I remember a story about cooperation. It could have been in 1903. There was a big fire in Baltimore. Fire departments in New York put their equipment and men on 28 flat cars to rush themselves by train to Baltimore to help put out the fire. When they arrived, they found their endeavour to be useless. The threads on the firehoses would not fit the hydrants in Baltimore.
There are two lessons here. The first lesson is cooperation: one fire department rushing to help another. The second lesson is cooperation in the form of standardization. We take standards for granted. The world was not made with standards. Standards must be made by man. Without standards, our life would be primitive. Examples are couplings for fire equipment. Other examples come readily to mind:
The time of day, based on Greenwich mean time, used the world over.
The date, fixed by the international date line, observed by everybody.
Red and green traffic lights, the red light above the green, the same the world over.
The metric system.
Sizes of batteries. If I need a AAA battery, I may buy it anywhere in this world, and it will fit.
The gauge of our railways. A car may move from Halifax to Montreal to Boston to Chicago to Miami to El Paso to Los Angeles to San Francisco, Portland, Seattle, Vancouver, Calgary, Saskatoon, Winnipeg, Duluth, Minneapolis, down to Chicago. All this is possible because of the standard English gauge (56½ inches) between cities, same air brake system, same coupling between cars.
Meetings of professional people, such as this meeting of the Fire Chiefs for interchange of aims and knowledge.
Journals of professional and scientific people, for exchange of new knowledge with the rest of the world, competitors and all.
From an address to the International Association of Fire Chiefs, Toronto, September 22, 1991.
- Deming, W. Edwards; Orsini , Joyce (edited by); Deming Cahill, Diana (edited by). The Essential Deming: Leadership Principles from the Father of Quality (pp. 91-92). McGraw-Hill Education. Kindle Edition.
WE HAVE PREVIOUSLY explored Dr. Deming’s thinking around cooperation and competition, learning about his preference for win/win competition and how erstwhile competitors can keep many more customers happy by working together than apart. Just the other day I came across a news release from a well-known craft brewer in Ottawa who is partnering with another in Toronto to combine their marketing and distribution teams to help each other get more product to market and sustain each other’s businesses. An example, though I imagine their leadership may be unaware, of constancy of purpose to remain in business and provide jobs.
In today’s post, we’re considering the other aspect of Deming’s view on cooperation as facilitated by voluntary standards that come from either industry working together or in conjunction with government. In The New Economics, Deming writes “standardization is something that all of us take for granted", providing customers with access to products that are useable and serviceable across the country along with better competition for price and quality:
We ship an electric washer across the country with our household goods with never a conscious thought but that it is sure to meet the same voltage and current wherever it is plugged in. Our incandescent lamp finds the same socket in Springfield, Vermont, and Springfield, Illinois. The 15/34 shirt we send as a present from Iowa will fit the neck and arms that grew up to size in Virginia. We drive an automobile from coast to coast under uniform traffic signals. In Chicago we buy a tire that was made in Akron, and it will fit the wheel (made in Pittsburgh) of the car (built in Detroit) that we bought in New York.
The ratio of focal length to diameter of a lens (e.g., 2.8) is understood everywhere. We may buy an AA battery anywhere in the world to replace the one that just became too weak for service (though the quality of battery may differ markedly from brand to brand). The convenience of 110 volts and uniform outlets everywhere in the northern hemisphere would be difficult to express in words.
Competition for price and quality is not stifled by standardization.
Deming, W. Edwards. Out of the Crisis (MIT Press) (p. 300). The MIT Press. Kindle Edition.
While he lauded the capabilities voluntary standards within industry could provide, Deming was not so keen on involving government as the sole arbiter, however, observing (in his usual way) “I do not want my talented, capable, and sincere friends in the federal agencies in Washington to write the industrial standards of this country. Too much is at stake.” It was his preference that standards bodies, like the American Standards Association provide the framework or “machinery” to enable concerned industry partners to arrive at a standard together to enable economic benefit for businesses and consumers.
Contribution from William G. Ouchi: In Order to Compete, Learn to Cooperate
Of course, business and industry in the modern frame of the prevailing style of management (win/lose) will often miss opportunities to collaborate, as Deming relates in both The New Economics and Out of the Crisis, with a story from William G. Ouchi’s 1984 book, The M-Form Society, about the difference in quality of cooperation on regulations by industry in Japan and the US drawn from an annual general meeting of the US Trade Association where Ouchi was a guest speaker. 300 industry leaders had gathered in Florida for talks punctuated by a round of golf at noon one day, and fishing the next. On the third day, Ouchi blasted them:
While you are out on the golf course this afternoon, waiting for your partner to tee up, I want you to think about something. Last month I was in Tokyo, where I visited your trade association counterpart. It represents the roughly two hundred Japanese companies who are your direct competitors. They are now holding meetings from eight each morning until nine each night, five days a week, for three months straight, so that one company’s oscilloscope will connect to another company’s analyzer, so that they can agree on product safety standards to recommend to the government (to speed up getting to the market place), so that they can agree on their needs for changes in regulation, export policy, and financing and then approach their government with one voice to ask for cooperation. Tell me who you think is going to be in better shape five years from now.
Deming, W. Edwards. Out of the Crisis (MIT Press) (p. 307). The MIT Press. Kindle Edition.
Indeed!
Connect the Dots
Voluntary standards, when considered in the full context of Deming’s philosophy, are entirely consistent with his thinking about operational definitions, quality, cooperation of components, and teamwork which are based on a whole-system view. In The New Economics, he elaborates on his Production Viewed as a System diagram noting you could draw boundaries around it to define a “single company, or around an industry, or as in Japan in 1950, the whole country”. Ouchi’s story about Japanese companies, he observes is based on a view of industry as a whole system. We might imagine it as below, with each Japanese company who is providing input having their own system boundary describing the interactions of components to fulfill developing a standard or policy change to enable compatibility or interoperation, for example.
Reflection Questions
How does your organization or business benefit from standards? What economic activities do they enable? How have you observed standards being avoided for advantage over competitors or to stifle innovation? How would the intervention of government redress or exacerbate this situation? How feasible would it be to see the level of cooperation William Ouchi described in our industries today? In what ways has it already occurred? In what ways has it not?