The Deming Prize was established by the Union of Japanese Scientists and Engineers (JUSE) in 1951. It was awarded only to Japanese companies from the moment of its establishment until 1984. JUSE decided to award the prize to foreign companies in 1984. The Deming Prize is the first and the most prestigious of all awards for quality that exist today.
The Deming Prize
The purpose of the Deming Prize is to promote the development of total quality management systems (TQM) and to encourage the application and development of quality tools or statistical methods that allow improving the work in organizations.
The Deming Prize is awarded in 4 categories:
- The Deming Prize for Individuals. The Prize is awarded to individuals (or a group of individuals) who have made an outstanding contribution to the study and development of Total Quality Management (TQM) or statistical methods. Also, the prize is awarded to those who have made an outstanding contribution to the dissemination of TQM.
- The Deming Distinguished Service Award for Dissemination and Promotion (Overseas). This nomination was established in 2009. It is awarded to individuals (or a group of individuals) for distributing and promoting TQM outside Japan.
- The Deming Prize. It is awarded to organizations that apply TQM. TQM system must correspond to organization management philosophy, business area (type) and organization environment. Any organization can receive the Deming Prize in this nomination regardless of the type of business, size and location.
- The Deming Grand Prize. This nomination is awarded to organizations that have already won the Deming Prize and continue to develop TQM system. Organizations can participate in this nomination only three years after winning the Deming Prize.
Several committees consider the request of candidates:
- Deming Prize Committee. Determines the winner among the candidates based on the examination answers.
- The Deming Prize for Individuals Selection Committee. Reviews and selects candidates for the Deming Prize in an individual nomination (the Deming Prize for Individuals for outstanding services in the distribution and promotion of TQM).
- The Deming Prize Examination Committee. Considers and selects candidates for the nomination of the Deming Prize and The Deming Grand Prize.
- The Deming Prize Steering Committee. Determines the policy and the scheme of work, coordinates the activities of the committees and reviews the rules (if necessary).
The assessment of organizations is carried out according to a number of criteria. Before 2018 the composition of the criteria was divided into three types Ц "Basic Categories", "Outstanding TQM Activities" and "Roles of Top Management".
The basic categories include the following composition of criteria:
1. Management policies and their deployment regarding quality management. This criterion contains two components. The first component evaluates how the organization's policy reflects the principles of management, the scope of the organization's activities, the business environment. It also evaluates the setting goals and strategies focused on quality and customer satisfaction. The second component evaluates how the organization deploys and applies the policy within its divisions and ensures the integrity of its implementation.
2. New product development and/or work process innovation. It includes two sub-criteria. The first sub-criterion evaluates the actions of the organization related to the development of new products (including maintenance) and/or innovative production processes. The second sub-criterion evaluates how new products can meet the requirements of customers. It is evaluated the contribution to improving the efficiency of business management for innovative processes.
3. Maintenance and improvement of product and operational qualities. The criterion contains two sub-criteria - daily management work and continuous improvement. According to the first sub-criterion, it is estimated how the organization achieves the preservation of product conformity due to the standardization of current work and training of personnel. The second sub-criterion evaluates the planned and continuous work to improve the quality and other aspects of the activity. It is carry out the assessment of the goals achievement to reduce defects and inconsistencies in the processes. Also, it is checked the improvement of the customer satisfaction rating.
4. Establishment of systems for managing quality, quantity, delivery, costs, safety, environment, etc. According to this criterion, it is evaluated which management systems the organization uses and the effectiveness of the use of these systems.
5. Collection and analysis of quality information and utilization of information technology. According to this criterion, it is evaluated the effectiveness of the collection and application of product quality information, the use of statistical methods for its processing, the use of information in the development of new products and the improvement of current (operational) activities.
6. Human resources development. It is evaluated the planned and continuous work of the organization for the training and development of personnel and the impact of this work on improving the quality of products and current activities.
The "basic category" criteria relationship is shown in the figure:
Each of the "basic category" criteria is evaluated according to four aspects - efficiency, consistency, continuity, completeness.
Numerical evaluation is performed on five levels:
- 1st level - actions are not performed;
- 2nd level - bad;
- 3rd level - good;
- 4th level - excellent;
- 5th level Ц exceptional. It is a benchmark for comparison with other organizations.
Each of the levels contains a range of numerical values. These values depend on the maximum number of points that set for each of the criteria. The maximum number of points for all criteria of the "basic category" is 100 points.
"Outstanding TQM Activities" include the following criteria composition:
1. Top management's vision and business strategies. This criterion evaluates the top management participation in the TQM system, the presence and implementation of the future state vision of the organization and policy to achieve this state.
2. Creation of values for the customers. The organization's activities related to the development of a quality management system, the creation of value for the customer, the development of technological systems for the creation of new products and services are evaluated according to this criterion.
3. Remarkable improvement of organizational performance. This criterion evaluates the organization achievements in quality improving, increasing productivity, speed of work and reducing the cost of production, preserving the environment and safety.
4. Establishment of the management foundation. It is evaluated the technological capabilities improvement and key competencies, the speed of reaction to changes in the business environment, the strengths of human resource development, the strengths of the use of information systems.
"Outstanding TQM Activities" criteria are evaluated in three aspects - efficiency, repeatability, innovation.
Each aspect can be evaluated on a 5-point scale:
- 1 point Ц not implemented yet;
- 2 points - implemented, but not significantly;
- 3 points Ц mostly implemented;
- 4 points - implemented;
- 5 points Ц fully implemented.
This scale is intermediate and evaluates the aspects implementation within each criterion.
The final evaluation of the criteria is also carried out on a 5-point scale:
- 1 point Ц no action;
- 2 points Ц actions are performed, but not everywhere and not always;
- 3 points Ц actions are performed well;
- 4 points Ц actions are performed perfectly and form the basis of key technologies;
- 5 points Ц actions are exceptional. They are a benchmark for comparison with other organizations.
The maximum number of points for "Outstanding TQM Activities" is 5 points.
The last criterion is the "Roles of Top Management". This criterion evaluates the understanding and enthusiasm of top management in the TQM system implementation, the ability of top management in leadership issues, vision, strategy and strengths of the organization, staff development and social responsibility. The assessment is carried out on a 100-point scale.
The scheme of organizations participation in the Deming Prize is as follows:
The organization submits request for Prize participation and fills necessary documents. The committee overview and evaluate these documents. The reports with the highest number of points are considered as candidates for the Deming Prize. The organization must score at least 70 points in the "basic categories", at least 3.5 points in the "Outstanding TQM Activities", at least 70 points in the "Roles of Top Management" in order to be included in the candidates list. The committee selects the best reports and then performs on-site inspection. The Prize takes place after selecting the best candidate.
The participation in the Deming Prize is structured differently for individuals. An individual must be recommended by the Prize committee members or apply request independently in order to participate in the award. A "self-nominee" needs to fill out and submit a report to the committee. The Committee evaluates and compares candidates based on information about their activities and reports. The Deming Prize for individuals is awarded the best one of the applicants.
More detailed information about the Deming Prize can be found on the JUSE website.