Overview
From the mid-1960s through 1980, Deming continued his dual existence: revered in Japan, invisible in America. He maintained a private consulting practice, taught at new-york-university's Stern School of Business, and continued to work with Japanese companies and JUSE. Meanwhile, American manufacturing entered a long decline, losing market share to Japanese competitors in automobiles, electronics, steel, and virtually every sector where quality and reliability mattered. The man who could have explained why this was happening was teaching statistics to NYU graduate students.
The American Decline
During this period, American industry was dominated by management practices that Deming would later catalogue as the Seven Deadly Diseases in out-of-the-crisis: emphasis on short-term profits, evaluation by performance and merit rating, mobility of management (managers who hopped between companies and industries), running a company on visible figures alone, excessive medical costs, excessive warranty costs, and excessive legal costs. These practices optimized for quarterly earnings while systematically destroying the capability of American manufacturing. Quality was treated as a cost to be minimized through inspection rather than a benefit to be maximized through process improvement.
Japanese Ascendancy
While American industry declined, Japanese manufacturers — applying the methods Deming had taught them during the japan-and-the-quality-revolution-1947-1960s — continued to improve. By the late 1970s, Japanese automobiles were demonstrably more reliable than American cars, Japanese electronics were superior, and Japanese steel was cheaper and better. American consumers noticed, even if American executives did not. The competitive gap was a direct vindication of Deming's teaching — quality and productivity are not trade-offs; they are complementary, exactly as the chain reaction in out-of-the-crisis would later argue.
Deming in the Wilderness
Deming was not idle during these years. He continued refining his ideas, working with Japanese clients, and developing the management philosophy that would eventually crystallize in the system-of-profound-knowledge. He published sample-design-in-business-research in 1960 and principles-of-professional-statistical-practice, maintaining his academic statistical career. But he was an elderly professor known only in specialized circles — a man whose ideas had already changed the world, recognized only by the world he had changed. The American management establishment had no idea he existed.
Significance
The forgotten decades are essential context for understanding the urgency and anger in Deming's later American work. When he finally reached American audiences during the american-revival-and-legacy-1980-1993, he was not a patient teacher but a frustrated prophet who had watched decades of avoidable decline. His contempt for American management practices was not theoretical — he had seen the alternative work in Japan for thirty years while Americans destroyed their own industrial base through ignorance and arrogance. The statistical foundations from his education-and-early-statistical-career-1900-1927 and usda-and-census-bureau-1927-1946 years had been available to American industry all along; they simply chose not to listen.