Business Question

TP Application Paper Content

TOC applied to services. Write a comprehensive paper that applies the TP tools to a PSTS, educational or other service you are familiar with using either the “snowflake” or the “three-cloud” method as described in the text. The paper should include at a minimum a (1) CRT (2) EC, and one of the following (3) FRT with NBR; or TRT with PRT; or an S&T. In the narrative of the paper, describe the problem, situation, or system, how it was selected, the logic used or applied, the procedure, and the TP outputs.

Find attached relevant chapters. Book used is Theory of Constraints by Cox , J. F., & Schleier, J. G

TP Application Paper
Write a comprehensive paper on the application of the TP tools to a selected problem, system,
or situation using either the “snowflake” or the “three-cloud” method as described in the text.
The paper should include both the CRT and the EC applied to a real situation, process, or
problem. In the narrative of the paper, describe the problem, situation, or system, how it was
selected, the logic used or applied, the procedure, and the CRT outputs along with the generic
cloud or core conflict.
Select a real problem, situation, process, or issue to apply the TP tools. Explain the rationale for
its selection.
Use either the snowflake or three-cloud method as described in Chapter 25 on the text. Walk
the reader through the steps used using third-person narrative, figures, and tables (as needed).
Use APA formatting for the entire document. Make sure the tables and figures are formatted
per APA.
Include the one or more Current Reality Trees (CRTs) to describe the current situation.
Include one or more Evaporating Clouds to describe the generic or core conflict.
Evaluate the results using the Categories of Legitimate Reservation (CLRs).
Provide a summary of the process and an interpretation the results or expected benefits.
The primary goals of this assignment:
1. Does the paper demonstrate that you have a fundamental knowledge of TOC and the
Thinking Process tools?
2. Does the paper achieve its intended purpose to apply the theory to a real experiential case?
The TP application papers will be graded using the the following grading rubric. Since this is a
graphic-intensive activity of creating figures, it is important to understand proper APA
formatting. For those who may not have used a graphic program before, I suggest using
PowerPoint to create the figures/charts and then paste them into the Word document.
TP Application Papers Grading Rubric
Selected topic content, and
appropriate use of TP tools
Format, organization, &
completeness
APA style
Writing, grammar,
punctuation
Selected content area covered Neat, well-organized, use of
All tables & TP charts
and addressed thoroughly.
APA headings. Correct font,
formatted correctly using
Superior writing styl
90- Outstanding use and
size, & margins. Exceeds
APA and are easy to read.
writing errors. Exce
100 understanding of TP tools.
expectation for amount of
Tables & charts are
grammar & punctua
Paper demonstrates creativity content, excluding front & back referenced in the
and depth of knowledge.
matter.
narrative.
Selected content areas covered
Neat, organized, use of APA
and addressed well. Good use
All tables & charts
Good writing style. F
80headings. Correct font, size, &
and understanding of TP tools.
formatted correctly using errors. Good use of
89
margins. Meets expectations
Paper demonstrates some
APA.
punctuation.
for amount of content.
knowledge.
Selected content areas covered
Organized. Correct font, size, &
Writing style meets
and addressed adequately. Fair
70margins. Barely meets
Minimal use of APA for
acceptable standard
use and understanding of TP
79
expectations for amount of
tables and charts.
writing errors. Gram
tools. Paper demonstrates a
content.
punctuation need w
little knowledge.
Selected content areas
Writing style does n
sporadically covered or
Some organization. Fonts,
minimum acceptabl
60- addressed. Missing key
sizes, & margins not to
APA not properly used in
standards. Numerou
69 elements of understanding in
specifications. Less than
document.
errors. Lacks gramm
the use of TP tools. Paper
expected.
punctuation.
demonstrates little knowledge.
Selected content areas missing
Writing style demon
information. Turned something Lacks organization. Fonts,
serious deficiencies
50- in. Obvious lack of
sizes, & margins not to
No APA format. Used
errors throughout th
59 understanding or use of TP
specifications. Length of paper inappropriate technique. Does not demonstra
tools. Paper has little redeeming is unacceptable for the topic.
understanding of gr
value.
punctuation rules.
Common problems found on previously submitted assignments.
1. Read the assignment instructions carefully. Turn in a complete assignment. Students
generally lose points needlessly because they omit major parts of the assignment. Re-read my
instructions on the Grading and Assignment Info before you hit submit. Meeting the
requirements is the minimum standard.
2. Use the logic. Many students use improper or misuse the prescribed logic of the tool. Each
TP tool demands proper use of either sufficient cause (CRT) or necessary condition logic (EC).
