Hey Japan Inc., It’s Time To Wake Up


Japan has had a few years of minimal growth, though it shrunk in the first quarter of 2018, the country is still entrenched in another potential lost decade. Rising unemployment, stagnant GDP, and a terrible demographic future, the country that dominated the 1960s through 1980s has forgotten the source of its success.

Old ways die hard, and a reluctance to change may keep Japan stuck in another decade of minimal growth. The problem with Japan is the same problem that happened to the U.S., arrogance and a focus on profits rather than quality and customers.

Prior to WWII, U.S. products were known around the world for high quality and meeting customer needs. Things changed after WWII. As the only major country which emerged post WWII with industry still intact, the U.S. was able to sell anything it produced; there was barely any competition. Corporate executives changed the focus from quality to sell, sell, sell. As the Americans pumped out low quality products the Japanese were setting the stage for phenomenal success. Based on the teachings of Dr. W. Edwards Deming, Japan was able to change the country’s reputation as a producer of low-quality junk, to creating high-quality products and services that exceeded customer expectations.

Deming arrived in Japan in 1950. The country was in ruin and had a global reputation for producing low-quality products. Deming showed Japanese industry leaders that a focus on quality and customers could change the reputation of Japanese products in 5 years. Deming told the leaders to not focus on costs and profits, just focus on quality and providing customers with products and services they truly needed. Profits would follow. The Japanese followed Deming’s teachings and changed the country in 4 years – one year earlier than predicted.

Decades of success resulted in high levels of arrogance. Just like the Americans before them, the Japanese forgot the importance of quality and customer focus, and focused on cost-cutting and “paper profits” – profits only on planning documents. Then the bubble burst.

The result has been ongoing product recalls, boring product designs all led by unskilled management. A corporate culture of unquestioning obedience to superiors has resulted in “me too” products, lack of creativity and innovation, and employees who only do what they are told. The world has changed but Japan Inc. has remained stuck in the 1960s.

So why this rant? I have lived and worked in Japan, worked for Japanese companies in the U.S. for over 20 years and just got back from two weeks traveling the country. I have a close relationship to the country and an insiders’ perspective on how things are run. And things are not good. Executives and management, who still feel they are the best in the world, refuse to learn new methods of business, and continue to develop products based on constraints rather than market needs. The days of kaizen are long past. Corporate cultures refuse to learn and improve. Employees are out for themselves rather than the good of the company.

The only way for Japan to stimulate long-term growth is to look in the mirror and be honest with itself. As the Americans finally learned after 2008, quality products that meet customer needs and wants are what drive profitability, not false planning numbers. Japanese leaders need to relearn Deming teachings. They need to embrace new ideas from all levels of the organization and move from an inside-out mentality of product development and design, to an outside-in culture driven by the market and consumers.

Japan can easily do this. The country has a highly educated workforce, world-class research institutes, and leading manufacturing technology. All it takes is strong leadership that is willing to change and accept new ideas. Japan did it in the 1950s and the Americans started doing it again about 10 years ago. It can be done, but when arrogance overrides daily business practice, failure is imminent.

As the Japanese population declines, the youth become more-and-more disillusioned, and incumbent corporations hold-on to long-held but failed management policies, Japan Inc. must act. If you think you know more than the enemy and think you are better than the enemy, you are going to lose.

Japanese business leaders need to encourage continuous education and adopt modern business practices. They need to accept outside ideas to free-up resources and meet market demands faster. The solution is simple, but having the will to commit to change is much harder. I hope they wake up before it is too late.

Creating a Fact-based Mindset


The world seems like a pretty crazy place lately. “Fake news” is an ongoing buzzword, causing people to question everything they read, hear, and see. Or worse, too many people are not questioning what they hear. The lack of critical thinking is a serious issue. The widespread and persistent ignorance needs to be addressed. It is time to stand-up and change your corner of the world.

Problems are exaggerated, claims are exaggerated, and true issues are misjudged. Intuitive, emotional judgements are preferred over reason. The use of distortions, exaggerations, or lies remains unchallenged. Too many people present ridiculous arguments based on zero evidence and unsubstantiated claims.

Too many people blindly believe anything they hear. Most people go through life with unsubstantiated beliefs and driven by biases and emotions. It is time to start changing how you interpret the world and become a disciplined and critical thinker.

If you are like me and are frustrated by the poor thinking habits of co-workers it is time to change (the media and politicians are really frustrating, but I can’t change them, yet). It is time for a revolution. It must start with you. Change yourself, first. Recognize bad arguments and learn how to construct good arguments. Understand unconscious cognitive biases that influence how we make decisions. Improve your reasoning.

