Media Tech is a Daiwa House company that provides IT services to the whole of Daiwa House Group of companies (around $30b in revenue). They manage 30,000+ Desktop and notebook computers and supply over 1000 new ones each month. It is an interesting environment of high-volume small projects with short lead times. The case study will cover the lessons learned and results achieved from implementing Critical Chain Project Management.
This presentation describes a project of TOC for Education in Malaysia describing what to change, what to change to and how to cause the change, the project 100 clouds and the analysis, findings, and implications of the project. This history of TOCfE in Malaysia is provided. The project 100 clouds is described. The goal of the project was to give students the problem-solving skills they needed. 100 students ages 13-14 from three schools were taught the evaporating cloud tool and constructed one cloud a day for 100 days. A post-test was given to the students that completed the assignment to see if they internalized the use of the evaporating cloud in their problem-solving skills. Some students did not complete the assignment, others did not take the post test, some that completed the 100 clouds did not internalize the issue of the tool, etc. The results are presented for each grouping. The primary conclusion was that most children that completed the assignment learned to use the cloud in their lives.
How Critical Chain was used to plan and execute the replacement of slew bearings on two continuous casters in a steel plant. The worlds best time was 22 days. This project aimed to cut this in half to 11 days. They succeeded, allowing the organization to secure $20M of additional revenue.
A standardized, easy to construct, current reality branch (CRB) was identified in TOCICO Chicago 2012 as a missing piece in the powerful array of theory of constraints (TOC) thinking processes (TP) solutions, which range from simple conflict / dilemma clouds to transformation strategy and tactics (S&T) trees implemented in CCPM. The 12-questions process has evolved from over a decade of practical experience in using the TOC TP to solve a variety of problems involving individuals and organizations, focused on providing answers to the 6 D's - Discomforts, Dilemmas, Doubts, Difficulties, Direction and Decisions -using necessity and sufficiency causality logic. The sequence of 12 questions, when asked by skillful TOC practitioners, can be the key to make the TOC TP, the crown jewel of TOC, accessible to non-practitioners. The 12-questions structure is a proposal for a universal current reality branch, a meta-structure that can become a building block of, and source of insight into, the construction of conflict clouds, negative branch reservations, chronic conflict, and standardized current reality trees, leading to formulation, sale and implementation of TOC-based solutions.
Gain first hand knowledge on how to leverage Exeprons Advanced Critical Chain Project Management technology and predictive capability to manage resources across a Multi-Project Portfolio. Understand how to complete more projects on time and within budget, create a competitive advantage through reliable and early delivery, and lead and accelerate Change within your organization. Weve actually made it easy for you by putting all the advanced power of Critical Chain AND the technology to do it together in order for you to effectively and more productivity manage your Multi-Project Portfolio. Exepron, a Collaborative Enterprise Business Solution presented as an Intelligent Multi-Portfolio Project Management Cloud Solution, designed to significantly reducing the Time between Investment and Return. Disruptive Intelligence, Low Risk Deployment, Ease-of-Use interface for Rapid Company-wide adoption.
5 Major Marketing Mistakes: Marketing is connecting with your target market and showing them you have the stuff that solves their problem or delivers better outcomes / results, explaining it to them where they can be found and helping them to buy it. Here are 5 major marketing mistakes: 1. Not selecting a target market or niche. • Your target market is the people you want to sell to along with the products/ services you sell. People with specific needs and the specific stuff they need equal a target market. • Undesirable effects (UDEs) will only make sense to your market IF they are really THEIR UDEs. • The TOC buy-In process is missing layer 0. It's very difficult to gain buy-in from an unknown, un-described, entity. • If your target market is not specific enough, they won't relate. The more specific and targeted your market, the more you can talk directly to them and in their language. • Where do you make the most throughput for the least amount of your capacity? • What are your under exploited assets? • Opportunity is .... a need to be fulfilled .... a want to be addressed .... a fear to be relieved .... a problem that needs to be solved. For opportunity to flourish there needs to be an identifiable group that will buy it and a profitable way to contact and engage the target market. • When most hunters go out to hunt, they think like hunters. When a master goes out to hunt, he thinks like a deer. • Knowing what your market really wants and who they really are is very important. Communicating where they're at without making them wrong is important, while pushing their emotional hot buttons. Rationality is used as a tool to support the emotional. • Write your marketing to ONE very specific person (your Avatar .... a member of your target market). • Market WHERE they hang out and in the way (type of media) they hang out. 2. Not measuring at all or not measuring the right things. • In operations we can physically see constraints. In marketing we don't have this ability .... we need data. • What's working for you .... twitter, LinkedIn, website, webinars, direct mail, Facebook, Interest, article writing, PPC, retargeting, blog posts, TV, banner ads, podcasts, cold calls, video marketing, leaving comments, mobile marketing, e-mail marketing, or what? • How many leads do you generate? By what method(s)? What is your conversion rate at each step of your sales inversion process? • What's your sales conversion process? Retention process? • What's your upsell and/or post sale process? • What do you spend on marketing and what ROI does each generate? (BTW your ROIs will be much better if you have a specific target market.) • When calculating your ROI, consider both time and money. • If you don't know these numbers, how will you know where to focus your efforts and what to improve? • Testing is how we improve our marketing. What to test, in what order depends on what your measures are indicating. Test your message - wording, pictures, colors, placement, fonts. Test the medium - direct mail, ads, videos, webinars, closing techniques. Test your sales process. Test where/ how your make your offers, as well as, the specifics of your offer. • The ability to turn floods of information into real knowledge has become one of today's most valuable resources. 3. Not understanding what you're selling. • It's not about you or your product / service. • It's about them and the outcome or better results they're seeking. • The customer doesn't want products, services or techniques .... they want an outcome! • People want value. The way we offer them value is in the form of results which is in the form of our products or services. • Selling tangible, measurable results that the customer can expect to experience in the real world dramatically increases the price you can charge. • We want high value products/ services that are tailored to our customers needs so that they say to themselves .... I never knew someone could understand this at this level. • If you don't understand your target market (#1) nor what you're selling, then you have no chance of knowing what competitive advantage to create or what mafia offer to make. 4. Doing nothing to generate leads. Thinking that hope and a website are a strategy. • The more you can spend to get a lead, the less you have to worry about competition. • There are lots of ways to generate leads. Which is best depends on your situation. That's why testing is so important. • You can start by seeing what competitors are doing. If they are using a particular lead generation method for more than 4 months, they are probably getting an ROI from it. • Draw your funnel and track the data. • There are 3 ways to GROW a business. 1) increase the number of customers; 2) increase the T per transaction; and 3) increase the frequency of purchase or repurchase. 5. Push marketing instead of pull marketing. • Leverage applies in marketing just as it applies in operations. It costs you the same to send out a flier that gets a 1% response rate or a 10% response rate. By working on the right things in your marketing you greatly increase your leverage. • Getting prospects to seek YOU out and/or realize 'I need help' is pull marketing. • Spewing everything you know out to your market is about you, not your customer. • Your marketing should itself be valuable. Give away some of your best stuff. • Get people to act NOW. • Give your prospects results in advance. • Call out the elephant in the room. • Repurpose content. • Inherent simplicity applies in marketing too.People want simple ideas, not complex ones. Influential writing is not about writing better, it's about simplifying things in a better way. • Without a detailed avatar of who you are marketing/ writing to/ for, and what makes them tick, you are engaging in blind target shooting.t complex ones. Influential writing is not about writing better, it's about simplifying things in a better way. • Without a detailed avatar of who you are marketing/ writing to/ for, and what makes them tick, you are engaging in blind target shooting.aging in blind target shooting.
5 Major Marketing Mistakes: Marketing is connecting with your target market and showing them you have the stuff that solves their problem or delivers better outcomes / results, explaining it to them where they can be found and helping them to buy it. Here are 5 major marketing mistakes: 1. Not selecting a target market or niche. • Your target market is the people you want to sell to along with the products/ services you sell. People with specific needs and the specific stuff they need equal a target market. • Undesirable effects (UDEs) will only make sense to your market IF they are really THEIR UDEs. • The TOC buy-In process is missing layer 0. It's very difficult to gain buy-in from an unknown, un-described, entity. • If your target market is not specific enough, they won't relate. The more specific and targeted your market, the more you can talk directly to them and in their language. • Where do you make the most throughput for the least amount of your capacity? • What are your under exploited assets? • Opportunity is … a need to be fulfilled … a want to be addressed … a fear to be relieved … a problem that needs to be solved. For opportunity to flourish there needs to be an identifiable group that will buy it and a profitable way to contact and engage the target market. • When most hunters go out to hunt, they think like hunters. When a master goes out to hunt, he thinks like a deer. • Knowing what your market really wants and who they really are is very important. Communicating where they're at without making them wrong is important, while pushing their emotional hot buttons. Rationality is used as a tool to support the emotional. • Write your marketing to ONE very specific person (your Avatar .... a member of your target market). • Market WHERE they hang out and in the way (type of media) they hang out. 2. Not measuring at all or not measuring the right things. • In operations we can physically see constraints. In marketing we don't have this ability .... we need data. • What's working for you .... twitter, LinkedIn, website, webinars, direct mail, Facebook, Interest, article writing, PPC, retargeting, blog posts, TV, banner ads, podcasts, cold calls, video marketing, leaving comments, mobile marketing, e-mail marketing, or what? • How many leads do you generate? By what method(s)? What is your conversion rate at each step of your sales inversion process? • What's your sales conversion process? Retention process? • What's your upsell and/or post sale process? • What do you spend on marketing and what ROI does each generate? (BTW your ROIs will be much better if you have a specific target market.) • When calculating your ROI, consider both time and money. • If you don't know these numbers, how will you know where to focus your efforts and what to improve? • Testing is how we improve our marketing. What to test, in what order depends on what your measures are indicating. Test your message - wording, pictures, colors, placement, fonts. Test the medium - direct mail, ads, videos, webinars, closing techniques. Test your sales process. Test where/ how your make your offers, as well as, the specifics of your offer. • The ability to turn floods of information into real knowledge has become one of today's most valuable resources. 3. Not understanding what you're selling. • It's not about you or your product / service. • It's about them and the outcome or better results they're seeking. • The customer doesn't want products, services or techniques .... they want an outcome! • People want value. The way we offer them value is in the form of results which is in the form of our products or services. • Selling tangible, measurable results that the customer can expect to experience in the real world dramatically increases the price you can charge. • We want high value products/ services that are tailored to our customers needs so that they say to themselves .... I never knew someone could understand this at this level. • If you don't understand your target market (#1) nor what you're selling, then you have no chance of knowing what competitive advantage to create or what mafia offer to make. 4. Doing nothing to generate leads. Thinking that hope and a website are a strategy. • The more you can spend to get a lead, the less you have to worry about competition. • There are lots of ways to generate leads. Which is best depends on your situation. That's why testing is so important. • You can start by seeing what competitors are doing. If they are using a particular lead generation method for more than 4 months, they are probably getting an ROI from it. • Draw your funnel and track the data. • There are 3 ways to GROW a business. 1) increase the number of customers; 2) increase the T per transaction; and 3) increase the frequency of purchase or repurchase. 5. Push marketing instead of pull marketing. • Leverage applies in marketing just as it applies in operations. It costs you the same to send out a flier that gets a 1% response rate or a 10% response rate. By working on the right things in your marketing you greatly increase your leverage. • Getting prospects to seek YOU out and/or realize 'I need help' is pull marketing. • Spewing everything you know out to your market is about you, not your customer. • Your marketing should itself be valuable. Give away some of your best stuff. • Get people to act NOW. • Give your prospects results in advance. • Call out the elephant in the room. • Repurpose content. • Inherent simplicity applies in marketing too. People want simple ideas, not complex ones. Influential writing is not about writing better, it's about simplifying things in a better way. • Without a detailed avatar of who you are marketing/ writing to/ for, and what makes them tick, you are engaging in blind target shooting.
In 2014 and under the leadership of Dr. Jeni Corpuz, we had our first Problem Solving Maps online course in Valenzuela City in the Philippines. 60 teachers were in this first group who then trained 45 teachers. This first program impacted over 15,000 students. Moving forward to now, thousands of teachers have been trained, some of them have conducted research and trained other teachers. More and more students are exposed to PSM. This is their story.
The underlying principle of flow unites and unifies various methodologies including lean, TOC, MRP, DRP, Six Sigma and is also the underlying foundation for Demand Driven. Each of these methodologies have had a market perception of conflicting with each other but flow unites and unifies these perceived conflicts. This presentation will explore the history of these methodologies and show how flow is the unifying force under all these approaches.
The majority of my consulting work deals with TOC-101 .... find and fix the bottleneck. I often can find the bottleneck within hours of arrival just by looking for the largest pile of inventory. Typically a common sense solution is available, but it has been lost in the “haystack” of work orders in the system. When this does not occur, however, I provide tools that will allow them to create focus around the bottleneck, so they will “over manage” this area (Exploit) and under-manage other areas (Subordination). This presentation covers 8 of these tools that all have common attributes .... they are quick to install, are data based, and are very visible. The analysis driven by this data allows the customer to move from opinion-based decisions to data-based decisions. These tools range from the readily available (stopwatches and apps on smart phones), to simple (a production board mounted near the bottleneck), to fairly complex (webcams mounted on the machine that use motion detection). All of this starts with training, so that the customer can understand the bottleneck and its attributes. I also teach the basics of variation, and how negative variation is more powerful than positive variation, and how buffers can absorb this variation.
In our search for inherent simplicity we suddenly have a body of knowledge growing immensely to do that. The miscommunication of data: we have the system or reality I am trying to describe, predict, etc. I collect data and run statistics and provide a data summary as the description of reality. My boss creates a picture of the understanding of others in the organization of my description. Four different data sets are shown to produce the same statistics. What are the system implications of miscommunication (an unintended gap between my goal and the understanding of the system)? The gap between reality and perceived reality can cause bad actions. The Challenger disaster is discussed. The cloud concerning message variation (short versus long) is provided. A is Improve system, B Ensure everybody has all information necessary to make a good decision. This requires D Provide a large and detailed report. The other requirement is B Recognize time and resource constraints of people in the organization which requires D' Provide an executive summary. The conflict is then between D Provide a large and detailed report and D' Provide an executive summary. Effect-cause-effect logic and the cloud have proven powerful and easy to use thinking processes (TP) to simplify communications in business and personal life.
As the health care system strains under the effects of rampant obesity and its accompanying diseases and conditions, experts argue about what simply constitutes a healthy diet. As evidence and studies mount, the expectation would be a resolution of the disagreement. On the contrary, a polarization of 'low carb' vs 'low fat' camps has evolved, with no reconciliation in sight. With the stakes tremendous, why is this? This presentation will provide a status report on our research collaboration between Goldratt Research Labs and Professor Tim Noakes of the Sports Science Institute of South Africa. These include the use of the Change-Matrix-Cloud-Process to understand where and why individuals and professionals get stuck in the change/don't change process, the use of an exciting artificial intelligence engine to bypass 'big data' and instead mine the knowledge of experts directly, and other devices relevant not only to nutrition, but any industry as well.
What makes TOC so powerful, and yet so difficult to embrace? In this informative and conversational session, Sanjeev will explain how counterintuitive solutions power the success of TOC, and at the same time, make it hard for some people to buy into. For example, TOC posits: * Allowing for idle time increases overall throughput. * Allowing more time for a sub-process reduces overall cycle time. * Stopping work on projects makes them go faster. * Moving inventories away from the point of sale makes supply chains more responsive. TOC often feels counter-intuitive to traditional managers, consultants, and enterprise software providers simply because theyve been trained in a particular way. Its never easy to see the world in a new way. The pure numbers approach works, but only up to a certain point. As supply chains, logistics systems, projects, healthcare systems all get more constrained, things will start to hit a wall. At that point, you have to understand the physics of your FLOW before you can use numbers to manage and improve things. TOC looks at the underlying physics of flow—thats why its so powerful. This is a Memorial Lecture in honor of the late Peter Britt Noonan.
Following this presentation the participant will be able to- Identify the main injections and benefits; Explain how the 5 steps apply to this environment; and Discuss how buffer management supports integration in this environment. This presentation focuses on community health and social care in a region of the UK where the TOC approach has been applied through QFI Consulting over a period of more than 5 years. The research involves a combination of case and action research over three distinct cycles. The first cycle concerns the use of TOC based discharge management across the 12 community hospitals in the region. This is followed by 2 cycles extending the TOC application into community outpatient care over the last 18 months. The presentation is structured around these three cycles and in each case the process of analysis, design and implementation is presented together with the results and issues associated with building the capability then capitalising and sustaining it. These cycles are then discussed in relation to the 5 focusing steps with particular reference to the use of buffer management. The presentation concludes with a reflection on how the inherent simplicity of this complex environment relates to the other TOC applications.
Despite the major role of non-profit organizations (NPOs) in modern society, TOC does not offer a comprehensive global methodology for these organizations. This presentation delineates a comprehensive managerial methodology of NPOs. The TOC-based methodology for NPOs proposed herein fits the needs of NPOs and reflects the inherent differences from business organizations. It deals both with the planning aspects and the execution aspects of the NPO. The key issues for achieving the missions of the NPOs to the benefit of society are: definition of the GOAL of the NPO, definition of its throughput and last but not least applying the strategic gating mechanism for selecting of the most valuable initiatives. The seven focusing steps are adapted for NPOs by pointing on the permanent constraint of NPOs and emphasizing the importance the GOAL definition and using proper measures of performance. Examples of implementing the methodologies in various NPO environments like hospitals, law court systems and NGO are presented and a full case study of a technology literacy NGO is discussed. The presentation will follow the six steps of SOTSOG process.
For the theory of constraints (TOC) thinking processes (TP) to really make a positive impact as problem-solving and decision-making tools to help us “leave a better world behind"" and sustain the success of a TOC implementation, their adoption rate and application success rate within organizations and by individuals need to dramatically increase. Even TOC experts themselves use the TOC TP mainly as communication tools rather than as practical problem-solving and decision-making tools due to their complexity and the time and discipline required to generate new and valuable insights with the tools. In the first part of this workshop titled “The evolution and practical application of a simplified TOC thinking process - the change matrix cloud method”, Dr. Alan Barnard will present his research that resulted in the development of the new change matrix cloud method from the Goldratt's evaporating cloud, communications CRT and change matrix methods. The CMC method has evolved and been thoroughly tested over the past decade across a wide range of applications globally. The field testing has shown it maintains the benefits of the original TOC TP tools, while overcoming their limitations with a process that is simpler, faster, more systematic and (in many applications) more reliable to generate new breakthroughs. In the second part of this workshop, attendees will have the to apply all 5 steps of the CMC method to make a breakthrough in any significant problem or decision they are currently facing.
The nature of constraints has been a subject of many discussions over the last years; e.g., at a TOCICO webinar by Eli Schragenheim and on LinkedIn. All these discussions have come to a deadlock. There are very different perceptions and definitions of what a TOC “constraint” is and what it is not. The Constraint Matrix (CMX) framework is a serious attempt to bring theoretical as well as pragmatic clarity to this highly important question by suggesting a fresh answer. It is also intended to be a powerful communication tool to promote the understanding of the importance of constraining factors / leverage factors, especially for businesses. As TOC is based on hard sciences we should always search for inherent simplicity. CMX provides the currently lacking classification of different kinds of constraints. As a simple framework it captures the essence of “positive” and “negative” constraints in for-profit environments. Positive constraints are sources of high performance and results towards the system goal(s) (as defined by the system owners), while negative constraints have significant negative impact on performance and thus results. Strategic constraints focus on the competitive environment and tactic constraints on flow.