This will become more important as you progress in the course. The best approach to testing
logic is to use if…. then… statements for sufficiency diagrams such as the CRT. Use the logic
statement, “in order to…I must have…for each entity relationship in necessity diagrams such as
the EC. This is what I do to test your logic, so you should too.
3. Construct the tool properly. The CRT should flow from causes to effects. It is easier to read
from the bottom up. Don’t forget that the CRT can also utilize “logical and” connectors. For the
EC, the flow is from necessary condition to the objective. Place the arrows in the correct
direction.
4. Make your assumptions transparent. This is particularly important with the EC. Every
connection should have at least one assumption (p. 746). Check the validity of your
assumptions. Pages 742-746 provide a solid method for this.
5. Use the categories of legitimate reservation to check for errors in thinking. You may need to
utilize someone else in this process. I guarantee you will not find lapses in your logic if you are
the only one reviewing this. The tools are meant to communicate and verbalize problems. They
are not just academic exercises.
6. Use negative branch reservations, if needed, to identify potential unintended consequences,
if needed. It really makes a difference in the thinking and makes the problem much clearer.
7. The biggest error most students make is to have a preconceived solution in mind before
starting the process. In fact, some students never define the problem, only the solution, which
really does not help the process. The TOC approach is to understand first “what to change.” The
TP Application Paper 1 assignment DOES NOT ask you to define a solution–that is part of TP
tools paper 2. Yet, some students immediately wanted to define a solution (even to the point of
including it as part of the UDEs) and then build their diagrams around that. You must
understand the problem first. (Remember the first layer of resistance?). Don’t be like everyone
else who has an unsupported opinion about how to a solve problem. Those people have not
thought about it enough, but you should be able think it through using the TOC approach.
8. Learn how to write in the technical genre. Make your papers professional looking. You are in
graduate school. Meeting the requirements will only be enough to earn a C and that is not
acceptable. Buy the APA Manual. You will use it for every class in the program. Last, always
proofread your work more than once and use both the grammar and spell checker. That is
what I do when I read your papers. There is no excuse if I catch silly errors. Not making silly
mistakes is what sets you apart from everyone else in the workplace. You should be able to
write an error-free paper using APA format.
CHAPTER 25
Thinking Processes Including S&T Trees
Lisa J. Scheinkopf
Introduction: Anybody Can Be a Jonah!
If I have ever made any valuable discoveries, it has been owing more to patient attention, than
to any other talent.
—Sir Isaac Newton
The Thinking Processes (TP) are the tools of Jonah, the beloved physicist-mentor of The Goal’s
Alex Rogo (Goldratt and Cox, 1986). In order to really gain benefit from the use of the Theory of
Constraints (TOC) TP, you need to adapt the mentality and discipline of thinking like Jonah. You
don’t need to be born a genius. You don’t need to have a PhD. You do need the conviction to
think clearly, and to consider yourself a scientist. According to Dr. Eli Goldratt, “no exceptional
brain power is needed to construct a new science or to expand on an existing one. What is
needed is just the courage to face inconsistencies and to avoid running away from them just
because ‘that’s the way it was always done’” (Goldratt and Cox, 1986, Introduction). This leads
us to the principle on which all of TOC is based—the concept of inherent simplicity. Goldratt
discusses this concept in The Choice, explaining that “the key for thinking like a true scientist is
the acceptance that any real life situation, no matter how complex it initially looks, is actually,
once understood, embarrassingly simple” (Goldratt, 2009, 9).
Any intelligent fool can make things bigger, more complex, and more violent. It takes a touch of
genius—and a lot of courage—to move in the opposite direction.
—Albert Einstein
Goldratt’s description of science and his concept of inherent simplicity are not new. Not
surprisingly, his messages can be traced to one of the most important scientists of all time, Sir
Isaac Newton. Newton’s Rules of Reasoning in Philosophy (Newton, 1729) have guided scientists
since the early 1700s to recognize that “nature is simple and consonant with itself,” and thus
few causes are responsible for many effects rather than the other way around; to avoid
attributing more causes to an effect than are both true and sufficient to explain its existence;
and to enthusiastically analyze and learn from (rather than ignore) the situations in which reality
contradicts (or appears to contradict) our understanding of it (see Appendix A on the McGrawHill website: http://www.mhprofessional.com/TOCHandbook).
Copyright © 2010 by Lisa J. Scheinkopf.
When it comes to the use of the TP, people generally fall into two categories. The first consists
of the people who make the decision to adapt the mentality of a scientist and the second
category consists of the people who don’t. Those in the former category create meaningful
improvements. They work hard at it—they exercise the muscle between their ears rigorously—
but instead of feeling drained, they are energized not only by the results, but by the expansion
they have made to their knowledge and understanding of the world around them.
What are the TP tools? Why are they so effective in analyzing business and personal problems?
