The Theory of Constraints (TOC) solutions cover a wide range of environments and sectors dealing with products, projects and services. Its many elements and design processes can also be leveraged to design new applications from the generic solutions. How is this actually done and can TOC elements reveal a strategic development method that brings harmony to a National Defense military organization?
In recent years, TOC applications have emerged in government services. Agencies have been able to improve their delivery performance as measured by value-for-money (QT/OE) as the goal. These successful implementations reveal the improvement possibilities for capability-based cost centers that are uniquely represented in national defense organizations.
Military organizations are known by two primary characteristics: stability and fire-fighting. While these may seem contradictory, they are interdependent. Stability comes from standardized education based on centuries of warfighting practice and theory that informs a uniform capability structure and controls. Fire-fighting is the temporary condition caused by unpredictable conflicts that demand flexibility while maintaining unity of action that is practiced during peacetime training. When uniform capability structures are undermined, the prolonged strategic fight for survival can disrupt essential foundations that support system harmony.
In the mid-2000’s, the 110th Attack Wing (Michigan Air National Guard, USA) was awarded “best A-10 flying organization in the U.S. Air Force” just before receiving an unexpected and crippling blow to its identity and focus when it was scheduled for closure. In the intervening eight years, the organization fought for its existence which was mainly a political and marketing focus to obtain any emerging warfighting asset. Survival efforts neglected the foundational goal and operating strategy that would enable the delivery of relevant capabilities and necessitated a new strategic development approach to describe the reform process to create system harmony.
The Charter: In eighteen years, the organization commander (CEO), Colonel Bryan J. Teff, had not witnessed a single successful strategic initiative to bring bottom-line improvement to the many cost centers managed by the State of Michigan. His desire to avoid the same fate and demonstrate quality stewardship of Owner trust became a charter to build a Strategic Plan that will ensure improvement by completing at least one (1) strategic initiative. This broad objective provided an opportunity to explore and integrate the principles of the Theory of Constraints and execute a methodology that would provide clarity and focus on “what good looks like” for the primary mode of operation. With such a simple objective, the challenge shifted to one of coaching the executives to realize that a TOC-based approach would enable much more ambitious expectations and success!
The Foundation: The foundation for facilitating a rapid, product-focused approach came from several years of TOC self-study, hosted TOC training programs, and sub-system experimentation. But the real value was obtained from brilliant developments presented at the 2016 TOCICO Conference and The Decalogue process that informed a straight-forward 5-step Rapid Strategic Improvement Process based on the Big-TOC Body of Knowledge.
Step 1: The Strategic Direction of the Enterprise – Defining the Goal and Necessary Conditions
Building the Strategic Ideals became an executive coaching exercise. The basic military organization views strategy as the combination of all assigned functional tactics as a sufficient summary of strategy. Rarely is a true strategic view created. Beginning with a Viable Vision for a National Defense Enterprise, the essential questions for positive change was introduced: What does good look like for “profitable growth” of an ever-flourishing military enterprise?
The fundamental questions of It’s Not Luck (Goldratt, 1994) were then presented and adapted to create an Enterprise Compass comprised of the Vision, Mission, Values, and Necessary Conditions. The ultimate objective was to identify the focusing goal of the Organize, Train, and Equip military unit by bridging the gap between government service-based and capability-based criteria for claiming success.
Step 2: The Direction of the System Measures – Motivating Harmonious Behaviors
National Defense organizations in an ideal environment experience long lag times between capability development and actions or “market” impact. Developing strategic value-for-money measures to synchronize effort at all levels of the organization was accelerated by the reality of system resilience in the chain analogy. In the 110 ATKW, measuring and monitoring every administrative detail resulted in shifting priorities, unfocused behaviors, and all of the Engines of Disharmony that system reality would suggest.
Establishing the truly relevant measures of the system that motivates harmonious system stability required an understanding of how capabilities are produced and reported. The Haystack Syndrome (Goldratt, 1990) provided a lens to identify Readiness Value and Training Value measures that focus management attention and inform the depiction of the strategic system map.
Step 3: The Direction of the Solution – TOC Five Focusing Steps from The Goal (Goldratt, 1984)
Constructing the Enterprise Throughput Operating Strategy required basic understanding of the function and influence of a selected Critical Activity on the throughput of a system (Fox, 2016 and Utah SUCCESS Framework). The pattern of obtaining relevant missions and funding had obscured the requirement to convert raw manpower potential into legitimate capabilities for customer requirements.