Watch the Joe Rogan podcast, listen to the Argument Ninja Academy by Kevin deLaplante and watch his videos, and read books like Factfulness by Hans Rosling or Applying Scientific Reasoning to the Field of Marketing by Terry Grapentine.

Use fact-based understanding and data-driven arguments. Keep the following points in mind:

  • Ask reporter questions (who, what, where, when, why, and how)
  • Don’t generalize
  • Look for differences and similarities across (and within) groups
  • Don’t blindly follow the majority
  • Always stay open to possibilities
  • Don’t assume people are idiots
  • Beware of vivid examples
  • Don’t focus on being right
  • Avoid jumping to conclusions – stay calm, be patient
  • Test opinions against data

Improve yourself, learn how to properly consume media, and identify over-exaggerations. Be humble, curious, and realistic about the extent of your knowledge. Do not be embarrassed if you make a mistake or if you do not know something. Be open to new information, actively seek out disconfirming evidence, and realize that things can be both good and bad.

Once you improve yourself, then share the thinking tools with co-workers and help them improve their arguments. Hunt out ignorance within your organization and demonstrate the value of data, evidence, testing and experimentation. Embrace ongoing discussions, arguments, and collaboration between cross-functional teams; the different perspectives, talents, and knowledge will strengthen decisions and improve your business.

And if someone still uses poor logic, or emotions to argue their belief, challenge them. And if they think the world is flat, or the environment is not warming, just tell them to make sure their doctor does not bother to wash her hands the next time you go into surgery. Ignaz Semmelweis would be proud.

The Myths of Creativity

Many of us believe that only certain people can be creative or creativity happens serendipitously (i.e., it just happens). Yes, some people are more creative than others are, but everyone can be more creative. Creativity is a skill. Like any other skill (e.g., skiing, guitar playing, painting), the more you learn and practice, the better you will become. With the right tools, techniques, and regular practice anybody can become more creative and innovative.

Creativity is about gathering information, letting it incubate inside your brain, and then allowing the unrelated “dots” to connect. This process allows the raw pieces of information to reform into creative ideas. Creativity does not just happen. It is the result of multiple experiences and perspectives, and the long, hard effort of learning and understanding new topics.

Several myths often restrict people from developing new, productive and innovative ideas. Remember, creativity is a skill. Just like playing the piano, juggling, or riding a motorcycle, you get better through practice. Anyone can do it. Ignore the following myths.

The Eureka Myth states creativity happens by chance, serendipitously. Yes, a creative idea often “appears” when you are not thinking about it. This idea usually appears as the information regarding the problem “incubates.” As you avoid thinking about the problem, the various unconnected pieces of information develop into patterns, unconsciously. Then, “Eureka” a new idea pops into your mind; usually when you are not thinking about the problem (e.g., in the shower, while hiking).

The idea did not just happen. It happened due to the past research, study, and investigation; all the previous thinking you did on the subject (Kramer, 1987). It was your hard work and effort finally coming to fruition (and the series of “sparks” which slowly build upon each other) (Sawyer, 2007).

The Expert Myth is one of the most popular excuses for not being creative. The myth states only people with the “creative gene” are creative. This myth has been popularized by the assumption that “creative celebrities” such as Thomas Edison, Bill Gates, Steve Jobs, and Elon Musk, are very different from most people. The problem with this myth is it ignores all the research, hard work, and practice each of these people did to achieve their famous innovations (and all the previous work from many individuals and groups) (Sawyer, 2007). Many leaders think only certain areas of the organization are creative.

Do not believe that the only creatives work in research and development (R&D) or marketing (i.e., typical “creative” departments). This narrow-mindedness results in missed opportunities in all departments and all levels of the organization. You can uncover new, valuable ideas in accounting, finance, logistics, information technology (IT), and other “non-creative” departments. Creative ideation only requires focus, an open-mind, and hard work (along with effective tools and techniques). Creative thinking must happen in all areas of the organization; continuously, every day.

Yes, some people are more creative than others. These “natural creatives” typically can “connect the dots” of unrelated items easier than most people or identify trends early. However, creativity is a skill, and you can get much better at it using a deliberate and systematic process, along with regular practice. Also, most ideas become valuable innovations through teams, not an individual. It is typically not just one person that creates innovative new products and solutions but a team.

The Reward Myth states the only way to develop good ideas is to incentivize people. Often leaders will challenge teams to innovate with extra vacation time, financial rewards, or job promotions. Yes, incentives could stimulate ideation, but the real influence is typically internal (i.e., inside of you). Incentives only work short term. For long-term creative projects, the inner drive, fortitude, and desire are what compels someone to work day and night, month after month, to create amazing new products or services, improve existing processes, make impactful decisions, or solve complex problems.