How is the application of logic, language, and structure brought together for penetrating
analysis of problems and conflicts? How do the TP tools then help in laying out the transition
from an undesirable present to a desirable future? How do they help protect a plan from
unanticipitated pitfalls? How do they link together as an integrated system of logical capabilities
for bringing about positive change? I hope to answer these questions in a way to show that
almost anyone willing to do the work can achieve deep insight and make significant and
meaningful improvements to environments both simple and complex; with step-by-step
instructions on how to do it.
I begin with discussion of the tenets in logic and fundamental assumptions in philosophy that
underlie the TOC TP. Then I illustrate how the discipline of diagramming helps in guiding our
analysis. Each of the TP tools is discussed in sequence with instructions on how to use it. The
chapter moves on to examples, some of them real application cases.
The Basic Building Block—Cause-and-Effect Logic
You see there is only one constant. One universal. It is the only real truth. Causality. Action,
reaction. Cause and effect.
—The Merovingian, The Matrix Reloaded
When we accept the premise of inherent simplicity, we accept the premise that every element
of a system is connected to the system via cause-and-effect relationships with the other
elements of the system. This means that the better our capability to uncover and understand
the actual cause-and-effect relationships that exist today, or that we intend to put into place
tomorrow, the better our capability to improve.
What do we mean when we say there is a cause-and-effect relationship? We mean that by the
mere fact that one condition exists in a system, another condition is an inevitable result. Let’s
look at a simple example which may seem trivial because it is obvious, yet it does illustrate
clearly the basic building block of the TP.
It is evening, and you have just arrived home from a day at work. You open the door to your
home and turn the switch that operates the lamp in the hallway to the “on” position. The lamp
doesn’t turn on. What could be the reason? After verifying that you did in fact turn the switch
to “on” rather than “off,” you check to see if the lamp is plugged in. Why? Your life experience
has led to your intuitive understanding of a cause-and-effect relationship—you know that if the
lamp is not plugged in, the light will not turn on.1 You find that the lamp is not plugged in. Aha!
You confidently plug the cord into the wall, flick the switch on again, and—oh no, the light is still
not on. What do you check next? Your brain goes through a quick checklist of potential causes
for the light not turning on. Do you change the light bulbs? Do you turn on another light in your
home to verify that the problem is isolated to the lamp and not a larger issue such as the circuit
breaker or fuse, or even an electricity outage in the neighborhood? Any of these would be
sufficient to cause the lamp to not turn on, so you keep checking—in the order that your
intuition, which is based on experience with similar situations, tells you is most likely to least
likely—until you uncover the cause, make the appropriate change, and turn on the light.
FIGURE 25-1 Cause-and-effect map—lamp does not turn on.
Figure 25-1 graphically illustrates the cause-and-effect map you built in your mind. Please note
that as you gained more information, your cause-and-effect mental map enlarged and you
better understood the situation. You checked directly the facts you could check directly, and you
modified the “entities”—your verbalization of the facts—as you went along. In the third
scenario, when you finally looked outside at the rest of your street and found that it, too, was as
dark as your lamp, you predicted and verified an effect that gave credence to a potential cause.
If the street lights and neighbors’ lights were on, you would continue checking for alternative
causes.
You also may not have been satisfied that you had at last verified the cause—you may have
decided to speak with a neighbor or call the utility company. If they did in fact verify the power
outage, the resulting cause-and-effect map would have looked like Fig. 25-2.
FIGURE 25-2 Cause-and-effect—power outage in the neighborhood.
In this example, you instinctively conducted checks on the hypotheses of cause-and-effect you
were making, and you used a process to do so.
1. You identified a problem. The light doesn’t work.
2. You hypothesized a cause. The switch is not turned on.
3. You checked your hypothesis by checking for two conditions:
a. You verified the condition. You checked to see if “switch is not turned on” was actually the
case. It was, in fact, turned on, so you hypothesized a different cause, and then verified that the
condition existed.
b. You validated the cause-and-effect connection. Was the fact that the lamp was not plugged in
really the cause for the lamp not turning on? You checked directly by plugging in the lamp and it
still did not turn on! So, back to hypothesizing a condition that could cause the lamp to be out
and then validating the cause-and-effect connection.
When you adapt the mentality of the scientist, you will do these checks automatically. As we
make our way through the chapter, we will expand our understanding of these a template for
the detailed process of checking is provided.2 It is also provided in Appendix B, which is located
at the end of the chapter for your convenience.
