Takamiya doubt
that when 80% of the product requires rework before it is
considered acceptable, the resulting output will be of higher cost
and lower quality? This fact of life is the basis for the quality
principle. 

MANAGEMENTS THAT LEARN TO MANAGE FOR QUALITY
HAVE AN UNBEATABLE ADVANTAGE OF THOSE WHO DO NOT.

There are some who consider quality to be an end, not a means. They
are apt to say: "Quality is free". This is a misguided statement. 

QUALITY MANAGEMENT IS A MEANS TO LOW COST AND
HIGH PRODUCTIVITY

TO SAY THAT "QUALITY IS FREE" IS TO CONFUSE
MEANS WITH ENDS.

This statement goes against the first principle of quality
management which states: 

FIRST PRINCIPLE OF QUALITY MANAGEMENT
QUALITY IS NEVER YOUR PROBLEM.
QUALITY IMPROVEMENT IS THE ANSWER TO YOUR PROBLEM.

Quality improvement is not an end. It is a means. 

The "leverage" of quality has been pointed out by Feigenbaum (4),
who referred to the "hidden factory" i.e., the factory within a
factory where employees were busy fixing the mistakes of the main
factory. This hidden factory is busy taking care of rework, scrap,
inspection, management meetings to see what to do to fix whatever
went wrong, supporting sales people placating customers, purchasing
agents who are trying to get emergency supplies because someone
ordered or delivered the wrong thing, etc., etc. Feigenbaum
suggests that this factory amounts to 20% of the company personnel
and accounts for about 20% of the cost of manufacture. 

The competitive consequences of the decreasing cost quality curve
are very great. Heretofore it was common experience that to raise
the quality of one product over another, it was necessary to
increase the cost. It was possible, therefore, for economists to
speak of the market as "segmented," considering in one segment
products of higher quality and higher cost and in another, products
of lower quality and lower cost. It is still possible to segment
the market according to features but it is now necessary to take
into account the destabilizing effect of the inverse cost-quality
function. 

The new breed of managers has learned that it is possible to lower
costs by increasing quality. This means that the higher quality
producer has a double advantage. The higher quality product can
command a higher price, yet because it has a lower cost to the
producer, it gives the enterprise a much larger profit margin than
its competitors. It can use this margin in several ways, including
the option to finance growth internally as it moves into new
product lines. It can also keep the competitors on the verge of
bankruptcy as it slowly lowers its prices and gains market share. 

This sort of thing has now happened in automobiles. By applying the
new management techniques Japanese automobile manufacturers have
attained a significant cost advantage over American producers. The
following table is taken from a talk by James Harbour and indicates
the situation a few years ago, just before significant managerial
changes were made at some of the American automobile companies. 

All over the globe managements area learning the quality
principles.  At the Center for Advanced Engineering Study we see
steady stream of foreign visitors, eager to learn the new style of
management. Organizations of enthusiasts are forming in Europe, in
Latin America, in Asia. Through an organization called the
Association of Overseas Technical Scholars, Japan is exporting this
kind of management to 17 Asian nations. Their motivation to do this
is quite simple. Japan expects to move offshore to other countries
those industries in which the competition has learned about quality
and thereby reduced their competitive advantage. They expect to
retain in Japan those industries which have a very high value added
per pound of product . They intend to stay ahead of the race by
concentrating on high technologies. This is a very intelligent
strategy for a country which has only people as a resource and must
import essentially all the materials from which it makes goods for
export. 

QUALITY--THE ECONOMIST'S BLIND SPOT

The result of the learning now going on will be that soon the
quality principle will be used all over the world. Because
international trade has become essential to the survival of all
nations (including the USA), no company will be immune to the
increased competition. 

Any economist who intends to provide useful forecasts and guidance
to a government needs to take into account this new development.
Economists make their predictions and render their judgements by
studying economic indicators. These indicators are taken from the
numbers which represent quantitative factors in the economy. The
objective of economic theory is to provide insight and
understanding of what is happening and what is likely to happen in
the economy, based on data about the economy itself and whatever
other information is available. Until the quality indicators are
included in the theory, predictions will be inaccurate, even
misleading. Existing economic theory simply would not have forecast
the Japanese ability to import essentially all the raw materials it
needed and then to compete with a fully developed automobile
industry established in a country which needed very little
importation, and to beat the industry on its own ground. It has
happened with one industry after another in one country after
another. The quality principles cannot be ignored any longer if
economic predictions are to be of any use. 

The development of economics has been greatly influenced by the
concepts in thermodynamics. For example the concept of
"equilibrium" is discussed in terms which are quite similar to
those used in discussing chemical equilibrium. Nicholas
Georgescue-Roegen has gone so far as to suggest, in his book "The
Entropy Law and the Economic Process" (7), that a true theory of
economics should be based upon the laws of thermodynamics,
especially the second law. Whether this is true or not is arguable,
but his book does make clear how similar many of the arguments of
thermodynamics and economics are. 

Economists make good use of the conservation principles of mass and
energy. For example, the basic "input-output tables" for which
Leontief received a Nobel Prize is a matrix which accounts for the
fact that in all manufacturing processes there is a conservation
principle which can be used to see how the change in activity of
various industries changes the demands upon the sources of these
materials and one another. The Nobel Prize Committee recognized the
importance of this contribution to our understanding. The First Law
(or more generally, conservation principles) provides limits to
performance. You cannot make something for nothing; you cannot
create energy, you can only obtain it from a source. An
input-output table provides information from which it is possible
to see how well the transformations occurred. 

