Deming's System of Organizational Knowledge

Understanding Your Organization

(Also known as Deming's System of Profound Knowledge)

Deming's System of Organizational Knowledge

Make sure that you're heading in the right direction.

© iStockphoto/Fertographer

Because of recent budget cuts, Janet asked her assistant to find the cheapest flights and rental cars whenever he's organizing trips.

However, problems quickly surfaced from this seemingly innocuous goal.

The cheapest flights involved several layovers, which meant that salespeople were arriving at client offices feeling tired, bruised, and demoralized. This affected their performance. Then, if they took a client out for dinner, they were forced to drive them in a budget rental car, which diminished their reputation. Sales were starting to fall.

This simple example highlights what can happen when you don't fully understand how team objectives relate to the overall goals of your organization. Although Janet's assistant was meeting his objective of saving money, it was affecting the company's overall performance.

This is where Deming's System of Organizational Knowledge is useful. This model helps you think about your organization from a general perspective, so that you can meet your team's objectives in a way that is consistent with your organization's goals.

About the Model

The System of Organizational Knowledge (also known as Deming's System of Profound Knowledge) was created by W. Edwards Deming, an American professor and consultant, and published in his book "The New Economics for Industry, Government, Education" in 1994.

The model helps you look at your organization as a whole. From there, you'll have a better understanding of how your team's actions affect other parts of the organization, and you'll see how the work you do helps your organization reach its overall objectives. You'll also be able to work more effectively with other parts of your organization.

The model can also help reduce internal competition between teams and departments, as it makes it clear that all of the parts of an organization should work together and reinforce one another to accomplish objectives.

According to Deming, when you apply the model, you will also find new meaning in your work and in your interactions with others, which can then lead to increased job satisfaction.

To apply the model, you need to have an understanding of each of the following areas of your organization. These areas are interrelated, as shown in figure 1, below. This shows that changes in one area can have an effect on the other areas.

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