Be Your Best

Todd Gifford - Success Coach

Over the holidays, I had the opportunity to go see the epic movie Avatar in 3D.  I did not have any real desire to see it, but I volunteered to be the guy who took some of the family and extended family ‘PG13’ kids to this movie.  Going to the movies is something we like to do during that week between Christmas and New Years.  I was pleasantly surprised by this picture and recommend you see it if you have not already, but that is not why I mention it here.  I won’t ruin the ending, but Avatar did drive home an important concept that I have been reading and thinking about that applies to all of us in our business and careers.  We’ll get to that in a minute.

Just finishing up a book called “The Goal: A Process of Ongoing Improvement” by Dr. Eliyahu M. Goldratt and Jeff Cox.  In this book Dr. Goldratt introduces the management philosophy/concept of The Theory of Constraints (TOC).  The Theory of Constraints is based on the premise that the rate of goal achievement is limited by a small number of , but at least one main constraining process.  Only by increasing the flow through the constraint can the overall throughput and goal achievement be increased.  TOC then says that once the key constraint is identified, then the organization should be aligned around exploiting that constraint to significantly improve performance.  Obviously I am giving the Reader’s Digest version here, but it is a pretty simple theory (simple but very powerful).

Constraints can be internal or external, but a Constraint is anything that prevents the system from achieving its goal.  One of the key important aspects of TOC is that there are not tens or hundreds of constraints, but only one or a just a few in any given system.

Back to Avatar.  When Pandora’s Na’vi people were up against the humans to save their planet and there hometree from destruction and exploitation, they had a major ‘constraint’.  Their Goal was to save their bio-botanical neuro network from being destroyed.  The major constraint was they did not have any defense from the air attack power by the humans.  Realizing this, they began to rally their Na’vi people around this constraint, and ultimately the constraint was exploited such that their air defense became the main reason for achieving a major goal.

The reason I think you want to pay attention to the Theory of Constraints and why it is a very powerful tool in your business is that so often we assume that there are ‘hundreds’ of things that are working against our goal attainment.  We focus on what the goal is and attaining it, but rarely sit down and think about what is the primary constraint to attaining the goal.  If you start analyzing the situation with the understanding that you are looking for one or just a couple of major constraints that are in the way of major progress, they start rising to the surface and becoming clear.  Once identified, rallying to exploit those constraints can be the easier piece of the puzzle.  Not identifying or exploiting the constraints can allow for a lot of wasted effort and falling short of the target.

A simple example of TOC might be: Goal—to attain X% Cost Savings in 2010.  Normally, you would develop a strategy and tactics based solely on the goal itself, and go to work.  However, if the time is taken to look at where the one big constraint is, based on historical information (example: Suppliers not willing to proactively provide Cost Savings Ideas), then a specific strategy can be developed to exploit that major constraint and allow better throughput.  Strategies might include allowing the most aggressive and creative suppliers to do Plant Cost Savings Walkthroughs, having face-to-face meetings with key suppliers to ensure they understand your objectives and the benefit for them to support you, creation of better tools for suppliers to communicate their ideas, and new forums for cost savings ideas to be created in.

The big takeaway for me is the act of looking at each situation for the big constraint, knowing that there is one or a couple out there all the time. Once identified, rallying the team or organization around it to exploit it can be very rewarding and even a little fun.

Take Care, Todd Gifford
President
Dee Electronics