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2015 TOCICO International Conference

Transforming Businesses Track

Erica Fondevila
Goldratt Consulting

Andres Hurtado

Transforming Management: From Dealing with Symptoms to Understanding Cause and Effect
September 7, 2015

Managers constantly deal with problems. They consume their day by day capacity dealing with undesirables situations. Somehow problems repeat themselves, over and over again. Why is it so difficult to eliminate some repetitive problems? There is no doubt about manager’s capabilities. They all have talent, intuition and experience. One possible answer could come from the way that managers deal with their realities.

This presentation has been developed with the purpose of validating the following thesis: "It is possible to significantly improve the ability to achieve significant results from manager’s interaction by changing the way they look and deal with company´s reality.”

A Proof of Concept is a tool scientists use in order to understand and explain some events in reality. We will like to show how this simple and practical process can help management teams to explain what is happening, decide what to do in order to improve and finally test the proposed solution to try to find the flowed assumption inside the thinking process.

We will use a real example to present the process full logic in action. 30 minutes will be enough to catch up the essence.

The first step in this case study was getting to know the company’s reality: Understanding the process we want to study. Then identify the main KPIs they use to evaluate their process performance. Third look for undesirable effects. E.g: Some KPIs had them very stressed out:

  • Long Lead Times
  • Low due date performance
  • Low capacity
  • Poor communication
  • Claims from clients

Digging deeper with the purpose of finding the cause for all this problems, we made a hypothesis: "what is causing all these undesirable effects is the lack of synchronization”; they were working as silos, trying to maximize local optima everywhere. We set that base as the start for our proof of concept: "If lack of synchronization is the cause for all the problems we see, then applying the basic principles of TOC should reduce/disappear all these problems”. We chose two areas to make the proofs of concept, the ones that were making most of the noise: Order Commitment Process and Samples Workshop.

In the Order Commitment Process we applied Red Line Control. A daily meeting with all the people involved was established. During that meeting of half an hour, all the status of the ongoing orders were analyzed, starting from the ones in black, following with the ones in red until the time of the meeting was done. After a couple of weeks, the lead times of this process started to improve significantly, black orders started disappearing and red orders were decreasing.

On the Samples Workshop we applied Drum Buffer Rope. Before our intervention, they had some investments approved to increase the workshop’s capacity. After two weeks of working under DBR, they increased their capacity on 70% without any investment.

ERICA FONDEVILA is an Industrial Engineer from Escuela Superior Politécnica del Litoral – Ecuador and Jonah in Thinking Processes. Currently Works as a Consultant for Goldratt Consulting in Ecuador and El Salvador. Have experience in other fields of the consulting sector and as an entrepreneur in Ecuador.

ANDRES HURTADO is an Implementer for Pimienta. He is an Industrial Engineer from National University – Colombia. Andres is finalizing his Master's Degree on Philosophy from Universidad Tecnológica de Pereira and is currently working as Goldratt Consulting Project Director and Auditor. He is also TOCICO Certified as a Supply Chain Practitioner and Strategy and Tactics Implementer and has spoken at TOCICO International conferences in 2010, 2012 and 2013.

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