UNDER THE SPELL OF THE QUALITY GURUS These consultants get up to $10,000 a day to help companies improve their products. If only the wise men could agree on how to do it.
By Jeremy Main RESEARCH ASSOCIATE Patricia A. Langan

(FORTUNE Magazine) – THE PROBLEM, all too common among U.S. corporations: Too many of the company's formerly vaunted, fully automated whiz-bangs are banging when they should whiz. Customers are threatening to take up with a Japanese supplier who makes only one bad whiz-bang in a million. The increasingly common solution: Hire a quality guru, or a whole ashram of them. A band of about 600 consultants who specialize in improving quality have become some of the most sought-after advisers to American business, commanding fees of up to $10,000 a day and filling their schedules a year in advance. Possessed by an almost messianic sense of mission, they are convinced the U.S. needs their advice more than almost anything else. The gurus seem to agree on certain basic points. They believe that until top management gets permanently involved in quality, nothing will work. They set little store by robots, automation, and other gadgetry. They have little use for quality circles except as an adjunct to other methods. But beyond these basics, it is every guru for himself. Their methods differ markedly. They do not always respect each other's work -- in fact, they are sometimes downright contemptuous. And the whole field is suffused with a fog of jargon, slogans, and statistics. As a result, the quality message often fails to get through to clients. But when it does, the effects can be remarkable. Companies have transformed design and manufacturing processes, indeed even their management philosophies, on the advice of these gurus. Which guru should your company choose? The menu of possibilities is wildly varied, with offerings that range from the bland to the incendiary. Do you want an inspirational type like Phil Crosby, who will send the corporate staff charging up the hill under a banner inscribed Zero Defects? Or do you want a technical type like Dorian Shainin, who will work quietly alongside your engineers? Perhaps you masochistically crave fiery denunciations from the 85- year-old W. Edwards Deming, who will probably tell your managers they are a pack of idiots? If the gurus were to elect a master from their own ranks, they would certainly choose Deming. ''He is a national treasure,'' says another prominent quality expert, William A. Golomski of Chicago. Deming, a onetime U.S. government statistician, was virtually ignored in the U.S. for decades while the Japanese soaked up his ideas. He now seems driven to make up for lost time. Last fall he had a two-hour operation for a cataract, then went straight back to the basement office of his home in Washington, D.C., where he worked until 8:30 P.M. A one-man show, he travels at a killing pace. With some contempt for actuarial odds, Deming is making appointments for 1988. Many who can afford his fees, which can run as high as $10,000 a day, probably will not get his services; he is particular about new clients now. Deming has gone far beyond the statistical methods that he propounded decades ago, but they remain the heart of his practice. Essentially he first shows manufacturers how to measure the variations in a production process in order to pinpoint the causes of poor quality and then how to gradually reduce those variations. By spreading Deming's philosophy throughout the company, Ford, in - the view of consultants and market researchers who have made comparisons, has probably taken greater strides in improving quality than any other U.S. auto manufacturer. These days a speech by Deming may barely touch on statistical process control. Instead he concentrates on his management philosophy, which is somewhat more controversial and less lucid than his statistical theories. He likes to preach 14 points of management, which include ''drive out fear,'' a curious message coming from a man whose imperious manner and withering scorn will terrify any manager careless enough to ask him the wrong question. As Deming grows older, there is less thunder and more whisper in his theatrical style; he wanders at times and tends to be more contemptuous of management. Another towering figure among quality consultants, Joseph M. Juran, a stripling of 81, has been crossing Deming's path for decades. They both worked at the Hawthorne Western Electric plant in Chicago in the 1920s, although they didn't know each other then. They both got to Japan in the early 1950s, Deming a little ahead of Juran, and they both won belated recognition in the U.S., Deming a little more than Juran. But Juran, the immigrant son of a village shoemaker in what is now Rumania, has honors and clients enough to satisfy anyone. The clients include Motorola, Texas Instruments, Du Pont, Monsanto, Xerox, and the Internal Revenue Service. They pay him $8,000 a day for advice, and pack his one-day seminars at $695 a head. Juran, who looks a bit like a plucked bird with bristly eyebrows and mustache, teaches a system of management intended to put a plant or corporation on the path to improving quality year by year. Clients begin by picking specific annual goals and setting up teams to work on them. As the company attacks one project after another, it learns from Juran's lectures, his staff, or his tapes, the managerial approach and statistical tools it needs. Rivals and academics