A Guide to Implementing the Theory of
All Singing From The Same Systemic Song Sheet
The Constraint Management Model for Strategy which we examined on the previous page is a superb approach for organization-wide improvement when everyone is already aligned and singing from the same song sheet – or at least is willing to do so. It is without doubt a systemic/global optimum approach. The holistic approach is also a systemic/global optimum approach but one borne out of the experience that not everyone initially wants to, or understands the need to, or even knows how to sing from the same systemic song sheet.
Experience suggests that contrary to expectation, a substantial and rapid but localized success in the implementation of any one of the Theory of Constraint logistical or non-logistical applications will not result in a steady and system-wide uptake of that success. Indeed the opposite may well occur and may eventually result in the winding-back of the initial genuine but localized success. If we are in the business of moving organizations towards their stated goal, then clearly this will not do. The holistic approach sets out to ensure that everyone understands, and is in agreement, as to what must be done before there is any attempt to undertake it (1).
Sometimes it is easier to define the holistic approach by what it is not rather than by what it is, so let’s start there.
The holistic approach is not the courageous successful implementation of a single Theory of Constraints application, either logistical or non-logistical. This arises because the successful implementation of any of the Theory of Constraint solutions generally results in the breaking of the previously perceived constraint. That is great – but by definition the constraint has to have moved somewhere else – unless you are making infinite throughput – and I don’t think anyone has seen this yet. Herein lies the problem.
Imagine for instance that you are in marketing and the constraint is in production. The production people break the constraint. Big deal. You could have written a list, as long as your arm, of reasons why production couldn’t meet the market. Now they claim the constraint is in marketing but they don’t have a clue just how different marketing is from production.
Or imagine that you are in production and the constraint is in marketing. The marketing people break the perceived constraint. Big deal. You could have written a list, as long as your arm, of reasons why marketing couldn’t beat the market. Now they claim the constraint is in production but they don’t have a clue just how different production is from marketing.
Who is right? Well both are right, and both are wrong. If it had have been easy to break the constraint in another area it would have been done. That it wasn’t done previously proves that it wasn’t simple. Unfortunately nobody will see that.
Let’s repeat that – unfortunately nobody will see that if it had have been easy to previously break the constraint it would have been done.
Subsequent to a successful localized implementation a number of different things might then occur. At the best the implementation will peak and remain static. Many people will in fact be very happy to have achieved such an improvement and to maintain it. At worst, however, a number of ill effects may arise and often the implementation will slowly degrade. Generally, people who were not intimately involved in the implementation will begin to “unpick the threads” from the sidelines. To counter such actions we must remember Goldratt’s first law of business “be paranoid.” Not to be confused with his second law which is also “be paranoid!” If you think people are unpicking the implementation, then they most probably are. Saying “yes” and doing nothing is a reasonable indicator of a slow unraveling. After all isn’t this how most improvement initiatives – even successful ones – have been defeated in the past.
Maybe we are now in better position to define the holistic approach.
The holistic approach is a means of ensuring a process of on-going improvement. Remember our leverage curves on the page on process of change? But how do we ensure that the process will be on-going whenever it jumps a boundary between functional or logistical or business units? Goldratt’s answer to this problem is to ensure at the outset that the top leadership/management of the organization understands;
(1) The system.
(2) The goal of the system.
(3) The necessary conditions.
(4) The fundamental measurements.
(5) The role of the constraints.
Essentially we are asking that the reductionist/local optima view be reframed and replaced with the systemic/global optimum approach.
The mechanism for obtaining this is a series of video presentations first broadcast internationally in 1999 and now available both as video tapes for groups and CD-ROMs for self-learning purposes (see links and resources). This enables management to understand the problems, the interactions, and the solutions for each other’s area. Thus production gains insights into marketing and sales. Marketing understands production, distribution, and accounting.
The presentations provide the vision and understanding for “why change.” The subsequent facilitation addresses “what to change,” what to change to,” and how to cause the change.”
Properly facilitated this approach will ensure a true process of on-going improvement.
Returning to our model system once more, we are trying to avoid the reductionist/local optima approach as depicted here.
We are trying to replace it with the systemic/global optimum approach as depicted here.
However, we want to totally avoid going through the finger pointing stage like this.
The development of a commonality of purpose or understanding amongst the senior management is necessary, but of its own, insufficient. We must still use the Thinking Processes to gain full understanding.
As you know from practical experience, if you have a hammer, then everything looks like a nail. And if you have screw then a butter knife looks like a serviceable screwdriver – well that is until you have to put it back in the kitchen draw again.
The point being we are trying to obtain collaboration and understanding without matters disintegrating into finger pointing, or worse still to have agreement when no agreement exists in reality in order to preserve appearances. We want to move from the current reductionist approach to a systemic approach as smoothly as possible.
Senge describes the myth of the management team. “All too often teams in business tend to spend their time fighting for turf, avoiding anything that will make them look bad personally, and pretending that everyone is behind the team’s collective strategy – maintaining the appearance of a cohesive team (2).” Amazing – I don’t think Senge ever worked in Japan and yet he understands it perfectly. Of course he was actually referring to that paragon of free-enterprise – corporate America. It must be pretty universal then.
Let’s continue with the quote. “To keep up the image, they seek to squelch disagreement; people with serious reservations avoid stating them publicly, and joint decisions are watered-down compromises reflecting what everyone can live with, or else reflecting one person’s view foisted on the group. If there is disagreement, it’s usually expressed in a manner that lays blame, polarizes opinion, and fails to reveal the underlying differences in assumptions and experience in a way that the team as a whole could learn.”
That’s interesting because if you have read the previous section you will be aware that the Thinking Process provides us with a tool for exploring differences in assumptions in a way that the whole team can learn, as you know the method or approach is called a cloud. The same tool is specifically designed for no-compromise outcomes – win-wins.
However, the tool of choice for ensuring collaboration without finger pointing is not the cloud, but a derivative called the 3 cloud method. This allows us to develop a no-compromise outcome and communicate it and its ramifications to others outside of the original decision process. We looked at this specifically in the section on leadership and learning. The details of the methods are outlined in the section on the communication current reality tree and the 3 cloud method. This combination allows us to develop an “us and our solution against the problem” without ever raising an “us against each other” intermediate stage.
Having gained agreement on the problem using these techniques, thereafter, the normal approach using the Thinking Process tools is possible.
The outcome of this process is that the leadership of all major components of the business have developed and agreed to an implementation plan and its execution. There is broad agreement on how future events should unfold and the understanding necessary to modify things to take account of new developments as they occur.
Odd as it may seem at first, the holistic approach represents a certain maturity in the sequence of the development of the Theory of Constraint applications. One that couldn’t have been arrived at earlier. The logistical solutions; production, supply chain, and project management and the non-logistical solutions can be applied individually to firms that specialize in a particular environment but as soon as they are applied to larger environments then the new challenge becomes how to integrate the applications. The answer is to do this at the outset – before any one particular application is applied – but to do that you must also have access to all the applications.
Rather like overcoming a series of physical and policy constraints within a firm within a single application, each logistical and non-logistical application itself also overcomes a pressing problem (how to manage) within different parts of industry as a whole until the pressing problem is not production, nor distribution, nor sales, nor engineering but rather how to integrate these together as required within a single corporate strategy – to get everyone singing from the same systemic song sheet. This is the aim of the holistic approach.
(1) Goldratt, E. M., (1999) How to change an organization. Video JCI-11, Goldratt Institute.
(2) Senge, P. M. (1990) The fifth discipline: the art and practice of the learning organization. Random House, pg 24.
This Webpage Copyright © 2003-2009 by Dr K. J. Youngman