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Video Presentations Videos available from the November 1997 Jonah Upgrade Workshop in Ft. Lauderdale. JFL-1 - The Roots of TOC and the 3 Cloud Approach
Presenter: Eli begins by talking about a recent breakthrough in the thinking processes. The three cloud method which up to this point has been tried on 60 different subjects has shown a way to develop a very clear understanding of the policies and measurements which are contributing to UDEs in our environments. It is a belief in science that if you take any subject and map the cause and effect relationship to the end result, the end result is a simple system. In this simple system you need only touch one arrow to effect the entire system. The question we are only now beginning to address is why hasn't this type of thinking moved into management. During the 19th century we believed that the scope of the physical sciences was limited to only those things which could be measured, since human feelings could not be measured they were therefore not science. The definition of science is now those things that can be predicted in significant probabilities. Human feelings can be predicted in significant probabilities. Beginning with the development of the one UDE cloud method, we are starting to see results from the CRT constructed using this simple method. There follows some discussion, including usage in a teaching environment of the three cloud method and in typical Eli style he leaves us with an assignment. Using a subject that we have already analyzed, that we thought we had done a good job with, write a list of UDEs, pick three and generate the one UDE clouds. The exciting conclusion comes tomorrow. See JFL-16.
JFL-2 - Georator This presentation covers what it takes to create an Unrefusable Offer and how to maintain the Unrefusable Offer once it is in place. Mr. George Ripol, president of Georator, discusses how the company was introduced to TOC and the steps that they took to get to where they are today. He explains the need for focus when there are many Jonahs present in a company. He speaks about Georatorıs experience with creating an Unrefusable Offer to the market. The company created its Unrefusable Offer at a Jonah Program®. However, when first implemented, the offer did not increase sales as expected. After attending the Colorado Springs JonahSM Upgrade, they understood why the first offer did not take off they had not gained the buy-in of the sales force. To correct this problem, they had the sales force go through a dedicated Management Skills Workshop that focused on dealing with the sales force's issues of using the Unrefusable Offer. By using the MSW tools to resolve their own issues, the sales people bought into the solution. The result, a three fold improvement in sales. However, after a period of time sales experienced a decline. The reason turned out to be the sales people's reluctance to surface customers negative branches and trim them. It was by far easier for a sales person to do a follow up, than to do a negative branch. Georator solved this issue by doing a lot of role playing with sales people focusing on NBRs that have shown up and NBRs that could eventually show up. They also made certain that the sales person would be focusing on the customers UDEs. This approach worked well. Now, the company is working on ways to improve their offers even further.
JFL-3 - TOC in Banking
Presenter: Security Federal Bank is located in Northwest Indiana and employs 192 people. The bank was historically focused on mortgage lending with very little emphasis on retail or community banking. The bank had a reputation of being "solid" but "sleepy." In 1995 the decision was made to embark on a new way of banking. In October of that year a new president/CEO was hired to make it happen. As a result TOC was introduced into the organization. The first question to be answered was, "what's wrong with banking?" One thing that was immediately apparent was the amount of regulatory measurement that banks had to deal with or, in other words, policy constraints. The Security Federal team wanted to narrow the 34 core measures which were extremely confusing for bankers, customers and even regulators into the three primary measures of TOC - Throughput, Investment and Operating Expense. The difficulties of converting these measures into the banking industry were worked out by the management teams at weekly meetings centered around the concepts observed in The Goal. These new measures and paradigms were then communicated downward through the organization effecting how all employees approached banking and how they were measured and compensated. The bank now holds bi-weekly management meetings on the Thinking Processes and what is working or not working in their environment. In one year Assets rose from $212 million to $317 million, Non-interest income rose form 1.03% to 1.65%, loan servicing assets rose from $850 million to $1.4 billion and net interest margin spread rose from 2.02% to 3.56%. Some other effects have been observed in the Thinking Processesı impact in the employees personal lives as well. This initial success has given the organization the confidence to move the TOC effort into new areas and expand itıs existing application. Drum-Buffer-Rope is being applied to loan processing and servicing areas, Managers are being trained as Jonahs, the employees are being taught the day-to-day Thinking Processes and Personal bankers are being trained to use clouds and trees to help customers bank better.