speak of the ''beauty'' of the Juran process because it is so well organized. Clients like the results. Wayland Hicks, a Xerox group vice president, says that the company's plant in Mitcheldean, England, which produces small copiers, decided to follow the Juran process ''religiously'' when management learned that poor quality was eating up about 20% of the plant's output in scrap, waste, and returns. The Juran system, says Hicks, cut the quality losses by 30% to 40% and won the plant a national prize in Britain in 1984 for quality improvement. While they are rivals, Deming and Juran respect and generally speak kindly of each other. Juran, however, feels that Deming is still basically a statistician who is a little out of his depth when he talks about management. While Juran spent 17 years at Western Electric, the manufacturing arm of the old Bell System, Deming gained most of his experience working outside the corporate world. Deming, says Juran, tends to issue ''far-out statements and platitudes'' about management. Deming is wrong, for instance, to tell management to ''drive out fear.'' Juran believes ''fear can bring out the best in people.'' With the money that pours in from his practice, Juran has established the Juran Institute Inc. in Wilton, Connecticut, to manage his lectures and seminars and to produce the videocassettes his clients use. He employs a staff of 30 and needs more. ''The organization has become my master, as I feared,'' he says a little wistfully. Philip B. Crosby, 60, a cocky, sandy-haired bantam, is not the least wistful about building a profitable, successful organization around his quality program. A former vice president and director of quality at ITT, Crosby appears to be the biggest commercial success among the gurus. Philip Crosby Associates Inc., which he established in 1979, has put 35,000 executives through its Quality College in Winter Park, Florida, and hundreds of thousands have taken his courses in their own offices or plants. General Motors, which owns 10.4% of the Crosby company, has set up a Crosby school in Troy, Michigan; Crosby has nine other institutes or licensed operations in the U.S, Europe, and -- yes -- Japan. His company earned $4 million last year on revenues of $34 million and went public in October at $13 a share. The stock sold recently for $26.50, making Crosby's stake in the company worth about $11 million. His first book, Quality Is Free, sold almost one million copies. He has a corporate Learjet and a place in Savannah, Georgia, where he goes every month for a breather. Yes, Crosby has it all -- except for the respect of his rivals. While they agree that he is a superbly entertaining speaker and a great motivator, they say he lacks substance -- that he can't teach the methods of achieving quality. ''I do not regard Crosby as an expert in the field of quality,'' says Juran. ''He is an expert in public relations. He is a combination P. T. Barnum and Pied Piper.'' Many of Juran's colleagues express similar opinions. Crosby's best-known slogan is the exhortation to achieve ''zero defects.'' Juran and Deming would argue it is pointless, if not hypocritical, to exhort a worker on the line to turn out a perfect product when the overwhelming majority of imperfections are due to poorly designed manufacturing systems that workers can't affect. Crosby maintains that he does teach the tools of improvement, but even his admirers agree that he is more inspirational than practical. Hicks of Xerox, for instance, says that Crosby is ''a great asset'' in motivating managers but not much help to the engineers and the people in the lab. Still, Digital Equipment, Chrysler, IBM, Johnson & Johnson, and AT&T, among others, have set up Crosby programs in-house and have thought it worth sending senior managers to four days of Quality College at $1,650 per executive. IF A FOURTH guru were to be listed among the best known along with Deming, Juran, and Crosby, it would be Armand V. Feigenbaum, 66, who is so uncontroversial that he is often unnoticed by managers who don't specialize in quality. A serious, unexciting engineer, Feigenbaum was General Electric's worldwide chief of manufacturing operations and quality control for a decade until the late 1960s, when he set up his own firm, General Systems Company Inc. in Pittsfield, Massachusetts. It now employs several dozen engineers. Unlike the others, Feigenbaum delivers no uplifting messages to eager executives. He is more likely to put them asleep with a style that even his admirers find soporific. In his 851-page textbook, Total Quality Control, the general reader will find little but platitudes and hard-to-digest technology. But quality professionals rate his book as an essential text. His total quality control aims at managing so that the same statistical and engineering methods applied to production can be used throughout a company, in marketing and distribution, for example, as well as on the shop floor. Feigenbaum doesn't try so much to create managerial awareness of quality as to help a plant or company design its own system. Long-term clients include Deere & Co. and Pirelli, the Italian tiremaker. To illustrate just how hard it can be to understand the magic of the gurus, consider Genichi Taguchi, 62, one of Japan's prophets of quality who also practices in the U.S. When the powers at Bell Laboratories invited him to illuminate their eminent scientific minds with his statistical ideas in 1962, & they