In real processes of manufacture, what is actually accomplished is
only a small fraction of what could be done. The theoretical limits
of productive capacity are very much greater than what actually
occurs. If the productive efficiencies of the future are assumed to
be the same as those of the past, predictions about the future will
make about as much sense as driving a car down the highway guiding
it by looking at the white line in the rear view mirror. 

For an economic forecast to be relevant, it should take into
account two factors which have a strong effect on the economy. The
first is technology and the second is quality. 

Competitiveness derives not only from natural advantages i.e.,
proximity to natural resources, but also from two thrusts:

INVENTION AND INNOVATION:
MAKING NEW AND BETTER THINGS.

QUALITY AND PRODUCTIVITY:
MAKING THINGS IN BETTER WAYS.

New technologies of products, processes and manufacture strongly
influence invention and innovation in products. The Congress seems
to see a close connection between the rate of innovation and the
support for research leading to new and improved technologies on
the one hand and international competitiveness on the other. The
USA has had a long standing tradition of trying to support "Yankee
ingenuity". 

New technologies of management strongly influence quality and
productivity. Because so many people look upon management as a
privilege, it is difficult for many of them to accept that if they
use an improved technology, they are not admitting that they were
inadequate in using old technology. At any rate, for a given level
of technological advance, it should be obvious that the way the
system is managed determines the quality of the output. 

Until very recently, economic theories did not take into account
technology. Some economists are revising their approaches to make
technology an explicit factor in their equations. To take into
account technology will not be enough. Developments in quality
management now have to be included as well. 


As a thermodynamicist I cannot help but be struck by the similarity
between the role of quality in economic competition and the role of
entropy in thermodynamics. Entropy is a useful measure of the
potential to improve things. Gain in entropy means loss of
thermodynamic quality. Gain in entropy also means loss of
information. (8). As we shall see, loss of information during
manufacture also means loss of quality. The formal aspects of this
intriguing analogy remain to be explored (9). They are potentially
of great interest. These considerations are beyond the scope of
this paper. 

The new era of economic competition is dominated by the quality
imperative. 

LEARN TO REDUCE COSTS THROUGH INCREASING QUALITY
OR SELL OUT TO THOSE WHO ALREADY KNOW HOW.

THE MANAGERIAL CHALLENGE

Some people refer to the impact of quality as the "Second wave of
the industrial revolution". Before the industrial revolution goods
and services were produced by skilled artisans working by
themselves or with apprentices. In the case of larger projects, the
work was done by a hierarchy of managers and workers, under the
leadership of a skilled person. The individual tasks were
relatively simple and unchanging. Certain crafts could be
identified: bricklaying, stonecutting, concrete mixing and pouring
for example. The industrial revolution saw the skill of the
individual craftsman transferred to the factory, where the work
could be better organized. In United States in the 1930's the
industrial revolution had progressed to the point where two kinds
of unions were formed. The AFL was organized along traditional
lines, according to crafts. The CIO was organized according to
industry. As we shall see later, the full impact of the process of
industrialization occurs when the skills of the individual person
are transferred to the organization, not just to the place of work.


Wherever strong international competition is occurring the number
of job classifications is being severely reduced. Workers are
expected to move from one task to another, filling in and helping
one another as required. Whereas before people associated
themselves with specialist jobs, now the emphasis is shifting. This
shift requires that the jobs be described in terms of standard
procedures. In a modern factory the practice is to post at the
place of work a written description of how to do the task,
presented in such a fashion that a person can slip into position
and begin to work with a minimum of training. Complete
interchangeability of workers is not possible, of course, but that
is the ideal--the complete transference of the skill to the
organization. 

In such a setting it is important that the human not be diminished.
Managerial approaches which respect humanity are the hallmark of
the successful manager. 

Until recent times, top management and schools of management have
paid very little attention to technologies aimed at increasing
quality. This is certainly not because the basic information was
unknown. The theory was laid down by Walter Sherwhart in the 1930's
(10). Statisticians such as W. Edwards Deming and Joseph Juran have
carried the message around the globe ever since. Dr. Deming's most
recent book (11) is devoted to the changes managements must make to
apply the technologies for quality. But their teachings were
ignored everywhere (except Japan) for a half century. 

It is easy to look back and understand why it happened. In the era
just after WWII the emphasis was on quantity of product, not
quality. Now people have to learn new ways. 

Most people seem to learn a new outlook on life only when they
must. Most of us tend to lead unexamined lives, basing our everyday
actions on custom and usage. When our beliefs are challenged, most
of us react with anxiety and sometimes even anger. 

Philosophies of management go back a long way in history. Stueart
and Eastlick (12) have written a brief history of the development
of managerial concepts, starting from the building of the pyramids.

The Old Testament described an hierarchical organization in
"Exodus' indicating that Moses "chose able men out of all Israel
and made them heads over the people, rulers of thousands, rulers of
hundreds, rulers of fifties and rulers of tens". 

The hierarchical form of organization was used by the Romans in
conquering the entire known world 20 centuries ago. When reading
this historic review, two things seemed to leap off the pages: 

HISTORICALLY: MANAGEMENT HAS BEEN A PRIVILEGE
LABOR HAS BEEN A COMMODITY

At the start of the 20th century, this image of what it means to be
a manager was given a certain intellectual status by the work of
Frederick Winslow Taylor, who became known as the "Father of
Scientific Management".  Here are two quotations from his work: 

     "Hardly a competent workman can be found who does not devote
     a considerable amount of time to studying just how slowly he
     can work and still convince his employer that he is going at
     a good pace". 