Similar to the Expert Myth, the Lone Wolf Myth wrongly assumes that one person, locked away in a laboratory, shed, or garage, develops innovative products or solutions. The truth is that teams develop the majority of great ideas, inventions, and innovations. Thomas Edison had a large team working on many different problems and developing multiple solutions simultaneously. Edison was a great showman, and most people thought he created everything himself; actually, Edison developed the first product incubator which had multiple teams working on various projects until the problems were solved (i.e., the original Silicon Valley; just located in New Jersey). Possibly Edison’s greatest achievement was designing work environments where teams could collaborate, fail, learn, and create amazing innovations (Johnson, 2014). The majority of great innovations are the result of collaboration, with multiple perspectives focused on the same goal. Remember, it was not one person who got the astronauts to the moon. Individuals often develop new ideas, but teams typically refine ideas into innovative solutions.

The Start-up Myth states that only small, flexible organizations can innovate. These agile organizations with few rules allow employees the freedom to develop creative ideas and build innovative new products. Too many people believe large, bureaucratic organizations cannot innovate. Do not believe the myth. Any organization, no matter the size can develop an army of creative innovators. All it takes is support from upper management, training, and an environment that focuses on managing risk, embracing failure, and continuously experimenting.

Apple, Ford, Microsoft, Proctor & Gamble, and other large organizations prove that it is not about the size, it is about leadership and organizational culture. Creativity is about thinking differently. A creative organization encourages people to think differently and continually improve (Zaltman, 2003). Ignore these myths.

Focus on learning and practicing the proven tools and techniques within this section. Develop new creative ideas and turn them into innovative solutions. Anyone can be more creative. Just like any skill, becoming more creative takes time, patience, and lots of hard work and failure. Never accept someone telling you something is impossible. The effort, desire, skill building, daily practice, and lifelong learning will allow you to do amazing things. You need to be committed.

Statistical Significance vs. Practical Significance

A key driver of statistical significance is sample size. One issue with statistical significance is that with a large population, you will most likely determine statistical significance (i.e., any difference or any correlation will be significant). The differences between any sample means will be significant if the sample is large enough. However, when conducting real-world research, statistical significance does not always equate to practical significance (or vice versa). You need to ask the question, “Can you use the statistically significant (or insignificant) results in a practical, real-world application?”

Significance tests are not always valid due to faulty data collection, outliers, or other variables that might invalidate your data. You typically use costs, timing, skills, resources, or your research objectives to determine practical significance. Just because your results indicate statistical significance (i.e., the p-value is lower than the significance level (a)), the data might not be valuable for decision-making.

A statistically significant result only determines your evidence against the null hypothesis, not necessarily if the results apply to real-world decision making. Statistical significance does not guarantee practical significance. A few questions to ask when determining the applicability of results is:

  • How much significance does the difference have statistically and practically?
  • How will the results affect the business?
  • Is the difference large enough to be valuable in the organization?
  • Are the differences between samples big enough to have real-world meaning?
  • Can you afford to make changes based on the findings?
  • Can you afford not to make changes based on the findings?

For example, you set your significance level at 0.01. The resulting p-value is 0.015. This p-value is not statistically significant (0.015 > 0.01), and you do not reject the null hypothesis. However, the difference between 0.015 and 0.01 is not excessive regarding your research topic. For practical application, you determine to use the findings (i.e., reject the null hypotheses). The result is not statistically significant, but can still be practical in addressing your real-world research objective.

Moreover, the opposite can also be true. Your results can be statistically significant, but not practical. For example, you want to know if targeting college students between the ages of 18 and 21 years will increase sales. Your p-value demonstrates a statistical significance; however, you decide the effort and cost to pursue these potential target customers is not practical. The possibility of a 3% increase in sales does not greatly affect profitability regarding the effort and costs of acquiring these customers.

Even though the data resulted in a statistical significance, it is not practical to pursue. Do not let your statistical results drive your decision-making. You must take a holistic view of the data, along with subject-matter knowledge, intuition, and your exploratory research findings to make practical decisions that will allow you to achieve your research objectives.

Why Brainstorming Does Not Work

Sorry to burst your bubble, but brainstorming is not very effective for developing new ideas. Most research on idea generation has shown brainstorming typically does not result in valuable ideas (Schirr, 2012). Most brainstorms are usually just a group of people haphazardly sharing ideas (Jones, 1995). Even with all the research on the flaws of brainstorming, it is still widely used in most organizations (Sutton & Hargadon, 1996).

The majority of research has shown brainstorming is not effective in generating quality ideas, as group brainstorming typically inhibits creative thinking (Mullen, Johnson, & Salas, 2010). Research confirms individuals develop a higher quantity of quality ideas individually rather than in a group (Mullen, Johnson, & Salas, 2010). Research has also shown brainstorming is less effective than individual ideation.

