The Theory and Practice of Profound Knowledge: an Inquiry Into Quality and Strategy Management
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THE THEORY AND PRACTICE OF PROFOUND KNOWLEDGE: AN INQUIRY INTO QUALITY AND STRATEGY MANAGEMENT By GREGORY H. WATSON Bachelor of Arts in Philosophy Taylor University Upland, Indiana 1970 Master of Science in Systems Management University of Southern California Los Angeles, California 1975 Master of Arts in Legal Studies Antioch University Washington, DC 1983 Master Science in Industrial Engineering Oklahoma State University Stillwater, Oklahoma 2003 Submitted to the Faculty of the Graduate College of the Oklahoma State University in partial fulfillment of the requirements for the Degree of DOCTOR OF PHILOSOPHY May 11, 2018 THE THEORY AND PRACTICE OF PROFOUND KNOWLEDGE: AN INQUIRY INTO QUALITY AND STRATEGY MANAGEMENT Dissertation Approved: Camille F. DeYong Dissertation Adviser Manjunath Kamath Shelia M. Kennison Kenneth E. Case Paul E. Rossler ii ACKNOWLEDGEMENTS Special appreciation is recognized for the guidance of my advisors in the industrial engineering and management graduate program at Oklahoma State University. Kenneth E. Case, PhD, served as advisor for my Master of Science in Industrial Engineering degree program, and Camille F. DeYong, PhD, was my advisor during my doctoral studies. Both of these individuals have been exceptionally generous with their time and helpful with their advice as I have plodded through my programs of studies. Without the encouragement of Case, I never would have begun this journey, and most probably never would have ended it! DeYong has guided me through the maze of requirements and academic guidelines and aided me to find my way when the bread crumbs were eaten by wild squirrels. I cannot thank you both enough! I have been privileged to have been challenged in course work by each of the members of my doctoral research committee: Paul E. Rossler, PhD, challenged me to investigate thoroughly the relationship between Walter A. Shewhart (1891-1967) and W. Edwards Deming (1900-1993) as a means to clarify the obtuse complexity of the system of profound knowledge developed by Deming; Shelia M. Kennison, PhD, challenged me to understand the mechanisms that generate cognitive psychological bias in the Executive Decision Making (EDM) process and how to consider the issue of cross-cultural bias when decisions require a comprehensive implementation across national, social, and iii Acknowledgements reflect the views of the author and are not endorsed by committee members or Oklahoma State University. cultural boundaries; Manjunath Kamath, PhD, challenged me to consider how technical systems solutions can be used as a means to implement operational solutions to this complex decision process; and Sunderesh Heragu, PhD, challenged me with respect to the need to validate this theoretical approach. In addition to my formal research committee, I must express my deep appreciation to Hiroshi Osada, PhD; Noriaki Kano, PhD; Kazuki Suzuki, PhD; Robert E. Cole, PhD; Bo Bergman, PhD: Andrew D. (Jack) West, PhD; Benson Tendler; and Narayanan (Ram) Ramanathan for their kind participation in friendly debates; they willing worked with me to conduct “thinking experiments” with respect to various topics addressed in this dissertation. I am also grateful that one of my Finnish students, Tuuli Paasilehto, used her legal analysis background to critique an early draft of this dissertation for its stream of argumentative logic. Finally, I must express special thanks to Glenn H. Mazur of Japanese Business Consultants, Inc. for assistance in understanding the meaning of Japanese terms used to describe elements in the Japanese system of Total Quality Management. My appreciation would be remiss without expressing my sincere acknowledgement of a very wonderful personal assistant who keeps my administrative life on track—despite my often desperate attempts to derail it. Thanks, Celina R. K. Rellahan! You are the best! Also, I need to thank my writing muse and editor of the American Society for Quality’s Journal of Quality and Participation (and also the first female president of ASQ), Deborah L. Hopen. Deb, you helped me to clarify this subject tremendously, and I appreciate your editorial guidance. Finally, my administrative support group would not be complete without thanking Logan Farrell for his mastery of the American iv Acknowledgements reflect the views of the author and are not endorsed by committee members or Oklahoma State University. Psychological Association style guide and knowledge of all the hidden secrets in Microsoft Word formatting! You were a great help in the final days of the publication of this dissertation! Inspiration for this dissertation topic was also strongly influenced by four individuals. The late Peter F. Drucker, PhD, provided an insight into the support role that senior managers require in their EDM process and the role that the analytical staff members have in supporting that decision-making processes. Marcos E. J. Bertin, PhD, directed my thoughts to the difficult question of assurance of the quality