     "Under our system a worker is told just what he is to do and
     how he is to do it. Any improvement he makes upon the orders
     given him is fatal to his success." 

In later years Taylor was to lament what had been done in the name
of "scientific management". He preferred to dwell upon the
intellectual and scientific contributions (i.e., time and motion
study, work measurement, methods engineering) which he had
pioneered and did not wish to be associated with the sociological
effects. 

Juran has called the hierarchical or "tree structure" the "Pyramid
of Power" and has pointed out that the nature of the conversation
changes as one ascends the pyramid. At the bottom people talk about
things. Near the top they talk about dollars. The people in between
are translators, who convert things (programs) into dollars
(budgets) and vice-versa. This is an oversimplification, of course.
Unfortunately, it is not that oversimplified. The translation of
things into dollars is the way that top managements connect what
happens in the factory with what happens in the macroeconomic world
outside the factory. 


Ralph Landau, a distinguished chemical engineer, has written a
strong attack on the state of economic theory. One of his main
points is that while what happens at the level of the factory
determines what happens at the level of the national economy, there
is no theory that ties the micro- and macro- economics together.
He points to physics in which it is understood that the behavior of
very small particles is described by quantum mechanics while the
behavior of systems of particles is described by classical physics.
The connection between these two views is made through statistical
thermodynamics. 

In economics, unlike physical the two theories are not connected.
There is no micro- theory and connecting analog to statistical
thermodynamics. It appears to me that the difficulty cannot be laid
to the door of the economists. They, after all, have to work with
the figures that are available to them. The difficulty lies in the
understanding of the managers themselves as to what it is that
influences the performance of the organizations they are supposed
to lead. Most managers think in terms of a tree structure. This
image of the organization needs to be changed if a manager is to
learn the technologies associated with quality improvement. 

CHANGING THE MANAGER'S VIEW OF MANAGING

To begin, we define the manager's job as follows:

THE PEOPLE WORK IN A SYSTEM.
THE JOB OF THE MANAGER IS
TO WORK ON THE SYSTEM
TO IMPROVE IT
WITH THEIR HELP.

Managers should not visualize themselves as sitting atop a portion
of the pyramid. Rather they should think of themselves as
responsible to:

IMPROVE THE QUALITY

OF THE PERFORMANCE OF
SYSTEMS OF PEOPLE, MACHINES,
PROCESSES AND PROCEDURES.

This change in perspective cannot be mandated. It cannot be
"managed". It must be led. If top management thinks of itself
primarily as engaged in a struggle for power to be at the top, so
will all the managers beneath them. In my opinion this has been an
important factor in the decline of the British ability to compete
in world markets. The top positions in British industry have been
held for so long by people of privilege that they have lost touch
with what life is like near the bottom of the pyramid. 

Something akin to the British experience has been brewing in the
USA. For about 35 years American schools of Business Administration
and Management have been turning out MBA's for whom entering the
pyramid of power has been a guiding ambition . They have been
"groomed" for "top management". The prestige schools make no bones
about it. Their ambition is to produce the leaders of tomorrow's
industry. Unfortunately, their training is aimed mostly at
conquering the pyramid. It is certainly not aimed at starting at
the bottom and straightening out how the work gets done. 

When the top of the pyramid is concentrated on the flow of dollars,
there is a tendency in good times to take the maxim: 

IF IT AIN'T BROKE, DON'T FIX IT!!

In stringent times, there is no time to fix things. This maxim
needs to be replaced with a different one:


CONTINUOUS IMPROVEMENT IS A WAY OF LIFE.

To take a place in a quality enterprise, the managers need to
develop new competencies and a different "image" of the enterprise.
They need to learn: 

A NEW PHILOSOPHY OF MANAGEMENT
NEW MANAGERIAL TECHNOLOGIES

The new philosophy of management requires a reconsideration of the
purposes of the organization, the rights, responsibilities and
obligations of all the people in it, and, especially, how managers
and workers should relate to one another if the organization is to
be competitive in world markets where quality is a driving force. 

The new managerial technologies enable managers to improve systems,
to increase quality (thereby cutting cost) and to smooth the flow
of innovative products and the introduction of new processes.
Through these technologies managers can better serve the customers
and gain market share while becoming more profitable. 

THE OBJECTIVES OF THE NEW STYLE OF MANAGEMENT


A manager must satisfy a wide variety of "stakeholder". The
enterprise looks different to different people, depending upon
whether they are in the organization or outside it. Figure 3 gives
a picture of how different people with different interests in the
organization perceive it. 

Competitors, customers, news reporters, financial analysts and
shareholders all are on the "outside". What they see is just the
tip of the iceberg. If it is a quality company they see remarkable
new products, good value for the money, high quality goods and
services. When they deal with salespeople they are impressed at
their understanding. Customers feel that those who serve them
really care about doing a good job. 

Shareholders see that the company is applying new technology and at
the same time producing good financial figures. The company is
making good contributions to the business and social environment. 

The company is seen by reporters as a "good citizen" in the
community. They see the company growing in influence. The
management of the company is invited to serve on committees of the
community, and people are pleased when they do. 