Envisioning bottom-line value was prompted by the Necessary But Not Sufficient (Goldratt, 2000) discovery process. The TOS demonstrated the major activities by sub-system that required maximizing flow to enable Critical Activity efficiency and maximum throughput. The Critical Activity Focus combined with the three Necessary Conditions inform the TOC philosophy of Win-Win decisions. The power to improve immediately through better decisions was revealed in the core conflict in C-level and functional decision making that favored emotional flexibility over the Harmony Cycle of Emotion-Intuition-Logic (Goldratt, R. 2016).
Step 4: Direction of the Improvement – TOC Change Questions
Dr. Alan Barnard presented several options for developing a Strategy and Tactic Tree (2012 and 2013). The Gap Analysis method seemed most suitable and capitalized on the natural inclination to use barriers to justify the status quo. Through a four step process, the elements of the S&T Tree were developed using the TOS as a guide. to identify performance obstacles, supplanting strategy objectives, best gap-closing tactic, and Pareto Analysis with supporting harmonious system behaviors.
4-Step Gap Analysis Method to Build the S&T Plan
- The Gap or Obstacle Identification
- Strategy or Supplanting Objectives
- Tactic or Change Method
4. “3-Why” S&T Pareto Analysis: Necessity (CMCP), Parallel (Emotion-Intuition-Logic Cycle), Sufficiency (3 Primary TOC System Behaviors: TOC Decision Making, Relay Runner, Switching Rules; Throughput Measures; Sub-system S&Ts)
In order to avoid overloading, S&Ts were developed for the Critical Activity and supporting activities with a direct impact on throughput of capabilities. Finally, the S&T sequence for activation was developed using the Five Focusing Steps and The Decalogue (LePore, 1999) as a guide.
- Priority of Impact: Exploit and Subordinate
- Sequence: Dependency and Activation Foundations
- Critical Activity Focus: Switching and Scheduling
- Flow Behaviors: Work Ethic and System Harmony
Step 5: Direction of the Strategic Future – Organize, Train, Audit, and Expand
Strategic Navigation sustains the improvement through TOC Desired System Behavior controls, TOC compatible leadership philosophy (Kothekar, 2016), S&T and Red Curve navigation (Holt, 2016), and Blue Ocean Strategy guidance (Kim, 2015).
The strategic future begins with organizing strategy execution according to Critical Chain Project Management and designating S&T responsibilities. Training and reforming system behaviors is facilitated by the Strategic Ideals and TOS Focus that brings system stability. Auditing and adjusting S&Ts is based on valid measurements of improvement. Finally, the S&T Tree is expanded based on knowledge gained and subsequent gap analysis of the TOS and Necessary Conditions.
Several challenges existed in the 110th Attack Wing Strategic Development. The strict time constraints eliminated the opportunity to conduct TOC educational exercises. As a result, TOC solutions were integrated into S&T development and local examples had to be crafted for Drum-Buffer-Rope scheduling, Relay Runner, Switching Rules, and Flow Measurement discovery. The resistance to “business-world methods” required a unique integration of concepts and principles that avoid significant references to methodologies that had top-down implementation pressure with little local successes.
It may be appropriate to limit the presentation to a subset of the submitted abstract to fit the designated time block. I welcome the guidance of the Submission Review Committee on content and scope if selected as a presenter.
Projected Post-Presentation Questions:
- Q1: What about Military Employment as a different Mode of Operation and Measurement? (Employment TOS with a Critical Activity of S&T “stabilizing” effects)
- Q2: What are the current results and projected capacity improvement?
- Survey Results, Baseline Measurements, Full Potential vs. Improvement Target, TBD on Readiness Value and Training Value, TBD on TVD and IVD Flow Measures
- Q3: How does the Enterprise Strategy with TOS relate to the subordinate business units? (Seamless until the mode of operation shifts to “Employment”)
- Q4: Can this method produce realistic solutions in other areas such as TOC in Relationships? (Family Strategy and Common Conflicts Available)
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- “SUCCESS Framework.” Utah Governor’s Office of Management and Budget.