What is the problem? A huge distributor of pharmaceutical goods serves more than 10 thousands retail stores and hospitals as well as 300 of their own retail drug stores is implementing the TOC supply chain solution. It required the company to shift from a push inventory system based on forecasts to pull replenishment based on actual demand. This change required the ability of the company's distribution center (DC) employees to pick 3 times more lines than ever daily. The DC keeps 8500 SKU. The most obvious and easiest solution is: 1) to increase the DC capital equipment, 2) increase of personnel, 3) increase the number of shifts per day. But such an “easy” solution immediately requires an increase in investment and operational costs. Initially it looks quite difficult taking into account also the fact that ??? supply chain solution was initiated to increase net profit. The direction of the solution. We've assumed in our analysis that current operational processes at the DC were based on local efficiency policies which ate into its capacity. The task then was to change the DC processes in a way that will increase capacity significantly without additional investment and with a minimal increase in operational costs. The DC of a huge distribution company has many undesirable effects (UDEs) like: 1) a huge investment into capacity and equipment, 2) a tendency to focus on an increase efficiency per resource (in this case .... per person), 3) interdependencies of operations and high uncertainty. That's why we decided to apply some approaches and solutions from ??C make-to-order (???) solution in order to gain more capacity. What was our thinking and approach to the analyses? At the start we considered implementing in our own drug store chain only because we earn a higher return on investment there. Traditional push replenishment in the company generated approximately 100 lines per day on the DC. This was the number generated by the drugstores' daily orders. The TOC replenishment requires to replenish daily what was sold yesterday. Thus we get approximately 400 lines per drugstore per day. Such a difference (from 100 lines to 400 lines per drugstore per day) reflects the increase in capacity requirements if we are going to replenish what was sold yesterday what is the impact? It is not 150 stores * 100 lines =15000 pick up lines at the DC under the push system but 150 stores * 400 lines = 60000 pick up lines under the pull replenishment system at the DC. Here we consider only 150 drug stores (not the full 300) as a separate geographical part just for an easy illustration of the logic and calculations. The new solution mechanics. We decided to consider the DC as the system's capacity constrained resource (CCR). The DC pick area consists of 2 zones: a pallet storage and a conveyor. The pallet storage is designed for pallet stock pick up and stockkeeping of manufacturers' boxes. The conveyor is designed for orders pick up which consists of many SKUs with a relatively low number of items for each SKU line. For instance: one manufacturing box consists of 100 items of a Product X. Meanwhile for each line this is not supposed to be more than 1-5 items. Considering the conveyor more precisely it occurs that the equipment is rather expensive. It's hard and more expensive to expand in comparison to pallet stock keeping. There are 2 conveyor parameters: how many SKUs can be kept there and how many pick up lines it supports. The conveyor is replenished based on forecasts. Frequently the conveyer stocking policy is violated by stocking excess inventories. For example, the conveyor currently holds a particular SKU with a particular serial number (this applies to pharmaceutical goods) but at the same time the headquarters requires a pick up of another serial number of the same product for some other clients. The conveyor also holds overstocks but additional small portions of goods have arrived then again we put them on conveyor zone. Now, what factors influence the number of pick up lines? For example, the storage of particular SKUs at the conveyor is a factor. In the situation of the “right” SKU location the less time the employee has to reach the particular cell, pick up particular SKU, and put it into the tray impacts employee capacity. This tray next travels by conveyor to another employee in order to be filled in with another SKU. This continues and finally the tray reaches the control point and packaging. Next, we've considered the gap in the current measure of cells utilization. As a reason of the Gap is the low number of pick up lines. The conveyor is designed to keep stock for 2 days only. However some SKUs have stock close to zero and we are forced to replenish them urgently or / and the stock is not in a right place on the conveyor. Meanwhile a significant number of SKU has stock for more than 5, 10, 20 and even 30 days. So the gap in pick up capacity was as a result of a gap in product availability that in turn was the result of the stockkeeping policy. This stockkeeping policy was that the SKUs most often demanded are kept in “slowly (remote)” locations (less available) and at the same time SKU with less demand are kept in “locations for high runners” or easily accessible locations. Thus we have identified an UDE that significantly impacts capacity and the next task is to identify the policies which caused the UDE. It's quite obvious that the replenishment algorithms are the cause. Suppose we have SKUs in manufacturer's boxes located on the conveyor and the stock is already enough. Also the current rules (which were based on the distribution mentality and practice the headquarters where series of the same SKU orders of drug stores should be picked up). As a result if SKU/series which is kept at conveyor is not the same with SKU/series which was defined for pick up then selected SKU/series should be located on the conveyor. As a result .... one more cell is occupied with the same SKU but with different serial number sequences. What was implemented and what is the result. We've eliminated this policy .... no more manual administration of series of particular SKUs. That alone decreased the number of small good arrivals to the DC. Elimination of only these 2 reasons has increased the number of pick up lines to 70 thousand lines per day. Additional changes were implemented. Unique insight. These changes caused the company such a significant and unexpected increase in capacity at the DC The company was then tempted to increase lines sold into wholesale. It's the same situation as if one increases the capacity of a very expensive resource which is a CCR and its capacity was increased significantly. This allowed selling products in our other markets at the lower prices also. We presented this problem and recommendation to the company and we made a similar decision. Its truly profitable to convert this additional capacities into additional throughput in our retail market in additon to our drugstore market.
Get ready to explore the challenges in Sales and how TOC improved sales performance. The presentation focuses on firsthand experience and data analysis of sales for several companies in the IT sector. In 2017, the founder was looking at some dismal prospects. After investing in sales, the team wasnt able to bring in any new business and the companies sales were and had been flat. That same year, after 2 years of operations issues, the decision was made to utilize Theory of constraints to resolve long standing problems in service operations. It was there that some systemic issues were revealed and so began the long march to improving business operations. But things would get worse before they got better as sales continued to struggle. It wasnt until a couple of years later that a real discussion was had on applying Theory of Constraints to the sales process. It wasnt an easy process to decipher, but the impact to service operations was clearly evident. It was through this evolution of sales that led to a new view of how to approach planning, forecasting, and executing our sales operation. It even launched an entirely new company focused on sales ops for IT firms. In this presentation, the presenter will share his story of what happened, what the data showed, and how the TOC method applied in sales created sustainability in his first business and launched a second business to help other IT companies.
The retail environment is full of myths that prevent proper functioning and perpetuate damaging modes of operation - pushing inventories is just one of them. In this workshop, well investigate myths in four broad categories - stockouts, surpluses, time and technology - and how to replace them with reality using TOC.
(Goal)Share is a new tool for reducing changes in projects by 50%. Three phases of projects are: choosing projects, project content, and execution. Critical chain project management (CCPM) only deals with execution- the furthest phase from the core problem. The process to reducing project changes is: define problem (UDE: changes); direction of solution (using the strategy and tactics (S&T) tree to capture project content); development of the tool with three very different businesses; 5 simple questions & one easy-to-use tool; and how to…and pitfalls to avoid.
This presentation will discuss a “new kind of textbook,” replacing the thunderous volumes measuring a thousand pages in length and 5 pounds in weight with mini-textbooks affording quality learning and interdisciplinary engagement, where learning takes place in all aspects of life. The goal is to assist the learner in looking at the world from a rational perspective, by leveraging the knowledge of specialists in business, and integrating this knowledge into textbooks demonstrating the ease .... and joy .... which “difficult” subjects can be tackled with enthusiasm. An airplane soars, a door opens automatically, my cell phone rings, the Panama Canal widens, the weld holds, and the immunization protects. The moon is full, the rain passes, a rainbow arcs, and the leaves color. From the “common” to the “uncommon” (Elon Musk's Tesla, SpaceX, and hyperloop), everything is extraordinary .... if given a chance.
Coke (used as fuel in Blast furnace) is produced in Coke Oven Batteries which consist of alternately arranged heating walls and Ovens. For efficient process, optimal heat distribution over the entire heating wall is essential which necessitates the measurement of temperature. It is done manually in 3 shifts by 3 persons daily, directly from the oven top by opening the flue caps to measure temperatures with the help of a hand-held pyrometer in harsh environment. Given that steel industry is labor intensive, manpower productivity has been at the forefront in all policy making and Tata steel is making concerted efforts in this direction. Present case explains the application of TOC in achieving the objective of improving manpower productivity at Coke Ovens. As surfaced in Core conflict cloud, it is evident that deploying more manpower provides the advantage of frequent update of data while increasing the risk involved in safety. Therefore, any underlying assumptions which give rise to the conflict should be addressed to derive suitable injections. The conflict of deployment of manpower was resolved by identifying a new win-win solution. The Innovative injection has a huge potential (patent filed) and has a scope of wide implementation across industries. Video length: . PDF: slides.
It is well known that difficulties to utilize CCPM for Product & Service Development projects and we experienced a lot of failures or poor results. Kaoru presents, based on his lessons learned from failure, misunderstanding and wrong assumptions causes such failure, and useful knowledge to overcome various obstacles. Most of Product & Service Development projects are SOFT projects that involve cooperation in learning exchanges, expert advice, economic and trade development, and information exchange. In Many cases, project process includes experiment process, iterative or incremental process. If Kaorus understanding and observation is reasonable, the original CCPM is designed to support HARD projects and many of TOC practitioners do not have enough knowledge to utilize CCPM while accommodating the nature of SOFT projects In this presentation, Kaoru illustrates the nature of SOFT project and difficulties to utilize CCPM for SOFT project. He also shares his Learning from Failure and various Giants Since his clients do not permit to disclose the name of the client and detail of the projects, he will not provide actual case studies, but he will present essential information based on the reality extracted from 50+ projects, about 1) project outline 2) difficulties & failure 3) causes & reasons 4) practical knowledge to overcome obstacles, and 5) Success by combination of CCPM and other knowledge or methodologies. In this presentation Kaoru emphasizes that he learned all knowledge to overcome obstacle from existing knowledge about Project Management, Operations Research and TOC. He did not invent new knowledge nor methodology. Precise understanding of boundary and assumptions of TOC and open mind to learn from failure and outside of TOC leaded him to achieve meaningful result of CCPM in SOFT projects environment. He also emphasizes TOC and CCPM is practical and powerful in SOFT projects environment. Even in agile development such as SCRUM or DevOps, the concept of Constrains, Flow, and Buffer Management (including fever chart concept) are the essential and practical knowledge to realize GOOD FLOW of the projects. He concludes his presentation by his idea about key success factor Learning from Failure and various Giants.
When the former governor of the state of Santa Catarina, in Brazil, Mr. Luiz Henrique da Silveira, started his first mandate in 2003, he asked for Mr. Miguel Abuhab's help on how to improve the state's tax management system in order to enhance the tax collection efficiency. As he stood before the problem, his mind was immediately driven by two important beliefs in science: First that “all complex systems are governed by inherent simplicity” and also that ""all conflicts with systems can be resolved...if we can find the erroneous assumption(s)”. Weeks later, Mr. Abuhab returned to the governor with his first draft on how to improve the tax management system by just breaking the limiting assumption that was blocking the viable vision. Miguel has shown that by changing the current perspective to a holistic one, they could not only improve the tax system, but completely change it for a brand new reality, where the taxes fees could be reduced while the government would be able to leverage its tax incomes. At this point both Miguel and the governor realized they were standing before a solution for the country instead of something local. At this moment, backed by powerful assumptions, and a handful of injections, this plan is being analyzed by the Secretary of the Treasury of Brazil, Mr. Joaquim Levy, among other key stakeholders within the government. It's not only about finding a better way to raise the tax incomes. It's a plan to boost the Brazilian economy, benefiting both citizens and government in a true win-win relationship.
This presentation covers the past 15 years of applications of TOC in the mining industry. The presentation is presented in the form of a narrative of a typical implementation on a mine, followed by a summary of the key learning points from more than 60 implementations on mines over several years of practical experience. It is not based on a single application, but a mosaic of several implementations that follow more or less the same patterns of application, successes and sometimes followed by failure. The presentation sets the stage of what it is like in a deep underground mine, then deals with the steps to identify the constraint(s) and then covers some exploitation and subordination examples. The final stage shows how the typical leadership constraints are overcome and how a culture of success can be created. The essential transformation is from a cost-world approach towards a throughput-world approach.
The purpose of this presentation is to propose a process to build a strategy and tactics (S&T) tree using a SWOT (strengths, weaknesses, opportunities and threats) analysis as a starting point. The output of the SWOT analysis is used to determine the different assumptions that are part of the generic structure of the S&T tree at its different levels. In addition, each level of the S&T tree is designated a different title to create a language that facilitates communication. Finally, the output of the S&T analysis is summarized in a strategy map which is a tool to communicate graphically the relevant part of the organizational strategy. A case study of the process being applied in a development bank in Nicaragua is presented to illustrate the process.
This presentation provides a way for corporate employees to train and develop their own personal leadership skills. It suggests ways of finding how to motivate themselves in the harsh environment of organizations, to develop their business skills, and to improve their own leadership. This is deployed as a practical learning tool, so that a worksheet is prepared for self-training. This worksheet is a customized one built on the individual's circumstances and characteristics. A Cloud describes the dilemma experienced by employees in their poor company environment serves eliciting three kinds of good ideas (injections) to resolve their leadership dilemma. You could practice each of the above three injections to understand and apply them yourself. To do this, I created a worksheet format designed with an implicit support of the TOC thinking processes. This will allow you to assess your current level of leadership and to anticipate future levels of your personal leadership.
Whether you are dealing with stories & sprints, projects, or portfolios, one question you must answer is, what to work on next? That is, of the work I could do, what work is most important for me to do? This is a priority decision — and you must use some kind of prioritization method to answer it.
As in many places in the world, such as the US, the Netherlands, and Germany, Israel suffers from a real estate bubble. The price of residential real estate has doubled in the last eight years, causing economic and social problems across the country. Young couples cannot afford to buy a home and have difficulties coping with rental prices. If this situation continues, it will be a huge problem for the mortgage market for both the households and the finance industry. Research shows that about 20% of all purchases are for investment purposes. In an environment of almost zero interest rates, private investors prefer investing in residential real estate over investing in bonds or securities. This situation calls for new approach and TOC offers a new way of observing the problem. A focused Current Reality Tree (fCRT) analysis reveals four core problems: i. No clear government real estate policy; ii. Ineffective and inefficient production of new housing; iii. High yield for investment in residential real estate; iv. Almost no alternative to residential real estate investment. The first three core problems are being taken care of by the government. The 4th issue is being neglected, and we suggest a TOC-based solution. Using the Conflict Resolution Diagram (CRD) to describe the private investors' conflict, we can find a win-win solution: issuing a bond that imitates the price of residential housing. A survey shows that 40-50% of potential investors will consider buying this bond as an alternative to purchasing an apartment. As we do not have clear data on the demand curve we assume that the issuing of ""Real Estate Bonds"" will reduce the demand for housing by 10-20%, and be followed by a residential housing price reduction of 5-20%.
Management, quality work and TOC? Quality people shadowing in the corners or hunting for bottom line results? Why the management of companies is not regarding quality work as productive? For the management quality work is a way to make more money. The management and quality people perceive the targets and priorities of the company in different ways and it often happens that quality work is not supporting to achievement of the goal but is regarded more like inevitable waste. The quality certificate is justifying the quality work as long as it does not disturb the business. On the other hand, the quality people do not feel that their work is appreciated although they have valuable experience and operations understanding as well as competence on different development methods and approaches. This set up leads to develop isolated pockets and details of the company thus losing significant bottom line potential. This short presentation is an abstract of a well-received half-day workshop held in the 60th European Organization of Quality Congress in Helsinki in May 2016. On the presentation the conflict described above was first analyzed and then one direction of the solution was identified. The key question to break the conflict: what should be in place so that the quality work could be directed in most productive way? In the analysis different views of important stakeholders were considered. We claim that the TOC mind set and methods based focused quality development can strongly support the business and in addition the quality function can become ever more important and an appreciated partner for management. The TOC thinking processes were used when analyzing the conflict and creating the direction of the solution. Furthermore, it was also presented how TOC thinking and methods can be combined to boost e.g. Lean- and Six Sigma based development and results.
Typical situations where mediation may be of value include: marriage issues, looking after children when divorce happens, neighbor disputes, landlord-tenant disputes, small claims court legal actions, disputes between parents and teenage children, and many more examples. Basic assumptions of the situation are both sides believe they are in the right; both parties have no experience with mediation; both parties feel that any form of mediation is going to result in their losing and the other side winning; mediation frightens one or both parties; lawyers may already be involved; there is a great deal of pain, mistrust, and a refusal to listen to anything the other side might have to say. The key theory of constraints (TOC) thinking processes (TP) tools comprise the following: the cloud to capture the key aspects of the conflict situation; the prerequisite analysis to capture obstacles to any win-win resolution, and then to develop an agreed-upon plan to resolve the issues, the negative branch reservation (NBR) analysis to transform proposals into agreements; and a facilitator trained in using a prerequisite tree. This presentation develops a process by which conflicts can be voluntarily resolved. The actions required of the mediator and of the participants, and the logic of why the process works, are covered. This is a tested and successful TOC application.
More and more practitioners of systems improvement have come to realize that the Theory of Constraints (TOC), Lean and Six Sigma are actually very compatible and synergistic with TOC often providing the focus for where to apply the Lean and Six Sigma tools. In spite of this, TOC is not only still perceived by many as non-compatible with Lean and Six Sigma and some practitioners of Lean and/or Six Sigma continue to promote the perception of incompatibility. One source of this continuing perceived conflict is TOCs focus on balancing flow in contrast to Lean s focus of balancing capacity. Part of the underlying cause of this perceived conflict is how waste and balance are defined, specifically as it applies to individual process cycle times and capacity and how those definitions are then applied to the design of a production system. This presentation will look at how the conflict can be resolved by challenging the assumption that TAKT time and capacity should be the same. We will see how system balance can be attained by focusing Lean tools on the cycle time side of the system design and the TOC tools on the capacity side. Video length: . PDF: slides.
This presentation discusses the value creation to project management beyond critical chain. Question 1: If we reduce time to market by 10% using existing resources this will increase the value of the firm by approximately 100% (assuming we are facing a resource constraint and the development is the constraint). What is the impact? Question 2: If we eliminate 10% of the features, we add almost 100% the value of the company. We assume the development resource is the constraint. What percent of the development is wasted? Over 70% of development is wasted. We have a garbage plant of 70% where department efforts do not add value to the company. The goal of the company is to increase its shareholders' value as measured by discounted cash flow. A value driver (financial and managerial) is any performance variable that can significantly increase shareholders' value. The six value drivers for project management are the project goal, strategic gating, 25 / 25 process, tactical gating, complexity reduction, and complete kit concept.
This presentation is a follow-up on the LaTourneau Technologies (LT) presentation given by Dan Eckerman at the last conference. This is my view of what we did versus what Dan presented which was his view. Debra provided an overview of the steel mill and what they build (oil rigs, large heavy equipment loaders). The vertically integrated supply chain with control points and strategic buffers was described. Education provided included a two-week Jonah course. Lessons learned i.e. control points in sales, engineering, front end and back end production, etc. with respect to the bottleneck capacity, measures, portfolio management, etc. were also discussed. The current design for critical chain, drum buffer rope, and the replenishment solution was described. A description of actively synchronized replenishment (ASR) was provided. These concepts were discussed for internal constraints, industry downturn and economic downturn (recession) environments.
Problem: When selling or gaining buy-in to the TOC solution for project environments, it is often difficult to for the prospect to grasp the reality of the full transformative vision and benefits. After all, it is a great departure from today's reality. Though we have good exercises to demonstrate the negatives of bad multi-tasking versus focused tasking (the Bead Game, the paper tearing exercise), it is hard to translate those exercises to the full benefits of the integrated solution and the full need for software. We can describe the elements and the proposed benefits, but the intuition of how it really can work is often lacking.
There is a proven track record of the implementation of Critical Chain Project Management with good CCPM software to support. This presentation discusses the challenges of implementing without introducing new software.
TOC is a powerful methodology, but in 25 years of implementing worldwide, Gerry Kendall found it is not sufficient to have a lasting impact. Even when applied with passion, skill and experience, TOC requires other elements to drive newsworthy results. In this presentation, Gerry shares the 5 most compelling injections with many real-life examples, which, when combined with TOC methodology, helped him and the organizations he touched succeed for years. Video length: . PDF: slides.
The organization of this presentation is to provide a description of Prince Manufacturing and its problems, the theory of constraints solution, the implementation approach, the results and the lessons learned. Prince Manufacturer was formed in 1950 and now has five plants making welded and tie-rod cylinders, mono block and sectional valves, pumps and low speed, high torque motors (ISO 9001 certified). They sell direct to large original equipment manufacturers (OEMs) and use 18 distributors for small OEMs and catalog sales. The company experienced minimal growth and flat profitability over the past 3 years. They investigated TOC as they were frustrated with the status quo; they intuitively knew there was a better way as they had some knowledge of The Goal, and wanted to consider that a Viable Vision (VV) might exist. The TOC solution included: guaranteed on-time availability and rapid response. The secondary offer to distributors was vender managed inventory (VMI) and availability of high volume products. The solution for sales steps of the SFS process consisted of creating the offer, synchronization between operations and sales, training, delivering the offer, managing the pipeline and leveraging the offer are described in detail for each market segment. Results include offers accepted grew from less than 20% to over 80%. The pipeline expanded 10 fold in six months. The solution for sales now represents 70% of current sales. Lessons learned include: sales can never start too early, not all sales people are equal, identify and implement measures early, etc.
This presentation will help you work out how best to achieve a breakthrough in a (new) industry using the Theory of Constraints. It will be based on my own lessons learnt from developing TOC based solutions for many different industries including financial services, insurance, poverty, tourism, design, executive education and health and social care. over the last thirty years.