The financial analysts report that the company is doing well, is a
good investment, safe and with good growth potential. 

Competitors see it as a formidable force in the marketplace. 

Top management sees that the company is a high quality, low cost
producer. The company has a good track record in the introduction
of new products, bringing them out on time, within budget and free
of "call backs". The products are obviously designed to meet market
needs. When it is necessary to change from one kind of product to
another, the changeover goes smoothly. 

Middle management sees that the inventory is small and that there
is a rapid turnover of inventory. Things work; the systems and
procedures do what they are supposed to do. Departments do their
work swiftly and efficiently. The equipment is well maintained and
adequately modern. The employees are cooperative. There is a spirit
of "can do" about the place. 

Supervisors do their work in the absence of conflict. They are not
caught in the middle, trying to explain why today's orders are in
conflict with yesterday's orders. They generally know what to do
without being told because the purposes of the company are clear.
Customer values dominate decision making. 

The workers see that quality is important. It is not just a slogan.
The management is attentive to quality, and everyone is helped to
do a better job. Management is visible everywhere and does not hide
out in its upper offices. Supervision is helpful and employees are
urged to find better ways to do their jobs. 


The workers are rightfully proud of their work. They say, "WE ARE
THE COMPANY". They trust the management to look out for them. They
do not fear for their jobs. They believe their personal fortunes
are bound up with the company fortunes. "We are all in the same
boat". 

Very few companies meet this image of the excellent company. In the
next section we shall consider how to make an audit of your company
to see where it stands. 

HOW TO TELL WHERE YOUR COMPANY IS ON THE ROAD TO EXCELLENCE

When you know what to look for, you can learn a great deal about a
company by just walking around and observing things. Since we are
talking about a system of people, machines and procedures, it is
important to observe all three. 

WHEN YOU ATTEND MEETINGS:

DO PEOPLE PRESENT ONLY THE GOOD NEWS?
DO THEY REPORT BAD NEWS ONLY ON REQUEST?
DO THEY PRESENT ONLY RAW DATA?
ARE DATA ANALYZED STATISTICALLY?
ARE DATA PRESENTED IN TABULAR FORM OR AS
GRAPHS AND CHARTS?

How topics are discussed in meetings is a good indicator of where
the enterprise is heading. In figure 4 we indicate some of the
indicators as measured by how the management views data in
meetings. 

WHEN YOU TALK WITH THE WORKERS:

DO THEY SPEND TIME LOOKING FOR WAYS TO IMPROVE?
DO THEY TAKE DATA ON WHAT THEY ARE DOING AND
THEN DISCUSS THE SIGNIFICANCE OF WHAT
THEY HAVE LEARNED?
DO THEY DO THEIR OWN HOUSEKEEPING AND ARE THEIR
WORK AREAS CLEAN?
DO THEY REGARD THE NEXT PERSON IN LINE AS A
"CUSTOMER" AND TRY TO UNDERSTAND THE
CUSTOMER'S NEEDS? OFTEN?
ARE SAFE PRACTICES THE RULE? OBEYED?

Managerial attitudes influence the attitudes of the people
reporting to them.  Anyone walking through an office or factory can
spot things which are not quire right.  How they people react to
you when you point them out provides considerable evidence as to
where the company is headed.  Figure 6 shows how management
attitudes towards defects, errors, deficiencies and problems can be
used to gauge the direction of the company.

An excellent company can be vulnerable.  When you are at the top
there is not place to go except down.  Bad managerial practices can
ruin an otherwise excellent company.  Figure 7 shows some of the
management actions, or rather inactions, which are the telltale
signs of heading for bankruptcy.  The most important of these
actions are those in which the management does not want to see the
problems.

These inactions are also likely to be revealed by management
attitudes towards opportunities for improvement.  The road to
bankruptcy is paved with managerial incompetencies.  Some of these
are pictured in figure 8.

If you walk through the enterprise, you can see the management
understands the pitfalls on the road to excellence.  Some of the
traps are picture in figure 9.

It is easy to "walk the shop" and look for these kinds of evidence.
A discussion with the workers will tell you if they are working to
procedures. Talk with someone taking data and ask if they know what
the data are used for? When did anyone ask? Do the numbers go
anywhere besides the computer?

If you ask managers what they have been working on recently, and
where their time goes, you can see if the important tasks of the
enterprise are being taken care of. All managers have three basic
responsibilities. These are:

1. To maintain the operation. That is, to tend to daily operations,
keep things going.

2. To improve the systems for which they are held responsible.

3. To provide for the future, that is, to foster invention.

The degree of responsibility in all three functions varies with the
level in the organization. Figure 10 shows a suggested split of
responsibilities versus level in the organization.

When the management does its job and the employees are all involved
in improvement, a company is at its strongest. It is not possible
to compensate entirely for one or the other. This balance is
portrayed in figure 11.

In the preceding sections we have discussed the obligations of
management to press for continuous quality improvement. This
pressure must be felt across the entire organization, not just on
the manufacturing floor.

Since the manager's job has been defined as continuous improvement
of systems, our review of the available tools begins with a
discussion of different ways to approach the improvement of
systems.

To improve a system in an organized way requires several steps.
These steps will seem intuitively obvious, but experience shows
that most managers do not follow them. To improve a system you need
to know the following:

1. What the purpose of the system is. What do people think the
system is supposed to do? How is it judged? By whom? 

2 . How the system is supposed to work. Does it work the way it is
intended? What goes wrong? How do the people cope with whatever
goes wrong? 