Advertising legend Alex Osborn developed brainstorming in the late 1930s. The goal was to generate a large number of ideas to create new advertisements. Osborn felt brainstorming would lower individuals’ inhibitions, reduce self-criticism, and eliminate criticism from others, creating an open environment that allows people to ideate freely. Unfortunatley, most people only use the popularized four main rules for effective brainstorming (Osborn, 1963).

  1. Generate as many ideas as possible
  2. Focus on original or unusual ideas
  3. Do not criticize any ideas

Combine and refine the best ideas. Another aspect is people often organize a brainstorm to push their ideas or agendas deceptively through the group exercise (Isaksen & Gaulin, 2005). The main negativity of brainstorms is the cost. The cost of brainstorming regarding time spent and individual dollars per hour can be the same as throwing money in the trash. There are much better ways to develop new, creative ideas.Unfortunately, most brainstorms are a “one and done” without further follow-up and without continued refinement and implementation of ideas. To develop optimal solutions, you need to modify and refine ideas continually. You typically cannot move through the creative process in a single meeting (Cho, 2013). Most people only learn Osborne’s four rules and ignore his other guidelines for effective brainstorming.

When led by an experienced facilitator with a focused topic, brainstorming can provide some value. It can be a fun way to share ideas, stimulate ideation, and motivate individuals to compete against co-workers to develop the best idea (Furnham, 2000). However, brainstorms often go off topic and result in a large number of useless ideas (e.g., low value, low quality).

So why do so many business leaders still rely on brainstorming to develop new ideas or solve problems? Even when a 1958 study conducted by Yale University and Osborn showed that students working alone developed twice as many ideas than groups (Bailis, 2014). An easy answer is “it just feels right.” Intuitively, it makes sense that a group of people sharing ideas should generate high quality, original, and diverse ideas; unfortunately, this is not the case (Kohn & Smith, 2011). Unfortunately, many of us feel that “two heads are better than one” and collaboration allows you to bounce ideas off each other (Bailis, 2014). Also, managers feel brainstorming is a fair way to allow everyone to contribute ideas and leverage buy-in of decisions (de Bono, 1992). Unfortunately, this attempt at consensus building wastes valuable time and resources. It is much better to allow everyone to ideate individually (using proven tools and techniques), then meet as a group to evaluate and refine the best ideas (i.e., convergent thinking).

Most inefficiencies during a brainstorm session are due to individuals dominating the discussion (i.e., the loudest voice wins), redundant ideas, cognitive uniformity where individuals feel pressure to support other ideas, members giving up on the group, and fear of having ideas evaluated or judged (i.e., the fear of looking stupid) (Isaksen & Gaulin, 2005). Early ideas also tend to have a disproportionate influence on the rest of the discussion (Greenfield, 2014). Also, brainstorming results in high levels of productivity loss and impediments to ideation due to waiting to speak, listening to others, or other aspects of group interaction. (Sutton & Hargadon, 1996). Unfortunately, brainstorms often end in a list of ideas with no closure (Furnham, 2000).

The goal of creative thinking is to develop useful ideas to drive new product concepts, adapt current products for new uses, revise internal processes, or solve complex problems. (Stam, de Vet, Barkema, & De Dreu, 2013). Forming a group and telling everyone to brainstorm will not work and is inconsistent with Osborn’s suggestions (Isaksen & Gaulin, 2005). It is best to ideate individually and then meet as a group to analyze and review ideas, then converge on the best choices using proven and effective tools (Stam, de Vet, Barkema, & De Dreu, 2013).

Lessons from the Chef

I always push people to gain new experiences. Either personally or professionally, you need to get yourself out of your comfort zone. To come up with new ideas and drive improved business practices, new and varied experiences are the key ingredients to success. With the loss of Anthony Bourdain this past week, we lost a source of inspiration and guidance to lead an adventurous life.

Bourdain did not just inform us about great places to eat all over the world. What he left us was the influence to meet new people, try new things, and build our creativity and sense of wonder. Too often, we get into habits and forget to try new things. Do not keep going to the same restaurants or same vacation spot every year.

You do not need thousands of dollars to experience new things. Find a restaurant in a different town you never visited. Visit a museum you would normally never think of visiting. Go to a weird play or movie. Join a club to learn new skills and meet new, interesting people.

Do not sit still and stay stuck in habits. If you want to come up with new ideas and live a full life, you need new experiences. Listen to podcasts, visit your local comedy club, or attend a local event that is makes you uncomfortable.

Get inspiration from other people and try new things. Go on a road trip. Take a bus or train trip to get a new perspective of travel. Bourdain lost to his demons, but he left all of us with an incredible array of work and wonder. Now is the time, do not wait until you are ready. You will never be ready.