This project was originally planned to take 35 days, and it was completed in 6.5 days. Safran Electronics & Defense (SAE) in Mantes-la-Ville is a factory of 300 people with 2 main production units: Machining of parts and Final Assembly. The factory was implementing a range of production improvement projects based on TOC (Theory of Constraints) methods. One of the workstreams was to simplify the production flow on the factory floor. The target of the new layout was to help reduce lead times, simplify the flow of parts and increase global productivity. Around 48 machines-tools needed to be moved without interrupting production. Guillaume Brethenoux, Maintenance Manager led this project. He used the Critical Chain Project Management principles to challenge the initial planning of 5 weeks and eventually achieve the reengineering of the shop floor in 6.5 days!
This is the lead presentation to a facilitated session on how to create mindset and behavioral change. Alex Knight gave some of his own experiences and thoughts on changing mindset and behavioral change. The first thing we have to do is pick up a mirror and look at ourselves. Alex described his professional and consulting background (Ashridge School, Goldratt Consulting,and QFI) as related to the topic. His learning from the difficult moments includes: When experiencing difficulties in mindset and behavioral change, consider the following: 1. Start by assuming the other person is right (Ask yourself: what is it that you are not hearing?); 2. Look inside yourself to discover what behavioral / mindset change you need to undertake (what is the block in my understanding that makes me think I know more than that person) first in order to help others with their own change (the leader within). Trying to understand why that person thinks they are right can be approached in two ways: 1. Assume they are wrong and you are right and find the gap between their logic and your logic OR 2. Assume they are right (what does that mean in terms in my logic?). The best way to achieve mindset and behavioral change in others is to start the journey with an examination of yourself. For example in the healthcare area, one-third of the time someone is blaming others for the problem. You do not have the right to blame someone else until you prove you are 'squeaky clean.' A route to achieving mindset and behavioral change is mastering the following two qualities: value-based leadership and practical visionary. The characteristics of each of these are discussed.
This presentation provides the definition and benefits of a Mafia offer; the background providing our experience with clients; the six most common problems and solutions; other lessons learned and the results of Mafia offers. A Mafia offer is an offer that meets a client's significant need to the extent that no significant competitor can. (Dr. Eli Goldratt) A Mafia offer is an offer so good, that your customers can't refuse it and your competition can't or won't offer the same. The Mafia offer should increase sales and profits significantly and guide the strategy and tactics for the entire organization. The Mafia offer boot camp is described. The six common problems include how your offer is presented; getting in to make your Mafia offer presentation; the number of prospects; risk, paranoia, too good to be true; your target market; and quality / lead-time / DDP / customer service. Lisa provides a case study illustrating the problems and solutions.
With over 1,100 branded chain stores across 38 countries and approximately 8,000 products, JACK & JONES is one of the brands of BESTSELLER, a family-owned clothing and accessories company founded in Denmark in 1975. After getting great results by performing the replenishment of its products with a pull system using DBM (dynamic buffer management) in its own stores, JACK & JONES was chosen to start using the same NeoGrid solution to manage the replenishment of thousands of partners through its worldwide, wholesale stores. Outstanding results came right away, during the first month of trial with partner Zalando: On-shelf-availability jumped from 85% to 95%, potential lost sales moved from 18,8% to 4,4% and sales increased 15,3% compared to the previous month. Key success factors include consistent POS data integration, adequate process change plan and trial execution, category management and dynamic buffer management. This new approach built a model that promoted effective linkage of the whole distribution chain as one system, reducing the levels of inventory in the system while coping with better product availability at the store level.
This presentation provides the case for how to achieve a win-win-win solution for all stakeholders of the U.S. healthcare system. Dr. Ferguson explains the key components of the analysis from a paper she wrote. The answers to the questions (What to change?, To what to change?, and How to cause the change?) are presented for each type of stakeholder, in addition to how to overcome resistance to change. Professor Ferguson also explains how to improve healthcare in the world as well as an analysis that addresses all of the stakeholders of the U.S. healthcare system. Each stakeholder is addressed with respect to the questions of 'What to change?' and 'To what to change?' in the paper. With respect to the second question, a summary of any known successes of implementing TOC in healthcare in the world is shared. The question of 'How to cause the change?' is answered as well to some extent. The full answer to the third question would need to be presented in a strategy and tactics (S&T) tree written specifically for how to implement the change in the U.S. A roadmap is described in this presentation as well.
Acquiring companies using TOC principles, and the improving their performance using simple, powerful TOC solutions is part of GCPL's culture now. Each acquisition in different parts of world brings a challenge for core TOC team to quickly understand the culture of the company, complexities in business and develop and implement simple solutions to see significant improvement in performance in short times. Recently GCPL acquired a company in the US, wherein a thin team manages a complex business of wet hair care products. This presentation is about the TOC implementation in this company, the unique challenges faced, flow solutions deployed and results gained in a short time span. It describes: What is THE VALUE for the customers of the company and its relationship with the FLOW Process of aligning / subordinating all functions towards the global goal of ˜Creating significant value for the customers and FLOW improvement initiatives can create significant value for the customers in a short period of time. The focus on FLOW provides a strong platform for the teams to collaborate and also improves harmony. Since there is clarity on what is the significant need of the customers, it is now pursued by teams who hitherto had seemingly conflicting local measures. This presentation covers how the company is using TOC solutions to improve flow, and focus on the significant need of customers. Company continues to use innovative yet simple TOC solutions, which are internally developed.
The objective of this presentation is to Improve your thinking productivity by leveraging the foundation laid by Eli Goldratt. The tasks/ the challenges are: 1. Figure out why a) people continue to think below par (despite The Choice) b) thinking productivity is not a major concern area? 2. Build further on Eli's solution; 3. Key missing piece: the way we are wired to think- in fast and slow modes. The deliverables are: 1. A 'new composite' narrative on “Thinking Clearly” - incorporating Eli Goldratt's & Daniel Kahnemann's tenets suitably, besides other elements; 2. Relate to 'Thinking' in a new empowered way; 3. Carry away a set of guidelines and practices to enhance your thinking productivity.
Aubrey Daniels proposed and exposed in detail a mechanism to reinforce desirable behaviors in his seminal book "Bringing Out the Best in People". TOC, on the other hand, has been proposing and implementing successfully many high level strategic and logistical solutions over the years. In this presentation we will explore the complementarity between the positive reinforcement tools proposed by Daniels and TOC solutions. The specific choice of behaviors to reinforce, the specific mechanics to do so and how to integrate the views of positive reinforcements with the general principles and tools of TOC will provide us with new insights into leading people to new levels of performance and satisfaction. We will explore the logic and draw up a few examples of the application of the methods combined to illustrate the processes examined in this presentation. Video length: 59:29. PDF: 31 slides.
Brazilian planes manufactured by Embraer fly on 120 airlines around the world. The world leader in the regional jet market, there are more than 1,500 E-Jets. To keep any aircraft company on the market depends heavily on its workforce, considering that making airplanes requires highly qualified engineering, we need to control resources, as they are often scarce and the development time should be competitive. Because of that, we use the critical chain to make this control of programming of developments. However, the frontline team has the perception that it is under pressure, which causes stress due to tight deadlines and complex tasks. This work environment can affect productivity and engagement. Looking at this environment, we apply the principles of the theory of constraints. We built a Current Reality Tree with a small and representative committee of workers and arrived at the root causes of the problem. With Evaporating Cloud, we understood what was behind the conflict: to plan or not to plan. This assessment provided us with valuable information on what to change. We apply a simplified Strategy and Tactics Tree, setting goals and actions. Finally, change management techniques were used in the implementation phase, which is currently under way. Video length: 1:00:46. PDF: 37 slides.
This presentation describes the significant growth in India's economy highlighting the 10% growth in gross domestic product and the manufacturing sector. The India status of project management is discussed with respect to due date performance (99% of projects late), cost overruns (expected cost overrun of 20%) and scope. The large number of very large projects is discussed as is the lack of managerial experience in project planning and execution. A case study of a client is discussed where the company is building a Greenfield paper mill (estimated cost $20 million) and lessons learned from this project are presented. A paper machine project flow diagram, project management competence, the opportunity for critical chain, challenges faced in Indian context (cash flow management, for example) unstructured processes, project realities, managing supplier and contractor relationships, use of templates (task update, issue resolution, cash flow, vender management, procurement) are described.
This lecture presents two particularly important TOC concepts that are used in Neogrid solutions: DBM and mafia offer. DBM (Dynamic Buffer Management) enables the Neogrid solutions to dynamically manage our customers inventories, automatically adjusting buffers according to end consumer demand. Therefore, Neogrid offers the necessary resources for a better interpretation of seasonality and sudden changes in retail demands. The concept Mafia Offer allows our customers to analyze performance of their operations through indicators such as Throughput Value Days (TVD) and Inventory Value Days (IVD), thus, they can monitor the gains that retailers have when using our solutions. Video length: 39:26. PDF: 29 slides.
The last century was the stage of an impressive evolution in healthcare: we are living longer, and the population is growing. However, these improvements led to a higher and rising demand for healthcare services. Despite an ever-increasing investment in healthcare, lack of capacity and timeliness are still affecting every country. Current management methods are not providing an effective solution to this crisis. Frequently, the bad/outdated policies that healthcare organizations are using to manage their resources and patient flow are the problem. Potential solutions, like Lean and Six Sigma, provide limited benefits and still incur in the same problems: high investments and long implementation time. Healthcare organizations that adequately applied the TOC achieved impressive results. A recent study about TOC in healthcare (based on academic articles and TOCICO video proceedings) reported improvements in productivity .... more patients treated .... and in the timeliness of care .... which leads to better outcomes. Applying TOC basic principles and three POOGIs can be implemented in a few weeks and usually does not require additional cost. TOC principles and POOGIs can be applied in healthcare to address the core conflicts and undesirable effects. Examples include family medicine practice, imaging practice, emergency departments, inpatient bed management, and home care. Video length: 48:41. PDF: 60 slides.
This presentation introduces four new tools to effectively improve government. The strategic compassthroughput operating system is based on the 5 focusing steps and allows one to focus on what is important and provides organizational alignments. The journey board capacity model illustrates “what good looks like”, visual management, and future reality trees and allows one to focus on goal-setting, responsibility, and accountability. The standard operating procedures - value stream map ensures full-kit, standard work, and best practices while providing common expectations, smooth hand-offs, and flow. These four new tools provide effective visual management. Each is described in detail and illustrated through numerous examples. Video length: . PDF: slides.
Can adding a little TOC to the production process of custom manufacturers get results? What if the manufactures are highly custom job shops and machine shops? What if the TOC Consultant never steps foot on site? What if no software was used? Drum Buffer Rope was simplified, customized, and implemented remotely via an online coaching program from 2007 to 2020 at over 400 custom manufacturers and job shops. This presentation reviews the learnings and results.
Industry 4.0 is a real breakthrough in operations, however until now a good use-case waits to be found, as investment is huge. TOC has established itself as a great focusing mechanism - combining TOC thinking with Industry 4.0 implementation can carry huge impact with it. How can it be done correctly?
Sales pipeline is a conceptual model to manage the stepwise sales process. The traditional sales activities are focused to increase the conversion rate even with some counterproductive effects. To avoid this negativity there would be opposite focus to the opportunity flow expecting improvement in sales performance. I suggest a method of resolving this conflict between the issues of conversion rate and opportunity flow. This is a solution developed for the salespeople to be able to close his business talk with customers. When salespeople can actively lead the closing of each stage in his sales process, it will improve the conversion rate as well as the opportunity flow. To implement this solution, an integrated utilization of TOC methodologies is needed; TP is used to empower the ability of salespeople; and both DBR and CCPM are used for activity scheduling. I present a concrete implementation plan of this approach following a real-world example.
The problem of appointment scheduling in healthcare has been researched by several hundred academicians and practitioners for over sixty years without any viable solution being identified. There is little overlap in the research by these two groups. Academicians are primarily measured and rewarded by publishing in top tier academic journals, which generally requires theory development, sophisticated statistical analyses, or optimization techniques. In academia, the rigor of the research is of utmost importance. On the other hand, practitioners are interested in how to solve specific problems, so the relevance of the research is the primary concern. In 2012, Cox and Robinson presented a case study that solved many of the appointment scheduling problems of a large family practice clinic. Since that presentation, a literature search of the appointment scheduling area has revealed the above divide between the academic and practitioner approaches to the appointment scheduling problem. This review of the combined literature also revealed 14 major ""problems” (undesirable effects or UDEs in TOC terminology). In a preliminary study presented in South Africa in 2015 these UDEs are analyzed from a TOC perspective using the three processes of ongoing improvement (POOGI): the change question sequence, buffer management, and the five focusing steps. We then use (inherently) classification (the first stage of science) to sort through the causal relationships (the third stage of science) in moving from the chaos of the problem environment to the harmony of the TOC solution environment and approach. In this research we will review those findings and present some illustrations of the scheduling solutions. We also discuss two possible approaches to bridging the academic .... practitioner divide, design science and TOC as theory development, that may help TOC be accepted in top-tier academic journals. We hope the solution-development process of using the POOGI and classification of TOC will provide an approach to addressing other chronic problems and will find acceptance in top academic journals.
Acquiring companies using TOC principles, and the improving their performance using simple, powerful TOC solutions is part of GCPL's culture now. Each acquisition in different parts of world brings a challenge for core TOC team to quickly understand the culture of the company, complexities in business and develop and implement simple solutions to see significant improvement in performance in short times. Recently GCPL acquired a company in the US, wherein a thin team manages a complex business of wet hair care products. This presentation is about the TOC implementation in this company, the unique challenges faced, flow solutions deployed and results gained in a short time span. It describes: What is THE VALUE for the customers of the company and its relationship with the FLOW Process of aligning / subordinating all functions towards the global goal of ˜Creating significant value for the customers and FLOW improvement initiatives can create significant value for the customers in a short period of time. The focus on FLOW provides a strong platform for the teams to collaborate and also improves harmony. Since there is clarity on what is the significant need of the customers, it is now pursued by teams who hitherto had seemingly conflicting local measures. This presentation covers how the company is using TOC solutions to improve flow, and focus on the significant need of customers. Company continues to use innovative yet simple TOC solutions, which are internally developed.
The five steps of focusing are in the core of TOC. When applying them to a production environment that has a permanent and expensive bottleneck step 2 is extremely challenging. The decision of how to exploit the system's constraint(s) demands a sophisticated production plan. In 1975 Eli Goldratt and his partners built OPT. It was a finite forward scheduling system based on simulation software called SPSS. OPT laid the foundation for TOC. Unfortunately, OPT does not exist any longer. Nearly 40 years later .... Emanuele Strada has developed smart production plans by using the same concepts while employing concurrent advanced software. He has built dynamic modeling to demonstrate and simulate the behavior of the production environment not only for the make to order (MTO) but also for make to availability (MTA) regime. It is a unique work. The modeled plan was successfully incorporated into the operation of a mega production facility. The modeling takes into account several factors that complicate any attempt to build a production plan, such as: process steps dependency, process performance variation, material scheduling, process capacity and capability, batch size logic, order due date commitment and more. These factors and their interdependencies are considered together with time! The dynamic process modelling enables the learning of the behavior of the system under the above factors and analyzing the assumptions behind the suggested solutions. It reduces the risk of implementation failure and predicts and boosts the effectiveness of the proposed solution in a specific environment. The presentation outlines the parameters and considerations that should be used for building such plans.
This presentation describes how Tata Advanced Materials Ltd. used TOC principles to double its operational productivity, turn-around from loss making to profit making, and sustained the profit increase over the last four years! After an overview of Tata Corp. and Tata Advanced Materials Ltd., the presentation describes the situation as: Due to the heavy investments made for the aerospace business and the time taken to ramp up the execution of orders, the losses started to go up and reached a peak of $10 mn on sales revenue of $14 mn USD in 2012-13. The spree of losses continued in 2013-14 and the 1st half of 2014-15. In October 2014, SR Mukherjee (aka SRM) joined the organization. SRM had worked in an organization previously, where TOC had been implemented. It was decided to implement TOC in TAML to improve its OTIF, throughput and profits. TOC Implementation started with a weekly dashboard and reviews every week from November 2014. The following metrics were used to build alignment in the organization: OTIF, net revenue, throughput, customer complaints, and free cash flow (FCF). The entire senior team was aligned to deliver on these parameters and discussions were focused on planned vs actual achievement, variance between the two and the corrective actions to be taken in the coming week to meet the plan. From this beginning the detailed Tata journey and results are provided. Video length: . PDF: slides.
This second 90-minute session will build on the keynote theme and take participants through the 5 steps, as detailed in our new book with the same title as the session. These steps are what we use to help organizations change from a “push and promote cost centric strategy” to a “position and pull flow centric strategy”: 1. Explain the “New Normal” .... Today's supply chains are complex adaptive systems (CAS) and require “new rules” centered on maintaining system coherence; 2. Understand and embrace flow and its implications for Return on Investment (ROI) and the importance of defining relevant information that ties flow to ROI. This requires understanding and using relevant ranges of time to determine when non-financial measures are appropriate and when financial measures are appropriate. This is a fundamental building block of good management accounting and economic principles but has even greater importance due to the nature of instability inherent in CAS and demonstrated by the bullwhip effect in supply chains. 3. Design an operational model for flow. This requires the organization to understand itself as a system and the connections and interconnections of the flow of materials and information. I will explain the different role of decoupling points and control points to create short stable windows for planning and execution from quote to cash. I will include how to choose them and protect them with dynamic and variable time, stock and capacity buffers; The vital role of real time visibility of these buffers in both planning and scheduling as well as execution and their relationship to smart metrics. 4. Bring the model to the organization .... Implement the model. 5. Use smart metric to operate, sustain and improve the Demand Driven operating model. Smart metrics use dynamic, visible buffer management to define the edge chaos and provide a safe zone for organizations to learn, adapt and improve. There are 6 Smart Metric objectives. Three non-financial, system reliability, system stability and system speed/velocity. The fourth is quantifying system waste and the dollar opportunity and it is a mix of both financial and nonfinancial measures. The remaining two, local operating expense and strategic contribution are both financial. The session will explain the fundamental building blocks of a Demand Driven Smart Metrics information system. We will use a practical example of how to design and then use the model to plan, schedule, execute and focus/prioritize improvement. We will explain the relationship of the use of visible a real time feedback loop focused on the flow to and through strategic control and decoupling points.
This first 90-minute session will build on the keynote theme and take participants through the 5 steps, as detailed in our new book with the same title as the session. These steps are what we use to help organizations change from a “push and promote cost centric strategy” to a “position and pull flow centric strategy”: 1. Explain the “New Normal” .... Today's supply chains are complex adaptive systems (CAS) and require “new rules” centered on maintaining system coherence; 2. Understand and embrace flow and its implications for Return on Investment (ROI) and the importance of defining relevant information that ties flow to ROI. This requires understanding and using relevant ranges of time to determine when non-financial measures are appropriate and when financial measures are appropriate. This is a fundamental building block of good management accounting and economic principles but has even greater importance due to the nature of instability inherent in CAS and demonstrated by the bullwhip effect in supply chains. 3. Design an operational model for flow. This requires the organization to understand itself as a system and the connections and interconnections of the flow of materials and information. I will explain the different role of decoupling points and control points to create short stable windows for planning and execution from quote to cash. I will include how to choose them and protect them with dynamic and variable time, stock and capacity buffers; The vital role of real time visibility of these buffers in both planning and scheduling as well as execution and their relationship to smart metrics. 4. Bring the model to the organization .... Implement the model. 5. Use smart metrics to operate, sustain and improve the Demand Driven operating model. Smart metrics use dynamic, visible buffer management to define the edge chaos and provide a safe zone for organizations to learn, adapt and improve. There are 6 Smart Metric objectives. Three non-financial, system reliability, system stability and system speed/velocity. The fourth is quantifying system waste and the dollar opportunity and it is a mix of both financial and nonfinancial measures. The remaining two, local operating expense and strategic contribution are both financial. The session will explain the fundamental building blocks of a Demand Driven Smart Metrics information system. We will use a practical example of how to design and then use the model to plan, schedule, execute and focus/prioritize improvement. We will explain the relationship of the use of visible a real time feedback loop focused on the flow to and through strategic control and decoupling points.