3. How can you define a quality output? Who decides? The people
working IN the system know how to tell? Do their orders permit them
to do a good job? 

4. What potential exists to improve the system? 

THE FIRST TOOL: FISHBONE (ISHIKAWA) DIAGRAMS

If you want to know what excellence is, you have to go to whomever
is the judge. In general this is your customer.

Many people believe they are far removed from the "customer",
working deep within the organization. Quality conscious people
realize that everyone in the organization is a "customer" of
someone else. Once this fact is recognized, it becomes possible to
identify the customers of the system.

I shall use an example from our Center for it illustrates two
things. First, that the methods we are discussing can be applied in
an office environment. Secondly, the organization chart is a very
poor guide to knowing how to improve quality. 

In our Center the Headquarters staff is made up of about a half
dozen people. There are three active programs in the Center, each
program under a Program Director. When the headquarters staff met
to discuss our job it quickly became evident that our customers
were the people running the programs. We decided that a quality job
from headquarters consisted in giving strong and effective support
to our programs. We drew an Ishikawa or "fishbone" diagram (often
called a "Cause and Effect Diagram") to illustrate how the various
services we rendered came together to provide good program support.
This diagram is reproduced as Figure 12. If you were to come to our
Center you would find this diagram on a blackboard with different
people's handwriting on it. Each member of the staff was encouraged
to enter ideas on the diagram. These ideas were discussed in staff
meeting. The Program Directors were invited to discuss the diagram.
In this way we could identify what our jobs were and how our
customers perceived what a good quality operation was. 

Ishikawa, or "fishbone" diagrams are a powerful tool for managers.
They provide a method to involve all the people in the improvement
process and to see how the various factors come together to make up
the total performance. 


THE SECOND TOOL: FLOW CHARTING

A fishbone diagram helps to relate the elements of a process, but
it does not really show how the process works. To see how the
people and organizations interact with a process, a flow chart is
helpful. One of the tasks we undertake in our office is to arrange
for the annual meeting of our board of advisors. Arranging
meetings, especially if they are infrequent, can be an awful chore.
Our advisory board meets once per year and is drawn from a number
of places around the company. Finding a suitable time in everyone's
calendar is difficult, especially if the membership is voluntary.
The responsibility is divided among several people in our once.
Figure 13 shows a flow chart prepared by one of our secretaries,
who did this after about four one hour sessions in the group. The
flow chart was discussed among five of us and as a result, we were
able to establish a firm procedure. This is a simple, almost
trivial task, but when we worked together to undersigned it, most
of the frustration we had felt around the office each year when it
was time to call a meeting vanished. The flow chart provided the
basis for a standard procedure. 

Many people object to "standard procedures". They feel that such
procedures stifle creativity. However, when these procedures are
not imposed from above, but are worked out by the people
themselves, as a way to do a job consistently and excellently, they
do not appear as a constraint. Everyone understands that at
future meetings the procedures are subject to review and
improvement. 

Figure 14 shows a flow chart for the introduction of a product.
This flow chart is, of course, much more complex than a flow chart
for organizing a meeting. This form of flow chart has one important
advantage: It shows the relationship between the people and the
work to be done. When studying a flow chart a manager can ask the
following questions: 

1. Who are the "customers"?
The flow chart identifies suppliers and customers by the horizontal
transfer lines. Whenever a horizontal line appears it identifies a
transaction involving a customer and a supplier. The manager can
ask if they have identified what constitutes a quality delivery. 

2. What is the quality of the work?
At every transfer point, if quality has been defined, it should be
possible to take data on the quality of the goods or services
delivered. 

3. What are the barriers to good quality work?
The people who work in the system can be asked to comment upon the
flow chart. Does it actually show what they do? Can they show, by
reference to the flow chart what their problems are? 
Flow charts make the situation come alive.  In an extremely through
provoking paper, F. Timothy Fuller(13) has shown how a flow chart
can illuminated a situation that no way can do.

Figure 15 shows the flow chart for a simple assembly operation.  It
is a simple task, merely to take a kit of parts from the input
station, assemble the three parts into a new part and place it on
the output station.  From the perspective of the manager, it is
easy to do and appears as a simple task on the manager's flow
chart.

Figure 16 shows what the task looks like in case of quality of the
incoming kits is poor.  It is not certain that all the parts are
there, the operator must first check if any are missing.  Depending
upon which ones are missing, a different assembly procedure is
followed.  Furthermore, a new procedure has to be followed by the
supervisor, as indicated on the diagram.  What was a simple task is
now seen to be complex with many more possibilities for error
introduced.

What makes a flow chart so useful is that once prepared it may be
studied by all who participate in the process and improvements
suggested. In presenting this flow chart, Fuller pointed out ways
to improve it which, at first glance, would seem to be contrary to
common sense. His paper makes for thoughtful reading. 

A THIRD TOOL: NOMINAL GROUP TECHNIQUES

In the preparation of fishbone or flow charts, it is helpful to
involve the people who actually do the work. Until they become
habituated to working in problem solving teams, it will be found
that they are often unable to contribute. There is a skill in
working together to solve problems and most people do not have it
without some training. Most managers have not been taught to lead
a problem solving team, and are uncomfortable and unskilled at it. 

