Abstract Number: Critical Issues about the Theory Of Constraints Thinking Process A. Theoretical and Practical Approach

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1 Abstract Number: Critical Issues about the Theory Of Constraints Thinking Process A Theoretical and Practical Approach Second World Conference on POM and 15th Annual POM Conference, Cancun, Mexico, April 30 - May 3, 2004 José Antonio Valle Antunes Júnior Universidade do Valle do Rio dos Sinos UNISINOS Av. Unisinos, 450, São Leopoldo / RS - Brazil Phone/ Fax: Marcelo Klippel Universidade do Valle do Rio dos Sinos UNISINOS Av. Unisinos, 450, São Leopoldo / RS - Brazil Phone/ Fax: André Luiz Koetz Universidade do Valle do Rio dos Sinos UNISINOS Av. Unisinos, 450, São Leopoldo / RS Brazil Phone/ Fax: Daniel Pacheco Lacerda Universidade do Valle do Rio dos Sinos UNISINOS Av. Unisinos, 450, São Leopoldo / RS Brazil Phone/ Fax:

2 ABSTRACT This paper presents some critical considerations about the Thinking Process of the Theory of Constraints TP of TOC developed by Eliyahu Goldratt. The article makes evident that the central consideration of the TOC consists in concentrating all efforts in the so called core problems. Also, the paper describes the techniques involved in the TP of TOC, showing that these techniques and methods could be used as stand alone basis with sufficient results. Finally, the article makes evident the qualitative feature of the TP of TOC that uses the Scientific Method for seeking the systematics of Structuring, Identification, Analysis and Solution of Problems. KEY WORDS: TP, TOC, Core 1.) Introduction The Theory Of Constraints is a relevant theme into the context of the discussions occurred at the scope of Operations Management at 80 s and 90 s. Although at the beginning, Goldratt had proposed a set of principals and techniques linked to Operations Management called OPT (Optimized Production Technology) just during the first years of 90 s he starts to explain the internal logic of Theory Of Constraints. To understand with more details the concepts of TOC, Goldratt emphasize the necessity to comprehend the called Thinking Process of TOC. 2.) Presentation of Basics Concepts of Thinking Process of TOC

3 The Thinking Process TP can be considered the Problems Solution, Analyses and Identification Method adopted at the more wide logic of TOC. Historically, the TP was proposed by the first time at the book What is This Thing Called Theory of Constraints and How Should it be Implemented (Goldratt, 1990). Later, Goldratt (1994) presents the TP at the book More Than LUCK..., that is a continuity of the book The Goal. The Problems Solution, Analyses and Identification Method developed by Goldratt has the objective of answering three essentials questions, as the following: a) What to change? b) What to change to? c) How to successfully cause the change? According to Alvarez (1996), the central proposition of Goldratt when the proposal of PP, consists of concentrating all efforts on the called core problems, that is, the problems that impact the system global performance in a significant way. According to Dettmer (1995) many undesirable effects of a specific system are caused by a much reduced number of core problems. Therefore, the simultaneous solution of the core problems allows assuring the elimination of undesirable effects. The first question (first step), what to change, is answered by the construction of the called Current Reality Tree and it has the objective of essentially define the core problems found at a specific system. In order to do it, the Scientific Method is used, which is based at the effect-

4 cause-effect logic and it has as objective and critical view of the analyzed reality. According to Kingman (1996), this step must be constructed from the teams, generally from a cross-functional logic that objective to analyze the core problems in depth. As positives points that it could be observed from the construction of the tree, Kingman (1996) observes: a) The possibility of providing a effective communication with the principals problems of the company; b) The common understanding of involved systems. The second step, what to change to, initiates from the core problems defined by the Current Reality Tree seeking to formulate an effective solution to eliminate the current problems that limit the global performance of the analyzed system. At this phase, the Techniques used are: a) Evaporating Cloud; b) Future Reality Tree. The more creative Technique which requires team members creativity, is entitled Evaporating Cloud. The Evaporating Cloud technique starts from a certain structured problem motivating the verbalization of the implicit presuppositions concerns of the actual conflicting positions or apparently existent. The technique aim at, through the systematic search of higher level creative solutions (synthesis), finding solutions that objectively ruptures these implicit presuppositions that would induce to the adoption of commitment practical solutions between the antagonistic positions in play.

