In a recent interview, I was asked:
How do you go about investigating and finding the “weakest link in the chain” with your clients? What specific processes of evaluation would you recommend to businesses looking to self-assess?
We really disagree with technology vendors and VARs who come into organizations, do some kind of minimal evaluation of the environment, toss out some rule-of-thumb values or percentages that companies “might benefit” from implementing the technologies they're trying to sell, and close the deal. It is even worse if, after making the sale, they come back to the organization saying, “The first thing we need to do now is a ‘requirements analysis’ so we know how we are going to implement” the technologies.
No vendor or VAR—and that includes my firm—knows (or will ever know) as much about how the client’s enterprise works—or fails to work—in the process of turning products and services into Throughput. Equally as important, most executives and managers do not know about how their organization works—or fails to work—in their customer-to-cash streams either. They think they know; but, in the final analysis, they generally do not know.
Like Toyota’s executives and managers wisely assert, we, too, believe that “no one knows more about running the machine than the man who runs the machine.” If you want to understand how something works—or is failing to work effectively—you must ask the people who are involved in the daily nitty-gritty activities of your customer-to-cash streams.
In order to facilitate this, we use the ToC Thinking Processes—a set of tools specifically designed to help unlock “tribal knowledge” and help get the corporate politics out of the way of real and ongoing improvement.
After getting a little background about our client’s (or prospect’s) business and its situation in its industry, the first question we typically ask the executive and management team is this: “What are the top five or six things that you think are keeping your company from making more money tomorrow than it is making today.” Actually, we like to do this with their team assembled, but we hand out 3x5 index cards and ask them not to consult one another. Rather, each individual writes their top issues down—each on a separate 3x5 card.
We also ask them to tell us only the issue on the card. We don’t want what they think might be the cause.
For example, we want to see “Our prices are too high to be competitive.” We do not want, “Our prices are too high to be competitive because our manufacturing equipment is outdated and inefficient.”
We tell them, if the “because” factor they feel tempted to put on the same card with another issue is, in their mind, a top factor in keeping the firm from making more money tomorrow than today, then put it on a separate card.
When we get done collecting the cards, the next step is to get clarifications from the authors—sometimes a statement may be perfectly clear to the writer, but needs to be clarified further for a larger audience (or, perhaps, especially for us as outsiders). We also weed out duplicates, since there are typically duplicate or very similar responses when the process involves ten or 15 participants.
Once we are at this point, we take the team through the process of using these UDEs (Un-Desirable Effects) that they have written down for us to build a Current Reality Tree or CRT. This is one of the Thinking Processes that helps the organization begin to see their customer-to-cash stream as a unified cause-and-effect “system,” instead of thinking about what happens in this department or that department in relative isolation. You can read a simple explanation regarding Current Reality Trees here.
“Root causes” are the underived UDEs at the bottom of the CRT. Since they have no predecessors—they are identified as “roots” and are targeted for exploitation, following the Five Focusing Steps approach.
By the time we are done, we are generally getting comments like: “We’ve never seen our organization like this before.” Light bulbs are coming on all over the room and a clearer view of the very small handful of things that are actually keeping the company from making more money tomorrow than they are making today is beginning to emerge. In short, they are beginning to see—clearer than ever—their system’s constraint or constraints.
Notice, we are not asking them “What needs to be made more efficient?”, or “Where do you see the greatest opportunity for savings?” We are asking them what’s keeping them from making more money. Those are entirely different questions coming from two different realms—the former questions from cost-world thinking and the latter from Throughput-world thinking.
In answer to your question, the very best toolset for “self-assessment” is the ToC Thinking Processes. Anyone can learn to use them—and we encourage our clients to learn to use them without our assistance. But having someone with knowledge and skill in their application when the firm is getting started on a process of ongoing improvement (POOGI) can certainly give the company a kick-start toward improved profitability.
We would be delighted to hear your thoughts on this matter. Please leave your comments here, or feel free to contact us directly.