1 - Oded_23 Tocpa_usa_21-22 March 2016

Helping companies on a

continuous growth in cases of

no decisive competitive edge

Oded Cohen, TOC Strategic Solutions, Israel

22 March, 2016

23rd International Conference of the

TOC Practitioners Alliance - TOCPAwww.tocpractice.com 21-22 March, 2016, Tennessee, USA

23rd International Conference of the TOC Practitioners Alliance - TOCPAwww.tocpractice.com

Oded Cohen

Oded has over 35 years of experience in developing,teaching and implementing TOC methodology,solutions and implementation processes workingdirectly with Dr. Goldratt all over the world. Among thecountries to which Oded brings his expertise are theUSA, Canada, Japan, India, China, the UK, Poland,Russia, Ukraine, Colombia, Chile, Peru, Turkey andmany others.

Oded has authored multiple TOC articles andcontributed to numerous TOC books.

Oded in the is the author of Ever Improve – A Guide toManaging Production the TOC Way , published in June2010. Oded co-authored the book Deming & Goldratt:The Theory of Constraints and the System ofProfound Knowledge – The Decalogue.

Together with Jelena Fedurko Oded has co-authoredthe book Theory of Constraints Fundamentals.

Oded is International Director of TOC StrategicSolutions Ltd and Founder and Co-President ofTOCPA.

[email protected]


� Introduction – what is the problem?

� Some history cases

� The Direction of the solution

� Some practical recommendations

POOGI in cases when

DCE is not established

3


Is the collection of TOC practitioners a community?

TOC Practitioners have:

� Knowledge

� Experience

� Ability to construct/adapt special solutions

Why community?

� For continuous learning

� For preserving the knowledge that has been generat ed

� For supporting those who want TOC but struggle in i mplementing

and in achieving the expected/desired results

Introduction

The TOC Practitioners

4


Necessary Conditions:

� A TOC Leader: Capable, Willing and Confident

� Supportive environment

� Good and relevant solution

� TOC Professional for:

� constructing the solution

� and for auditing the implementation

Are these conditions sufficient?

Successful

Implementation

5


When introduced to TOC people and companies expect to achieve results as per the Red Curve.

The danger of the Green curve is well known.

The standard S&T trees call for the development of the Decisive Competitive Edge “DCE”.

The DCE suggested by TOC is based on logistical exc ellence –managing flow the Toc way in production, distribut ion and/or in project management.

However, we have experienced situations in which ac hieving logistical excellence was not enough to provide the company wi th DCE. In some cases it was not enough even for just a compet itive edge.

In these cases the desires of the owners and manage rs to use TOC were not reflected in the bottom line.

Red Curve, Green

Curve and DCE

6


The success of the first three steps brings joy and in most of the cases quick bottom line results.

The initial results provide stamina to carry on to step 4.

Usually, step four for logistical systems deals wit h elevation of resource capacity. When the output of the elevated capacity can be sold - step 4 is a celebration.

However, if the constraint moves to the market – the continuation of the growth of the company largely depends on the abilit y to capitalize on the improved performance.

Whether the difficulties are internal or external – many companies experience :

• Slow down in the growth

• Unhappiness due to the need to put more (intellectu al) efforts

The Joy and the Pain of

the Five Focusing Steps

7


Usually, step 4 becomes a conflict area between the operational departments and sales/marketing. This l ead to:

• Disconnection between operations and sales

• Reverting back to the system prior to TOC

• Moving to another approach (Lean etc.)

However, there have been some “stubborn” and persist ent leaders that have not given up and have continued t o pursue the continued improvement in spite all difficulties .

I want to share with you some of these cases as the y represent in my eyes the essence and the spirit of TOC

The reaction to the

difficulties in Step 4

8


Case 1 – Started in 1989

Triumph – UK

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1989 – Jonah Program and Manual DBR

1990 – Sales and Marketing, TP

1993 – Implementing “Disaster” , the SW package

1999 – Upgrading Disaster – Replenishing Internal Buff ers

2004 – Lack of Subordination

2005 – Solutions for Sales

2007 – Government Contracts and A&D Projects

2010 – Implementing Symphony for wood plant

2011 – The New Triumph

Presented by Andrew Jackson - 21st TOCPA Conference, 2015 UK

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1/1/1979

1/1/1980

1/1/1981

1/1/1982

1/1/1983

1/1/1984

1/1/1985

1/1/1986

1/1/1987

1/1/1988

1/1/1989

1/1/1990

1/1/1991

1/1/1992

1/1/1993

1/1/1994

1/1/1995

1/1/1996

1/1/1997

1/1/1998

1/1/1999

1/1/2000

1/1/2001

1/1/2002

1/1/2003

1/1/2004

1/1/2005

1/1/2006

1/1/2007

1/1/2008

1/1/2009

1/1/2010

1/1/2011

1/1/2012

1/1/2013

1/1/2014

1/1/2015

1/1/2016

To

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11

TOC Applications: TA, DBR, TP, Flow management, NPD,

0

200

400

600

800

1000

1200

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Sales Volume

Sales Volume

Start

TOC



Retail

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TOC Availability: Stock Availability, TP, Market Of fer

Steps taken:

� DTA – Buffers in CWH and in shops

� Results: dramatic reduction in the overall stock co upled with increase in availability.

� At the same time the sales increase was just 2% abo ve the inflation rate as compare to the desired 10%.

� Set the objective to increase the amount of sales p er visiting buyer and to increase the amount of traffic.

� Used UDEs and UDE clouds to develop market offers, as well as ample of ideas (what ever can work in such environm ent).

� Results: sales are growing slowly while investment is well managed


1. The first phase of the TOC implementation achieve d high level of service level for their industries

2. They all have dominant and committed leaders (and in two cases also the owners)

3. The sales people have been supportive (to differe nt levels)

4. The leaders have been willing to listen to the TO C practitioners and to use suggested directions and actions

Nevertheless,

None of them have managed to turn the logistical ex cellence into DCE

Characteristics of these cases

13


No and Yes!

Theoretically – no! the role and the responsibility of the leader is to ensure the well being of the company. If the leader cannot find the solution within the TOC the it makes sense to search and employ any other approach that can help achieving improved performance.

Practically – Some leaders like TOC, want to use TOC and are frustrated that TOC does not fully work for the m.

The problem is that for some companies at some time s -the standard TOC solutions do not answer their need s as per their specific circumstances.

Is there a Problem?

14


The problem exists only for those that love and wan t TOC.

The direction for the solution is simply:

Do not Give up!

1. Employ every element of the TOC solution. Ensure it is implemented correctly. Even if it does not provide the expected result it will serve as a base for further developments

2. Use TOC thinking processes to refine existing elements of the solution and to develop additional ideas.

The Direction of the

solution

15


Establish a TOC Think Tank that comprised of:

�The leader

�Knowledgeable and experienced TOC practitioner(s)

�Few capable and willing key managers

The Thinking Tank should be determined and committe d

to find a solution. As such to develop, check and r evise a

solution that fits the specific circumstances of th e

company.

Practicalities

16


For the external TOC Practitioners:

� Carefully conduct the CRS – Current Reality Study

� Do not overcommit results if there are not enough evidence to establish the improved performance, especially, the financial gains.

� Check carefully the expectations of the leader and their perception of what can be achieved.

Some Recommendations

17

1 - Oded_23 Tocpa_usa_21-22 March 2016

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