5 The presupposition of the Evaporating Cloud Technique is that the process of problems solution, instead of requiring commitment solutions between two or more proposals in conflict, can be also solved with a higher level simple solution that eliminate the existents commitments between the two or more previous conflicting proposals. Goldratt use the called Dialectic Logic of problems approach. The idea does not consist of finding commitment solutions between the thesis and the antithesis of a certain problem. The Evaporating Cloud Technique starts from the faith that, at all cases, the possibility to generate a higher level synthesis from that the thesis and antithesis that are in play exists. According to Alvarez (1996), the utilization of Evaporating Cloud Technique is an exercise of creativity, at which it was tried to introduce new elements which are able to invalidate the existents presuppositions. (Alvarez, 1996, p. 77) In other words, there are certain presuppositions that support and / or ground both, the thesis and the antithesis at a certain problem, and the role of finding the creative solutions that allow attending both the presuppositions of thesis and antithesis belongs to Evaporating Cloud Technique. The ideas that allow to achieve this higher level synthesis are entitled by Goldratt as Injections Shingo (1996a) can be used for give an example, associated with the SMED System Single Minute Exchange of Die, from the utilization of the dialectic method and relationship with the Evaporating Cloud Technique. It is proposed a thesis as which the global costs can be reduced by the increase of batches sizes at the operations that demand high setup times. In opposition of this idea there is an argument antithesis that which the larger batches size result in a set of wastes derived from the increased of these inventories.

6 Apparently, these two propositions are not subject to conciliation and it is necessary to adopt a commitment solution, an intermediary one between the two arguments. This is the logic of manufacturing economic lot size. The injection for this problem, that does a higher synthesis from thesis and antithesis in play, is the fact that is possible to change the tools (setup times) in a much low time, lower than 10 minutes. In that case, it is possible to produce low batches in order to rupturing the presuppositions that were behind the conflict apparent and that conduce to the adoption of a commitment solution. From the proposed injections that must be effective in order to assure the effectiveness of adopted solutions, the called Future Realty Tree FRT is built. The FRT also starts from the logic of effect-cause-effect phenomenon in order to elucidate where it is desired to achieve with the proposed injections by the Evaporating Cloud Technique. The FRT is built from the proposed injections at the previous phase of the method. The FRT, in synthesis, has the objective of providing a visualization of how will be the future of the analyzed system, whether the proposed injections are put in practical. The third step of the method has the objective of answering the question of how to successfully cause the change. At this step, two basics techniques are used: a) Prerequisite Tree; b) Transition Tree. At this step, the idea consists in proposing a plan able to change the reality that is only possible to render if objectives actions are accomplished at the sense of the change. The first used Technique Prerequisite Tree starts from the presupposition of that, once the companies are composed from people always will appear some resistances and obstacles for the proposed

7 changes. The Goldratt objective consists in evidencing the eventual resistances for the proposed changes, in order to plan the actions that can rupture the presuppositions that support the existents obstacles. The operation of Prerequisite Tree is done through the establishment of intermediates objectives able to prevent the action of eventual obstacles for the change. These intermediates objectives must be verified until all obstacles are eliminated. Later, the Transition Tree is used, which, essentially, it associates each intermediate objective to an action to be accomplished. (Alvarez, 1996, p.86). In other words, the Transition Tree is responsible by the assembly of the objective actions plans that must, at least theoretically, lead to the elimination of the problems root causes. 3.) Critical Analyses of Thinking Process of TOC A critical analysis of the proposition and the utilization of the Thinking Process of TOC at companies in general allow evidencing the following topics: The TP of TOC presents a qualitative character based on the facts of reality, using the Scientific Method for the systematic search of the Structuring, Identification, Analysis and Solution of Problems. It is possible that, at a certain number of cases, is necessary to ally it to the conjecture of effect-cause-effect relations proposed by the involved team, qualitative facts derived from the empirical phenomenon observed at the practical of the Companies.