JFL-4 - Harris Semiconductor
Presenters: Critical Chain in Harris Prior to hearing from the Harris team Dee Jacob gives us an overview of the nine points of single project implementation. These steps are necessary for understanding paradigm shifts...to stop spreading safety everywhere (strategic aggregated safety), to stop the behaviors that waste task and safety time, to stop the reasons why we multi-task and to account for resource contention within a window of time.
Puneet Saxena and Bob Murphy first present a little history. The Mountaintop Facility makes discrete power semiconductors. The market is growing around 30% a year. They needed to make a strategic decision how the semiconductor department was going to affect the company. What they decided was that Fab 8 was going to double the capacity of the company. Puneet and Bob explained the basic paradigm shifts that Harris had to go through to make the implementation successful. First of all was the discovery that many tasks they thought had to be sequential in nature really could be done in parallel. Traditional project management does not allow for taking advantage of positive variations. It is more important to know how much time still remains for a task to be completed. Understanding resource dependencies is crucial. For the whole project to be completed successfully, it is not necessary for each and every task on the project be completed exactly on schedule.
JFL-5 - Building the Network
Presenter: Dee Jacob, who has been instrumental in the development of the Project Management Applications, offers a presentation on the value that a proper network offers to project scheduling. Dee starts by defining a project network and a task as well as understanding how we currently construct project plans which many times are not appropriate for applying critical chain scheduling. In outlining the process for building the network she elaborates each point from her own experience in facilitating project implementations. In addition, Dee discusses how to get task times cut for reducing the tendency to imbed too much safety in projects. Examples are presented of various projects that compare the structures of the initial plan versus the interdependency plan and desired lead time versus critical chain lead times. By using the Thinking Processes to check assumptions about the order of activities to be performed and the timing for accomplishing various tasks it is revealed that these projects can be completed within the desired lead time with critical chain scheduling for a feasible immune plan Summarizing the presentation Dee discusses the key benefits of having someone facilitating the construction of the network. A facilitator can act as a disinterested party to allow the project participants clarity as to what is really necessary and critical and keep the objective of the project on track.
JFL-6 - Oregon Freeze Dry Oregon Freeze Dry (OFD) works in removing water from different products at low temperature and pressure. They sell finished products and freeze-dry goods in the following areas: Food products include: ingredients, private label meals, backpacking foods and government rations. Non-food products include: heat, oxygen, shear-sensitive materials, microbials, pharmaceuticals, nutraceuticals and chemicals. OFD has three plants in Albany, Oregon and one plant in Preston, England. The story of OFD begins with the marketing problem of trying to get a large consumer goods company (Company X) to renew a contract for one of the ingredients that OFD makes. It's a very high volume ingredient - $28m the past four years. Larry Von Deylen attended the External Constraints Course (ECC) to develop an unrefusable offer for Company X. He explains a bit about what the offer consisted of, and the importance of selling the offer to the right people. Larry met with the purchasers to achieve the objective of obtaining agreement to meet with the Division General Manger of Company X; this is where the problem took a turn for the worse. The overall response was, "Great plan, but too late because he was recently informed of product discontinuation." Company X had decided that they were not making good enough profit margins on this type of product products with expensive ingredients like those from Oregon Freeze Dry. Larry and OFD had to think of another approach to maintain this customer. It was then that OFD started to look into the TOC distribution application. If it was money that company X wanted to save, why doesn't OFD make an offer to Company X that would address inventory and distribution costs and problems. Company X was also about to purchase a computer system to address these logistical problems; OFD could offer alternative solutions. Unfortunately, OFD failed in preparing well enough to get buy-in from the logistics department of Company X, therefore failing to be successful for the moment. The story is not a sad one. Upon looking into the distribution solution, OFD decided to implement this system themselves. Some of the results that they have achieved have been excellent. For example:
This is a beautiful example of the TOC distribution solution in practice, getting very good results in lower inventories, improved on-time shipments, fewer production mistakes, less wasted time, faster reaction times, competitive advantage, and most importantly it has contributed to 20% sales increase in 1997.