The development of new ideas is founded on combining a series of unrelated items. Collecting a wide array of experiences will supply you with lots of new things to think about and build upon. If you want to create an amazing new product or service, improve a poorly operating process, or solve a tough problem, you need a wide variety of perspectives. So hit the road, eat something weird, and enjoy life. You only get one shot at this life, so make it fun and exciting. Make a schedule and do something new and exciting every 4-6 weeks; religiously. No excuses, just keep experiencing life!

Musings from AAPOR


I just got back from the American Association for Public Opinion Researchers (AAPOR) 73rd annual conference. AAPOR focuses on advancing scientific and practice of survey and opinion research. This year’s conference was located in Denver, Colorado. Denver was a great location as there were plenty of great restaurants within walking distance and the weather was perfect.

Founded in 1947, AAPOR is the leading association of public opinion and survey research professionals. The AAPOR community includes producers and users of survey data from a variety of disciplines. Members span a range of interests including election polling, market research, statistics, research methodology, health related data collection and education.

This was my first AAPOR conference. The schedule was jam-packed for several days of panel discussions on various topics. My objective for attending was to:

  1. Understand panels as I am looking into developing one for my organization
  2. Gather insights to improve response scales
  3. Learn new techniques for improved insight gatherings

I attended several excellent panel discussions. The panel discussions were comprised of academics, research professionals, and federal and state researchers (e.g., US Census, USDA, University of Chicago). The first panel discussion was “Surveying Rural America”. It was a great discussion on the difficulties of accessing rural individuals, due to differing definitions of “rural”, internet and/or WiFi access issues, and validation of addresses and phone numbers. A large part of my job is studying the rural consumer; it was good to hear other researchers’ struggles with accessing this valuable segment. Overall, it was a good discussion and provided some food-for-thought when I plan my next trip to rural communities within the U.S.

The next seminar I attended was “Word Up! Exploring Qualitative Data Collection Methods and Use of Qualitative Data to Enhance Survey Insights”. This discussion presented challenges with focus groups and individual in-depth interviews (IDI). As a large part of my work includes qualitative research, and especially individual IDIs, this was a great discussion to learn how others overcome the various challenges of gathering qualitative insights. The speakers also discussed new technologies that can assist researchers to uncover new insights. It was another good discussion to provide me with new ways to think about my next research project.

To wrap-up day 1, I attended “Mixed Methods Approach to Reducing Response Errors Associated with the Usability of Web Surveys”. As the majority of my research projects entail mixed methods (qualitative and quantitative), I was looking forward to learning new tips and techniques to improve my skills. This was a good discussion, but focused more on mixed-modes rather than mixed-methods. Overall it was a good discussion with strong interaction between panelists and attendees.

Day 2 kicked off at 8am with “Building a Multi-Mode Survey Research Panel: Lessons Learned and Future Developments from Be Heard Philly and Be Heard Mile High”. I was looking forward to this discussion as I am considering developing a research panel. This was a great discussion by the folks from Temple University in Philadelphia and the Center for African American Health in Denver. The individuals from Temple shared their struggles and missteps building their panel “Be Heard Philly”. It was a great discussion of what not to do and what to do, when building a panel from scratch. The panel shared examples of the lessons learned and provided excellent tips to avoid the “pain” they experienced. A key struggle for them is the ongoing need to market the panel to the community and increase participation.

The same panel included the lead of “Be Heard Mile High”. Temple University has started sharing their templates and tools with other organizations. “Be Heard Mile High” and “Be Heard Philly” work closely to improve participation and solve ongoing issues. The leader from the Center for African American Health in Denver shared her experiences and the benefit of working closely with Temple University. Overall I learned a lot and the speakers provided great ideas and cautions.

The next discussion I attended was “Running our Questions through the Ringer: Multiple Methods for Evaluating Survey Questions”. The speakers discussed their experience using cognitive interviews and IDIs. There were also several discussions on the use of card sorts and attempting to eliminate respondent confusion during research. One interesting discussion was the use of focus groups to gather information to develop IDIs. This was very interesting for me as I am from the old school of conducting IDIs then organizing focus groups. So the use of a focus group before IDIs was something new.

The final panel of the day (and the conference for me) was “Panel or Wallpaper? How to Cover Your Survey Needs and Other Advice on Starting and Running an Online Panel”. This discussion was another excellent seminar to help me get my head-around panels and determining if they are right for my organization.

The final panel of the day (and the conference for me) was “So Many Choices, Research on Response Scales”. This discussion was heavily attended and kicked off with speakers from GfK. They shared their research and experiments on developing effective response scales. The speakers presented multiple examples of the pros and cons of using unipolar versus bipolar scales, as well as different rating scales and including (or not) anchors – using either text or numerals. The speakers provided many real-world examples and tips to ensure strong validity with your survey questions. I gained some excellent tips to improve my research question development.