8 According to Norren at alli, the consensus trees seem work at some Companies but not in other (Noreen et alli, 1996, p.56). The authors suggest that it can occur due to the paradigms, concepts and techniques that constitute the basics presuppositions for the construction and structuring of the problems. If the people of the group works having as presuppositions different paradigms in terms of Operations Management (for instance, Just-In-Time and Just-In-Case paradigms), simply what does not constitute a problem for a certain professional, for example the existence of large production batches (Just-In- Case view), can constitute a problem to another professional, that is inside at a distinct paradigm, according that the existence of large batches constitute a serious obstruction for the improvements on the Productivity and Quality at the Company (Just-In-Time view). The trees are constructed from the paradigms professed by the team participants. Thus, the professionals that profess different paradigms will tend to structure the same problem at differed way. From this paradigm is constituted Theories and, as said Deming, it is impossible building the knowledge without the previous existence of a Theory. This discussion suggests the necessity to development a wide theoretical discuss concern the general techniques and principles of Operations Management. It must precede the trees proposed by Thinking Process of TOC. An important issue at the development of the Method consists in using the maxim conceptual precision possible. This will assure an effective sharing of the content of effect-cause-effect relations by the team members. If the concepts are not clearly explicated, the phrases content used will tend to difficult the development of the job at the scope of the analyzed Company.

9 The trees are constituted in an effective mechanism for the consensus construction concern the existents problems, theirs roots causes and the propositions for the solution of it. It is catalyzed by the existence of a common paradigm between the participants. Also, they are used as effective devices at sense of to communicate for the other people the knowledge generated during the elaboration process of the job. At the last sense they can used as an effective communication channel of the problems observed at the Companies. The techniques from the several phases of TP of TOC can be individually used with satisfactory results (Norren et alli, 1996). As individual techniques, the Current Reality Tree and the Evaporating Cloud are the more used at the practical reality. The Current Reality Tree can be used to establish systemically and rapidly the principals problems of a certain generic activity. The Evaporating Cloud is a technique that, using the creativity and the dialectic thinking, allows obtaining good solutions from the conflicting situations that apparently demand intermediates solutions of commitment. The problematic of auditing of different trees is also a relevant theme. Once the tree is built by the involved actors Work Team it is very important the validation process that following. It is relevant as can have a vice at source at the constitution of the work group not considering all possible views of the problem. So, it is essential that after the use of different techniques of the method an independent auditing must be followed by the people that know the elevated problems and that not have participated directly from the work process.

10 4.) Conclusions The considerations approached at the present article allow concluding that the TP of TOC must be used while a logic tool of Identification, Analyses and Solutions of Problems. A critical and discerning analysis from the utilization of TP of TOC show the actual dependence of the paradigm and of the respective theory adopted. Thus, the perceptions that are used at the process of Identification, Analysis and Solution of Problems in general depending of the faith and merits professed by the involved actors with the practical issues in theme. The involved actors influence widely and directly the process described above. It was observed that the utilization of techniques and tools of TP in an individual manner also allows achieving satisfactory results. Finally, it is important to emphasize that the utilization of TP of TOC for the analyses of the Productive Systems has the potentially of supporting objectively the implementation of improvements solutions turned directly to the process. 5.) References

11 ALVAREZ, R. R. Desenvolvimento de uma análise comparativa de métodos de identificação, análise e solução de problemas. Porto Alegre, Dissertação de Mestrado em Engenharia de Produção, Universidade Federal do Rio Grande do Sul DETTMER, H. W. Eliyahu M. Goldratt The Theory of Constraints: A Systems Approach to Continuous Improvement. Institute of Safety and System Mangement, GOLDRATT, Eliyahu M., COX, Jeff. A Meta. 12.ed. São Paulo: Educator, GOLDRATT, E. M. What Is This Thing Called Theory of Constraints and How It Should Be Implemented? New York, North River Press, GOLDRATT, E. M. Mais que Sorte... Um Processo de Raciocínio. Editora Educator, São Paulo, KINGMAN, O. The Thinking Processes and Effective Problem Solving. In: Make Common Sense a Common Practice. Proceedings do 1996 APICS Constraint Management Symposium and Technical Exhibit, april 17-19, p , Detroit, MI, NOREEN, Eric, SMITH, Debra e MACKEY, James T. A Teoria das Restrições e suas implicações na contabilidade gerencial. São Paulo: Educator, SHINGO, Shigeo. O Sistema Toyota de Produção Do ponto de vista da engenharia de produção. Porto Alegre: Bookmann, 1996a.

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