JFL-7 - Bal Seal Engineering Company, Inc.
Presenter: Immunizing the Future of the Company Peter Balsells, who has been with Bal Seal since 1990 and been the President since 1996, became aware of AGI due to a 1991 Wall Street Journal article. He proceeded to read The Goal and was part of the successful implementation of the Drum-Buffer-Rope/Buffer concepts at Bal Seal (testimonial given by Dave Pickels entitled The Implementation of DBR and Working with Constraint Shifting at Colorado Springs JUW, 1996 video #JCS-11). In the spring of 1997, Peter and his management team began their strategic planning process with a successful vision by the year 2020. The Strategic Selection criteria were: company goals in terms of net profit and ROI, boundaries of technology to pursue custom manufacturing job shops with determined areas to compete in selected high value projects, and new product launches. Throughput was determined by two sections of Bal Seal, the engineering division and the manufacturing division. Peter wanted to be able to measure if increased business was due to good performance from design engineering or from an increase in production orders, so that each division is credited and rewarded appropriately. The engineering division was taking on ten new projects on top of their regular operations. They discovered that there was a lack of clarity and objective to the projects. Since there was a contention for their time, the engineering team found that they could not do it all (they had previously tried to compromise but it failed). The team turned to Critical Chain/Project Management and the Thinking Processes to help achieve their objectives. The team identified the strategic constraint resource to their multi-project environment and found that 90% of their obstacles needed policy changes. They rearranged the criteria and changed policies to meet the objectives. The result: an extra 10% capacity was revealed for the design work. The strategic planning was completed by making sure that measurements were in place to support the changes and mechanisms in place to evaluate projects. The single most important win for Bal Seal is that they "achieved consensus from the management team." Being the only Jonah at Bal Seal, Peter has successfully pulled together his team to come up with a plan to immunize the future of the company.
JFL-8 - Imperial Oil
Presenter: Imperial Oil is the largest oil company in Canada and is an affiliate of Exxon. Bob Wilson has been with the company 36 years and is the General Manager of Materials and Services Supply Department. The presentation is a work-in-progress to better understand how the company has applied TOC to its internal operations. The company started off trying to implement TOC principles to their oil field process from reading The Goal, however, people soon realized that they needed help and they contacted the Goldratt Institute. An investment was made in TOC and the Thinking Processes by having an in-house Jonah Program® to form an internal network of 12 Jonahs, training in the Production application, and training an internal licensee in the Management Skills Workshop. Progress on their projects within the company has been slow, but he is here as a story of trying to get the momentum needed for their improvement efforts. Bob's ambitious target has been an overall company strategy of operations excellence to capture the marketplace since their product is indistinguishable from competitor products. His department has been trying to centralize standards and business processes for a better purchasing strategy. In trying to put this purchasing plan in place the company has learned many lessons. Most important is how the Five Layers of Resistance is a framework for communicating the mutual interests of each party and gaining buy-in. Working on the buy-in has meant moving towards global interests and getting agreement on the core problem which is shared by all. In addressing their issues they find the tools of the Thinking Processes have helped and they are continuing to work toward their breakthroughs.
JFL-9 - Wendell August Forge
Presenter: Tom discusses how Wendell August Forge went from the threat of going out of business to success in an industry where competitors were failing. Wendell August Forge is a family owned business that specializes in giftware. Their main sales season is Christmas during which over 50% of their product is sold. They had started with reading The Goal and then moved to a Production Workshop to turn things around. Using TOC, Wendell August Forge stopped working on orders that were too small to earn a profit. Etchers, who were in limited supply, were focused on etching instead of trying to simultaneously develop new designs, and production cells were reviewed. The production cells turned out not to deliver the results that Wendell August Forge had anticipated, but were helpful making the constraint identifiable. After using TOC throughput is up 10.3% (a very conservative estimate), plans that are developed actually last, the leadership confidence is up, stress is greatly reduced, and the company was able to award its employees with its highest bonus to date.