for the governance of organizations with particular emphasis on the establishment of the strategic policies that define the future direction of organizations which are jointly developed by the CEO in collaboration with the Board of Directors. The combined guidance Ira M. Millstein and Pekka Ala-Pietilä helped me realize the importance of improving the quality of senior management decisions through the development of methods that assure clarity and The impetus to pursue a doctoral degree so late in life is owed to a promise that was made to my parents Robert John Watson, Jr. (1914-1995) and Anne Faye (Bellotte) Watson (1917-1998). Although neither has survived to see this day, the continuing existence of my life goal of completing this doctoral degree is based on a promise which my mother extracted from me so many years ago. So, Mom and Dad, with the completion of this work I have also fulfilled my promise to you both! Finally, I wish to acknowledge my wonderfully supportive family. First, my wife, Inessa Alexandra, has suffered through many years of isolation and self-sufficiency as I have dedicated my pursuit of this research in combination with my vocation which has always v Acknowledgements reflect the views of the author and are not endorsed by committee members or Oklahoma State University. left too little time to advance the development of our relationship. Thank you for your support and love. I only wish that I could have attended more of your concerts and watched your tennis matches more often. Our children, Andrew Daniel Watson, Dina Belfer, and Cristina Daniella Joula, have been a special source of pride and satisfaction as we have all grown together while each of us has pursued his or her own educational pathway in parallel. The arrival of my latest grandsons courtesy of my lovely daughter- in-law Laura has created new energy in our lives .Thank you to twins Jonah Daniel and Nolan James for the promise of the future that you have brought into our lives. I also have been greatly blessed by two older godsons who have become my grandsons: Alexey Daniel ‘Alosha’ Belfer and Alexander Dominique “Sanja” Belfer. Observing your growth and development over the past decade has brought a very special pleasure to my life. I am looking forward to your continuing evolution and believe that you will accomplish many great things in your lives. I am especially glad for your talents in athletics and hope that the completion of my academic program will be a special inspiration to you both as you design the future that you wish to have for the rest of your lives! vi Acknowledgements reflect the views of the author and are not endorsed by committee members or Oklahoma State University. Name: GREGORY H. WATSON Date of Degree: MAY, 2018 Title of Study: THE THEORY AND PRACTICE OF PROFOUND KNOWLEDGE: AN INQUIRY INTO QUALITY AND STRATEGY MANAGEMENT Major Field: INDUSTRIAL ENGINEERING AND MANAGEMENT Abstract: This research develops a theory of profound knowledge, derived from the quality dialog between Walter A. Shewhart and W. Edwards Deming. In 1992, Deming introduced his system of profound knowledge as the mechanism by which executives could make organizationally transforming decisions to implement strategic change. He coupled this theory with the Deming Cycle, which represented a change in the Japanese PDCA Control Cycle, focusing on learning and improvement rather than on work process analysis and control. These changes were enigmatic because Deming did not provide academic citations for his system, linkage to his prior theories, or operational definitions for the terms he used. Instead, Deming implied that his prior theories should be perceived as a natural outgrowth of this new system. Thus, the system of profound knowledge only represents a framework for further consideration and not a serious advance in quality thinking. This research investigates the sources of Deming’s system, related to a thinking experiment that he had been conducting with Shewhart since the late 1920s when they first met and began a lifelong association. The nature of their symbiotic thinking is described, and literature is cited to trace the evolution of the four elements in Deming’s system—from their nascent beginning in the 1870s, when logical positivism and pragmatism began to influence scientific thinking and merged with probabilistic theory for conducting investigations. Shewhart contributed the core concepts for Deming’s system in his theory of control, and his statistical process control methods; however, a host of academics and researchers from such diverse fields as psychology, philosophy, statistics, physics, economics, and engineering contributed related ideas that are integrated into the comprehensive approach to quality which is described here as the theory of profound knowledge. This research performs two sequential inquiries. First, it develops a scientifically appropriate theory of profound knowledge based on a grounded research analysis of the historical thinking pathways which developed each of the four elements, defining a general model describing the manner in which this theory operates.