While the example I used may seem trivial, the scientific process is not. Most of us simply are
not practiced in using or communicating cause-and-effect logic. Dr. Goldratt recently conducted
an experiment. He asked about 40 people—all were intelligent, educated adults ranging in age
from 20-something to 60-something, ranging in professions from student to CEO—to think of
and then write a sentence that contained the word “because.” The only qualifier for the
sentence was that it needed to be a sentence that the individual writing it believed. In other
words, they were each asked to make a statement of cause and effect that they believed to be
correct. There were a wide variety of sentences, such as “I discipline my children because I care
about their well being” to “Americans drive SUVs because they don’t care about the
environment” to “My boss and I don’t get along because . . .” to “The cake tasted bad because
the recipe was lousy.” Dr. Goldratt then asked the group to apply the simple checks to their
statements. In the vast majority of cases, the individuals wrote to him and said that once they
applied the checks, they came to realize that their original statements were wrong.
Think about how many decisions are made every day based on assumptions of cause and effect.
If the group of 40 is any indicator—and I have no reason to believe they are an exception to the
general population—I cannot help but think how many decisions are wrong. People are hurt
and organizations do not improve, due to our carelessness in the use of “because.” The only
difference between using cause-effect thinking in a situation like the lamp and a situation in
which the direction of an organization is set is the decision to really check the assumptions that
would drive a given course of action.
When you develop the habit of using cause-effect, using it to make the tough decisions will be
as natural as using it to figure out why the lamp does not turn on. I cannot stress the
importance of practicing—of exercising your brain muscle to think clearly, and to regularly map
the cause-effect statements you use, hear, and read (the sentences you use that contain the
word “because”). This is the best preparation you can do for when you need to reach for the TP
to make the big improvements you care about. By incorporating into your daily practice the use
of the basics that I introduce in the next section, you will have everything you need to use—and
even develop for yourself—the TOC TP.
Basic Terms and Mapping Protocol
Cause and effect are two sides of one fact.
—Ralph Waldo Emerson
An entity is the description of an element of the situation. An entity can be an effect or a cause.
Keeping in mind our desire to think and communicate clearly, entities are stated as simple and
complete sentences. As we make our way through the various application tools, we will identify
special types of entities. Note that an entity is not a statement of cause-effect, which is a
description of the cause-and-effect relationship between at least two entities.
An arrow is used to illustrate a cause-effect relationship between two entities. It is the graphical
representation of the word “because.” The entity at the pointed end of the arrow is the effect,
and the entity at the nonpointed end of the arrow is the cause (see Fig. 25-3).
An And Connector3 is an ellipse or a straight line across the cause-and-effect arrows used to
illustrate a “logical and” relationship between multiple entities that together form a single cause
for an effect. All entities that are “captured” by the “and connector” are required as causes for
the effect to occur. To better understand “logical and,” see Fig. 25-4.
Entity B is an effect of both entities A and C. Neither Entity A nor Entity C can cause Entity B
alone, both must exist. Moreover, when both exist, Entity B is an inevitable result. Let us use a
simple example. It is your friend’s birthday, and you, along with a group of his other friends,
have decided to make a surprise party to celebrate the occasion. You are all gathered in his
home, and the big moment arrives. He opens the door, walks in, and you all jump up and shout,
SURPRISE! Is he surprised? Yes, but only if he was not expecting the party. See Fig. 25-5 for an
illustration of the cause-effect involved. Note that if either of the two causal entities did not
exist, he would not be surprised by any one of them.
Figure 25-6 illustrates a simple cause-effect tree. There are 12 entities and 8 cause-effect
relationships. Of the 12 entities, 5 are causes only, 2 are effects only, and 5 are both causes and
effects. Can you identify the entities, causes, effects, and cause-effect relationships depicted in
the tree?4
We have already established two of the fundamental assumptions of TOC: the concept of
inherent simplicity and that anybody can think like a scientist if they choose to do so.
FIGURE 25-3 Entities.
FIGURE 25-4 The “and” connector.
FIGURE 25-5 Example of “and” connector.
FIGURE 25-6 A simple cause-and-effect tree.
When I say “fundamental assumptions,” I mean that these are two entities that TOC takes as
“facts.” With just these two assumptions as our guide, we can bring to light three more very
important pieces of the foundation on which all of the powerful TOC applications are based, and
on which your use of the TP will be most productive and beneficial:
1. People are good.
2. Every conflict can be removed.
3. There is always a win-win solution.
Please refer to Fig. 25-7, which is a small cause-and-effect tree that illustrates how these three
basic elements of TOC are derived.