JFL-10 - Introducing TOC in Venezuela
Presenter: Embarking on a one-woman crusade to introduce TOC into a country like Venezuela has proven to be a rather daunting task. Venezuela is a small country where an inflation rate of 100% is not unheard of. Perhaps no one is better suited for the task than Maria. Her energy, enthusiasm, and desire to see TOC succeed are proving to be the most successful tools she has to spread TOC throughout Venezuelan industry and universities. Those tools aside, Maria Cristina has a plethora of other creative ways to communicate the concepts that underlie TOC. The highlight example from the presentation was the Drum-Buffer-Rope game involving an audience member as our very own Herbie. Through the use of a piece of rope and a child's drum, Maria shows the pros and cons of traditional manufacturing, just-in-time, and other manufacturing methods. This game very clearly illustrates DBR, and is a lot of fun for the group. Other props and fun are included in this presentation. Maria's ideas are creative, and effective. The exercises detailed in this video are well worth exploring when trying to find ways to communicate a little differently. People remember 10% of what they hear, 20% of what they see, and 80% of what they experience, based on Maria's exercises people in Venezuela are remembering 80% of what she has to say.
JFL-11 - Management Skills Workshop (MSW) to Improve Production & Other Results from Australasia
Presenter: Kathryn Leishman presents four stories of people using the Management Skills Workshop (MSW) tools. The Alliance Group Ltd. produces frozen and chilled meat. The suppliers of the meat, in this case lamb, are also the owners. It is a highly regulated and seasonal industry. The Alliance Group has six processing plants, 6,000 employees with 25% of them full time year round and 75% full time during the main season. The lamb supply to the slaughter houses was decreasing, due to farmers converting their land to dairy, forestry, or government land bank. Supply was also greatly affected by price. As soon as a better price was offered the supply of lamb shifted over to that slaughter house. In June 1996 they attended a TOC overview and in August 1996 a marketing offer was generated through the External Constraints Course. In October, 1996 a subject MSW on production was offered as a trial to four of the plants, and in November 1996 it was implemented in all six of the plants. The MSW was highly successful in dealing with a variety of issues. For example, traditionally dogs were used to help round up the sheep. One man and two dogs could round up 100 lambs in about five minutes. In Europe there was concern with having the dogs around sheep so the Alliance Group stopped using dogs. The round up time went up to forty minutes using three men! Using the conflict resolution tool the group developed a solution where the dogs would be used in part of the round up, a special gating system was developed, and a lead sheep was trained. In another instance the issue of washing the sheep came up and was soon resolved. The Alliance group has been able to resolve negotiations with the union much faster, strikes were prevented and resolved where typically several strikes were common, profits increased, and a win-win attitude is now common within the organization. Ms. Kiwi was an employee working 70% at a 50% pay rate. She wanted to either increase her salary or decrease her hours and decided to use the MSW to help present her case to her boss. On one side if she decreased hours someone else would still have to do the work and the money would still have to be spent. She could try to find an additional source of money internally to make up the 20% difference, but her benefits are tied to salary and the additional source of money would not count towards the benefits. She presented her conflict cloud to her boss who was so impressed that he increased her salary to 75%. Global Addictions is a retail store that specializes in trading cards and trendy items. They operate a store front in a local mall and were in great concern about a rumor of the mall increasing their rent by 12%, an amount that could drive them out of business. They developed a cloud to present to the mall about the mall's need to increase the rent and their need to be able to stay in business. Through the discussion the injection of the mall helping the store increase its revenue was raised and an agreement was made. The mall would increase the rent 8%, which is what the mall really wanted, and would offer the store in-mall promotions, free copying, and free assistance in promotions. The value of the promotions was about $3,950. The 8% increase in rent amounted to $2,500. Riverside Primary School used the MSW to address several issues of concern. One issue was to re-organize eight classes into nine and include a music classroom. Part of this operation included new class lists and another part was to greet and convince the parents of the change all in one day. Through using the MSW to address a variety of issues the school was able to increase its staff's morale and the ability to cope with challenging students. This success in resolving issues and increasing morale was reflected in decreasing occupational sickness (commonly associated with on the job stress) from $300,000 a year to $50,000 a year.