Nominal Group Technique (NGT), is a way to lead a group in problem
solving. The steps in NGT are simple:

1. Silent Generation of Ideas
a. The group is asked to remain silent for a brief period of time
and to write down on a piece of paper ideas concerning the question
that has been posed by the leader. (The question could well be,
"What is the most important question for us to consider?") 

2. Round Robin Feedback
a. Each person is asked, one at a time, according to the seating
arrangement, to present one idea from his or her previously
prepared list. Each person is limited to one idea at a time. In
this way, no one can dominate the conversation. Everyone gets a
turn. When a person has run out of ideas, that person says "I
pass". The leader continues to poll the group until all say "I
pass". 
b. As each person presents an idea, it is written on a board or
flip chart. The ideas are presented as brief statements without
elaboration. The person writing the statements is not to
editorialize or "improve". It is important that each person's idea
be written down as originally presented. 

3. Group Clarification of Ideas
a. After the group has finished generating ideas, it will be found
that many ideas are similar. Members of the group are asked by one
another to clarify their ideas and the leader attempts to group
ideas in similar categories, with the help of the members. During
this process it will be decided by the group that certain ideas are
so similar that they can be made into one. Such clustering should
be done only with the consent of the persons who generated the
ideas. The leader should be careful that no one is dominated by the
group or has an idea lost. 

4. Individual Voting on Ideas
a. If there are N ideas, each person is allocated a total of (1 +
0. 5N) votes. That is, if 46 ideas were generated, each person will
have 24 votes. Call the number of votes, V. Each person chooses the
V most important ideas from the list and ranks them. For example,
from the list of 46 ideas, each person selects 24 and ranks them in
order of importance, putting a "24 " opposite the most important
idea and a "1" opposite the last. 

b. The leader tallies the votes. The tally is done by counting not
only the scores, but also the number of votes. Someone reads from
the slips of paper as the leader writes to the LEFT of the idea the
NUMBER OF VOTES and to the right the NUMBER assigned. After all
votes have been tallied, the totals are computed. Each idea will
have been ranked in two ways: To the left will be a number showing
how many people thought it was an important idea. To the right will
be a number telling how strongly the voters feel. 

5. Presentation in a Pareto Diagram

A FOURTH TOOL: PARETO DIAGRAMS

A Pareto Diagram is merely a bar chart in which the bars have been
arranged in descending order, with the largest to the left. Pareto
charts are useful to help a group set its priorities. Figure 17
shows a pareto diagram for the time spent in different tasks by a
group of office workers. On the left is the amount of time spent
(measured in average annual wages) and on the right is the
cumulative percentage of time. It can be seen that the total of
time spent on typing, answering the telephone and retyping accounts
for about 70% of the effort. Without a Pareto chart it is difficult
for a group to agree on what to do next. Pareto Diagrams are an
important aid to consensus building, based upon "fact based
decision making". 

A FIFTH TOO: RUN CHARTS

Run charts are merely plots of how a viable or attribute of
interest varies with time.  Successive observations are plotted on
a graph.  Figure 18 shows a run char.


The importance of run charts is that the eye is very good a
noticing patterns.  It takes much more experience to notice
patterns when numbers are displayed in tabular form.

Figure 19 shows the histogram which resulted when an automatic
machine tool was running freely. Figure 20 shows the distribution
when the machine was placed under the control of an automatic
controller. (Data courtesy of Dr. W.W. Scherkenbach of Ford Motor
Company). The histogram tells at a glance that the automatic
controller was overcontrolling. It produces a statistical
distribution that is broader than before the control was used. 

A histogram can reveal a great deal about a process. A "double
humped" histogram, for example, is evidence that outputs from two
different processes have been mixed. 

 SEVENTH TOOL: SCATTER CHARTS

Figure 21 shows one variable plotted against another. The points
form a pattern which suggests a correlation. 

FIGURE 21. Relationship of Actual Rates of Registration to
Predicted Rates (104 cities 1960).

AN EIGHTH TOOL: CONTROL CHARTS

Figure 23 shows a control chart for the production of a part. The
upper and lower control limits indicate the limits of "normal" or
"usual" production. As long as the data points fall inside these
limits, the operator (and the manager) should leave the process
alone. Every process exhibits such variation. The job of the
management is to find out what are the normal limits associated
with this variation and decide whether they need to be improved.

FIGURE 23. Deming, W.E.; Quality, Productivity, and Competitive
Position.

CONSTANT IMPROVEMENT IS THE NAME OF THE GAME

Earlier we commented that meeting specifications is not enough.
Genichi Taguchi has presented an interesting example of why this is
so.(l4). In figure 24 we show the distributions of characteristics
from television sets manufactured by Sony in the USA and Japan .
These characteristics pertain to the color control system.
The vertical bars indicate the specification limits. As indicated
in the diagram, all of the sets manufactured in the USA met the
specifications. They were within tolerances. The sets from Japan
did not meet the specifications. Some fell outside the limits. Yet
when customers were asked, it was found that they preferred the
sets from Japan. Why should this be? 

FIGURE 24. Distribution of quality characteristic for color control
In television sets manufactured by Sony in USA and Japan.


We can understand better why the Japanese made sets are preferred
if we recognize that the vertical line at the center of the diagram
represents the most desirable value. Any deviation from this value
represents a loss. We do not know precisely how to describe this
loss but it makes sense to say that the loss increases as the
distance from the most desired point. A simple loss function is a
parabola as sketched in figure 25.