Start at “the bottom” of the tree, at Entity 1, which summarizes the essence of the concept of
inherent simplicity. When we couple that with Entity 2, the definition of “conflict,” it becomes
obvious that “conflict” is not a natural state, and thus must be man-made (Entity 5, given the
definition of “man-made” in Entity 4). Now go to the left side of the tree. Again, we start with
the summary of the concept of inherent simplicity in Entity 1. If you agree that human beings
are actually part of nature (Entity 6), then it would become obvious also that our natural state
as human beings is, as described in Entity 7, harmonious—consonant with the rest of nature, in
harmony with ourselves and other people. It is no wonder, then, that Goldratt insists, “people
are good” (Entity 8). Entity 11 states that people have the innate ability to think logically. When
we combine this with what we have by now established—that people are naturally harmonious
and conflicts are man-made—we have no choice but to recognize that people have the innate
ability to eliminate conflicts (Entity 9) and the innate ability to create harmonious solutions
(Entity 12). The result of these are the TOC premises (verbalized in Entities 10 and 13) that
“every conflict can be removed” and “there is always a win-win solution.” I encourage you to
study this tree, and to use it for practicing your own use of cause-and-effect logic. Would you
add or modify any entities? Are the causalities solid? What tests would you conduct to verify
the entities or validate the causalities represented? If you agree with the tree, what else stems
from it? Can it help you to explain any of your own life experiences?
FIGURE 25-7 Deriving the three basic elements of TOC.
We are at a crucial point in your TOC TP education. We have logically derived some fundamental
concepts that TOC views as “facts,” which formulate basic principles guiding the use of the TOC
TP tools:
1. The concept of inherent simplicity: Nature is simple and consonant (harmonious) to itself.
2. People are good.
3. People have the innate ability to think logically.
4. Every conflict can be removed.
5. There is always a win-win solution.
I guarantee that your use of TOC will be much more fruitful if you use these five principles to
guide your way. It is also likely that you are not so convinced that they are “facts.” I would ask
you, then, to simply agree that they are a possibility. Once you agree that they are a possibility,
and you consider just the possibility when you go about your daily problem solving, then I have
little doubt your use of the TP will be worthwhile for you.
The last of the human freedoms: to choose one’s attitude in any given set of circumstances, to
choose one’s own way.
—Viktor Frankl
The rest of the chapter is devoted to teaching you the various “standard” TOC TP. We start with
tools that can be used to help you become more productive on a day-to-day basis, and then we
move into the tools that are used in a “full analysis”—the systematic approach to answering the
three questions of change. Please note that all of the “standard” TP are simply applications of
what we have covered thus far in this chapter. If you read no further, and simply put into
practice what we have covered up to this point, you would have the ability to derive the tools
yourself when the need arises.
Tools for Daily Decision Making and Problem Solving
While we are free to choose our actions, we are not free to choose the consequences of those
actions. Consequences are governed by natural law.
—Stephen Covey
Everything we do, every action we take, places a cause into reality and the effects (results) of
the cause (our action) inevitably happen. The results (effects) of our actions do not have a
choice, but the actions we take (the causes we put into motion) are a result of the choices we
make. An action is putting in motion a conscious or not-so-conscious decision. Whether we are
consciously or not-so-consciously doing so, we are making many decisions every day, day in and
day out. Many of the decisions we make not only impact us personally, but also have an effect
on others—our partners, families, teammates, associates, clients, suppliers, shareholders,
communities, etc. Of course, the decisions made by others quite often have an effect on us.
Living is a constant process of deciding what we are going to do.
—Jose Ortega
Negative Branch Reservation (NBR)
We can evade reality, but we cannot evade the consequences of evading reality.
—Ayn Rand
Think about how often well-intentioned actions have led to undesirable consequences. The
Negative Branch Reservation (NBR) is the standard TOC TP tool with which we use cause-andeffect thinking to predict, as best we can, the effects of a given cause (e.g., action), and modify
our idea before taking action in order to prevent undesirable consequences of taking the action.
Situations in which the NBR is most commonly used are:
• Someone has presented you with an idea that they think is great, but from your vantage
point, you see potential problems stemming from it. (You are thinking, “Yes, but . . .”)
• You are presenting (or preparing to present) someone with an idea you think is great, but
from their vantage point, they see (or might see) potential problems stemming from it. (They
are thinking, “Yes, but . . .”)
• You have an idea, and your intuition is telling you that your idea is still incomplete. (You are
thinking, “Yes, but . . .”)
The NBR maps the cause-and-effect relationships between an idea (the cause) and the
undesirable effects (UDEs) that are predicted to stem from that idea (cause). It is then used to
modify (typically by expanding on) the idea in ways that would prevent the UDEs from
becoming reality.
With the NBR, we introduce the entity type injection. An injection is an entity that describes an
element of an idea (solution) that is intended to be implemented. Injections are always entry
points to a tree such as the cause-effect trees just discussed. They represent elements of the
system that do not yet exist in the system, but that will be consciously injected into the system
in order to cause the changes desired.
