Goldratt’s Thinking Process and Systems Thinking

1. Goldratt’s Thinking Process and Systems Thinking James R. Burns July 31, 2007

2. THEORY OF CONSTRAINTS: GOLDRATT 1. Identify the system constraints 2. Decide how to exploit the system constraints 3. Subordinate everything else to that decision 4. Elevate the system constraints 5. When this creates new constraints, go back to step 1

3. Reference(s) • Dettmer, H. William, Goldratt’s Theory of Constraints, ASQ, 1997.

4. THE ISSUES ARE: • What to change? • {What is the core problem?} • What to change to? • {Where to look for the breakthrough idea?} • How to effect the change? • {How to bridge from a breakthrough idea to a full solution?}

5. Goldratt’s TP (Thinking Process) • An excellent methodology to facilitate sessions during the initiation phase (definition and conceptualization stage) of a project

6. Strategy for change • Create the tree • Critique the tree

7. Why trees?? • To get a complete picture of what is going on • To model all of the causation involved • To see what is related to what • To identify the core problem • To validate a proposed injection

8. What to change? • Team constructs a current reality tree (CRT) • Team starts by listing all undesirable effects (UDE’s) • Team inter-relates these by use of a tree, called a CRT • In the current reality tree, the team traces UDE’s back to a core problem (CP)

9. EXAMPLES OF UDE’s • Due dates are often missed • It is difficult to respond to urgent demands • There is too much expediting • Inventory levels are too high • There are frequent material shortages • Safety stocks are inadequate

10. Symptoms, Root Causes & a Core Problem • Rather than reacting to symptoms, we should be finding root causes • We consider undesirable effects to be symptoms • We look for a “common cause” that is the source for most of the undesirable effects

11. A CRT for software development • Only 28% of software projects are successful—on-time, within budget and with full functionality • Software projects are always the slowest projects to be completed • TI merged two divisions of the firm…. • It took 6 months to do all logistics • It took 18 months to reconcile all of the software differences

12. Example Current Reality Tree Managing Software Development Projects Is rarely successful Software Development Projects take too long Software Development Projects cost too much Software Development Projects have quality problems A

13. Software Development Projects take too long Software Development Projects cost too much Fixing changes takes time There are many late- breaking changes to requirements Fixing changes costs money Users discover new features they want included in the software Users don’t know what they want Users change their minds Users are untrained and not sophisticated

14. Late in the lifecycle Users discover new features they want included in the software Users are untrained and not sophisticated Project Managers Do not train and teach Users about software development A Project Managers do not utilize “early discovery” techniques with users Software is of poor quality and takes Much time/money to debug Software Project Managers do not encourage use of walkthroughs through testing Software Project Managers Are poorly trained And unaware of pitfalls in Software projects

15. We conclude…. • That the core problem is with poorly trained software project managers

16. The next construct is the Evaporating Cloud {EC} • The Evaporating Cloud is used to address the question… What to Change to….

17. Core problems are studied further by use of an evaporating cloud • Evaporating clouds (ECs) will surface assumptions • Breaking an assumption leads to a breakthrough called an injection • At this point the team is unconcerned with the practicality of the injection

18. What is an injection? • a solution to the core problem • a strategy that will mitigate all of the UDE’s • Injections that appear impossible to achieve are called flying pigs

19. Example Evaporating Cloud Training takes much time/money, requires trainers Project training is long and arduous Many well-trained Project Managers Are available now Project Manager expertise is required now Instant Project Manager expertise required

20. What have we learned from the EC above? • Many expert project managers are needed now • Creating well-trained project managers takes time • Instant project management expertise is required now • SOLUTION: Expert system for project management

21. INJECTION • Create a PM expert system • An advisory system that novice Project Managers can seek and obtain advice from.