FIGURE 25. A plausible loss function indicates a loss in quality
proportional to the square of the deviation from best value .

If we multiply this loss function by the distributions the area
under the curve gives the weighted loss associated with the
distributions. As shown in Figure 26 this loss is on average higher
for the US produced sets even though all of the sets produced in
the US were within specifications and some of the Japanese sets
were not! 

FIGURE 26. The area under the curve when the loss function is
multiplied by the distribution function indicates the weighted loss
associated with each distribution. 

There is a fallacy in setting tolerance limits. The difference
between the performance of a set that falls just inside the limits
is not very different from the performance of a set that falls just
outside. Yet one will be sold and the other will be reworked. We
have been so accustomed to using minimum acceptable as a measure of
quality that a deviation from this practice seems strange. As
Dagwood Bumstead has said: That makes a lot of sense if you don't
think about it. 

THE PROGRESSION TO EXCELLENCE

We do not have too much experience in observing how a company moves
from near bankruptcy to excellence. A few companies in Japan went
through the transformation and their stories are given briefly in
reference (15). In general, based on these experiences, it appears
that the transition tends to follow these stages: 

STAGE 0:
THE MANAGEMENT EXPRESSES CONCERN ONLY OVER MARKET SHARE, PROFITS
AND RETURN ON INVESTMENT. 
STAGE 1: 
THE MANAGEMENT IS CONCERNED ABOUT QUALITY OF THE PRODUCT BECAUSE OF
IMPACT ON WARRANTY COST AND CUSTOMER COMPLAINTS, LOSS OF MARKET
SHARE. THE ACTION TAKEN IS TO ADD MORE INSPECTORS. 
STAGE 2: 
MANAGEMENT RECOGNIZES THAT CONTROL OF THE PRODUCTION PROCESS WILL
LEAD TO LESS WASTE AND A LOWER COST TO OBTAIN ACCEPTABLE PRODUCTS.
QC IS ADDED TO MANUFACTURING.
STAGE 3: 
THE RESULTS OF QC ARE LIMITED BY REACTIONS OF PERSONNEL SO
MANAGEMENT BEGINS TO EMPHASIZE QUALITY MANAGEMENT.  MANUFACTURING
INTRODUCES STATISTICAL QUALITY CONTROL.
STAGE 4:
MANAGEMENT ASKS THAT SQC AND QUALITY MANAGEMENT METHODS BE
APPLIED TO ALL DEPARTMENTS WHICH BORDER ON THE PRODUCTION
DEPARTMENT. (PURCHASING, TRANSPORTATION, WAREHOUSING, ETC.) 
STAGE 5:
MANAGEMENT APPLIES QUALITY MANAGEMENT PRINCIPLES TO R&D, AND
TO ENGINEERING. (THERE IS CONSIDERABLE RESISTANCE BECAUSE
THESE DEPARTMENTS HAVE A HARD TIME BELIEVING THEY HAVE
ANYTHING TO DO WITH QUALITY PROBLEMS) 
STAGE 6:
MANAGEMENT RECOGNIZES THAT QUALITY MANAGEMENT PRINCIPLES WILL
BE USEFUL IF APPLIED TO ALL DEPARTMENTS OF THE ENTERPRISE. 
STAGE 7:
MANAGEMENT PROCLAIMS (AND ACTS ACCORDINGLY) THAT 
   "CWQC IS THE COMPANY POLICY" 
  SPECIFICALLY, THIS MEANS:
    QUALITY IS FIRST PRIORITY
    CUSTOMER ORIENTED DECISION CRITERIA 
    PERSONNEL POLICIES RESPECT HUMANITY 
    ALL DEPARTMENTS COORDINATE AND COOPERATE
    ALL EMPLOYEES INVOLVED IN IMPROVEMENT 
    GOOD COMMUNICATION BASED ON
      FACTUAL DATA
      STATISTICAL QUALITY CONTROL 
    SOLID RELATIONS WITH SUPPLIERS 

THE BARRIERS TO PROGRESS

The most important barrier is the image that most managers have of
the enterprises they lead. Figure 27 shows both an organization
chart and a flow chart.

FIGURE 27. An organization chart and a flow chart are two different
"maps" of the organization and its activities. It makes a
difference which one comes to mind when the manager decides to take
an action.

If the manager thinks of the organization in terms of the
organization chart, and tries to improve the situation, it is
likely that one set of actions will be taken. On the other hand, if
the manager thinks in terms of flow charts, a different set of
actions will come to mind. The organization man cannot see the flow
processes for the tree diagram.

TREE STRUCTURES VERSUS FLOW PROCESSES

WHERE ATTENTION WILL BE FOCUSED

             TREE

MOTIVATE PEOPLE
FIND OUT WHO IS WRONG
ALLOCATE RESPONSIBILITY
FIX EVERYONE'S ATTENTION ON
 "THE BOTTOM LINE"
CALL FOR CLEAR MEASURES OF
 PRODUCTIVITY
CALL FOR AND REWARD INDIVIDUAL
 ACHIEVEMENT
GIVE CRISP "MARCHING ORDERS"
"DO YOUR JOB"

          FLOW PROCESS

REMOVE BARRIERS
FIND WHAT IS WRONG
STUDY THE PROCESS TO PREVENT FLAWS
FIX EVERYONE'S ATTENTION ON QUALITY

CALL FOR CLEAR MEASURES OF QUALITY

CALL FOR AND REWARD GROUP
 ACHIEVEMENT
ESTABLISH WELL DEFINED PROCEDURES
"HELP ME TO HELP YOU TO DO YOUR JOB"