Figure 25-8 illustrates a simple NBR. Note that the only entry points to the tree (entities that are
causes only) are either elements of the system that exist today (and therefore can be checked to
exist in the system today) or injections (elements of the system that do not exist today but are
intended to be injected into it in order to cause the change). Every entity that is an effect
(entities that have at least one arrow pointing into them, whether they are also causes and have
arrows pointing from them) is stemming from an injection, and thus does not exist in the
current environment. Therefore, these entities are predicted to become part of the future state
of the system.
I want to stress the importance of considering the reason that you or others have generated the
idea in the first place—the benefits that the idea, once implemented, are intended to produce.
Acknowledging these benefits will provide you with the stamina to work through the negative
branches of your own ideas to achieve the benefits. And, to communicate your reservations
about other’s ideas in a way that they will understand you are not trying to throw out their
entire idea and its benefits, you just want to trim the potential negative ramifications. As a
result, you will foster a spirit of collaboration rather than confrontation.
Constructing a negative branch is simply using the rules of cause and effect to clarify, validate,
and resolve a concern over a potential negative ramification of an idea. The major steps are:
1. Write the idea as an entity. If there are multiple elements of the idea, try to write each
element as a separate entity. Often, it is just one or two aspects of the idea that are responsible
for the concern and this will help you illuminate only the problematic elements of the idea.
FIGURE 25-8 Simple NBR.
2. Make a list of the pros (benefits) and cons (concerns) of the idea. Write the negative
outcomes that you are predicting as entities—these are the predicted UDEs.5 Again, try to write
each element as a separate entity. Your list of cons of the idea may contain two types of
concerns:
a. The first type of concern is consequences that would occur once the idea has been
implemented. This is the type of concern that the NBR addresses.
b. The other type of concern is an obstacle. In this case, the concern is not with the idea itself,
but rather with things that would get in the way of implementing it. The TOC TP tool that is used
to deal with obstacles is the Prerequisite Tree (PRT), which will be described later in this
chapter.6
3. Using the mapping protocol discussed earlier in this chapter, connect the injection entity (or
entities) using cause-and-effect logic to the predicted UDEs. If you are predicting several UDEs,
you may choose to build a single NBR that would encompass some or all of the predicted UDEs,
or a separate NBR for each predicted UDE.
4. Check the validity of the cause-and-effect relationship and make adjustments so that it
reflects your full hypothesis. This effort will likely lead you to add additional entities and layers
along the way, as you make your concern clearer and clearer through the mapping process.
Refer to the simple checking process discussed earlier in the chapter.
a. Verify the existence of the causal entity. An NBR is triggered by some aspect of the current
reality that, when combined with the future that is going to be created, will hypothetically cause
the undesirable consequences. What is that condition, and does it really exist?
b. Validate the cause-and-effect connection between the hypothesized cause and the predicted
undesirable consequence. There are usually simple “mind-experiments” you can do, which
would either prove the hypothesis wrong or add confidence in its validity.
c. Don’t be surprised if you find that a key assumption you were making was actually incorrect,
and you discover that the idea would not (or most probably would not) lead to the negative
outcome with which you were initially concerned.
5. Now it is time to “trim the negative branch.” Identify the place in the tree where the
transition from “neutral” to “negative” occurs. In Fig. 25-8, this would be where entities 7 and 3
cause entity 8. It is at this intersection where we identify an additional idea that, if
implemented, would either prevent 8 from occurring, or even replace 8 with an effect that
would become an additional benefit of the solution. Check to make sure that this new, added
injection does not lead to more ramifications that are negative. If it does, either replace it with a
different injection or add an additional injection to trim the new negative branch.
In Chapter 24, Oded Cohen provides detailed step-by-step instructions for constructing and
solving negative branches. A great example of a negative branch is in Chapter 8 of Eli Goldratt’s
book, It’s Not Luck (1994, 53–58). I will also provide an example of an NBR later in this chapter,
when I review the use of a Strategy & Tactic Tree.
Evaporating Cloud (EC)
A cloud does not know why it moves in just such a direction and at such a speed. It feels an
impulsion . . . this is the place to go now. But the sky knows the reason and the patterns behind
all clouds, and you will know, too, when you lift yourself high enough to see beyond horizons.
—Richard Bach, Illusions
The second standard TOC TP tool that is used on a regular basis is the Evaporating Cloud (EC).7
The Cloud is the tool that enables us to eliminate any conflict, and paves the way for a win-win
solution. In a world where conflicts do in fact exist, and in which nearly everyone believes that
the only way to deal with a conflict is to compromise (which typically means that all parties
settle for less than what they really need in order to “meet in the middle”), why is TOC so bold
to claim that every conflict can be eliminated?