Overall the two full days were an excellent time to listen to highly experienced researchers from multiple fields. In addition, the benefit of networking with research professionals allows new perspectives when developing my next research project. Attending conferences outside your industry is extremely important to improve your skills and expand your perspectives. The benefit of gaining new insights and methodologies from experienced research professionals is the best way to grow as a researcher.

The Evolution of the Shewhart Cycle

If you work in a Lean-focused organization, you are probably familiar with the plan-do-check-act (PDCA) improvement cycle. PDCA is a four-step cycle that promoted discipline and structure to promote ongoing learning and continuous improvement. The cycle begins with the Plan step. This involves identifying a goal or purpose, formulating a theory, defining success metrics and putting a plan into action. These activities are followed by the Do step, in which the components of the plan are implemented, such as making a product.

Next is the Check step, where outcomes are monitored to test the validity of the plan for signs of progress and success, or problems and areas for improvement. The Act step closes the cycle, integrating the learning generated by the entire process, which can be used to adjust the goal, change methods, reformulate a theory altogether, or broaden the learning – improvement cycle from a small-scale experiment to a larger implementation Plan. These four steps can be repeated over and over as part of a never-ending cycle of continual learning and improvement.

The history of the PDCA cycle is a unique example of the evolution of a theory and its various interpretations and implementations. Dr. W. Edwards Deming is noted by most as the person who popularized the improvement cycle. The PDCA cycle was based on the Shewhart Cycle.

Walter A. Shewhart, a noted statistician working at Bell Labs to develop the national telephone system. He created a three part cycle in 1939. This three-part cycle was a systematic process for continuous improvement. Shewhart wrote:

These three steps must go in a circle instead of in a straight line, as shown . . . It may be helpful to think of the three steps in the mass production process as steps in the scientific method. In this sense, specification, production, and inspection correspond respectively to making a hypothesis, carrying out an experiment, and testing the hypothesis. The three steps constitute a dynamic scientific process of acquiring knowledge.

When Deming introduced the cycle to the Japanese Union of Scientists and Engineers (JUSE) in 1950, he modified the cycle. He added a fourth step and emphasized to the Japanese engineers the importance of ongoing interaction between design, production, sales, and research. This modified Shewhart Cycle was referred to as the Deming wheel by the Japanese.

Deming discussed the five steps of the cycle:

  1. Design the product
  2. Make it and test in lab and production line
  3. Launch the product
  4. Test it in service via market research and user interviews
  5. Redesign and improve the product given customer’s feedback

After Deming’s work in Japan, the Japanese modified the cycle and renamed it the Plan-Do-Check-Act (PDCA) cycle. The four-step process focused on creating and modifying process standards to prevent mistakes. Deming instilled in his students that everything must be perceived as a process. Most problems are due to the process, not human error. This PDCA cycles was a key tool for kaizen, or continuous improvement. And became popular from Masaaki Imai’s famous book Kaizen: The Key to Japan’s Competitive Success and the success of the Toyota Production System.

Dr. Ishikawa, the creator of the fishbone diagram and leading authority on the Quality Movement, modified the cycle in 1985. He included goals and targets with the Plan step as well as ways to achieve the goals. Ishikawa added education and training to the Do step for improved implementation. Proper control of the process according to Ishikawa was continual revision of standards based on the voice of the customer (VOC). This was based on Deming’s initial teachings that everything is a process and the standards that support the process must continually be revised and improved.

Along with the additional variables, Ishikawa added key statistical tools to develop quality. Examples of typical Lean tools used in a PDCA cycle are check sheets, histograms, Pareto charts, fishbone diagrams, scatter diagrams, and other tools for statistical process controls.

In 1986 Deming reintroduced the four-step Shewhart Cycle. As Deming promoted this model in his 4-day seminars, he warned denounced the PDCA Cycle. Deming based this on the English definition of “Check” means “to hold back

Deming never embraced the PDCA cycle. He warned that PDCA was not accurate. He felt that the English definition of “check” means to “hold back”. He felt PDCA was a corruption of the original model. Deming continually told his students that PDCA and his four–step cycle were only related through the scientific method, which is the foundation of the cycle and process of continuous improvement.

In 1993 Deming again modified the Shewhart Cycle. Deming named this modified cycle as The Shewhart Cycle for Learning and Improvement – the PDSA Cycle. Deming noted the third stage as “Study” rather than “Check”. He felt it was more important to study and learn based on the results of the action, to drive improvement. He felt “Check” only focused on evaluation and did not result in continuous improvement.


