From 2004 through 2007, we worked to apply Deming’s principles at Force Protection, a business faced with enormous opportunity and challenges. I attribute our transformation from start-up to established billion dollar company largely to the System of Profound Knowledge, which we worked to implement, not perfectly, but as best as we could.

By no means is it easy, or was the job complete, and transformation in the midst of growth is difficult, but without the System I do not believe we would have overcome these challenges. I attribute our success to the methods and theories developed by Deming.

Deming’s insight on complex social systems taught our management team to look at the company as a whole with a life of its own rather than as a loose collection of departments or individuals.

Deming’s theory is profound in its impact and amazing in its simplicity. As an American who taught these critical management theories to Japanese businesspeople after World War II, Deming quietly changed the world.

With these same theories and no natural resources except a motivated workforce along with committed leaders and managers, Japan developed the second largest economy in the world and a commitment to excellence and collective prosperity. Deming’s Theory of Profound Knowledge, his 14 Points for Management, and the practice of continual improvement are essential for any organization looking to compete successfully over the long-term.

In many ways, I believe that the current global economic crisis, especially as it is manifested in the United States, is the direct result of a departure from proven principles. What we are witnessing is the massive fallout that results from a systemic failure. Rather than functioning according to Deming’s principles and in accordance with the System of Profound Knowledge, individuals are striking out on their own and pursuing their own self-interests, in business and government, to the detriment of everyone.

Only by returning to the basics and the principles that have led to greatness can we ever hope to find a way out of the current crisis. The opportunities are tremendous. At Fort Ashford Funds, we are committed to helping our insurance and risk-related portfolio companies and the companies we invest in effectively pursue these opportunities through positive systemic transformation.

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