understood not a word he said. They assumed at first the problem was his English. But when they asked some Japanese scientists about Taguchi, it turned out his countrymen had difficulty understanding him too. Bell nevertheless brought in Taguchi in 1980 and asked him to work on a troublesome experiment involving the design of a manufacturing process for a new integrated circuit. Within six weeks Taguchi had helped Bell cut the defect rate on the circuits in half. Bell still didn't understand exactly what he had done, says Blanton Godfrey, head of the quality theory and technology department at Bell Labs, but it liked the results and has been inviting him back ever since. Taguchi's approach centers on a statistical method of zeroing in rapidly on the variations in a product that distinguish the bad parts from the good. The point is to avoid endlessly testing for all the possible defects. He uses an assortment of graphs and tables to find the key variables. Taguchi has also advanced the cause of quality with his concept of ''robust design.'' The primitive quality control still practiced by most U.S. industries depends on inspectors to discard or return work that does not meet specifications, typically up to 30% of a factory's output. In a ceramics factory, for instance, inspectors would throw out warped tiles. By comparison the statistical process control advocated by Deming and others throws out the inspectors and gets hold of the variables in the process -- changes in temperatures, say, or time in the kiln -- to reduce the warping. But Taguchi goes a step further with a ''robust'' process that produces good tiles even with erratic ovens. He has found, for instance, that adding lime to the clay creates a basic material less likely to warp when the kiln temperature is out of whack. Taguchi is marketed in the U.S. by the American Supplier Institute, a nonprofit organization in Dearborn, Michigan. He visits the U.S. three to four times a year to work with Ford, ITT, Xerox, and Bell Labs. More people understand him now, but they don't always like what they hear. Some leading statisticians in the U.S., among them George Box of the University of Wisconsin and J. Stuart Hunter, a professor emeritus at Princeton University, maintain that Taguchi's statistical methods are cumbersome and less efficient than those that they and others have used for years. Client Godfrey of Bell Labs concedes that Taguchi's ''statistics are sometimes very sloppy, and he doesn't always get the right solution, but he gets close and he always has fundamental insights.'' A company that does not want to go through an entire quality metamorphosis but simply wants to get rid of a particular glitch can call in Dorian Shainin, 71, an engineer with 50 years' experience under his ample belt. His card bears only his name and a phone number in Manchester, Connecticut, his base for almost constant travel. He has no organization, other than his son and partner, Peter, who operates out of Burlington, Washington. Shainin applies statistical methods that he claims are more cost-effective and simpler than Taguchi's for zeroing in on defective parts. Shainin swaps pairs of parts between good and bad equipment until he finds the one that causes the trouble. The trick is to zero in quickly on the right pairs among thousands in complicated pieces of equipment. Shainin says he can usually find the trouble with less than a dozen swaps. He has worked for Motorola, GM, and RCA, among others. Charles Thierfelder, who retired from RCA in May as vice president for product assurance at the electronic components division, says Shainin helped RCA fix problems with its picture tubes that had seemed insoluble. Says Thierfelder: ''His techniques got us from a poor second to the Japanese to the best reliability in the world.'' RCA supplies tubes to most of the Japanese TV set manufacturers in the U.S. ''I don't start with the C.E.O.s and give them hell like Deming,'' says Shainin. ''I provide tools for engineers.'' For his services Shainin charges $2,500 a day, considerably less than Juran or Deming, but more than most. ''I like to be a bit above average,'' he says. THE CORPORATE appetite for advice about quality seems inexhaustible. Taking no chances, large corporations seem to hire every guru they can catch, lest they miss the one with the real secret. Ford, GM, IBM, Xerox, and others take on crews of them. GM has used Crosby, Juran, Deming, Feigenbaum, Taguchi, Shainin, and many others. In addition some corporations have in-house gurus, such as Ford's Bill Sherkenbach. A company that decides to take its quality consultant seriously can take off on a ride that will transform the whole corporate culture. As Ford found out, following the Deming path leads to a lot more than tinkering with the assembly line. Reforms at the automaker range from changing the way cars are designed to instituting a new way of evaluating managers. Strong medicine, but, given global competition, demand for quality consultants seems likely to remain robust. The supply is another question. Universities have barely awakened to the need for people trained in the skills of Deming or Juran. Says Feigenbaum: ''Quality hasn't surfaced yet as anything more than a footnote in the business schools.'' If new gurus aren't being trained, at least the old ones keep plugging away. Their ranks may soon include some of the best-paid nonagenarians in the U.S. God bless the old gentlemen.