Many firms still use the term PDCA rather than PDSA, especially as this was adopted from the success of the Toyota Production System and Lean. In Japan, many firms use Plan, Do, See which Deming never understood the use of. No matter which cycle you adopt, the benefits to the organization are a culture of ongoing learning, experimentation, and continuous learning. Ensuring a culture of continuous improvement and learning is critical to stay ahead of competitors and continually wow customers.

Innovation: The Drucker Way

Innovation – another one of those annoying buzz words that everyone throws around. However, innovation is critical for long-term growth, but unfortunately true innovation is not done enough, or not done correctly, or is focused on the wrong things. Innovation refers to something new or updated that provides value to individuals or groups. The father of modern management, Peter Drucker recognized the importance of innovation within many of writings.

Peter Drucker was a management consultant and educator, who wrote almost 40 books as well as hundreds of articles, and created the term “knowledge worker” to define modern white collar office workers. He predicted many of the key developments of the 20th Century, such as the rise of Japan, the impact of marketing, the decrease of blue collar workers, and the development of the information society. Drucker focused on the relationship of management and society, and the importance of keeping social issues in mind when making decisions regarding the corporation. He also wanted managers to focus on the future and avoid short-term perspectives.

Drucker was born in 1909 in Vienna Austria. He grew up in a liberal Protestant house speaking English and German. His mother had studied medicine and his father was a lawyer. He was surrounded by some of the leading intellectuals, politicians, and scientists who visited his parents. This environment was a key to developing his holistic outlook on life and the desire to focus on the future and improving the world around him.

Drucker was strongly influenced by Joseph Schumpeter, a friend of his father who coined the term “creative destruction”. Schumpeter was an Austrian economist who identified innovation and entrepreneurial activities as the critical dimension of economic change, rather than market forces and price competition. Creative destruction was noted as a cycle of new economic structures being developed as old structures were destroyed or abandoned. Schumpeter’s ideas planted the seed for Drucker who focused on the importance of innovation and entrepreneurship.

Drucker felt there is only one purpose of an organization; to create a customer. The way to achieve this, an organization has two key functions, marketing and innovation. Drucker disdained short-term focus on profits instead of customers. He felt, the main way to create a customer was a long-term prospective and continuous innovation. And for effective innovation, an organization needed an outside-in perspective.

The way to innovate is having an outside-in perspective. Outside-in is a mindset and corporate culture that is driven by customer value creation, customer orientation, and customer experiences as the key to success. It’s all about the customer. Too many organizations focus on solving problems rather than exploiting opportunities. Focusing on problems leads to ongoing firefighting and the status quo, rather than finding tomorrow’s successful products. Innovation is providing real value to customers with products and services that improve their lives.

In business, market leadership is short lived and not likely to last, therefore, organizations must continually innovate to stay ahead of competitors. Drucker stressed the importance of customer focus and future focus. The U.S. versus North Vietnamese War was a painful lesson for the U.S. The U.S. focused on the last war, WWII and Korea, not the current war. This focus on the past instead of the future was extremely inefficient and led to the U.S.’s defeat. Organizations need to let of the past and focus on the future.

An outside-in perspective must be driven by the chief executive officer (CEO). Examples of this are Jack Welch at General Electric (GE) instituting Six Sigma with a clear customer focus, and Lou Gerstner at IBM who stated that “our customers run out business”. IBM went from $15 billion in losses to $5 billion gains in five years with this new mindset. To succeed managers need to know their customers better than anyone. The way to accomplish this is to get as close to the customers as possible.

Management needs to spend time with customers and non-customers. Tesco and Panda Express require all levels of employees to work in the retail shops at least once per year. Employees achieve greater understanding of the customer and understand how their job fits into the larger picture as they interact with customers on the “front lines”. This customer focus is also noted with Tesco’s corporate value etched into the side of the headquarters: create value for customers to earn their lifetime loyalty.

Drucker provided four rules for organizations to ensure the customer is the area of focus.

  1. Go where the customers are (current, non)
  2. Invited customers and suppliers to meet with your people – no substitute for direct dialogue
  3. Use technology to enhance customer satisfaction
  4. Spend 2-4 hours per week focused on competitors (websites, stores, customers, etc.) – stay one step ahead or counter latest competitive threats

Understanding customers will allow you and your teams to develop innovative, market-leading solutions. You must focus on the customer to ensure long-term growth. To develop successful innovations, you must align offerings with customer needs. Managers’ market views are often distorted by the “thick walls” of the company. It is critical to get out of the office and interact with customers on their turf. In addition, innovation requires time to think and reflect. If you are only focused on what is in your inbox, you will not be able to develop new offerings to keep current customers and attract future customers.