This presentation is about how TOC enabled us to succeed in acquiring and integrating an Ikea first-tier supplier's operations (in spite of difficult economic times). The company was heading fast towards a cliff... due date performance (DDP) was appalling, working capital (WC) sky high, warehouses filled with all the wrong materials and components, customers were looking for alternative suppliers (to us), batch sizes were large, cash flow poor, in-fighting and turf protection, nobody (within the company) knew the company's overall performance... The results included: DDP increased; customer satisfaction increased (we managed to retain the biggest customer, Ikea); existing customers awarded us with more business (also Ikea); hidden capacities were revealed: availability (of machine capacity, warehouse storage and manpower) increased; internal lead times decreased; batch sizes decreased, set-ups increased (even though everyone thought we were mad and wasting capacity); inventory decreased; WC was no longer a problem, the warehouse was under control; precious cash flow was freed (where none was available anywhere!); and ROI increased. We developed and implemented a four-stage project acquisition approach using critical chain project management (CCPM) principles.
Agile project management gets broad propagation. Its extreme lightweight steering has advantages .... but are local optimizations and do not use the full potential. On the other hand critical chain is a full-blown project steering .... but sometimes e.g. in sub-projects agile methods can be absolutely sufficient. So critical chain doesn't use the benefits of the agile methods. The presentation shows a two-phase approach to first make the agile methods compatible to critical chain and in the second step to improve the agile methods itself. All this is based on the thinking processes (TP) of the TOC and ideas based on drum-buffer-rope. The approach is validated in real projects and real teams' part of a worldwide active internet provider. As a result, agile methods can be used to steer sub-projects more lightweight. With small adjustments it's possible to get some buffer at the end to initially control the WIP. With the buffer at the end you can use progress-buffer-consumption monitoring. That makes agile compatible with CCPM. You do not need protection of sprints any more, therefore continuous flow is possible. The focus moves to reduce the inventory of open tasks. Maximum throughput and minimum lead time are now realistic and reachable.
Both Lean and TOC have successfully applied flow concepts to the construction environment but largely independently to date. This presentation draws findings from an action research project where the Last Planner System (a pull mechanism of Lean Construction akin to Kanban and specifically developed to meet the needs of the construction environment) and Critical Chain Project Management (CCPM) via Exepron were used in combination and benefitted a public realm project.
In real life we often feel pressured to Multitask - to constantly switch not only between tasks before we completed the previous task but also between projects. With the Multitasking Challenge, you can discover: Why, by Multi-tasking, will you not be able to achieve planned commitments? and Why, by Single-Tasking, you can do much better - get more projects done, faster at a lower cost, and with better quality (fewer quality mistakes). During the process of finding the best possible outcomes, you will learn valuable lessons, specifically what is multitasking (it really has not been properly defined)? and why is it so bad? Leading TOC experts and thought leaders, Dr. Alan Barnard and Dr. James Holt will walk you through this experience.
A clash of two worlds exists: academia versus practitioners. Academics are primarily measured and rewarded by their research contributions to their fields as recognized by publishing in the top tier academic journals. High powered statistical analyses and mathematical programming techniques are the highly recommended research methodologies: the rigor of the research is of utmost importance. On the other hand, practitioners are interested in how to solve their specific problem; the relevance of the research. Goldratt (TOC Journal) offered a different perspective to research (science) as developing in stages: classification, correlation and cause and effect. In 2012, Cox and Robinson presented a case study that solved many of the appointment scheduling problems of a large family practice clinic. Since that presentation, a literature search of the appointment scheduling area revealed the above divide. The appointment scheduling literature spans over sixty years dating back to the 1950's. No effective solution has been identified. Hundreds of academic articles have been published concerning how to “optimize” appointment scheduling. Few solutions have been implemented. On the other hand, the practitioner literature is equally unimpressive. It is divided into three general groups: solutions addressing only one problem area; general guidelines (lean and six-sigma) for problem solving in any practice; and others provide a totally different scheduling approach. These solutions offer some relief to some of the problems in some of the practices. A review of the combined literature reveals at least 14 major problems. These are studied from a TOC perspective in developing the Inherent Simplicity of the problem/solution.
GCPL has been growing through acquisitions in emerging geographies wherein increasing business complexity (in terms of product portfolio, new product introductions) has been a challenge. This presentation covers how the company is using TOC solutions to bring simplicity to grow businesses at a faster pace. Company uses innovative yet simple TOC solutions, which are internally developed. Deployment of these solutions have helped the company to realize significant improvement in on-time In-full (OTIF) performance to stores, inventory mix in retail outlets / customers and hence inventory turns. A detailed case is presented to demonstrate the conceptual model that is used to improve the business performance. The model developed can be easily adapted by many small- and medium-size businesses.
The authors believe that TOC-startup is an emerging new paradigm of “innovation management” for startups. The authors do not consider their exploratory work as complete (ex. it lacks development of S&T trees for startups), yet, they create a “path to TOC” for startups, to harness the TOC BOK, include S&T standard solutions, and to enable startups to reach success at a higher probability. Through their recent years' work with startups in central America and Mexico, the authors test and improve the new paradigm to bring it from theory to practice. They wish to open and share their process with the TOC community as they march on high-scale deployment, web platform supported, starting in Mexico and propagating to the rest of the world.
As in the physical sciences, it's a fundamental TOC assumption that there is an inherent simplicity in every complex system. Dr. Goldratt said that our ability to reliably predict the system outcome with the minimum level of inputs is a measure of the complexity of a system. With a better understanding of a system's fundamental elements and their inter-connectedness, we can achieve a greater reduction of the degrees of freedom of that system. By reducing the degrees of freedom, we increase our ability to leverage the system. In other words, when we uncover a more fundamental structure of a system and tie the system entities together better, we simplify it and this allows us to exploit and even elevate it. An indication that our TOC toolset is still too complex is exemplified when I recall Dr. Goldratt saying that it seemed to be out of sheer genius or luck that we gain the insight necessary to break clouds. He wished to build a systematic method of breaking clouds. With this presentation I will take a step in uncovering the fundamental elements, and dimensions of rational systems along with the core integration of all TOC applications in general. However I will primarily focus on a few core Thinking Process applications, with a central emphasis on the evaporating cloud.
GCPL has been growing through acquisitions in emerging geographies wherein increasing business complexity (in terms of product portfolio, new product introductions) has been a challenge. This presentation covers how the company is using TOC solutions to bring simplicity to grow businesses at a faster pace. Company uses innovative yet simple TOC solutions, which are internally developed. Deployment of these solutions have helped the company to realize significant improvement in on-time In-full (OTIF) performance to stores, inventory mix in retail outlets / customers and hence inventory turns. A detailed case is presented to demonstrate the conceptual model that is used to improve the business performance. The model developed can be easily adapted by many small- and medium-size businesses.
Following the successful implementation of an end-to-end supply chain solution for Microsoft in 2015, Goldratt Research Labs (GRL) was approached by a major book publisher in 2018 to help improve their supply chain by reducing shortages and surpluses. The objective was firstly to investigate the extent, consequences and causes of surpluses and shortages of their titles within retailers and their own DCs. Secondly, they aimed to jointly develop and test a solution that could significantly reduce shortages and surpluses and the related lost sales and profitability potential for both themselves and their retail customers. The model also contains more complex inventory management rules including Dynamic Minimum Order Quantities and Dynamic Safety Stock calculations Simulating a book publisher supply chain proved to be a challenging exercise as the type of demand and production characteristics is very unique to the industry. The model provided a way to test, evaluate and optimize the proposed Dynamic Buffer Management (DBM) solution in a safe risk-free space which would otherwise have been impractical to test in the real world. The model provides invaluable insight for both the publisher and its retail partners. Video length: . PDF: slides.
Dr. Goldratt has incorporated the concept of POOGI into the TOCs body of knowledge. Behind this is the Toyota Production System developed by Taiichi Ohno, who is loved by Dr. Goldratt. I n the Toyota Production System (lean production system), just-in-time and autonomation are defined as the two pillars. The foundation that supports these two pillars is the philosophy of three realism and continuous improvement (KAIZEN). Satoru Murakami has been providing consulting services using the TOC method in Japan for 20 years, has taught more than 100 KAIZEN activities and had achieved remarkable results such as Hitachi Tool introduced in Dr. Goldratts article Standing on the shoulders of giants. Satoru will try to introduce about Japanese styled KAIZEN and difference between other improvements. Actually, it is not well known that the meaning of Improvement and KAIZEN is very different. Improvement means to improve the current situation and make it better. So, in actual improvement activities, there are two types that emphasize, improvement that emphasizes making changes and producing Results and correctly recognizing the current situation Process. How is KAIZEN in TOYOTA rooted in Japanese culture different from improvement? Taiichi Ohno taught his subordinates: If you dont know the true cause, go to the site and see until you find out. This is the essence of the three realism of going to the site, seeing the real thing, and thinking in reality. However, in order for this three realism to work, there are extremely human-like points about how to evaluate people and what kind of relationships should be built between subordinates and bosses. In other words, it is necessary to turn that human beings are evaluated by results, to process including their approach. However, the expression evaluate not may be inappropriate and the expression work together will may be appropriate. This shift from result evaluation to process evaluation also supports that takes a long time to work on, and Japanese-styled KAIZEN activities. This presentation is based on 3rd step of 6 steps SOSOG, 'Get on the giants shoulders. - Gain the historic perspective - understand the giants solution better than he did.
Riddle 6 The Big Eric Carpets Case-Eric has built Big Eric with his own hands. He started with one small room and three women weaving carpets based on his own design. In five years the company grew to about $10 million annual sales. Three years later it was already close to $100M. It took another five years to reach sales of half a billion, with nine different regional plants, along with their central warehouses, at various locations in the world. This record of sales ($500M) was achieved in 2005. From that year forward the growth stopped. Actually sales went down at an approximate rate of 10% every year and this drop in sales happened throughout Big Eric's international markets. In 2011 the turnover was just $252M, causing a loss of $25M. What is causing the drop in sales? The four key people in Big Eric have different opinions....
In many ways, manufacturing organizations are different from project-based organizations, especially if a projects deliverables are not manufactured items. However, in many ways, projects are the same as job shops, made-to-order and engineered-to-order manufacturing environments. Both produce something that has never been made before. They both must meet a unique set of requirements.
This case study presentation provides an overview of the project management transformation in the French entity of global door solution manufacturer, Jeld Wen.
The Viable Vision (VV) strategy and tactic (S&T) trees are both powerful and insightful, but present apparent divergence with previous well-established TOC processes, in particular the thinking processes and the five focusing steps. This presentation closes these gaps and presents the inner structure of the VV S&Ts and how they should be understood both in terms of modifications and in terms of execution.
The service landscape is huge and heterogeneous. A sizeable part of it are not for profit service organisations, like: child protection, relief work, mental health care, health service organisations, communal/governmental services, legal services, and internal service providers (legal, HR, IT etc.). Although quite diverse, these organisations seem to have similar symptoms (UDEs): long waiting lists, long lead times, pressure to start new services immediately/fast, high wip, high perceived work pressure, inconsistent quality, and friction between workers/disciplines. Over the last 14 years, Hans and Michel have done dozens of implementations in similar service organisations. Today, they will share with you: how to create rapid insight into WIP (distribution) and lead-times from their primary system; how to create management reports and buffer management lists to speed up completion; how to drastically cut WIP ('intermediate sprint) and keep it down; how to eliminate waiting lists; how to create consistent quality of semis and end products; how to improve financial health by understanding and improving T vs. OE; how to increase output. Video length: 59:49. PDF: 36 slides.
Presented the TOCICO International ""Ever-Flourishing” Award (based on 8+ years of TOC use) Fleetguard Filters set out on its TOC journey in 2005. It operates in the auto-component market in India characterized by uncertainty and a cyclical nature. With the industry facing two crippling recessions in the last ten years Fleetguard remained unaffected. Fleetguard achieved significant milestones in its original equipment manufacturer (OEM) and aftermarket business segments. The first few years of the successful implementation helped it achieve the TOCICO Gold Award in Tokyo 2009. For successfully sustaining its TOC Journey, it has been conferred the TOCICO International ""Ever-Flourishing” Award this year. Through this presentation Fleetguard India explores its definition of “Ever-flourishing” and highlights what went behind this achievement. It also showcases the key levers behind its growth, results achieved and what is helping it to sustain the results. Above all the company shares itself as a powerful case of the sublime power of TOC thinking, a thinking that enables it to seek win-win and harmony for all stakeholders.
This presentation provides: a different look at the buffers of TOC replenishment; the concept of only time buffers usages in production of make to stock (MTS) and make to order (MTO); the results of simulation comparisons; the case study of TKF and a summarization of lessons learned. The derivation of maximum buffer level for the generic rule (The target level is defined as the maximum forecasted consumption within the average replenishment time, factored for the unreliability in replenishment time.) is provided. To determine this target level three questions have to be answered: 1. How long will it take us to replace what was just sold? 2. How much will the demand be during that time? 3. What is the variability of the demand and supply that we should take into account? These questions are answered through examples, a case study and a simulation.
Technological development is a key driving force in human progress, yet there is still a big gap in our capability to manage it. Connecting Goldratt's ""6 Questions of Technology"" to the thinking processes creates a framework to support innovation management. This process is meant to allow managers to have better control over the process, give the R&D team better focus and reduce the overall time required to go to market and generate a positive ROI.
Prof. Nassim Nicholas Taleb, the world renowned scholar and bestselling author of Black Swan and Fooled by Randomness, presents his latest work on uncertainty, randomness, and disorder (as outlined in his new book titled “Antifragile: Things that gain from disorder”. In this short video message specifically delivered by Nassim Taleb as the keynote to the TOCICO 2015 conference, he shares how, after retiring as an option trader to do full time research, he focused on how to find practical ways to define and measure fragility and identify the conditions that make most systems fragile. Systems that are harmed by volatility are fragile; robust systems are not harmed by volatility. But there are systems which he defines as Antifragile - systems that are not just robust, but actually benefit from volatility. Anti-fragile systems are able to limit the downside of volatility while fully capitalizing on the upside of volatility. Systems that are fragile have limited upside but unlimited downside. As such, fragile systems get weaker stronger over time while anti-fragile systems get stronger. With this new concept, Prof Taleb, challenges us to set even higher goals for our organizations (and ourselves) - the goal should not just be to achieve robustness, but to achieve the status of being Antifragile.
The five focusing steps, and several TOC solutions / processes are widely used in various industries for improving the performance of a system. However TOC solutions are not implemented / developed widely in the industry that deals with 'live animal farming'. These environments are much more complex than any other environments as it deals with 'live animals'. Some of unique characteristics of this environment makes it challenging to manage i.e. inventory of live animals can't be held for too long as it consumes food (truly variable cost (TVC) goes up), mortalities reduces potential throughput, sales price of products vary on a daily basis like other commodity, etc. When the authors could not develop a good solution using the 'five focusing steps' implementation in 'live chicken farms', they applied the 'thinking processes' (TP) to develop TOC-based solutions. Implementation of the solutions in a chicken farm environment delivered good results in very short time. The process was further converted into a standard guideline/process for analyzing other 'live animals farming' environments. Processes were tested to develop solutions for 'cow farming', 'calf growing' and 'pig farming' environments. With the help of some relevant companies, solutions for 'cow farming' and 'calf growing' environments were practically tested.
There are many key concepts of TOC: statistical variation and dependency; local versus global focus; the negative effects of multi-tasking; etc. that can be easily conveyed via the use of simple games. In many of our presentations and papers we talk about many of these ideas and even reference some of the games such as the dice game in “The Goal” yet often times the members of the audience have never had the opportunity to actually experience these games, the concepts they convey and see the results. This workshop will make use of simple games and exercises to allow participants the opportunity to explore hands-on, how many of our management driven policies, procedures, measurements and/or behaviors trigger actions that consume our precious and expensive capacity and how some simple TOC-based actions can yield significant, immediate and positive results. The exercises allow the participants to discover underlying capacity burning issues that exist in our organizations. They will provide the participants with tools to take back to their organizations to help their peers experience the same discoveries.
In this presentation Yasunaga Wakabayashi will give an overview of his own TOCFE practice and what he learned from it. Yasunaga conducted TOCFE education programs as a teacher at Kyoto University and as a non-profit organization for the public at large. These experiences gave Yasunaga the great potential of TOCFE and its power to change the future.
Tata Astrum Super as a branded Product was launched by Tata Steel in March 2019 to address the unaddressed Hot Rolled (HR) retail market. Tata Astrum Super was faced with two challenges in the retail channel. These were 1) the availability of HR sheets 2) Availability of complete basket of SKUs. The average monthly dispatch in FY-20 from Steel Processing Centre called PSPL was at a level of 2.5 kilotons per month (KTPM). PSPL was the only dedicated Steel processing center for Astrum Super processing. In FY21 total market demand of Astrum Super was projected to exit at a level of 10 KTPM. The 5 Focusing Steps approach was followed to identify, exploit, subordinate and elevate the constraint in order to meet the market demand of 10 KTPM in FY21.
Principles of flow are universal; applications are different depending on the circumstances. When the work is done in parallel in many non-dependent resources, bad multitasking can waste a lot of capacity, and local optima behaviors may arise when work in process (WIP) is not so visible. A simple and robust application of the principles of flow is proposed for these situations, such as quality control, maintenance and even in part of the sales process.
James Holt made the presentation for Richard Reed. He added his comments to the overheads. The purposes of this presentation are to provide a framework for analysis of a system; the background of the organization being studied; what to change: the UDEs, conflict clouds, core conflict cloud (CCC) and current reality tree (CRT); to what to change, the tabular analysis, strategic injection (Inj.) and future reality tree (FRT) and some management implications. The case study is the Planned Parenthood of New Mexico (PPNM), which performs medical services including annual exams, sexually transmitted diseases (STD) testing and treatment, pregnancy testing, abortion, tubal ligation, vasectomy, etc. to 21,943 patients in 2004. They also provide educational services. The presentation focuses on what to change and what to change to. The goal, and four necessary conditions (quality medical services, safe and secure work environment, remain financially solvent and maintain PPFA accreditation) are discussed. The prerequisites for each requirement are provided. UDEs include: long wait times for some patients; clinic financial viability is threatened; many personnel (clinicians, support staff and clinic managers) are highly stressed; clinic staff turnover is higher than desired; some patients leave the clinics dissatisfied; and the physical appearance of some clinic facilities is shabby. The storylines for the first five UDEs were converted to evaporating clouds (ECs) with assumptions then to a core conflict cloud with assumptions. The CRT is provided. Injections to the core conflict cloud are provided. James provided his assumptions: There is no way to improve the patient per hour rate; we cannot improve the patient show-up rate; the quality of service is equal to the time with the doctor; there is nothing we can do to improve our processes. Richard's two strategic injections are: The PPNM clinics' managers and clinicians align their personal as well as their professional goals with the new overall clinic goal of a balanced approach of delivering quality medical services while maintaining financial viability; and The PPNM clinics have a new appointment scheduling system that satisfies most needs of managers, clinicians, support staff, and patients alike.
One of the worlds largest mineral resources companies plans to establish a long-term mining business and develop an outbound logistic network to deliver the finished product to customers all over the world. During the identification phase study, the company needed to evaluate the most optimum logistic network configurations, compare and choose stock management policies that will provide highest availability at lower cost and determine required quantity of rail cars and storage volumes at sea ports and distribution hubs to achieved desired world class service levels. An AnyLogic model was developed by Goldratt Research Labs to support the study. The model covers production of 2 grades of finished products at the mine, loading the product to trains, transportation to hubs and ports, loading to sea vessels at ports and land distribution across several countries via Hub to customers by trucks. The simulation was able to demonstrate that using PULL stock management policy with dynamic target stock adjustment algorithm instead of traditional PUSH policy allowed Amalgama to reach 12% higher service level and provide world class performance with 16% less storage capacity in ports and hubs. In the presentation, the team leads from GLR and Amalgama will talk about the challenges weve overcome during the project, demonstrate the model and discuss the business value of the results achieved with the help of simulation.
This presentation is about strategy and tactics (S&T) trees: putting companies on the process of ongoing improvement, the red curve. The discussion is about the Viable Vision (VV) solution (templates given 2005 in Barcelona) as the overall guiding direction for the company. The VV is not a linear sequence of functional implementations. Our first approach was to look at individual prerequisite trees and compare them to integrate them into a comprehensive document. Injections are missing, choopchik injections, etc. The solution is the S&T tree. Building the S&T tree took six weeks. Zycon (RRR= reliability, rapid response) was the first template. This day is devoted to presenting the first S&T tree in great detail. History: The S&T was constructed in December 1985 before the thinking processes. Motivation was that Creative Output, the agent of change became hard to move. The Race was the presentation of the competitive edge that Goldratt gave to Creative Output. A person will judge what he sees according to his frame (his logic that he used before). If you are giving a different frame you have to give the logic of what and why your frame is right. The framework was constructed then put on the shelf. One problem that the thinking processes cannot solve: how to measure the individuals contribution in an organization. If we will connect the top of the organization to the individual contribution by perfect logic then we can measure an individuals contribution. Eli Abramo and Rami Goldratt worked for a year with Elis guidance to develop the rules for the S&T tree. Traditionally strategy (the what for?) is thought to be at the top and tactic (the how?) is thought to be at the bottom. The S&T redefines the strategy and tactic and each element of the S&T is defined, discussed and examples given from the RRR S&T tree.