We look no further than the concept of inherent simplicity for the answer. A conflict is a
situation in which each side thinks that it needs something that is in direct contradiction with
(cannot coexist with) what the other side thinks that it needs. If we accept Newton’s statement
that nature is “always consonant (harmonious) to itself,” then we must accept that in reality,
there are no real contradictions. It must be, then, that any conflict contains an erroneous
assumption that blocks the ability for each “side” to get what it needs, and is thus blocking what
should otherwise be a naturally harmonious reality.
Eli and Efrat Goldratt provides an excellent explanation in The Choice (Goldratt, 2009, 46–47).
Suppose that we have two different techniques to measure the height of a building. And when
we use them to measure the height of a specific building we get two very different heights.
Facing such an apparent contradiction no one would say, let’s compromise; let’s agree that the
height of this building is the average between the two measurements.
What we would say is that somewhere along the line we have made an erroneous assumption.
We’ll check to see if, in the time that passed between the two measurements, additional floors
were added. If that’s not the case, we’ll explore if our assumption—that each of the
measurements was carried out properly—is correct. If they were, we’ll look for an erroneous
assumption in the techniques themselves; we’ll explore the possibility that one of these two
techniques is faulty. In extreme cases, we’ll even doubt our understanding of height. But we’ll
always look for the erroneous assumption and never contemplate the possibility of
compromise. This is how strong our belief is that there are no contradictions in nature.
In other words, I say, when we face a conflict, especially when we cannot easily find an
acceptable compromise, let’s do exactly the same thing we do when we encounter a
contradiction; let’s insist that one of the underlying assumptions is faulty. If, or should I say
when, we pin down the underlying assumption that can be removed, we remove the cause of
the conflict; we solve the conflict by eliminating it. (Used with permission by E. M. Goldratt, ©
E. M. Goldratt. All rights reserved.)
Up to this point, we have been discussing cause and effect in terms of “sufficiency.” (See Fig. 259.) To say that “Y” is an effect of “X” is to say the following:
• If “X,” then we must have “Y.”
• “Y” exists because “X” exists.
• If “X” exists, then we know that “Y” must exist. If “Y” exists, “X” may not—something else
might cause “Y” to exist.
When viewing cause and effect in terms of “necessity,” we are looking at conditions that must
be in place in order for something (e.g., an objective) to be able to exist. To say that “B” is a
necessary condition for “A” is to say the following (see Fig. 25-10):
• In order to have “A,” we must have “B.”
• We cannot have “A” unless “B” is in place.
• If we do not have “B,” then “A” is impossible.
• If “A” exists, we know that “B” must exist. However, if “B” exists, “A” may not—additional
conditions may be necessary to cause it.
FIGURE 25-9 Sufficiency illustration.
FIGURE 25-10 Necessity illustration.
FIGURE 25-11 Cloud illustration.
The EC consists of five entities, and the arrows connecting them indicate the logic of necessity
(see Fig. 25-11). The conflict itself—the conditions that are perceived as needed but that are in
direct contradiction with each other—are described in the D and D′ entities of the Cloud. “D” is
a necessary condition for “B” and “D′” is a necessary condition for “C.” Both “B” and “C” are
necessary conditions for “A.”
Once a Cloud is written, it provides several places for us to search for and locate the invalid
assumption that is forcing the conflict—the perceived need for a contradiction (D and D′). If we
could figure out that B is not really a necessary condition for A, then D is no longer necessary,
and the conflict would be eliminated. Or, if we could figure out that D is not really a necessary
condition for B, then it is no longer necessary, and the conflict could be eliminated. Or, if we
could figure out that C is not really a necessary condition for A, then D′ is not needed and the
conflict would be eliminated. Or, if we could figure out that D′ is not really a necessary condition
for C, then it is no longer necessary and the conflict could be eliminated. Or, if we could figure
out that D and D′ are not really contradictions to each other and could actually coexist, then the
conflict could be eliminated!
Necessity is not an established fact, but an interpretation.
—Friedrich Nietzsche
The Cloud is used to articulate any problem as a conflict, find the erroneous necessary condition
relationship, and establish an injection that creates the path for a solution in which the conflict
is fully eliminated. Some of the generic situations in which a Cloud is used are:
• Being caught between a rock and hard place—a decision needs to be made, and the only
options available mean meeting the needs of one side and sacrificing the needs of the other.
• Eliminating gaps between authority and responsibility (the main cause for “firefighting” in
organizations).
• Any argument between individuals, teams, organizations, and communities.
