E Goldratt - The Goal

"I don't know," I say. "Let's examine the logic that brought us to write it. Do you remember what it was?"

"Roughly," he says. "It was something about the fact that we adopted throughput as the number-one measurement."

"I'm afraid that roughly is not good enough," I say. "At least not at such an early stage in our analysis. Let's try again, from first principles."

"I'm all for it," he groans, "But what do you call first princi- ples?"

"I don't know. Something basic that we accept without hesi- tation."

"Fine. I have one for you. Every organization was built for a purpose. We haven't built any organization just for the sake of its mere existence."

"Correct," I laugh. "Even though I know some people in some organizations who seem to forget it."

"Washington, you mean?"

"That too. I thought about our corporation, but who cares. Let's keep going. Another basic fact is that any organization is comprised of more than one person, otherwise it's not an organi- zation."

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"Correct," says Lou. "But I don't see the point in all this. I can give you many more correct statements about organizations in general."

"Yes, you probably can, but look at the conclusion that we can derive already. If any organization was built for a purpose and any organization is composed of more than one person, then we must conclude that the purpose of the organization requires the synchronized efforts of more than one person."

"That makes sense," he says. "Otherwise we wouldn't need to create an organization; the efforts of individuals would suffice. So?"

"If we need synchronized efforts," I continue, "Then the contribution of any single person to the organization's purpose is strongly dependent upon the performance of others."

"Yes, that's obvious." With a bitter smile he adds, "Obvious to everybody except for our measurement system."

Even though I wholeheartedly agree, I ignore his last com- ment. "If synchronized efforts are required and the contribution of one link is strongly dependent on the performance of the other links, we cannot ignore the fact that organizations are not just a pile of different links, they should be regarded as chains." "Or at least a grid," he corrects me.

"Yes, but you see, every grid can be viewed as composed of several independent chains. The more complex the organization -the more interdependencies between the various links-the smaller number of independent chains it's composed of."

Lou doesn't want to spend too much time on that point. "If you say so. But that's not so important. The important thing is you've just proven that any organization should be viewed as a chain. I can take it from here. Since the strength of the chain is determined by the weakest link, then the first step to improve an organization must be to identify the weakest link."

"Or links," I correct. "Remember, an organization may be comprised of several independent chains."

"Yes," he agrees impatiently. "But as you said, the complex- ity of our organizations almost guarantees that there are not many of them. In any event, it is taken care of by the S in paren- thesis that we put at the end of the word 'constraint'. Fine, Alex, what do we do about the measurements?"

"Measurements?," I say in surprise. "Where did they come from?"

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"Didn't we agree yesterday that the distorted measurements are the biggest constraint of the division?"

Bob Donovan is right. Lou certainly has a fixation on mea- surements. "They are definitely a big problem," I say carefully. "But I'm not convinced that they are the constraint . "

"You're not?" Lou is astonished.

"No I'm not," I say firmly. "Do you think that the fact that most of our products are already outdated in comparison to what the competition is offering is not a major problem? Don't you realize that the attitude in engineering, claiming that the basic rule of nature is that a project never finishes on time, is an even bigger problem. And what about marketing, have you seen any marketing plan that has any chance of turning the situation around?"

"No," he grins. "As a matter of fact everything that I've seen of long term planning should be more appropriately categorized under 'long term bullshitting.' '

I'm on a roll. Today asking me about problems is like open- ing a dam. "Wait Lou, I haven't finished. What about the mental- ity that is so prevalent in headquarters, the mentality of covering your ass. Haven't you noticed that whenever we asked about something that doesn't go so well, everyone almost automatically started to blame everybody else?"

"How could I not notice. Okay, Alex, I get your point. There are major problems all over. It seems that in our division there is a whole herd of constraints, not just a few."

"I still claim that there are only few constraints. Our division is too complex to have more than a very few independent chains. Lou, don't you realize that everything we mentioned so far is closely connected? The lack of sensible long-term strategy, the measurement issues, the lag in product design, the long lead times in production, the general attitude of passing the ball, of apathy, are all connected. We must put our finger on the core problem, on the root that causes them all. That is what actually is meant by identify the constraint. It's not prioritizing the bad ef- fects, it's identifying what causes them all."

"How are we going to do that? How are we going to identify the divisional constraints?"

"I don't know," I say. "But if we succeeded in doing it here, in our plant, it must be possible to do in the division."

He thinks about it for a minute and then says, "I don't think

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so. Here we were lucky. We were dealing with physical con- straints, with bottlenecks, that's easy. But at the divisional level we'll have to deal with measurements, with policies, with proce- dures. Many of them are cast already into behavioral patterns."

"I don't see the difference," I disagree. "Here we had to deal with all of the above. Come to think about it, even here the con- straints were never the machines. Yes, we called and still call the oven and the NCX10 bottlenecks, but if they were true bottle- necks how come we succeeded to squeeze almost twice as much out of them as before? How come we increased throughput so much without buying more capacity?"

"But we changed almost every aspect of how we operate them, and how we operate everything around them."

"That is exactly my point," I say. "What aspect of operation did we change?" Mimicking his voice I answer, "The measure- ments, the policies, the procedures. Many of them were cast into behavioral patterns. Lou, don't you see? The real constraints, even in our plant, were not the machines, they were the policies."

"Yes, I do see. But still there are differences," he says stub- bornly.

"What differences? Name one."

"Alex, what's the use of pushing me to the corner? Don't you see that there must be major differences? If there weren't, how come we don't even have a clue of what the nature of the divi- sional constraint is?"

That stops me dead.

"Sorry. You're right. You know, Lou, maybe we were lucky here. We had physical constraints that helped us to focus our attention, to zoom in on the real policy constraint. That isn't the case in the division. Over there we have excess capacity going through our ears. We have excess engineering resources that we succeed so brilliantly in wasting. I'm sure that there is no lack of markets. We simply don't know how to put our act together to capitalize on what we have."

Pacified he says, "That brings us to the real question, how does one go about identifying the system's constraint? How can we zoom in on the most devastating erroneous policies. Or, to use your term, how does one go about identifying the core problem, the one that is responsible for the existence of so many undesir- able effects?"