This roadmap to success is based on work at a Brazilian company, from a case study at the world's largest cosmetics franchise chain. We tested the impact of an event-managed process on TOC distribution and measured the performance of the company´s inventory stocking policies. Based on TVD/IVD (throughput value days and inventory value days), we concluded that this combination can create an environment with more efficient replenishment with higher stock turns, less stock-outs and increased sales.
Siemens' subsidiary Flender Graffenstaden located in Strasburg on the Franco-German border needed to improve its performance rapidly and dramatically. The oil & gas sector, one of its two core historical markets, was in recession due to the low price of oil. Their business, the design and manufacture of very large gearboxes, was facing fierce competition. In 2016 they decided to implement Critical Chain Project Management (CCPM) to build a decisive competitive edge based on very short lead times and the best on-time delivery performance in their industry. CCPM was first applied to their bottleneck (the design office) and then to their entire operations. In the first 5 months of the project the Throughput of the bottleneck more than doubled and the lead times of that department were divided by 5. These results were essentially due to the eradication of bad multi-tasking. Then, in the second stage of the transformation, the lead times of all the other components of their operations were also reduced (in production, assembly, testing, methods, purchasing & sub-contracting). In production they implemented TOC's DBR (Drum Buffer Rope). A portfolio CCPM Fever Chart was developed to manage the business as a whole. This provided a clear indication of priorities during execution and also powerful what-if simulation capabilities when envisaging a new urgent order or reacting to a change by a customer of his requested due date. The different components of the solution were integrated into the existing SAP environment. As the company begins its second year of its CCPM project it aims to further improve the on-time delivery performance and to further reduce its lead times. The conference will describe the journey: the successes, the surprises, the difficulties and the disappointments.
A well-known Japanese company, now suffering from a cash crisis, is learning TOC to change its culture and mode of operation dramatically even in a short term. Initial result shows a 35% production lead time reduction which happened in only 4 months. We believe the reduction will be much more once we will implement the full solution. The speaker will show how this company applies TOC, got very fast and meaningful results and what the challenges of this implementation were. Also, they will discuss the next steps after this 1st achievement.
Compensation Systems for Sales Professionals: are there alternatives for throughput world? Designing a compensation system for a sales organization is a strategic decision of a critical importance. An enquiry into most common systems, the bottom-line effects and the drivers behind them. The package structure and value being equal, what makes the strategies different is the way they support sales professionals decision making, the way strategies send the signals on what to sell first or what to stop selling completely. We ran series of computer simulations and used machine learning techniques to demonstrate the impacts of strategies both compliant and non-compliant with TOC principles.
Critical Chain is now widely used in aeronautical maintenance (MRO or Maintenance, Repair and Overhaul / Operations). The United States Air Force, the largest fleet of aircraft in the world, is in the process of a global rollout and several airlines have adopted it throughout the world. Over 30 aeronautical MRO cases worldwide from the USA to Australia and from Brazil to France will be presented. It will be discussed why the fact that it is quite easy to calculate the cost of winning or losing a day in the hangar has meant that this industry is leading the world in the adoption of Critical Chain Project Management (CCPM). In this business they know that gaining an extra day in their Turn Around Time is worth often of the order of $100K. They know better than anyone that time is money (or mission critical for military aircraft). CCPM and its proven results is therefore the obvious solution.
Embraer, being an aeronautical company, needs excellent engineering resources. In addition to technical knowledge, we also need to have the right people at the right time during developments, that is, optimized resources. Within Embraer engineering, we have a strategy area that monitors the workforce for the coming years. The data is generated by the product engineering departments of the Business Units (BU) .... Commercial, Defense and Executive .... and support engineering .... Testing, Software, Technological Development and Chief Engineer .... in the programs under development and serialization, as well as by the Engineering Department itself. strategy for new developments. One of Engineerings strategic projects, called Inter BU, defined the objective of optimizing the use of Engineering resources, enabling alternatives to engage in new business opportunities or to meet the agreed deadline of critical commitments. Engineering resources are limited and must be properly distributed to leverage the companys overall results. Enable alternative engineering resources to address new business opportunities or meet critical commitments on time is critical and requires flexibility to ensure a high level of efficiency, and the five focusing steps of TOC has been an important methodology that helps us identify resource constraints both for the quantity and for the quality needed for the product portfolio. The Inter BU project mapped the process using this methodology a whole. We divided the project into 2 fronts: Front 1: Identify, simulate and optimize engineering resources to meet the OTD of resource-constrained projects. This front is based on the execution of activities through the CCPM. Front 2: Identify, Simulate, Optimize and Reallocate engineering resources to meet business demands in accordance with corporate strategy. Front addressed with a workshop where we use the Thinking Process to identify the root cause and guide the strategy.
The topics of the presentation include availability examples, conditions for the applicability of the offer; core cloud of the client; blocking facts; elements of the offer; benefits for the client; benefits for the supplier; and comparison with other templates. Examples include spare parts distributors, fluids storage providers, and power generators manufacturers. The conditions of applicability of the offer include: condition 1 The damage for the clients caused by unavailability of the product is huge; condition 2 High uncertainty regarding when/ what/ how much clients will need; condition 3 The financial risk for the supplier in making it available is significantly lower than for the client. The core conflict for the client is A Continue to grow a profitable company, B Protect against stoppages; D Buy in advance; C Minimize investments; and D' Buy when needed. The supplier cloud is A Continue to grow a profitable company; B Increase sales; D Lower the price; C Increase profit; and D' Increase the price. The blocking factor for the supplier is price. Elements of the offer include: client pays a relative small insurance premium for having the product directly available and client pays the upfront agreed price when he makes use of it. Benefits to the client include: risk of lost throughput due to stoppages is lower; lower investment risk; and elimination of significant cost of emergencies. Benefits to the supplier include: additional sales not based on price but based on being at the right place at the right time; income on investment before it is sold; benefits of aggregation; expanding customer base and higher profit.
Critical Chain Project Management holds the promise of delivering projects faster than traditional methods - often 20-50% (or more) faster. But what if you have suppliers that take seemingly forever to deliver critical components? Or what if you have trouble getting your (sometimes very large) customers to deliver specifications, provide the needed authorizations, or answer critical questions?
Even though many of the TOC practitioners know the mechanics of the Critical Chain methodology, often they are hampered in convincing others to adopt this powerful body of learning. There is a mystery surrounding the science behind the methodology.
In this presentation we will describe the power of the fifth focusing step for sustaining the decisive competitive edge of a successful implementation based on inventory turns. From the beginning of the implementation POOGI has being established as a common practice on the plant. Its implementation begun at the management level, with weekly meetings, through which huge achievements were obtained. One of them was the amount of hidden capacity found without any large investment: from 40k to 60k batteries, which equals the levels of production expected from level three on the plant expansion plan, which required a minimum of 5 Million USD investment. On July 2013 a new POOGI focus was established: POOGI Junior, led by middle management. As a result of the biweekly sessions, one of the achievements obtained is the accomplishment of many micro-projects which generated set up time reductions, reductions in waste of times on the bottleneck and that revealed around 18% additional capacity on the plant. In order to close the cycle of ongoing improvement, there is a new project: Baby POOGI, led by people on the operational levels, producing a huge change in the culture of the entire company.
Public health care providers typically struggle with the need to meet demand for services, within a limited budget. This paper describes an analysis of a large public hospital, using the Theory of Constraints (TOC) comprehensive set of mapping tools to logically represent a problematic situation and investigate options for resolution. Based on the symptoms present, root causes and conflicts were identified, along with potential solutions. Further TOC tools were used to check for possible side effects of the solution, and identify obstacles that might impede successful implementation. Based on the TOC analysis, a trial project was implemented with significant benefits for two departments. Outcomes included dramatically reduced patient wait times and staff overtime, increased patient satisfaction, increased efficiencies, smoothed workload, and improved staff morale and retention, while maintaining patient safety and integrity of treatment, and staying within defined cost parameters. Video length: . PDF: slides.
This Critical Chain Project Management basics workshop is intended to provide a practical, easy to understand, and actionable introduction to the foundational concepts and principles of Critical Chain. The format is engaging for audiences as I frequently look for their inputs into their everyday experiences on projects as well as the concepts being discussed. In addition to the key concepts of Critical Chain, I also emphasize the importance of fostering a high-trust workplace which accelerates and maximizes the expected results. Three key areas covered: Focus, 50/50 estimates, and buffers. Focus Versus Multitasking on Projects: How much more successful could projects be if nonproductive multitasking could be minimized? A McKinsey Quarterly article indicates that multitasking damages productivity, slows people down, hampers creativity, makes employees anxious, and is addictive. Supporting these findings, a recent multitasking study states, “multitasking makes people less productive, less creative, and more likely to get thrown off by distractions”. Multitasking can also be a significant cause of extended project durations as illustrated in Exhibit 1. If a project team member has three project tasks to complete, A, B, and C, each task takes much longer to complete when multitasking. Context switching between tasks increases the completion times even further and causes the project team members to have to stop frequently to remember where they were each time they switch to a different task. Video length: . PDF: slides.
This presentation will tell the story of how Ive used TOC to help manage the ongoing healing of my daughter from a little known, auto-immune illness (PANDAS/PANS) that attacks her brain and causes intense personal suffering and family chaos from strong OCD, anxiety, intrusive thoughts, and other mental health dynamics. All while juggling a career as a partner in a fast-paced private equity business. Video length: . PDF: slides.
Chronic delay of infrastructure projects is an industry wide phenomenon in India. But once projects are delayed, more working capital is needed, increasing overall project costs. Therefore Bajaj Electricals, like most other companies in this business, had to contend with cost over runs, erosion of profit margin, and late delivery penalties for nearly every project. And the very viability of this business unit was in question! But by implementing TOC principles, the company addressed the core issues in its operations and gained the leverage to deliver projects within budget and on or ahead of time. Moreover, in the course of this implementation new solutions evolved. For the first time a distribution solution has been implemented along with CCPM in a project environment. And a first of its kind software was introduced to streamline TOC project execution and enable tighter controls and greater visibility.
Government has the power to bring both positive change and significant value to its citizens or needless, and even harmful, bureaucracy. This responsibility, along with being the steward of the taxpayer dollar, demands that government provides measurable value that aligns with value-generating goals and eliminates harmful practices. Despite this imperative, government often is stymied by vague objectives, conflicting measures, competing stakeholder input, and a lack of operational knowledge and tools. “Flavor of the day” initiatives plague government as administrations come and go. Likewise, government can chase big initiatives like coordinated case management or one-stop centers that too often lack rigor and fall apart at the point of execution.
Inherent Simplicity for Inherent Complexity at Boeing. It's hard to think of a company more complex than Boeing, the world's largest aerospace company and leading manufacturer of commercial airplanes and defense, space and security systems. This presentation will explain how Boeing has embraced the concept of Inherent Simplicity to develop and implement a robust, low-tech solution. You will learn how this large company is accelerating flow and improving productivity on complex development programs with thousands of engineers.
This workshop is an introduction to Project Management the TOC way. We discuss the nature of the projects and the nature of tasks, the impact of interdependency and variability on human behavior and the core conflict of projects. Critical Chain Project Management scheduling and buffer management are introduced for both single and multi-project environments. The workshop is intended to prepare the attendee to take the TOCICO online Basics Critical Chain Project Management exam, in advance of the TOCICO Fundamentals Exam.
The workshop would start with three conceptual approaches that each will be used later to explain the TOC solutions for managing the supply chain. 1. The TOC five focusing steps. 2. Planning versus execution as a means to deal with uncertainty. 3. The four rules of flow. The workshop would then outline the Simplified-DBR approach for make-to-order (MTO) in production, including the concepts of the time buffer and the planned-load. The breakthrough idea and practical use of buffer management would follow, and its two different contributions, the priority system and the feedback on the buffer size, will be explained in detail. Next, the idea for managing stocks would be covered. First, the implementation of the idea in production would be covered. The TOC way with make-to-availability (MTA) for both end items and intermediate common parts would be analyzed, including the far-reaching idea of not having any due-dates for such production orders. The ideas of managing stock through the distribution chain, including the basic idea of dynamic-buffer-management, would conclude the basics workshop.
A TOC company solidly on the red curve can still find itself in trouble. If they focus too much on efficiency and only their key products or services the appearance of a new competitor, a new technology, or a change in customer values can slow or even destroy their current market appeal. The company suddenly finds itself on a green curve. Product life cycles are often shown as an S-curve. They start out slowly, grow to become a dominant paradigm, and then slow down and become obsolete as a new product or technology takes over. This transition from one product S-Curve to the next is inescapable for any company desiring to permanently stay on a red curve growth trajectory. To survive, the company should use strategic red teams of critical thinkers using the TOC thinking processes and other means to find ways to obsolete their own products and jump onto the next red curve. This presentation will cover how such teams could be set up and how they would work.
Assuming that a business has a compelling product (or service), and the ability to execute flawlessly, then growth is simple. All that business must do is out-communicate its competitors. Easier said than done! In a typical organization, salespeople spend only a tiny percentage (single digits) of their time engaged in selling conversations. The balance of their time is dedicated to non-sales activities such as customer service, administration, prospecting, project management, and the like. Justins Prescription for Growth workshop will lead you through the critical changes your organization must make in order to remove ALL responsibilities other than selling conversations from salespeople, resulting in a dramatic uplift in sales activity. Conceptually simple. Complex to execute. Prescription for Growth will give you a step-by-step plan for flawless execution. Video length: . PDF: slides.
My love and passion for the subject of Thinking has its genesis in Eli Goldratts last seminal work “The Choice”. The essence of Elis message is contained in the following 2 key tenets/ action points and (1) With respect to the situation you wish to influence, use your Thinking faculty effectively to identify the correct causality [based on valid assumptions] underlying the situation of interest to you [in that he has given us a benchmark for good quality Thinking] and (2) Treat Thinking as a life skill- apply the above to all aspects of life- family, friends, work etc. Somewhere along the way, I observed that gaps existed between Elis intensity of Thinking Clearly, as envisioned in. The Choice and as practiced in the TOC community [that included me, personally]. In fact, Eli himself made 2 important observations to Clarke Ching in a 2010 interview on The Choice: because in my eyes The Choice is by far the most important book that I have ever written. My problem is that most people who have read The Choice did not fully understand it. The question that I have been probing in greater depth has been a simple one- why were people not Thinking Clearly- as per Elis vision and the benchmark set by him in The Choice...were there some additional missing pieces in the Thinking Puzzle that in some way, inhibit people from Thinking Clearly? Upon reading the Nobel Laureate, Daniel Kahnemans book, Thinking, fast and slow, I became aware that 2 significant and interesting aspects on the way we Think, viz.: a. We are lazy and halfhearted when it comes down Thinking b. We are wired to Think in 2 distinct modes and Fast (System 1-instinctive, associative, emotional, low effort) and Slow (System 2-rational, considered, cognitive, logical, deliberate, and effortful). provide us with an improved understanding of why we find it difficult to Think Clearly, and that additional counter measures would be required for them. Based on this expanded understanding, in the session Mind Your Mind at the Chicago TOCICO conference, I will highlight the need to be more Mindful in our Thinking, what all do we need to mindful of, how do we become/ remain Mindful, and more importantly, some added countermeasures. In short, I will be sharing with the community, a more expansive and a more composite view on Thinking, which includes Mindfulness as an essential component. Video length: . PDF: slides.
Situation/Problem: Its so simple “Agile” won the race. Regardless of what kind of company that thinks about improving their project management by using TOC and Critical Chain .... Agile is already there or requested. So we as an implementation supporter have to deal with this either integrating the existing agile stuff or setting up critical chain in a way that is can truly state that its agile. The direction of a solution is presented in this workshop. In this speech, I will show: 1) The straightforward connection between CCPM and agile:wWorkpackage in CCPM equals to release in agile. Further on how to do an estimate and how to derive the daily remaining duration out of the data an agile team has for its release. 2) A very easy to apply approvement for all kinds of taskboards of agile teams. Its all about WIP control and management of the blocker. 3) The next step is how to convince agile teams that they have a benefit from this CCPM stuff. That is the hardest part. But in the end, it all has to do with the constraint of the company .... the integration phase or architecture. 4) Furthermore, some arguments for the top manager to go for CCPM in addition to agile. Its all about scalability and being in control of the process and output. And getting the profit out of all this agile stuff. 5) There will be a definition of agile and the agile mindset and why it fits perfectly to TOC and CCPM. Maybe the three systemic layers of portfolio .... project .... agile team. 6) And last but not least some thoughts about why agile is so important .... and how TOC can improve this mindset by addressing the constraint of the customer or the constraint of the constraint of the customer. Or what an agile architecture looks like. This presentation will be a very simple straight forward knowledge transfer for consultants already familiar with CCPM, so that they can deal in an appropriate way with agile guys. Video length: 1:20:00. PDF: 43 slides.
The recent days of the worldwide Corona epidemic are the trigger for the thoughts I have about the actual functionality of the buffer management (BM) methodology and how it should play a role in protecting our projects. I assume that we all know that the project buffer, and the associated feeding buffers, are our main ammunition against the uncertainties that are spread along all the projects routes. This is if our projects are planned and executed according to the critical chain methodology which is a derivative of the theory of constraints. Having said that, the main question we should ask ourselves is if the buffers, that normally are planned to be 50% of the associated chain, are good enough against all types of uncertainties or are there any type of uncertainty that the buffers are not supplying us the needed protection and we should think about additional, or maybe another, type of protection. Before listing the main contributors for the deep penetration into the buffers, there is a need to emphasize that the buffers conceptually should be consumed and most of the times they are fully consumed. We should be worried about the too many projects that are still late in spite of the normally very generous buffers. These projects are the reason for my presentation. The list of contributors to the penetration into the buffers: 1. Late start of a project, it consumes buffer time in spite the fact that the buffers are not designed for protection against late start. How should we handle the late start? 2. Regular delays in completion of tasks, these are the common and expected uncertainty that are mostly due to low probability of completion of tasks on time. 3. Unavailability of a resource (Still busy in another project), very typical to a multi-projects environment and should be treated with the capacity buffer that can serve as the synchronizer between the projects sharing common resources. 4. "Grey Swan" events which are a potentially very significant event that is considered unlikely to happen but still possible (can be internal as well external to a project). 5. "Black Swan" events which are unpredictable event that are beyond what is normally expected of a situation and has potentially severe consequences (also can be internal as well external to a project). Only one (the second) out of the above five contributors is perfectly dealt with the regular buffer management methodology. What should we do to protect our projects regarding the other contributors? By the way, the regular statistics suggests that about 30% of IT projects are cancelled before completion. I presume that many of these cancellations are due to the last two contributors. We should do something different in regard to them and not just pray and hold ours fingers. Video length: 38:57. PDF: 21 slides.
This case study describes a physician lead TOC implementation to improve his ophthalmologic practice in a Brazilian hospital. The work consisted of performing 2 retinal imaging exams: fundus photography and fluorescein angiography. After applying the 5 focusing steps, buffer management, and drum-buffer-rope, the practice improved continuously. In 4 weeks, the practice increased the number of appointment slots by 50% and last minute appointments by 150%. All stakeholders saw the benefits beginning on the first day. Patients flowed very smoothly through the system. More importantly, the quality of care improved after implementing TOC. Since fighting fires was eliminated, the provider and the assistant could focus on the current patient treatment, dedicate more time for each patient and also attend more patients per session. Video length: . PDF: slides.
This presentation demonstrates to all attendees the value of using TOC principles to improve government operations. Government effects everyones life and business, yet the drive to improve government remains mediocre at best. The presentation will inspire them to get involved with their local government with the aim of introducing TOC to government workers. If the audience is already involved in government to some degree, then the presentation will inspire them to use these proven TOC tools and principles to improve the government they are already involved with. This presentation argues that government must keep up with the increasing demands of business, population growth, aging infrastructure, and customer demands. TOC offers this promise. This presentation offers the proof. The influence of TOC can and should expand globally to meet the government capability gap that is a worldwide phenomenon. Video length: . PDF: slides.