THE SECOND PRINCIPLE IN QUALITY MANAGEMENT

A person who sees the organization in terms of a tree diagram will
often try to improve the system by a technique such as "Management
and Objectives". Of course it is a good idea to have objectives and
to manage in such a way as to try to achieve them. It is also to
discuss objectives with the people who report to you. For one
thing, you need to know if their objectives are consistent with
your own. Many people advocate going beyond that: They propose that
each manager negotiate with the next level down and set targets for
personal achievement or the achievement of an organization. Setting
such targets removes from manager the responsibility to improve the
system. Observations of the results of such activities suggests the
second principle, also known as the Perversity Principle:

THE SECOND PRINCIPLE IN QUALITY MANAGEMENT

(THE PERVERSITY PRINCIPLE)
IF YOU TRY TO IMPROVE THE PERFORMANCE OF A SYSTEM
OF PEOPLE AND MACHINES BY SETTING NUMERICAL GOALS
AND TARGETS FOR THEIR PERFORMANCE, THE SYSTEM WILL
DEFEAT YOU AND YOU WILL PAY A PRICE WHERE YOU DID
NOT EXPECT IT.

This principle goes down hard with most audiences. Those who have
learned to manage through flow charts and according to the first
principle, undersigned it. Those who continue to see the world as
though all organizations operated according to tree diagrams find
the idea too strange to adopt. 

CONCLUSION - A PARABLE

I am indebted to Lewis A. Rhodes of the Association for Supervision
and Curriculum Development in Alexandria, Virginia for this little
story.

Once upon a time there was a captain of a ship who carried cargo
between San Francisco and Tokyo. He followed a straight line on the
map, as shown below.

One day a passenger by the name of Deming came aboard and said,
"Captain, why don't you follow a route like this?" and he drew a
curved line as shown in the next figure.

The Captain was not amused. He said, "Look here. I do not have time
to follow such a route. I do not have the fuel. My customers are
waiting. Everyone knows the shortest distance between two points is
a straight line. I tell my men to keep the compass heading right on
Tokyo. A straight line means a good bottom line." 

Dr. Deming got off the boat in Tokyo and he began to teach the
Japanese captains how to navigate. They followed the polar route.
After a while the American captain noticed that his competitors
were offering lower rates and faster service.  He
became quite agitated and when in Tokyo harbor he demanded to
inspect the other ships. He found to his amazement that they had
the same power plant, the same hull design, the same amount of
cargo space. The only thing he noticed was that the crew seemed to
be going about their work with a certain confidence. "That's it,"
he said, "it's cultural." 

The one thing the Captain did not examine was the image of the
world that was in the other Captain's head. He did not recognize
that if you have a polar projection of the Earth you see things
differently than if you have a Mercator projection. 

Too many managers still operate from the premises of the flat earth
society. The techniques are there to be used. They are simple,
probably simpler than many of the methods now in use. They are easy
to learn. All it takes is to abandon the idea that the Earth is
flat. 

REFERENCES



1. Pirsig, Robert M. Zen and the Art of Motorcycle Maintenance. New
York, Morrow Publisher (1974) 

2. Garvin, David A., "Quality On the Line", Harvard Business
Review, Sept-Oct,1983, pp 64-65 

3. Takamiya, Makoto "Japanese Multinationals in Europe: Internal
Operations and their Public Policy Implications':
Wissenschaftszentrum Berlin, September 1979
(Discussion Paper Series, International Institute of Management) 


4. Feigenbaum, Armand V. "Total Quality Control': 3rd Edition,
McGraw Hill Book Company, New York, (1983) 

5. Harbour, James and Associates. Presentation for "Quality Day'
Jackson Community College, Jackson, Michigan, September 1982 

6. Harbour, James and Associates, Automotive Industries Magazine,
May 1983

7. Georgescue-Roegen, Nicholas, "The Entropy Law and the Economic
Process' Harvard University Press, Cambridge, MA (1971) 

8. Tribus, Myron, "Thermostatic and Thermodynamics, An Introduction
to Energy,Information and States of Matter' D. Van Nostrand Co.,
Princeton, New Jersey(1961) 

9. Hunter, Stuart J, "Theory Sigma" a privately circulated paper
postulating that there exists in every place of work a vast
quantity of information that is ignored and could be used to
predict and prevent flaws but is treated as "noise" and not
subjected to proper analysis. (1983) 

10. Shewhart, Walter, "Economic Control of Quality in Manufactured
Product" D. VanNostrand Company, Inc., New York (1931) 

11. Deming, W. Edwards, "Quality, Productivity and Competitive
Position' Center for Advanced Engineering Study, MIT, Cambridge, MA
(1982) 

12. Stueart, Robert D. and Eastlick, John Taylor, "Library
Management' Libraries Unlimited, Inc., Littleton, Colorado (1981) 

13 . Fuller, F. Timothy, "There's Just Not Much Work In Anything",
Presented at the Second Ellis Ott Conference, March 20, 1988, New
Brunswick, NJ. 

14 . Taguchu, Genichi, "The Role of Meteorological Control for
Quality Control" (Privately released) Available from the American
Supplier Institute, Inc., Romulus, MI 48174