JFL-12 - Overcoming Resistance to Change in an Organization
Presenter: In this breakout session we are developing a CCRT on human behaviors within an organization. It is important to understand that the real difficulty in an organization is overcoming people's resistance to change. Think of the number of meetings you sit in where people come up with excellent solutions. The real problem with these solutions is actually acting on those ideas. People's ideas are immediately bombarded with all sorts of negative comments. How many ideas are thrown out because somebody sees a negative branch? Instead of following through with eliminating the negatives, we throw out the idea. What causes this resistance? Disagreements on problems that should be addressed and when they should be addressed, lack of consensus on how to solve the problem once the problem has been identified, frustration and lack of confidence over the multitude of ideas that have been thrown out onto the table. Other causes include the overwhelming number of obstacles that seem to block the possibility of any solution regardless of how good it is, inability to get others to buy-in, the organization has always been successful, why change it (past and existing success), the fact that there is no time to take on the new change, fear of success, fear of failure, past and existing failures (one buzz word to another), and change conflicting with one's local performance objectives. Do people resist change externally, or is it internally that they are resisting it. In order to have change externally I must have change internally. Lip service exists if authority is used to make the decision; our emotions are always an appropriate response to our perception of reality. They are resisting because based on their perception of reality this change is a huge threat. To implement change in an organization it's essential to get the ownership and active collaboration of all these involved in the change. This is what was used to develop the five layers of resistance. We found that we must establish correlation between the things that cause resistance and the five layers of resistance. Layer 1 our area of control is extremely limited, if you are in an organization which does not allow you to be empowered or causes you to perceive that you are not empowered, you are more likely to perceive this as your situation. When you are in Layer 2 you tend to be speaking on a more abstract level. At some point people here will start trying to adapt these concepts to their own environment and this is where you enter Layer 3, Yes...But. An essential step in getting people to buy-in to a change. Next step - Layer 4, what am I going to have to do to put it in place (it's impossible to make this happen)? Layer 5 - fear of going it alone. The next issue we cover is how to address the five layers. To address layer 1 we use a CCRT, in this session we detailed some of the new 3-cloud approach to developing a CCRT. In layer 2 we explore the evaporating cloud using the generic cloud of human behavior in organizations and the FRT (including the quantification of the desired effects). Layer 3 involves exploring and breaking negative branch reservations and additional injections to complete the solution; remember that additional injections become part of the FRT. Layer 4 focuses on developing PRTs, including getting buy-in of others whose collaboration is needed. Layer 5 is explained more thoroughly in the second part of this series. The focus in this videotape is primarily on the CCRT, how to construct and how to communicate it.
JFL-13 - Layers 2-5 of Resistance
Presenter: Layers 2-5 are reviewed using human behavior in organizations as the subject matter; questions from the audience are addressed throughout. Layer 1: Agreement on the problem. Layer 2: Agreement on the direction of the solution Layer 3: Addressing concerns of the person I am trying to get buy-in from Layer 4: Addressing obstacles that will prevent the success of the solution Layer 5: Addressing the fear of taking action. The generic behavior in an organization cloud is presented. An individual strives to ensure the ongoing success of their organization. On one side they want to ensure their own local performance so they do things to ensure the performance of their own area. On the other side everyone needs to focus on the performance of the organization as a whole. The cloud is developed where an individual's local measures conflict with the organizations global performance. Assumptions are then raised and reviewed by the group. Negative branches (layer 3), overcoming obstacles (layer 4), and layer 5 are then reviewed and discussed.
