When Dr. Deming Applauded a Canadian Business for Good Management

TODAY IS CANADA DAY, the day we Canucks celebrate the birth of our nation at a conference in Charlottetown, Prince Edward Island in 1867. It’s also a time worthy of recalling a short story from Out of the Crisis where Dr. Deming applauded the management at Reimer Express Lines, Ltd., for their observations and thinking about their operations and how to improve them. It’s also a good example of how Deming’s theory of management could be applied to the service industry.

Based out of Winnipeg, Manitoba Reimer’s tractor trailers were a mainstay on Canadian highways that many road-trippers will no doubt remember seeing. Sadly, after 67 years in business, they went defunct in 2019 after merging with a larger company, YRC Freight, which took over the brand and liquidated assets. While no longer with us, they provide a Deming-approved example of good management.

Our story begins part-way in to Chapter 7 of Out of the Crisis where Dr. Deming opens with a reminder (above) that was given to drivers at Reimer that business relationships are fragile and business can be easily lost with “gnarly service or looking like a vagabond”. Deming notes this isn’t a useless exhortation that he’d warn about - these are things directly within the driver’s ability to control. However, what happens when it becomes difficult to maintain that relationship because of problems the driver cannot control?

Dr. Deming describes a letter he received from Donald S. Reimer and John W. Perry, CEO and a top manager of Reimer, retelling some of their early experiences and successes improving their management. It began with a survey they gave to each of their 35 city drivers that asked:

How, in one sentence, would you describe the business we are in?

They got 32 different responses and none seemed to address what management expected. Two were highlighted:

The truck business. (This could mean that we are in the business of buying and selling trucks. No indication of requirements or standards that apply to our business, which is service.)

Transport business. (This could mean that we transport people by train, bus, or air, or that we sell buses.)

Deming, W. Edwards. Out of the Crisis (The MIT Press) (p. 194). The MIT Press. Kindle Edition.

Pause here for a moment: what would happen if you asked a similar question in your organization? What answers would you expect from colleagues and employees? Why?

This is a brilliantly simple and effective way to diagnose how well you have communicated the AIM and PURPOSE of your business to everyone. The deviations from your expectations are sources of COMMON CAUSES of variation and can be the source of all kinds of trouble in processes.

Reimer and Perry’s letter goes on to explain what leadership did next to explain their business as a service, and by working to understand the plight of drivers providing that service, including an example of management doing what for all intents was a Genba exercise with a driver. I’m reproducing this verbatim from the book, emphasis mine:

When we started to dig deeper, in a question-and-answer session with the men, I began to describe service as a process. To complete a service we must also complete various segments of our activities to ensure that the process is successful. For example, to suggest that we are in the freight business without any exposure to the services that we can provide between Eastern Canada and Western Canada is really missing the point.

It is up to the management to help the employees to understand that they are an important part of the overall business activity, the activity being service. So we worked for a few weeks with our drivers in Eastern Canada in reference to linking their pick-ups to our line-haul operations and to delivery in cities 1500 or 4000 miles to the west.

We have found that frustrations over various problems of drivers have disappeared as we improve the process, in contrast with acceptance of frustrations from trying to solve effects and not to get rid of causes. I should like to give you one small example.

Recently in Vancouver our terminal manager travelled with a different driver each day. He called me up one day excited about one driver, who, for a number of months, both he and the despatcher had deemed to be hopeless in productivity. Travelling with this driver, the manager noted that the radio was not working well. Vancouver is very hilly, and this driver served a number of our customers in the valleys, in which the reception was poor or non-existent. When the manager looked into it, he discovered that the driver had complained a few times to our local supervisors about radio reception, but we had not listened. The driver often had to drive miles out of his route to get out of the shadows of the hills, to seek audible reception in order to report a problem in collection or delivery, and to keep in touch with the despatcher.

Deming, W. Edwards. Out of the Crisis (The MIT Press) (pp. 194-195). The MIT Press. Kindle Edition.

In this example, management had formulated an opinion about a driver’s productivity without first understanding the system constraints they operated under, which was tied to the physical geography of his routes and radio technology of the day. Management held responsibility for the outcomes of the system they had designed for this driver, and by riding along they discovered firsthand the COMMON CAUSES of variation that were at play affecting the reliability of his schedules, things that were outside of his control to change — a good reminder about Deming’s observation, again from Out of the Crisis:

No amount of care or skill in workmanship can overcome fundamental faults in the system.

(3rd ed., p. 315)

In this case, it’s pretty difficult to overcome Canadian geography near the Rockies, even with modern cell towers and satellite communications as the “shadows” can still persist, as anyone with Sirius XM in their car can attest.

This was a refreshing read for me as I recalled Reimer and the role they played in building the Canadian economy by providing a vital service for moving goods large distances. Much of our history is founded on transportation from railways to shipping and trucking, each in a lattice of interconnections and interactions like intermodal freight. What was most inspiring was to see how Canadian business leadership took a keen interest in improvement of their management practices, even in a short anecdote about asking a simple question to learn a great deal about making their business work reliably. That the Good Dr. Deming gave them an approving nod is something to take pride in and remember on this Canada Day.

Consider Deming’s recounting of Reimer’s letter and how they began to improve their leadership by asking their drivers a basic question, and what that uncovered.

• What type of responses would you get from frontline workers in your own organization or business if asked that same question?

• How would you answer this question?

• Consider a time when you observed someone labeled a poor performer or problem employee. Was anyone in management “riding along” with them to understand their challenges, or just offering judgements? What was done to help them? What were the outcomes? What could have been done differently?

• Consider the driver who was unfairly labeled a poor performer and whose complaints went unheard until their manager rode along with them to witness the COMMON CAUSES of variation they had to contend with (mountains, radio) to make deliveries and keep in touch with dispatch. What similar circumstances have you observed where COMMON CAUSES are blamed on employees who can’t influence them? Has any manager “rode along” to learn?

As always, sound off in the comments below, and HAPPY CANADA DAY to all my Canadian subscribers: your continued support is really appreciated!