Utah state government has utilized TOC for the past several years and has achieved remarkable results. Based on these results, Utah Governor Gary R. Herbert formally initiated the use of TOC management tools and methods in all cabinet-level state agencies. This effort, which began in January 2013 under the leadership of Kristen Cox, has already proven to be effective across several types of pubic-sector work environments. The focus of the presentation will be to detail the strategies and tactics developed by the Governor's Office of Management and Budget to support state agencies in an enterprise-wide implementation. In addition, the presentation will highlight modifications to tactics based on lessons learned and inherent conflicts in government environments. Basic strategies and tactics of the Utah State Government TOC initiative include: developing necessary infrastructure, communication and messaging Utah's 25 percent improvement target, internal capacity, curriculum and tools, operational excellence initiatives, identification of main “systems” in state government, Throughput Operating Strategies, identification of primary work environments, performance management, adaptation of TOC metrics to government (Quality Throughput/Operating Expense), development of system measures (previous balanced scorecard contained over 400 different metrics and has been reduced to just over 100), operational measurements, budget processes, uncovering hidden capacity before increasing budgets, aggregate buffering, process of ongoing improvement, research and development, and evidence-based practices. In summary, the audience will gain an understanding and appreciation of Utah's ongoing journey to manage operations using TOC tools and methods. We would essentially be telling our story in an effort to motivate others to begin or further their respective government TOC efforts. Three learning objectives: 1. The audience will understand basic strategies for a TOC implementation in state government. 2.The audience will understand a common approach to measuring improvement in state government systems. 3. The audience will understand the intended future for Utah state government operations to utilize TOC management tools and practices, including aggregate buffering.
Local governments across the country are meeting the mandate for operational excellence through applications of the theory of constraints. In 2014, at the TOCICO International Conference in Washington DC, Kevin Fox presented an overview of the significant impact of the improvement projects he has led in the states of Utah, Hawaii and Texas, each of which has led to the wide-scale adoption of Theory of Constraints (TOC) principles in those states. The implementations have led to high levels of operational excellence and saved local governments millions of dollars. The need to utilize resources more effectively, and work within budgets that are growing at a far lower rate than the demand for services, creates increasing pressure on agencies to improve productivity and local governments across the country are mandating operational excellence. Government employees are highly committed to improving however, the systems are clogged with obstacles to high performance. Kevin Fox will share his expertise in finding breakthrough solutions for the obstacles to high performance to his 'Better, faster, cheaper: Practical applications of the theory of constraints (TOC) in government' Intensive Lab to be held on February 9-10, 2015, as part of the TOCICO Intensive Labs Series in Scottsdale Arizona. Government agencies are encouraged to take advantage of this exceptional, single focus training opportunity to bring a team of their top managers to learn from and work directly with Kevin. Participants will leave with individual plans to address their specific agency concerns that can be implemented immediately. Participants in this lab can expect a rigorous, hands-on, interactive two-day session that will provide them with the following: • A framework for measuring and motivating higher performance. • A solid foundation in TOC flow principles for government/service operations. • A simple guide to analyzing processes and identifying focused solutions. • Practical strategies to accelerate service delivery and reduce backlogs. • Tools and techniques for breaking bottlenecks and increasing delivery. • A road map for launching focused improvement efforts using TOC principles. • Strategies to confront complex government challenges such as recidivism, unemployment and homelessness. • An array of application examples and case studies from different government agencies. In this intensive 2-day lab, Kevin will demonstrate and teach the how-to processes that will enable participants to return to their various government agencies with strategies to address the identified obstacles and immediately impact the effectiveness of their operations.
This presentation focuses on an application of TOC thinking along with complementary tools for movie production. Similar to a military campaign, movie productions have specific objectives: fluid conditions, safety concerns, and logistics challenges. We present applications from concept development and financing to post production with examples from an independent feature film production in the US. In addition, we present how TOC can further strengthen the high reliability organization practices to increase safety and agility on movie sets.
TOC practitioners are well aware of the power of critical chain project management (CCPM). On-time in less time, on-budget at lower cost, without compromising on scope, quality or risk. So why is its application in the field of construction and capital (capex™) projects very limited? Wasn't CCPM originally developed just for this kind of project? Wasn't one of the first successes before the book ""Critical Chain"" was published on road construction? And this industry certainly suffers from the UDEs that CCPM was developed to overcome. Both Ian and Robert's early careers were in this field, and they were initially baffled as to why the acceptance of CCPM had been so slow. In this presentation, they will share their analysis of the situation, and will suggest how to overcome the core problems they found. Their hypothesis is that with projects where most of the work is carried out by third parties such as capex projects. CCPM by itself is not sufficient to guarantee success. CCPM assumes a collaborative project team, where there are no obstacles to sharing buffers to cover time and cost uncertainty and variability. However, with the prevailing procurement and contracting strategies adopted in this industry, this assumption is not valid. The predominant use of fixed price contracting and adversarial contract terms are fundamentally incompatible with CCPM. But there is an alternative. The presentation will describe a commercial approach to forming a truly collaborative project team, known as a Project Alliance. Ian and Robert will show how this method works, show how it overcomes most of the obstacles to using CCPM, and how this combination of CCPM and a Project Alliance, can deliver significant benefits to capex projects.
Eli (Goldratt, 2009) distilled out the 4 concepts (principles) of flow by considering how the seminal innovations in manufacturing flow management were developed to embrace increasingly unstable environments. The absence of reference to 'constraints highlights the more abstract nature of these principles that encompass lean and TOC thinking. The focus on flow and limiting over production with continuous improvement are largely self-evident, but alongside this he exposes the need for a paradigm shift in thinking often missing in such applications (principle 3: abolish local efficiency). This presentation seeks to illustrate and extend these findings acknowledging the importance of system-based management signaling tools and the management of aggregated buffers in increasingly unstable environments. The presentation also explores how the choice of mechanism combines the need to both manage and reduce variability and uncertainty. In more stable environments the emphasis is on reducing variation and uncertainty across the delivery system, but higher instability brings with it the opportunity to gain immediate benefits which is where TOC exploits the opportunity to focus and use aggregated buffers to first align and then reduce the impact of variability and uncertainty. The presentation considers how this understanding can be used to interpret and extend mechanisms such as Statistical Process Control, Kanban, Vendor Managed Inventory, the Last Planner System and Buffer Management in a health and social care setting. Finally, the presentation identifies the growing need to hybridize and adjust the choice of mechanism where the nature and level of instability changes over time. References Goldratt, (2009), Standing on the shoulders of Giants: Production concepts versus production applications The Hitachi Tool Engineering Example, Goldratt Consulting.
Actively Synchronized Replenishment (ASR) provides a no-compromise materials synchronization solution for manufacturers regardless of their preferred manufacturing methodology. In a world of improvement methodology religions, ASR is agnostic. The heart of its power is simple—material and component availability even in complex environments is tied to ACTUAL consumption. If you are frustrated with the compromises and obstacles forced into your environment by MRP this session is a must.
Actively Synchronized Replenishment (ASR) provides a no-compromise materials synchronization solution for manufacturers regardless of their preferred manufacturing methodology. The heart of its power is simple - material and component availability even in complex environments is tied to actual consumption while maintaining critical visibility with regard to available stock and the bill of material (BOM). This is essential to support pull-based scheduling and execution systems such as lean, and the drum-buffer-rope technique of the TOC; but it also offers the potential for major performance improvement in companies which use MRP in a traditional scheduling environment. if you are frustrated with the compromises and obstacles forced into your environment through the use of MRP, this session is a must.
This presentation describes the term actively synchronized replenishment (ASR) which is different from the traditional push (replenishment or distribution) solution. It includes manufacturing and MRP with many (6 or more) levels of bills of materials, vertically integrated business unit, etc. The underlying problem is that of the push versus pull distribution system conflict. The company wants to use lean (pull) but the company is also using a forecast to determine demand (push). The undesirable effects (UDEs) of poor material synchronization are listed and discussed. Survey statistics related to the problems of push are provided. The purchasing and fulfillment links seem to be working well in a number of companies but the MRP (all pure pull) is not functioning well. MRP was conceived in the early 50s and commercially coded in the 1970's. The environment has changed significantly while MRP has not. The details of ASR are provided with buffer locations and the supporting logic. Examples are provided where ASR should be used. ERP (enterprise resource planning, the traditional push solution) has not solved the problem.
This presentation provides a framework for implementing change, focusing on the role and requirements for leadership throughout the process. Three key learning points include: 1. Three levels of approaching change: Organizational, individual, and leadership; 2. Requirements for successful change at all three levels; 3. Usage of TOC tools within the framework. The audience should have: 1. A more robust and practical framework for causing change and making our implementations work; 2. A template to approach your implementations in the future; 3. Realistic expectations for short-term versus long-term results.
This session describes the standing on the shoulders of giants (SOSG) process developed by Eli Goldratt to identify breakthrough applications of theory of constraints. The SOSG process is explained and a description is provided of the four facilitator-driven sessions where the process is used to identify problem areas in current applications of TOC knowledge. The sessions include supply chain, critical chain, distribution solution, and thinking processes. A wrap-up session is provided describing the results.
Philip shares five recent examples of Critical Chain used in a variety of industries. Gold mining: large Capex project; process maintenance and mobile equipment MRO. Business Jet maintenance: boosting the performance of the market leader. Pharmaceutical industry: large Capex project and multiple process upgrades. Arterial implants world leader: the portfolio of all their major improvement initiatives. Covid-19 respiratory tests: speeding up product development to save lives.
The purpose of this presentation is to describe the unique features of government so that we can better appreciate how the arts and sciences of The Theory of Constraints (TOC) might be applied to the endeavor of governance. This presentation will invite the TOC community to interrogate these observations and have a productive dialog to advance our understanding of how government might benefit from established TOC concepts, Thinking Processes, and TOC solution implementations.
Avneesh Gupta presents an overview of the Tata Steel journey then three case studies are presented. Video 1: Video length: 26:27. PDF slide 1-11.
CASE STUDY 1
Banka, Vivek and Singh, Om Prakash Kumar. Pushing beyond limits (Achieving world benchmark using CCPM)
Tata Steel Ltd, Jamshedpur, LD#1 is the long product division. LD1 having 3 billet casters, CC1, 2&3. CC2 production is 1.26 mtpa it‚ the best among LD1 Caster. Turret is the equipment which is used to exchange the ladle and keep the continuous casting of billets. Due to Logistic problem, CC2 Turret is very complex in design and its non-conventional independent arm type Turret. This Turret has two slew bearing & it facilitates rotation of turret arm with 300 tons load. Due to its life, bearing needed a replacement. Video 1. Video length: 26:28-56:57. PDF slide start: 12-51.
CASH STUDY 2
Patnaik, Amit and Singh, Prakash. What could not have been done in 6 years, lets do it in 6 months! (Application of TOC 'Change Matrix Cloud Process in Human Resource Management -Capability Development)
There was gap of 18KT in performance of supplies of Medium Carbon-High Carbon(MCHC) to Market in FY 18. MCHC Corten is considered to be high Margin Product while at the same time it is very difficult grade to cast and roll. Availability of the grade is restricted due to: i) Casting in Narrow Width‚ (Requirement of Hot Strip Mill ii) Slow Casting Speed---Affects Caster Throughput iii) Requirement of Hot Charge. To avoid Slab crack and scrapping of slabs. Presentation describes how Five focussing Steps is used to identify constraint and Undesirable Effect which affects the performance. Video 2: 0 to 23:26. PDF slides: 1-15.
CASE STUDY 3
Patnaik, Amit. “Niche Product vs Regular Product” .... Dilemma resolved through application of TOC-Thinking Process (Increase in production of value added products to serve market demand)
ECBS is Enterprise Capability Building System, introduced in 2012 in Tata Steel with an objective to develop and use a scientific method for assessing desired and present knowledge/skill level of individual employees to identify their training needs as well as evaluate the effectiveness of training process. Even after 6 yrs of introduction of this concept the penetration at Raw Material (RM) locations was merely at 33% level (H1 FY19). TOC project was taken to enhance ECBS performance to 100% in 2 years span. TOC Change Matrix Cloud Process was used to resolve the conflict and verbalize all the Yes and buts‚ that need to be addressed to move from a half-baked‚ to a fully-baked, win-win solution. Video 2: start 23:27-57:02. PDF slide start: 16-46.
The last century was the stage of an impressive evolution in healthcare: we are living longer, and the population is growing. However, these improvements led to a higher and rising demand for healthcare services. Despite an ever-increasing investment in healthcare, lack of capacity and timeliness are still affecting every country. Current management methods are not providing an effective solution to this crisis. Frequently, the bad/outdated policies that healthcare organizations are using to manage their resources and patient flow are the problem. Potential solutions, like Lean and Six Sigma, provide limited benefits and still incur in the same problems: high investments and long implementation time. Healthcare organizations that adequately applied the TOC achieved impressive results. A recent study about TOC in healthcare (based on academic articles and TOCICO video proceedings) reported improvements in productivity .... more patients treated .... and in the timeliness of care .... which leads to better outcomes. Applying TOC basic principles and three POOGIs can be implemented in a few weeks and usually does not require additional cost. TOC principles and POOGIs can be applied in healthcare to address the core conflicts and undesirable effects. Examples include family medicine practice, imaging practice, emergency departments, inpatient bed management, and home care. Video length: 48:41. PDF: 60 slides.
My presentation is a study the process of a "bottom-up" type implementation of multi-project CCPM in Mazda Motor Corporation, from the perspective of the author's various experiences of CCPM implementations and consultations to many companies in Japan including Mazda's case. Why Japanese GEMBA people resist the Top-down decision of CCPM introduction? Why do many of Japanese companies select the bottom-up approach rather than top-down? Through this study, the author is trying to figure out the key factor of the successful CCPM introduction to Japanese companies.
The presentation introduces another giant, John Boyd and his Boyd Cycle (Observe, Orient, Decide, Act). It defines and develops the concept of the agile organization, shows how the combination of Boyd Cycles and TOC can enable the agile organization, and provides examples of the agile organization.
This presentation focuses on an application of TOC thinking along with complementary tools for movie production. Similar to a military campaign, movie productions have specific objectives: fluid conditions, safety concerns, and logistics challenges. We present applications from concept development and financing to post production with examples from an independent feature film production in the US. In addition, we present how TOC can further strengthen the high reliability organization practices to increase safety and agility on movie sets.
The presenter has a long career “selling” as an internal and external consultant both TOC- and quality-based solutions. Over the past 28 years, the target customers have ranged from mom-and-pop organizations, mid-size companies and multi-division corporations and government entities. The ability to successfully shift presentations and explanations to higher-level executives and larger organizations has been focused on solving some of the problems above. This presentation will cover what the presenter has discovered, some of the models she has used for communication and how she came up with them. She will also cover some simple steps that guide her in not only gaining access and closing the sale, but that can be used in communication within the organization to gain and maintain alignment. Some of the elements that will be shared are: 1. Knowing what to emphasize to whom. Taking a PM organization she will show how different items would be emphasized to different owners of the organization. 2. A simple model of how the solution is connected to the important bottom line. 3. A simple model for one to institutionalization the improvement. The models shown are easily translated to a specific consultants client base. Some of the techniques discussed will be: Generating bottom line UDEs for the particular audience; Creating a high-level model for connecting high level tactics to the bottom line; and Organizational change models that don't sound like cultural change. Questions: 1. How do I get my contact to get me access to their boss? 2. How do I overcome the appearance of using two different models - a 50,000 foot model and a detailed logic tree? 3. What do I do if I do not know what the person's bottom-line UDE is?
The Theory of Constraints thinking process and applications provide time tested means to improve company performance and plan successful strategic moves. Both create means to help managers focus attention on issues that should be resolved by using such things as: low WIP plans, buffer management, fever charts, etc. These are all forms of workarounds to deal with a larger constraint which generally remains unrecognized: The belief is that only management can resolve such issues. Using the ""Standing on the Shoulders of Giants"" process this presentation shows the current limitation and how a command and control approach called Mission Command, developed by the military, can break the current constraint and allow improved levels of performance in TOC companies.
This presentation describes breaking a market constraint using the thinking processes (TP) and TRIZ. The customer doesn't want a product or service but a solution to their problem. The solution must provide a win-win for the customer and the supplier. Your company must construct an unrefusable offer (URO). Five steps in constructing a URO using the thinking process are: 1. Determine the core conflict responsible for some/many of the market's significant problems. 2. Determine what changes your organization must make internally to solve the market's core problem; 3. Construct a solution, an offer your organization can provide to resolve that core conflict; 4. Develop an implementation plan that addresses the obstacles blocking the implementation of the solution; 5. Learn how to sell the URO to the market, as well as to your own organization. TRIZ is described including Anticipatory Failure Determination, Directed Evolution, Inventive Problem Solving, and Control of Intellectual Property. The use of S-curve analysis and TRIZ is discussed with examples illustrating innovative solutions. The TP can then be used to understand the undesirable effects of the customer that your organization can impact to create a decisive competitive advantage.
This presentation discusses the pressures we face as we try to execute projects and how our reactions to these pressures lead us into the vicious cycle. The vicious cycle is a cause-and-effect loop where negative effects cause more negative effects; the effects build on each other creating a downward spiral of ineffectiveness and limited productivity and undesirable outcomes.
LeTrourneau (LT) is headquartered in Longview, Texas with manufacturing locations in Longview, and Houston TX and Vicksburg, MS and with dealer locations worldwide. Markets served include controls, drive systems, internodal mining, drilling, forestry, marine, and steel. LT characteristics include: 1. Product leadership makes the largest products in the world. Jack-up rig sells from 150 million to 300 million dollars. It is delivered as a kit valued at about 40 million then is built with about a million man-hours as a 1 to 3 year project. 2. Make steel from scrap making thick plates 2-10 inches. 3. Build front-end loaders 7000-75000 parts works 8 years with over 90% uptime. 4. Have produced most of these products for over 50 years. We have only been in the drilling market for five year. We are heavily vertically integrated which is unusual for heavy equipment manufacturers. Typical undesirable effects (UDEs) include long lead times, high WIP, high obsolete inventory, very low inventory turns, low on-time delivery, high overtime and expediting, exiting markets due to pricing competition, poor cash flow, and low ROI. Total reliance was placed on GAAP for decision making for product pricing, transfer pricing, sourcing, capital expenditure, product profitability, etc. In 2000 we implemented drum buffer rope (DBR), installed MAPICS finite capacity planning module causing on-time delivery to increase from 10 to 75%. In 2004, Constraint Management Group (CMG) worked with LT providing the Jonah program. In 2005 we implemented TOC company-wide. The core conflict was A Maximize LeTrourneau ROI with B Meet LeTourneau's customer and market requirements and opportunities requiring D Focus and act on company performance and the other requirements C Maximize margins and metrics under my control requiring D' Focus and act on local performance. The primary injection was simple correct signals between business groups (BGs) and resources that maximize company throughput, net profit and ROI. The planning and control dilemma existed also. One strategic point was selected for each BG and component group. When we turned on the buffers we found we were working on green items (early items) when we had a lot of items in red (almost late). Steel Group implementation results showed previously poor financial performance to extremely profitable and included productivity increased 25%, WIP inventory decreased 25%, cycle time decreased 64% (14 to 5 weeks), on-time delivery increased from 50 to 90%, and plate inventory held decreased 2.6 million dollars.
The effective use of change/no change matrix to elevate the constraint and reduce the cycle time for payment in exports. A blockchain technology-based solution in trade finance was developed which could greatly reduce the time and had the requisite data security to be accepted by all stakeholders.
The agile methodology formerly in place for software development at Schneider Electric Engineering Workbench could not give the desired results. But a typical implementation of CCPM would not have worked either! The company innovated a flow model based on the core concepts of TOC which not only created a more harmonious work environment for developers but also increased productivity by a whopping 33%! This is their story.
In this keynote presentation, Dr. Alan Barnard, CEO of Goldratt Research Labs, will share, a number of key lessons we can learn from the way individuals, organizations and countries responded to the Covid19 pandemic. In many cases, there was initially an under-reaction by decision makers. The number of cases and deaths were low. But as soon as decision makers realized it was growing exponentially, they reacted. In some cases, it triggered over-reactions, trying to secure as many of resources as possible, driving up prices and overloading an already constrained supply. When there are so many unknowns and uncertainties, how can decision makers ensure they do not under-react or over-react? In this presentation, Dr. Barnard will share his insights on this question, and specifically, how the principles and applications of theory of constraints can help decision makers, not only decide when and how best to respond to cases where we have the lethal combination of exponential growth and finite resources, but also how to be better prepared for the next pandemic.