An outside-in focus and looking at the future (not the past) all requires a change in mindset. It is extremely difficult to change others and especially long-held corporate culture and beliefs, it is much easier to change yourself. To truly succeed you need to understand your customers better than anyone and develop new, exciting offerings. Change your mindset, keep interacting with customers, and focus on a few things that need to be done for the organization. Concentrating on these key areas will allow you to have the time to think and create new ideas that can be developed into successful innovations.

Creative thinking and innovation require a disciplined and structured approach. Ensuring you provide yourself with time to think and create is crucial for long-term success. Change your actions and mindset. Stop focusing on non-value work. You will find new ways to provide innovation and value by interacting with customers and non-customers, having new experiences, and rethinking how you think. So get out of the office and come up with new ideas to develop the next great, market-winning innovation.

Using Metaphors to Gather Brand Insights

As someone who has conducted hundreds of market research and new product development projects, the challenge of believing what consumers tell us is often a gamble. Too often consumers tell us they love our new product concept but then they never buy it. The graveyard of new products is littered among countless research projects that “validated” how much customers love the new offering. As marketing professionals we need to find better ways to understand the complex world of consumer behavior.

I recently finished a great book by Gerald Zaltman, How Customers Think: Essential Insights into the Mind of the Market. Zaltman is a professor at Harvard University and is a leading authority on marketing, market research, and behavior. The book focuses on Zaltman’s research technique, Zaltman Metaphor Elicitation Technique (ZMET) which is used to understand brand image. Marketing professionals can gain new insights into consumer behavior beyond traditional methods of superficial research (e.g., questionnaires, focus groups) using metaphors to elicit deep insights.

ZMET is a hybrid methodology grounded in various domains, including verbal and nonverbal communication, visual sociology, visual anthropology, literary criticism, semiotics, mental imagery, cognitive neuroscience and phototherapy. The goal of ZMET is to gather metaphors and constructs and understand the relationship among them in relation to the research topic (e.g., brand, product). These metaphors guide people’s thinking on a specific topic (e.g., brand awareness). Often consumer’s thoughts and opinions are unconscious and cannot be expressed verbally (at least initially). ZMET provides a valuable insight into the consumer’s mind to identify true behaviors in relation to a brand or product. ZMET helps identify what really matters to consumers, allowing for effective marketing communications.

A metaphor is a representation of knowledge. It is a figure of speech in which a word or phrase is applied to an object or action to which it is not literally applicable. For example, I am buried in debt or My office is like an icebox or Bill is a night owl.

When customers think of brands, they often do this via imagery. For marketing professionals, using metaphors in advertising (which aligns with prospective customer metaphors) will make it much easier for a consumer to align with the brand or product. Researchers feel that metaphors are the most basic method of thought and communication. Thus the need to understand how consumers think in terms of metaphors is critical to developing deep understanding of how they perceive brands or products. A word of caution, as a marketer you need clearly understand the customer’s metaphors and their meanings in various contexts to ensure you use the correct metaphor in your marketing.

Zaltman developed ZMET after traveling to Nepal in 1990. He gave locals cameras and asked them to document their lives through images. Zaltman noticed that in all the pictures the feet were left out. He realized that bare feet and old, worn shoes represent poverty; therefore, everyone did not include them in the pictures. This was done subconsciously.

Images have meaning that cannot be expressed with words. These hidden emotional intentions are images framed with deep metaphors. The goal of eliciting metaphors from consumers is to understand the hidden meanings that make consumers tick. You want to obtain insights that determine real consumer behavior and thinking patterns which can be translated into effective marketing communications.

A ZMET project typically consists of about 15-20 individuals. They are given homework regarding the research topic (e.g., brand, product). The consumer collects photos and pictures of what the topic means to them. The benefit of having the individual choose the pictures themselves reduces any bias (i.e., the researcher does not choose the source of the photos). They bring in these pictures and are interviewed, individually, for approximately 2 hours. The interviewer guides the conversation to gather deep insights how the images relate to the customer’s perception of the topic. A digital collage of the images is developed. The collage and interview transcripts are analyzed and metaphors are identified.

Zaltman has identified seven universal metaphors; balance, transformation, journey, container, connection, resource, and control. These metaphors are consistent between different races, cultures, and ethnic groups. As most humans communicate non-verbally, using imagery to understand deep consumer insights is a powerful way to elicit competitive advantages. The next time you are planning a traditional research project, think about ZMET and how it can provide new insights to change how you communicate to your market. As Zaltman notes, researchers can obtain more impactful insights through approximately 15-25 one-on-one interviews than multiple focus groups.

“A lot goes on in our minds that we’re not aware of. Most of what influences what we say and do occurs below the level of awareness. That’s why we need new techniques: to get at hidden knowledge – to get at what people don’t know they know.” Gerald Zaltman