JFL-14 - Ted Hutchin Update on Ph.D. Thesis This presentation is a short update on the status of Ted's Ph.D. project. A continuation of the dissertation work he has been doing in the UK. His findings illustrate the things that block people from changing personally, what he terms the "paradigm lock." He takes the layers of resistance and applies them to a personal level. His earlier presentation in San Antonio (Tape #JSA 8) showed how he has been examining why some people have used TOC without achieving success. He was attempting to find a possible missing injection that could ensure success to those pursuing TOC. The basic conflict is within the individual, and it was between change and status quo. The paradigm lock means the person involved in the necessary change does not believe they can deal with the constraint and remain in control at the same time. It keeps them frozen in their improvement efforts.
JFL-15 - Update on the California Penal System
Presenter: Danny starts out by giving us a recap of what results were shown at the JUW in San Antonio from his work with the State of California Prison system (Tape #JSA-16). In this prison system Danny did a dedicated Management Skills Workshop for the Warden and his staff. Keep in mind that in the prison system for the county of Los Angeles independent thinking is not encouraged. Currently there are 33 prison facilities in the state and 3 more which are under construction. In Los Angeles county the state has mandated that they comply with an Enhanced Outpatient Program (EOP) in order to provide the best level of mental health care possible. Six months after the deadline for the EOP program to be in place there was a 17% compliance rate. After utilizing the thinking processes taught in the MSW the facility in question has achieved a 100% compliance rate. They are currently the only site that is functional. As of this publishing they have an 80% occupancy rate and are anticipating a steady increase. The TOC solution that this medical/prison environment developed is so successful that other prisons are sending in their patients to the facility.
JFL-16 - Using the 3 Cloud Approach for Buy-In
Presenter: After assigning the Jonahs in attendance a 3 UDE Cloud exercise for home work and hearing the first chapter from the Project Management Self Learning Kit, Eli begins to explain how this relates to the buy-in process for overcoming the first two layers of resistance, using as examples, the generic clouds from Production and Project Management applications. During this discussion, the connection between the core problem and its related generic conflict cloud becomes apparent and this begins to shed light on what must be done to move through the first and second layers of resistance. Since the core problem you want to attack is an assumption being made in the generic 3 UDE cloud it becomes apparent that before you can expect anyone to buy-in to a solution you must first bring them to see why an assumption on that cloud is invalid. For example, in the production solution we prove to them that individual resource efficiency is wrong. Eli refers to this initial effort to overcome resistance as a Layer 2 subset: Getting buy-in to the direction of the solution. Eli displays how easily project managers can get side tracked and begin to resist the Project Management Application by making the assumptions that the project lead time was unrealistic to begin with and the safety buffers are inadequate. Actually, their are intuitively trying to invalidate and challenge the assumption we make in the Project Management Application: that the original commitment is realistic. Eli proceeds to share the statistical reasoning being used to find project lead times and safety features and shows why the reasoning is right, and the management of it, is wrong. This is achieved by using the new Thru-Put Technologies software simulations. This video can facilitate anyone trying to perfect the buy-in process and/or anyone trying to better understand the reasoning behind why Project Management the TOC Way works better than any other methods for improving project lead times.
JFL-17 - Project Management: The TOC Self-Learning Kit
Presenter: This session begins with Dr. Goldratt's assistant, Wendy Donnelly reading the first chapter from the yet to be published, Project Management Self-Learning Kit. The text she reads is an excellent display of Dr. Goldratt's knack for overcoming resistance to change. The chapter succeeds in overcoming layer one by first, acknowledging the diversity in all projects which allows everyone the comfort of knowing they are different. Diversity is then used to uncover the similar problems facing all project managers; short due dates, big content, little budgets. These very common symptoms appear to be caused by uncertainty in the content of any project. The reading closes with everyone understanding and agreeing that the uncertainty is not the problem, but rather, the way we manage uncertainty and diversity in projects is what to change. This video brings clarity to why most projects suffer from poor performance and can be used to facilitate moving a project manager through layer one of resistance. It also exemplifies how to take the dry logic of a CRT and turn it into interesting, easy to read prose.
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