The impact of the "Blue Ocean" strategy: to fulfill a significant need of a big enough market in a way no significant competitor can is a great contribution to moderns views of management and organizational strategies. In a more recent book "Blue Ocean Shift" the authors (Kim and Mauborgne) present a process to lead companies to their Blue Oceans, together with cases and examples of its application. In this presentation, we will explore what is the "Blue Ocean Shift" process, its strong points and its shortcomings and how TOC is a great fit to close the gaps and reinforce this process. The whole concept behind Viable Visions will be revisited, starting from a few templates (formalised in S&Ts later on) we will merge the process with the "Blue Ocean Shift" to develop new decisive competitive edges (DCEs) and new ways to implement those faster and more effectively with TOC. We will conclude with an overall process of strategies and tactics to develop and implement new Viable Visions with the Blue Ocean Shift augmented with TOC in the S&T format. Video length: 50:13. PDF: 44 slides.
This presentation explores the conceptual origins of buffer management in the context of TOC developments across make to order (MTO), engineer to order (ETO), make to availability (MTA) in manufacturing environments, in addition to more recent developments in the service sector. The presentation relates the buffer management concept to the seminal work of Shewhart (1931) and Ohno (1978) and discusses the practical and theoretical basis for extending the buffer management concept to enhance 'lean' developments, with particular reference to construction and healthcare management.
This presentation explores the conceptual origins of buffer management in the context of TOC developments across make to order, engineer to order, and make to availability (MTO, ETO, MTA) manufacturing environments and more recently in the service sector. The presentation relates the buffer management concept to the seminal work of Shewhart (1931) and Ohno (1978) and discusses the practical and theoretical basis for extending the buffer management concept to enhance 'lean' developments, with particular reference to construction and healthcare management.
Businesses are dying faster than ever as they fail to drive adaptation to an increasingly more complex and volatile set of circumstances. Management is starving for relevant information, much of which is obscured and distorted by antiquated models, methods, rules and tools held over from decades past. What will it take to change this? This workshop reveals a new management framework that enables a flow-based system of management to drive return on investment performance and adaptation for sustainability and improvement in the longer range. The new framework is called the Demand Driven Adaptive Enterprise (DDAE) Model. The Demand Driven Adaptive Enterprise (DDAE) Model spans the operational, tactical and strategic ranges of an organization allowing it to continuously and successfully adapt to the complex and volatile supply chains we see today. It combines the fundamental principles of flow management with the emerging new science of complex adaptive systems (CAS). It is the way that successful businesses will work in the 21st Century. This half day workshop will prove a compelling need for change, demonstrate fundamental solution principles and reveal a blueprint to transform the entire enterprise. Businesses are dying faster than ever as they fail to drive adaptation to an increasingly more complex and volatile set of circumstances. Management is starving for relevant information, much of which is obscured and distorted by antiquated models, methods, rules and tools held over from decades past. What will it take to change this? This workshop reveals a new management framework that enables a flow-based system of management to drive return on investment performance and adaptation for sustainability and improvement in the longer range. The new framework is called the Demand Driven Adaptive Enterprise (DDAE) Model. The Demand Driven Adaptive Enterprise (DDAE) Model spans the operational, tactical and strategic ranges of an organization allowing it to continuously and successfully adapt to the complex and volatile supply chains we see today. It combines the fundamental principles of flow management with the emerging new science of complex adaptive systems (CAS). It is the way that successful businesses will work in the 21st Century. This half day workshop will prove a compelling need for change, demonstrate fundamental solution principles and reveal a blueprint to transform the entire enterprise.
The opportunity, to implement TOC at scale in the Logistics Industry with Productivity Partners, requires that we can implement TOC at the speed of light using a series of Atomic Changes which are safe, understandable, and resistant to reversal. Analysis of Logistics many clients, simultaneously, using TOC at the Speed of Light produces a customized and co-authored implementation plan that is very consistent across an industry. It is then possible to execute those unique plans using standardized project chunks which we call Atomic Changes. Clients can assemble the atomic changes and execute their plans with strong and standardized guides, outcomes and measurements, to produce rapid, stable and measurable outcomes.
Public health care providers typically struggle with the need to meet demand for services, within a limited budget. This paper describes an analysis of a large public hospital, using the Theory of Constraints (TOC) comprehensive set of mapping tools to logically represent a problematic situation and investigate options for resolution. Based on the symptoms present, root causes and conflicts were identified, along with potential solutions. Further TOC tools were used to check for possible side effects of the solution, and identify obstacles that might impede successful implementation. Based on the TOC analysis, a trial project was implemented with significant benefits for two departments. Outcomes included dramatically reduced patient wait times and staff overtime, increased patient satisfaction, increased efficiencies, smoothed workload, and improved staff morale and retention, while maintaining patient safety and integrity of treatment, and staying within defined cost parameters. Video length: 50:32. PDF: 38 slides.
Mas Kapital is a Microfinance company located in Mexico. They have grown fast for the last 6 years but they were worried about the imminent threat of losing control of the processes and they decided to adopt the TOC philosophy in order to stabilize the company. In 2010 they met Dr. Goldratt and they decided to make a full TOC implementation grounded on their Viable Vision project. Since the beginning TOC tools were utilized in order to identify the undesirable effects. From this point we identified the major constraint as the loan submission analysis process, subordinated all the company efforts in order to only process good qualified potential customers and filter them in a better way to reduce credit risk and reduce bad debt, at the same time we divided the sales force responsibilities and tasks in order to focus the collections activity and align the promotion process to the real needs of the company, once we had the operations control TOC thinking processes were used to identify a significant need of the market and design Mas Kapital decisive competitive edge.
The only purpose of any review, similar to measurements purpose, is to help take better decisions. Most organizations measure a large number of parameters, and typically review monthly. Since the only purpose of review is to take decisions for corrective actions, the monthly review frequency for a large majority of organizations is not appropriate due to the long period between incidence time and corrective action. In my 20+ years experienceof helping organizations for achieving quantum improvement, one common practice has been a weekly review process. Typically the CEO and the direct reports of the CEO / all functional heads / business heads constitute the review team. In the weekly reviews, we review not only the planned and actual results, but also review the trend of the previous 13 week moving average. The 13-week moving average helps in overcoming resistance layer 1 i.e. not accepting the problem. Weekly reviews shrink the time between incidence and corrective action. It also helps develop capabilities of review team members to train them as potential CEOs. Faster reviews along with faster corrective actions generate faster results. Weekly reviews help participants understand the cause-and-effect relationships between different parts of the organization to help increase achievement of the organizational goal. Understanding cause and effect between different functions help reduce local optimization. Reduction in local optimization, in turn, helps increase organizational goal units. Increased organizational performance increases teamwork between different functions / business units. Sharing below the experience of Mr. Mahesh Sharma CEO Flexituff International. The weekly planning vis-a-vis earlier monthly scheduling is perhaps the single biggest change in our approach towards production planning dispatch scheduling and receiveable collection that seemingly has changed our entire working focus. First time, in the month of July 2013, we did not observe month-end syndrome where over 40% dispatchs used to take place in the last week. (The functional heads though now complain of having shifted month-end pressure to now weekend pressure as throughput is measured and monitored at the end of each week!). Weekly planning is resulting in more dispatches and higher payment collection. Video length: 1:00:31. PDF: 16 slides.
This presentation introduces our latest developments on delivering results fast. We will share how we have developed our approach, and the speed at which our clients have seen results. We will walk you through examples that illustrate our rapid implementation process, and how we are using lead and lag measure on projects: Overcoming the natural resistance to change thats the biggest barrier to fast, sustainable results; minimising disruption to working processes; removing the risk of people reverting to the old ways of working (increasing that valuable buy-in). Video length: 1:00:10. PDF: 26 slides.
In this one-hour presentation, Eli Schragenheim defines an insight as recognizing a cause-and-effect structure that can be applied to variety of situations. TOC has come up with several powerful insights that carry the potential of achieving huge value. Eli Schragenheim presents his chosen seven key insights and discusses their value beyond the immediate use within the TOC applications. The insights are: 1. The constraint / bottleneck 2. Visible buffers 3. Buffer management 4. Throughput 5. Conflict resolution 6. Inherent simplicity 7. Decisive competitive edge and the essence of strategy and tactic. The wide use of each one of those insights is the core of this presentation.
While it is pretty well-known that the concept of 'cost-per-unit' is flawed, the nature of the flaw and the possible implications of key decision making is not known. The workshop covers the basic flaw of the common cost accounting methods. Then the principles of T, I and OE are presented and why they are superior performance measurements, and superior information for decision making. Then the workshop identifies the current boundaries of the T, I and OE knowledge and the reason this simple method has not spread. Challenging some basic assumptions is required for coming to the critical new ability to rationally judge an idea by answering the question: Would the proposed idea increase the bottom-line or reduce it? The proper answer to the question involves translating human intuition into a numerical range and coming up with the full range of reasonable financial results that constitute the best supporting information for the top management team. Being able to quickly analyze almost any 'crazy idea' could open the door for many of the organization employees to feel free to suggest ideas. The outcome of such an analysis, based on the best available information, is much better exploitation of the organization's critical resources, leading to very high profitability. This workshop offers the opportunity to understand T, I and OE, both the current knowledge and also the new developments in this field.
Now What? This panel follows the 4-Part Introductory CCPM Education series Q&A sessions. The expert panel comprises all the presenters in the introductory education series and will cover any questions not addressed in their own specific Q&A session, as well as those submitted via the comment boxes. The panel can offer guidance on how to get started, and successfully deliver projects in less time with CCPM. Tap into their vast experience! Anyone from the PMI attending any of these sessions merits additional PDUs. Check with your local Chapter.
Unlike for-profit organizations with a clear goal of improving economic value now and into the future, the stakeholders of a health system, such as government, private industry and healthcare providers have conflicting interests. All stakeholders in the healthcare system, including consumers of healthcare seem to agree that the current performance of the healthcare system is undesirable. In the US, the conflict between two opposing ways to solve the healthcare system-wide problems has reached the highest sociopolitical level with proposals, such as Obama care and Free Market healthcare. The theory of constraints thinking processes (TP) could provide win-win solutions to eliminate all of the current healthcare system's undesirable effects (UDEs). The TP could be utilized as an effective tool for aligning the conflicting positions to achieve one clear goal and the necessary conditions for a flourishing healthcare system: availability of affordable, high quality of care for all US citizens, and an environment that provides incentives for innovations and continuous improvements.
The case of city-wide infrastructure construction and renovation for the UEFA Euro 2012 in Wroclaw, a large European city is presented. Applying TOC and critical chain project management (CCPM) within a set of huge, separate but interdependent, conventionally-managed yet time-critical projects was certainly a major challenge. Conveying the knowledge to people, who sometimes lacked basic project management skills wasn't easy too. But, as it turned out… it's not the technology, stupid! It's the trust! The main challenge was, as it often happens, that the various projects (all 13 of them) had to be ready within most challenging time-table, with no flexibility whatsoever regarding their finish. What has constantly added to the many technological and logistic problems the problems were constantly barraged by, was the basic lack of trust between the investor and project contractor, between the various contractors, most of them neighboring each other, within the narrow confines of space. Creating the trust between the investor and the contractors, the trust in project managers' ability to find solutions to even the most complex problems as well as the ability of the coordinating team to assist them in resolving the emerging inter-project conflicts in a truly win-win manner was the main challenge. Once met, we have seen them gradually gaining the trust in the beneficial impact of CCPM. That, coupled with the trust in the good will of the investor turned out to be the issue, which most contributed to their ability to finish all project on, or before time. Topics include: Mega-projects versus large projects, tools for uncertainty-management in mega-projects, and cooperating with the investor, contractors and subcontractors, vendors and internal and external control bodies.
How TOC could assist in handling emergency situations caused by a major disruption or disaster? The lack of oxygen could be a leading example. Of course, Covid-19 is an ongoing major disruption that causes several emergency situations in hospitals, economy, and eventually impacts several supply crises.
Introduction to scheduling several projects in a multi-project environment. Understand how to prioritize, stagger, and execute across a portfolio to achieve more project flow.
This presentation is an introduction to planning and scheduling a single project. Planning a single project includes the "what" the "how", the "who", "how long" and validation for that project. This session is part 3 of the 4-part series - picking up from "Building Blocks", and handing off to "Scheduling and Executing in a Multi-Project Environment".
At Boeing, we have a long history of learning where our previously useful methods begin to fall short and always seek more capable methods to develop and deliver the next edge in products and services. Across hardware oriented industries, the Agilistas and their cousins DevOps, DevSecOps, LeanAgile, SAFe and Design Thinking, etc, have seen muted success with more integrated products. We believe we have some answers to: why Agile, as currently structured, may never deliver similar levels of success in hardware, what injections from TOC could result in breaking through the current glass ceiling and, perhaps most importantly‚ how to tell, very early, whether your business will most benefit from Agile, ToC or a hybrid model for managing your project. We incorporate techniques from systems engineering, complexity theory & network theory in a synthesis of CCPM, Agile, Set Based Concurrent Design, etc without violating core tenets. We start with modifications of the Logical Thinking Process, sequence a sufficiently diverse set of Agile explorations of the design envelope, and then transition to an enhancement of CCPM once a WBS emerges. We call this Precedence Based Program Management. Video length: 58:31. PDF: 49 slides.
In this presentation, Douglas McKinnon, senior director of IT Project & Production Management, will describe how Charles River Laboratories used Critical Chain in the management of their extensive portfolio of IT projects. Despite far-from-ideal circumstances, and significant inertia and resistance, implementing Critical Chain helped deliver significant value to the organization. Before Critical Chain, about 55% of IT projects were delivered on time. Within a year of implementing Critical Chain this rose to over 90%, and has remained at over 90% for the past 2 years. At the same time end-user satisfaction with the delivered solutions rose. But the measure Douglas is most proud of is the increase in the employee engagement scores amongst the IT project delivery teams. From below average before they switched to CCPM, this has risen to one of the highest ratings in the company. He believes that ... A system that helps staff focus on the right things; Not having unnecessary bureaucracy; And an integrated approach to projects... was instrumental in this improvement in engagement and job satisfaction.
There is no longer any debate about whether a company should strive for continuous improvement. Now it's a matter of survive. Dr. Eli Goldratt verbalized the 5 most common mistakes people do when trying to improve their organizations or their lives: • We try to improve everything that can be improved. • We don't always get the contribution and buy-in from key stakeholders. • We don't always develop a clear and prioritized plan properly resourced to achieve our goals. • We lose focus when implementing our plan by multitasking and or getting distracted by less important issues. • We don't always learn the right lessons from experience. Even though they are valid statements in themselves, there is a clear causal relationship embedded. Companies spend a great deal of resources on trying to define what should be changed and how to make the changes happen as fast as possible. In other words they are focusing on the transition from current to future reality (looking forward and not backward). When looking at the statements above, the first 4 try to address that point. The last one is usually overlooked or sometimes even neglected. On the other hand is the one that clearly provides the better opportunities for learning and prevent the recurrence of the others. Therefore we decided to embark in a time machine and travel back to one of our main implementations in order to get a better understanding of what went wrong and propose an alternative solution. We are going to use the case of the implementation of a Viable Vision Project in large women shoe manufacturer.
Many Japanese companies are facing the dilemma to fulfill corporate social responsibility by securing employment versus to deliver new innovative products by investing more money for new product development. With four straight years of negative performance and a plummeting share price, Mazda had to come up with a way to deliver car innovation without increasing costs while keeping employment. Starting with bottom up initiatives and later supported by a top-down commitment, the company utilized the TOC five focusing steps which enabled them to use a laser-like focus on its TOC implementation to the only constraint to developing an innovative, new technological breakthrough called ""SKYACTIV.” Not only was Mazda able to cut its car development time in half, but also the mileage is competitive with hybrid cars without any compromise in performance and far less cost.
The presentation highlights the journey of our TOC implementation in the Motors Division at Bharat Bijlee, India. This is a mixed environment comprising of MTA, MTO and ATO (assemble to order), the complications were compounded because of the T-plant configuration. The business suffered from classic symptoms caused by working according to forecast (i.e. high stock outs, long lead times, low DDP, etc.) as well as firefighting and deeply entrenched local measures and silo behavior. The generic S&T was not sufficient to get the desirable results, and in the process it was realized that many new concepts had to be developed and implemented to address these special challenges. Significant operational results were achieved, enough to be perceived by the market, with significant improvement in financial performance. However, there are still challenges to be overcome both in Build and Capitalization: Reserving child components to take care of regular surges is becoming a difficult proposition. It remains to be seen whether better Inventory Turns for the channel partners (arising from superior availability and DDP) by itself does in fact constitute a Decisive Competitive Edge during a market down trend.
This presentation shares the correct process to develop a simple yet powerful way to identify and quantify the extent, consequences and causes of surpluses and shortages within the book publishing supply chain and how TOC was used to develop and test a viable solution that is generic enough to be applied to any other consumer goods supply chain.
Business, the sciences, organizations, societies and individuals are embedded and invested in norms, rules, regulations and controls that are valid and needed if for no other reason that anarchy cannot be an option. History is full of both great and disappointing lessons of new discoveries having great difficulty in gaining acceptance, even when the results have been demonstrated, without dispute. There are many instances where "the rules" are applied broadly in ways never intended. There are many instances in which the original reasons for "the rules" no longer exist, yet these rules are firmly embedded in behavior, policies and even laws. This session will demonstrate the thinking that is required of the change agent to bring their targeted audience on the journey that will include BUILDING A BRIDGE OF UNDERSTANDING so that one can feel safe on their journey to acceptance. Video length: 52:04. PDF: 20 slides.
The service landscape is huge and heterogeneous. A sizeable part of it are not for profit service organisations, like: child protection, relief work, mental health care, health service organisations, communal/governmental services, legal services, and internal service providers (legal, HR, IT etc.). Although quite diverse, these organisations seem to have similar symptoms (UDEs): long waiting lists, long lead times, pressure to start new services immediately/fast, high wip, high perceived work pressure, inconsistent quality, and friction between workers/disciplines. Over the last 14 years, Hans and Michel have done dozens of implementations in similar service organisations. Today, they will share with you: how to create rapid insight into WIP (distribution) and lead-times from their primary system; how to create management reports and buffer management lists to speed up completion; how to drastically cut WIP ('intermediate sprint) and keep it down; how to eliminate waiting lists; how to create consistent quality of semis and end products; how to improve financial health by understanding and improving T vs. OE; how to increase output. Video length: 59:49. PDF: 36 slides.
Avneesh Gupta presents an overview of the Tata Steel journey then three case studies are presented. Video 1: Video length: 26:27. PDF slide 1-11.
CASE STUDY 1
Banka, Vivek and Singh, Om Prakash Kumar. Pushing beyond limits (Achieving world benchmark using CCPM)
Tata Steel Ltd, Jamshedpur, LD#1 is the long product division. LD1 having 3 billet casters, CC1, 2&3. CC2 production is 1.26 mtpa it‚ the best among LD1 Caster. Turret is the equipment which is used to exchange the ladle and keep the continuous casting of billets. Due to Logistic problem, CC2 Turret is very complex in design and its non-conventional independent arm type Turret. This Turret has two slew bearing & it facilitates rotation of turret arm with 300 tons load. Due to its life, bearing needed a replacement. Video 1. Video length: 26:28-56:57. PDF slide start: 12-51.
CASH STUDY 2
Patnaik, Amit and Singh, Prakash. What could not have been done in 6 years, lets do it in 6 months! (Application of TOC 'Change Matrix Cloud Process in Human Resource Management -Capability Development)
There was gap of 18KT in performance of supplies of Medium Carbon-High Carbon(MCHC) to Market in FY 18. MCHC Corten is considered to be high Margin Product while at the same time it is very difficult grade to cast and roll. Availability of the grade is restricted due to: i) Casting in Narrow Width‚ (Requirement of Hot Strip Mill ii) Slow Casting Speed---Affects Caster Throughput iii) Requirement of Hot Charge. To avoid Slab crack and scrapping of slabs. Presentation describes how Five focussing Steps is used to identify constraint and Undesirable Effect which affects the performance. Video 2: 0 to 23:26. PDF slides: 1-15.
CASE STUDY 3
Patnaik, Amit. “Niche Product vs Regular Product” .... Dilemma resolved through application of TOC-Thinking Process (Increase in production of value added products to serve market demand)
ECBS is Enterprise Capability Building System, introduced in 2012 in Tata Steel with an objective to develop and use a scientific method for assessing desired and present knowledge/skill level of individual employees to identify their training needs as well as evaluate the effectiveness of training process. Even after 6 yrs of introduction of this concept the penetration at Raw Material (RM) locations was merely at 33% level (H1 FY19). TOC project was taken to enhance ECBS performance to 100% in 2 years span. TOC Change Matrix Cloud Process was used to resolve the conflict and verbalize all the Yes and buts‚ that need to be addressed to move from a half-baked‚ to a fully-baked, win-win solution. Video 2: start 23:27-57:02. PDF slide start: 16-46.
