External Constraints Course

This course is for organizations that want to significantly improve their bottom line performance, but can only do so by effectively addressing the external factors constraining their performance - external constraints such as insufficient market demand, poor supplier performance, or the unwillingness of the financial institutions to provide the necessary capital. In order to effectively address an external constraint, the organization must construct and present an offer that:

• Alleviates the impact of the external constraint on the organization's performance, and
• Provides the external constraint with significant, quantifiable bottom line benefits.

Such a win-win is what we call an "unrefuseable offer."

To construct and present such an offer requires that we create a shift in the way that our offer is valued by the external constraint: from one that is based almost solely on "price" - where the other important elements of our offer are left virtually unquantified (the ones that can make or break the deal); to one that is based on "price related to bottom line benefits." Hence, one of the major elements to be addressed in providing an external constraint with an "unrefuseable offer" is quantifying the value of the offer in terms of its impact on the external constraint's bottom line. Bottom line here doesn't necessarily mean Net Profit - it might mean Return-On-Investment, Inventory Turns, Cash Flow, or keeping within Budget. What's important in doing this is looking at the bottom line through the eyes of the external constraint and determining what it considers to be important. Quantifying the offer in this way enables the external constraint to value the organization's offer on the basis of the "bottom line benefits it gets for the price" rather than simply the "price."

Course Description
Under the guidance and direct assistance of an instructor experienced in the use of the TOC Thinking Processes to address external constraints, the participants work on constructing an unrefuseable offer. This is done by:

• Identifying problems (UnDesireable Effects/UDEs) of the external constraint that have a huge impact on its bottom line, and that are in some way related to the participant's organization's current offering (or lack thereof).
• Using the Current Reality Tree (CRT) or the Evaporating Cloud (EC) to determine which policies of the participant's organization significantly contribute to these UDEs of the external constraint. (Changing one of these policies will result in the breakthrough needed to create an unrefuseable offer, while ensuring a competitive advantage for the participant's organization - changing a policy is the hardest thing for a competitor to mimic!)
• Using the Future Reality Tree (FRT) to clarify and quantify the impact that this policy change will ultimately have on the external constraint's bottom line.
• Using the Negative Branch Reservations (NBRs) to verbalize the "yes, buts..." that the participant and others in his/her organization will have regarding the suggested change, and to complete the unrefuseable offer. (In creating an unrefuseable offer, we must keep in mind the fact that the external constraint's organization is the one experiencing the significant UDEs from the policy in question, whereas many of the people in the participant's organization do not directly experience any! As a result, internal people will be much less inclined to change the policy, and therefore, raise more NBRs than the external constraint!)

An unrefusable offer does not sell itself. Therefore, a considerable amount of the participant's time in the course is spent working under the guidance and direct assistance of an instructor to learn how to use the TOC Thinking Processes to sell the offer, both to his/her organization, as well as the external constraint. This is what makes the unrefuseable offer implementable. This is done through:

• Using the Prerequisite Tree (PRT) and TrT to determine what obstacles must be overcome and actions taken to convince the participant's organization to fully implement the change in policy. (The major obstacles to be overcome here are those that exist the mind-set of the people in the participant's organization whose active collaboration will be needed to fully implement the policy changes associated with the unrefuseable offer.)
• Internalizing the TOC Buy-In Process for overcoming the resistance to change the participant will face both internally and externally, resulting in a perfectly prepared presentation of the entire change for their organization. (For purposes of getting the ownership and buy-in of the people who will be selling the offer to the external constraint, it is best that they prepare the presentation for the external constraint.)

The participant can expect to leave with an implementable, unrefuseable offer that will effectively address his/her organization's external constraint; however, s/he should not expect to leave being able to independently use the TOC Thinking Processes.