22. What to change to? • From the CRT and ECs, a Future Reality Tree (FRT) is constructed • One purpose of the Future Reality Tree is to validate that the injection will achieve the desired effects (DE’s)

23. Due dates are rarely missed Demands are met 99% of the time There is little expediting Inventory levels are low There are no material shortages Production lead times are short or satisfactory Due date perf. is high Customers rely on quick responses There is little expediting Inventory levels are reduced significantly Material is available when needed Customers rely on quick responses Examples of DE’s

24. Building the Future Reality Tree • Start by turning the UDE’s around and writing them with a positive tone as DE’s • Place DE’s at the top of the limbs in the FRT • At the bottom of the FRT place the injection • Building the FRT is a two-phase process • Build considering only positive, ideal links, and assuming win/win strategies • Add negative loops later

25. What to change to, Cont’d? • The idea here is to get a picture of how an injection (a breakthrough) might affect the overall performance of the system. • The Future Reality Tree is the validation that a collection of injections will turn all of the UDE’s into DE’s

26. Future Reality Treefor our example Managing Software Development Projects Is usually successful Software Development Projects take reasonable lengths of time Software Development Projects aren’t too costly Software Development Projects create quality products A

27. Software Development Projects take too long Software Development Projects take reasonable Lengths of time Software Development Projects take too long Software Development Projects cost too much Software Development Projects aren’t too costly Software Development Projects cost too much Fixing changes takes time There are many late- breaking changes to requirements There are many late- breaking changes to requirements There are few late- breaking changes to requirements Fixing changes costs money Fixing changes costs money Fixing changes costs money Users discover new features they want included in the software Users discover new features they want included in the software Users discover no new features they want included in the software Users don’t know what they want Users don’t know what they want Users don’t know what they want Users rarely change their minds Users change their minds Users change their minds Users are more trained and sophisticated Users are untrained and not sophisticated Users are untrained and not sophisticated

28. Late in the lifecycle Users rarely discover features they want included in the software Users are trained and sophisticated Project Managers Do train and teach Users about software development A Project Managers utilize “early discovery” techniques with users Software is of good quality and dubbing is inexpensive and quick Software Project Managers encourage use of walkthroughs through testing Software Project Managers use an expert system To avoid pitfalls in Software projects

29. Last Question…. How to cause the change? We will use two more trees

30. How to cause the change? • The prerequisite tree • The transition tree • These help to get buy-in • These help us to develop a strategy for achieving a flying pig (an injection that appears impossible to achieve or implement)

31. The Prerequisite Tree • Place INJECTIONS at the top • List the obstacles that are expected • For each obstacle that is overcome, an intermediate objective is achieved • Each obstacle gives rise to an intermediate objective • The intermediate objectives need to be sequenced • The prerequisite tree does the sequencing

32. No well-defined ES Architecture There are many commercially-available ES Shells Pick an appropriate ES Architecture Select an appropriate ES Shell OBSTACLE INTERM. OBJECTIVE

33. The Prerequisite Tree, Cont’d • Takes an impediment or obstacle approach • This approach enables dissection of the implementation task into an array of interrelated, well-defined, intermediate objectives

34. The Prerequisite TreeOur Example Create Project Management Expert System Objective Test Project Management Expert System A

35. A Construct Project Management Expert System No well-defined ES Architecture No well-defined PM Body of Knowledge Codify PM Body of Knowledge into Expert System Shell Decide upon Expert System Architecture Obtain PM Body of Knowledge Select Expert System Shell

36. The Transition Tree • We know where we stand • We identified the core problem • We found an injection (one or more) that produces the desired effects • We found the milestones of the journey--the intermediate objectives (IO’s) • The question now is What specific actions must we take?

37. The Transition Tree, Cont’d • We must focus, not on what we plan to do but on what we plan to accomplish • For each IO, a specific action or set of actions are determined and initiated • Causing a specific change in reality is the imperative • The transition tree provides a ROAD MAP for getting from here to there!

38. The Four-Element Transition Tree Expected effect Specific action Condition of reality Unfulfilled need

39. Expected effect Specific action Condition of reality Unfulfilled need Unfilled need Specific action Condition of reality Unfulfilled need

40. The Transition TreeOur Example Create Project Management Expert System Test Project Management Expert System A

42. That’s it for Goldratt’s Critical Thinking • To get the full version, you have to go to New Hampshire (Goldratt Institute) , spend two weeks and $10,000 • To learn more, please refer to… • www.eligoldratt.com