When implementing a new way of administrating a company, the CEO needs to harmonize three different worlds: the work in process (current projects), the work to be liberated for processing, and the new projects (the ones which are being negotiated now). This presentation shows a simple way to FOCUS and do this shift.
This presentation is organized as: Introduction, the beginning, what to change, pilot phase, full implementation, and a conclusion. We have been implementing Theory of Constraints based solutions since 2001; worked with Dr. Goldratt on a Viable Vision Project in South Africa (the “Many Opportunities”story in The Choice); implemented Critical Chain, Operations (DBR), Supply Chain Replenishment, Throughput Accounting, and Strategy and Tactics. Product development company: in 2005 born out of a prototyping dept. closure; started with a mech. & electronics engineer, machinist & 2 model makers; today ±30 people; and today full design, prototyping and short run manufacturing products company. Manufacturing shop results include vacuum casts parts from 17 to 33/day and leadtimes from 10 to 12 weeks to 4 to 6 weeks but there is room for Improvement as?some design projects still turn black….
Circor Aerospace & Defenses on-time finish performance of new product development projects was not at the expected level. They suffered from projects finishing late, problems with specifications, silo phenomenon, and they were limited in their capacity to run projects by a capacity constraint in the Qualification Laboratory. They decided to implement Critical Chain Project Management. They began with 3 pilot projects. During this pilot phase they increased the capacity of the bottleneck department. Associated project plannings have been reviewed and adjusted to be CCPM-compliant: the sequence of activities became more logical with realistic leadtimes and several optimization measures to achieve the projects faster were identified and implemented. They also changed and enhanced their management routines to facilitate the coordination & synchronization between key actors. The project durations were reduced, and the projects finished on time. The efficiency and throughput of the New Product Development also increased. Following the success of the pilot projects, they then rolled out the Critical Chain Way on their entire portfolio. All these actions resulted in better managerial alignment, improved communication and better problem escalation within the project teams. It also provided Circor Aerospace & Defense with better, more challenging and more realistic, project schedules, and gave them much better visibility on the projects progress.
This presentation will delve into a case study of a manufacturing companys innovative approach to contract design. The company, a major player with worldwide operations, embarked on a journey to build a greenfield manufacturing plant in Poland. Instead of following the traditional win-lose approach to contract design, they challenged the status quo by negotiating a novel contract that paved the way for implementing the Critical Chain Project Management in the project.
Why are projects Late, Over-Budget and not providing all that was promised? See how variability and precedence lead to bad multi-tasking. Understand how simple steps can put your projects on track. All using some simple, hands-on games you can share with your organization.
Most organizations fail to deliver projects on time, on budget, and according to the agreed features and agreed results of their projects. This presentation describes a maturity model aimed to set the direction (with the steps needed to be performed) for multi-projects environments, based on the Critical Chain methodology, in order to get out of the messy situation and being able to have close to perfect performance.
Despite the great effectiveness of the CCPM methodology many businesses struggle with its quick and successful implementation. Some of the real implementation challenges include: Lack of buy....in to cutting task durations; Difficulty to perform meaningful resource management / scheduling in a dynamic CCPM driven framework; Managing, project related, technical and business risks; Aligning outside vendors and resources with the internal schedule; Starting feeding chains too early; Understanding flow index (% Critical Chain complete / % Project Buffer consumed) change impact on project schedule .... across the organization; Prioritizing among competing feeding buffers; and Communicating with customers requiring typical PMI-driven Gantt chart views. While our clients and their industries differ substantially, the above issues seem to be shared across a wide spectrum of organizations. The intent of this presentation is to identify the top 10 major obstacles to a successful CCPM transformation, discuss their root causes, and define successful solutions.
This presentation shows how critical chain project management (CCPM) was applied in a government MRO environment and has provided a powerful yet simple process for improving the fleet maintenance budget (FMB) project management team's awareness and knowledge of ongoing work activity status and the ability to adapt and capitalize on short-fused schedule changes. Benefits to attendees include: 1. Understand the value of implementation for a highly complex multi-project environment; 2. Understand performance measures used to enhance throughput in a not-for-profit, government agency; 3. Understand the five key success factors for their own implementations.
Acquiring companies using TOC principles, and the improving their performance using simple, powerful TOC solutions is part of GCPL's culture now. Each acquisition in different parts of world brings a challenge for core TOC team to quickly understand the culture of the company, complexities in business and develop and implement simple solutions to see significant improvement in performance in short times. Recently GCPL acquired a company in the US, wherein a thin team manages a complex business of wet hair care products. This presentation is about the TOC implementation in this company, the unique challenges faced, flow solutions deployed and results gained in a short time span. It describes: What is THE VALUE for the customers of the company and its relationship with the FLOW Process of aligning / subordinating all functions towards the global goal of ˜Creating significant value for the customers and FLOW improvement initiatives can create significant value for the customers in a short period of time. The focus on FLOW provides a strong platform for the teams to collaborate and also improves harmony. Since there is clarity on what is the significant need of the customers, it is now pursued by teams who hitherto had seemingly conflicting local measures. This presentation covers how the company is using TOC solutions to improve flow, and focus on the significant need of customers. Company continues to use innovative yet simple TOC solutions, which are internally developed.
The review includes a discussion of the nature of the system, two approaches to identifying the core problem of the system, identifying the direction of the solution with the future reality tree, using the negative branch reservation to strengthen the solution, how to cause the change with the prerequisite tree and intermediate objective map, and a discussion of the transition tree. Next a discussion of frequently asked questions about the thinking processes exam is provided. Last examples and practice exercises are provided.
The thinking processes (TP) provide a framework for understanding managerial dilemmas, identifying strategic direction, and implementing organizational improvements. Learn about unique public sector 'work-arounds', TP pitfalls in a service-oriented subsystem, and 'out-of-the-box' thinking by public sector managers. Insights gained in application of the TP in a US city water department, African solid waste management, and municipal services in the Philippines are presented.
When using buffers in FMCG (fast moving consumer goods) retail stores, we face large amount of buffers that are not always in line with their sale's behavior, but are there because of shelf presentations. Most stores are small and are located in the centers of the city hence have very little space for storage. While, 50%-70% of the sales occurs during the weekends, because of space constraint, the store's owners order only what they can hold in the back room. Also, in this business there are a lot of promotions. Every week 15% of the store's merchandise is on promotion, which makes consumption very hard to predict and hard to react. Only by introducing one centralized system, and by analyzing real time data from different franchisees across the whole chain we were able to understand real patterns and develop unique solutions and SOPs for these kinds of environments.
In many texts, Economics is defined as: the science of allocating scarce resources amongst competing or alternative ends. One of the basic laws of economics (which exploit the leverage from better utilizing the scarcest resource or system constraint) is defined as: To maximize the profit of the company we must produce & sell those products/services with the highest contribution per unit of scarce resource. Dr. Eli Goldratt proved the power of this law through the now famous P&Q example showing how by moving the focus to making and selling products with the highest throughput per constraint time unit (T/cu) rather than products with the highest price or highest margin, can dramatically improve a company's profitability. But will this simple rule (focusing on products with the highest T/cu) always deliver the highest profitability for the company. Alan's presentation explores the potentially devastating consequences of applying this simple rule to a more complex situation (than what was covered by the traditional P&Q example); a case where there is more than one overloaded resource (interactive constraints). The presentation also includes an analysis of the possible erroneous assumptions in the traditional management accounting and TOC texts as well as proposes a direction of solution (a new rule) to apply in such complex situations. Considering the fact that many plants have been balanced in design or through ongoing rightsizing efforts (i.e. if one resource is overloaded due to increased demand, it is likely that one or more other resources will also be overloaded), the above scenario might be more common than previously assumed. Management accountants, TOC practitioners, academics and implementers that apply the maximum T/cu rule to such complex environments could jeopardize a company's profitability in both the short- and long- term.
While the ownership and practice of TOC concepts necessitate rational thinking (Effect-Cause-Effect), not enough thought or study has gone into clearer understanding of why organizational transformation implementing TOC has been such a challenge and why the spread of TOC successes have only been incremental and not exponential. The sixth layer of resistance has been virtually unexplored. Proposals of paradigm shifting changes that trigger this resistance may have much to do with the basic human emotions of egotism and fear. These are obviously in conflict with the basic TOC philosophical pillars extolling the goodness of people and never saying we know, but still remain part and parcel of our psyche, feeding on our experiences and concerns. Based on the author's experience spanning more than a hundred situations involving the selling of TOC concepts and applications, this paper attempts to dwell on the less explored rational-emotional interface that may thwart the growth and whole-hearted acceptance of TOC. The paper hypothesizes that only the positive emotion of trust can counter the negative emotions of egotism and fear and an environment of trust and ownership is a pre-requisite order to foster a spirit of true win-win using TOC.
Choking the release is one of the first steps in the implementation in the production environment, both Viable Vision projects or local implementations. Based on the standard S&T for consumer goods or 3R the parallel assumption says: restricting the release of materials, to be just half the current lead time before the corresponding due date, leads only to good results, and to not negative ramifications (lead time is cut to less than half, DDP improves significantly, Throughput goes up and excess capacity is revealed). These results are achieved irrespective of whether a bottleneck exists or not. In environments where the starting situation shows that the vast majority of the production orders in the shop floor are already late (70% or more) or a major part of the touch time occurs at the CCR, the parallel assumption of the entity choking the release in the standard S&T, as described by Eli Goldratt, is not valid. Therefore it is necessary to better understand this specific environment and cause and effects relationships, verbalize clearly what are valid assumptions and elaborate a new tactic for achieving the original objective as described in this entity of the standard S&T. Using the ""Standing on the Shoulders of Giants"" process and the TOC Thinking Process, we have made an analysis on an environment that presented this situation, which is representative of a significant portion of the production environments around the world, for better understanding how these parallel assumptions are not valid, what elements in reality are responsible for it, what are the new assumptions and the required changes in the standard S&T. At the end we will show the new proposal for verbalizing the assumptions for a generic choking the release entity that contemplates these environments which is based on an actual implementation.
The presentation describes: 1. Why apathy (or resistance to change) occurs; 2. The cognitive side of change; 3. A change strategy (blueprint). Why do most clients think you did a great job in presenting then nothing happens? Logic is not enough; you must overcome emotion, behavior and motivation. These are likely to outweigh your logic. Efrat's cloud of A Happiness B Satisfaction D Initiate change C Security and D' Resist change is discussed. Mental maps, technology adoption life cycle, risk aversion verses risk takers, paradigms, etc. are described and how they might fit with Efrat's cloud. A change implementation model is described.
GCPL has been growing through acquisitions in emerging geographies wherein increasing business complexity (in terms of product portfolio, new product introductions) has been a challenge. This presentation covers how the company is using TOC solutions to bring simplicity to grow businesses at a faster pace. Company uses innovative yet simple TOC solutions, which are internally developed. Deployment of these solutions have helped the company to realize significant improvement in on-time In-full (OTIF) performance to stores, inventory mix in retail outlets / customers and hence inventory turns. A detailed case is presented to demonstrate the conceptual model that is used to improve the business performance. The model developed can be easily adapted by many small- and medium-size businesses.
A brief overview of the conference 2013 location was provided. The story of a German cathedral construction that spanned seven centuries was provided. This was an analogy to our building a cathedral of knowledge. The second story of a German aqueduct was given: a massive project. We have a challenge to live a meaningful life by developing the body of knowledge. Take TOC far beyond the boundaries of the business world.
A particularly challenging environment to implement the TOC distribution solution is manufacturing environments where there is a high degree of demand seasonality coupled with complex bills of material (BOM) structures. Seasonal environments require adjustments to the buffer targets in advance of actual consumption. Complex BOM structure environments require the ability to link the expected seasonal change in the finished goods demand through the BOM to the expected seasonal change in the raw material and component demand. This presentation will briefly describe the environment and the problem and then lead the participants through the thought processes we went through in designing and implementing the solution. From realizing that a finished good part requires multiple buffer targets with Effectivity Dates (EDs) to solving the problem where a raw material is in the BOM of hundreds of finished goods, and where the FG seasonal adjustment and dates all differ.
Get ready to explore the challenges in Sales and how TOC improved sales performance. The presentation focuses on firsthand experience and data analysis of sales for several companies in the IT sector. In 2017, the founder was looking at some dismal prospects. After investing in sales, the team wasnt able to bring in any new business and the companies sales were and had been flat. That same year, after 2 years of operations issues, the decision was made to utilize Theory of constraints to resolve long standing problems in service operations. It was there that some systemic issues were revealed and so began the long march to improving business operations. But things would get worse before they got better as sales continued to struggle. It wasnt until a couple of years later that a real discussion was had on applying Theory of Constraints to the sales process. It wasnt an easy process to decipher, but the impact to service operations was clearly evident. It was through this evolution of sales that led to a new view of how to approach planning, forecasting, and executing our sales operation. It even launched an entirely new company focused on sales ops for IT firms. In this presentation, the presenter will share his story of what happened, what the data showed, and how the TOC method applied in sales created sustainability in his first business and launched a second business to help other IT companies.
This presentation shows how to evaluate the impact of critical management decisions based on an integrated view of S&OP processes that behave within reasonable optimistic and conservative measurements of T, I and OE. The approach proposed by Throughput Economics will help you to understand that in order to manage successfully in a VUCA world you need to allow the S&OP team to build and communicate a common sense description of the current situation and the future impact of the critical management decisions, based on optimistic and conservative and ranges of Delta Throughput, Investment, Operational Expenses, applied to the real current capacity profiles of critical constrained resources .... CCR. Validate the need to preserve the protective capacity to ensure the delivery of the orders/projects, especially in the CCR. Evaluate the current portfolio ensuring that to maintain profitable sustainability, some SKUs should be cancelled, as a mean to obtain additional capacity.
Increasing the sales productivity of TOC consultants is discussed to help the attendees understand what they must do to cause sales. They can use the principles to create sales in their own businesses and to also help their clients create sales. Key learning points include: 1. How to create sales opportunities. 2. The two causes of sales success. 3. How to measure and manage both causes. 4. What you must know about your clients to insure their success (and yours).
Vivo (Telefonica Brazil), is Brazils largest telecommunications company. Its IT team has over 6,000 members. In 2018 Vivo set the goal of doubling the rate at which IT projects were completed - the IT2X Program - without employing more staff. In this presentation, CIO Andre Kriger will share the story of how VIVO achieved this objective, highlighting key challenges & obstacles they faced along the way, and how they overcame them. Last, Andre will discuss where he plans to go from here as they pursue ever-higher levels of value delivery.
Pricing is an important and powerful tool for achieving throughput. Brad shares his pricing experience and explains how he analyzed competitive pricing practices based on cost accounting and other traditional cost world assumptions to find the sweet spot where competitors were scarce; and exploited this sweet spot by developing a simple, fast process for pricing custom manufactured products (a process he calls Quick Quoting).
This presentation discusses the implementation goal: transforming the system of portfolio management and commercial aviation projects in the company's competitive advantage, with the following results: 1. Reduce the average cycle of implementation of projects; 2. Increase the amount of projects delivered in a given period, for the same quantity and quality of resources; 3. Contribute to the achievement of 100% delivery of customer projects within agreed in hiring (kept the same conditions of the time of recruitment); 4. Improve the quality of life of those involved. The design of the system was completed in 2009. In 2010 and 2011 we had consistent results with the objective established. Today, we are in studies to start a new cycle of improvement for another level of results.
Many improvement methods are in apparent competition and it's difficult to know which one to use in a given situation. The Cynefin Model, by Dave Snowden, can help match the right improvement method to the appropriate domain. The Cynefin Model shows that TOC is especially well qualified for managing complex systems. Further, looking at TOC and the Cynefin Model we can see how the inherent simplicity of TOC's breakthrough solutions are derived.
Many improvement methods are in apparent competition and it's difficult to know which one to use in a given situation. The Cynefin Model, by Dave Snowden, can help match the right improvement method to the appropriate domain. The Cynefin Model shows that TOC is especially well qualified for managing complex systems. Further, looking at TOC and the Cynefin Model we can see how the inherent simplicity of TOC's breakthrough solutions are derived. The presentation provides an approach to decide which improvement method (lean, six sigma, design of experiments, TOC, etc.) to use in a given situation; an understanding of why TOC is better able to manage complex systems than many other methods and an appreciation for how breakthrough innovations may be generated within TOC using a combination of the design and scientific method.
This presentation discusses the speed of change in reality and the need to change our patterns of behavior (based on the old environment) to match the new environment. We almost always change our patterns when the change is bad but almost never change our patterns based on positive changes. We must dive deeper into the assumptions related to our existing pattern of behavior and determine if they are still valid. Goldratt describes six changes in the environment and their impact on the old pattern and the need for a new pattern. Some of the changes are: 1. The speed of getting results (time to get the client signed up). 2. The speed of client results in seeing improvement (many clients see a doubling of sales in less than six months today (was 1-2 years previously). 3. The change in how we conduct the global practice (clients must now come to Israel--similar to aggregation at the top of distribution). 4. The time to teach a consultant where we trust him (was 3 years now with S&T 3 weeks of training interspersed with visiting the appropriate site, validating the assumptions, changing the assumptions to meet the company environment and auditing the site. 5. The perception of the value that the client can get in the future from the consultant (clients left because they felt they got most of the benefits already) We now sell the process. 6. What's happening in the market (we generated most of our leads in the past. Now people are coming to us asking to be a client.) We must recognize that we never KNOW. We must always recognize: Never say I know. We must also recognize that people are good. Never blame someone else. We have three things: our intuition, inherent simplicity and freedom of choice.
Eli discusses the Odyssey course, the S&T tree, the ability to separate levels of importance in a discussion, better relations with our parents, etc. He describes the uses of the TP to examine every facet of our life and briefly describes causality (necessary cause, sufficiency cause, additional cause) and the ability to separate levels of thinking between big items and small items. He also describes the use of the CRT to predict economic downturns in the global economy. Twice, Eli predicted the collapse of the economy using the current reality. What is our role? We start with a typifying effect. What is the typifying effect of our economy for last 20 years? Product development time is discussed with respect to the impact on time to market. The lifetimes of products in more and more industries are shrinking rapidly. If the lifetime of the product shrinks (and shrinks) and the development time is the longest factor in the time then there must come a time when development time exceeds lifetime. Since development time is greater than the time between model release times more than one model needs to be worked on at one time. This means that the company has parallel development teams and the teams must not talk to each other. The only thing a company can do is to shrink the development time. Many companies have tried to cut development lead time but failed. An example is PCs. The solution is to drastically cut supply time. Other factors China not only will become the largest producer but also the largest consumer. India is in a similar position; they had been blocked by political barriers. Both countries have about a 10% growth annually. Within the next decade another 2 billion people will be added to the consumer world.
TOC for inter-personal and outer-personal relationships is improved by understanding and using the four categories of injections. In this session four generic categories of injections are introduced by sharing examples of how to work with the four categories to break conflicts and to offer insights into how the categories can be used in the ambitious target process. The four categories of injections are: 1. Physical injections, 2. Emotional injections, 3. Mental injections, 4. Perceptional injections. Benefits to attendees include: 1. Develop the skill of finding injections and resolve conflicts. 2. Awareness of the intuitive way of finding injections and what can be added to it in order to have more options. 3. Better understanding of how to use TOC for themselves and their relationships.
This presentation discusses the findings of recent research that stands on the shoulders of a giant: Critical chain project management (CCPM), and re-examines CCPM's assumptions. CCPM assumptions were first extracted from literature analysis, complemented by text mining of a comprehensive CCPM database using NVivo and Leximancer software, and then tested against empirical data based on 10 case studies from a diverse range of industries. Theoretical and empirical investigation revealed several faulty assumptions underpinning CCPM, the core assumption being that projects are one type of operation. This faulty assumption resulted in defining the core constraint as the longest chain of activities and assuming this chain defines the project duration. However, in reality, projects are diverse and display all types of processes seen in operations. Subsequent analysis led to a 2x2 model that classifies projects according to their throughput value and team type and predicts their constraints. A sample project in each quadrant is provided to illustrate where CCPM applies and where it does not, and which TOC tools could be used. The presentation concludes by suggesting five prerequisites to applicability of CCPM: fixed value throughput, sequential workflow, non-dedicated team, unity of purpose, and urgency.
The question of "what is TOC?" continues be discussed on social media. Ray shares his insights and conclusions to answer that question derived from deployments across all levels and functions in many companies. To validate the answer, Ray will share an in-depth case study from the meteoric success of a renewable energy company, as well as "ready-to-use" guidelines to replicate that outcome.
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