When TOC is implemented in operations, improving flow (reducing lead time) becomes an
explicit, primary objective of the operation. Once the flow is put under control of the solutions
such as Drum-Buffer-Rope (DBR) and Buffer Management (BM), the Process of Ongoing
Improvement (POOGI) is put in place, in order to constantly improve the flow. The POOGI
process for a make-to-order (MTO) manufacturer consists of documenting the answer to the
question, “What is the order waiting for?” every time an order is delayed (not moving) for 10
percent of the production lead time. Periodically (e.g., weekly), a Pareto analysis is performed
on the sources8 of all such delays that occurred for orders that the priority system (BM)
indicated were at risk of becoming late. Teams are then put to the task of analyzing and
eliminating the major sources of delay.9 The Cloud is a critical tool that teams use to analyze
and solve the major source of delay. An example of this is provided as the steps to use an EC are
described. You will also find detailed guidelines for using the Cloud on a day-to-day basis in
Chapter 24.
TABLE 25-1 Examples of D and D′ Conflicts
1. Write the D and D′ entities of the Cloud. Write them in a way that it is obvious that they are
mutually exclusive. Some examples are in Table 25-1.
Our example company makes heavy steel products. In order to form and machine the steel to
their customer specifications, the process includes heat treat—putting the product in large
ovens to heat the steel and then placing the product in a tank of liquid (quench tank) to cool it
rapidly and bring it to possess the metallurgical properties needed. The weekly POOGI Pareto
analysis revealed that the most frequent answer to “What is the order waiting for?” was
“Waiting for heat treat.” A POOGI team was assigned to analyze and eliminate heat treat as a
major source of delay. As they reviewed the data, they found that the vast majority of the
delays could be further classified as “green10 orders waiting for the assigned quench tank to
become available.” They began to construct the Cloud (Fig. 25-12).
2. Write the corresponding B and C entities.
• B should answer the following questions:
• For what is D needed?
• What need will not be met if D doesn’t materialize?
You should be able to fill in the blanks to the following statements:
• B won’t happen without D.
• In order to have B, we must D.
FIGURE 25-12 Cloud example 1.
• C should answer the following questions:
• For what is D′ needed?
• What need will not be met if D′ doesn’t materialize?
You should be able to fill in the blanks to the following statements:
• C won’t happen without D′.
• In order to have C, we must D′.
• The following check will also help:
• If D exists, then C cannot.
• If D′ exists, then B cannot.
The POOGI team’s analysis led them to understand the internal policy that forced orders to wait
for quench tanks. It was not the lack of usable quench tanks in the company; rather it was the
unavailability of the specific quench tank defined in the order’s routing. The company had
previously set a policy that allowed production managers to move orders to capable work
centers other than those specifically identified in the routing when the priority system indicated
that the order was becoming at risk of being late (yellow or red) or already late (black). In order
to avoid “unnecessary expenditures” of time (making changes to paperwork) and money
(transportation costs to move the product from one plant to another), the company did not
allow such “exceptions” for “green” orders. Our steel products company’s Cloud now looked like
the illustration in Figs. 25-13 and 25-14.
FIGURE 25-13 Cloud example 2.
FIGURE 25-14 Cloud example 3.
Identify A, the mutual objective of B and C. Similar questions will enable you to verbalize the
objective.
You should be able to fill in the blanks to the following statements:
• [A] won’t happen without [B] and [C].
• In order to have [A], we must [B] and [C].
Our steel products company POOGI team completed their Cloud.
3. Surface the assumptions of each of the necessary condition relationships and identify those
that are invalid in the situation of conflict being analyzed.
The Cloud (as well as the PRT) utilizes the logic of necessary condition. Figure 25-15 illustrates
the relationship between this logic and the logic of cause and effect that we have been using
thus far.
FIGURE 25-15 The relationship between necessary condition and cause-and-effect.
By understanding this relationship, you can surface—and check the validity of—the assumptions
that are being made by using some simple questions and fill-in-the-blank statements:
• In order for A, we must11 B, because __________.
Why can’t A happen without B?
• In order for A, we must C, because __________.
Why can’t A happen without C?
• In order for B, we must D, because __________.
Why can’t B happen without D?
• In order for C, we must D’, because __________.
Why can’t C happen without D’?
• D and D’ cannot coexist because___________.
Why can’t B happen if D’ exists?
Why can’t C happen if D exists?
Note that you are looking for the “beliefs” that exist in the given situation. In Table 25-2 some of
the assumptions surfaced by the steel products company POOGI team are given.
4. Using the erroneous assumption as your guide, define an injection that would enable the
conflict to be eliminated. A good injection will enable you to “evaporate” at least one of the
arrows in the Cloud. You should be able to fill in the blanks to at least one of the following
sentences:
• If [injection], then [A] can be achieved without [B] because _____.
• If [injection], then [A] can be achieved without [C] because _____.
• If [injection], then [B] can be achieved without [D] because _____.
• If [injection], then [C] can be achieved without [D’] because _____.
• If [injection], then [D] and [D’] coexist because _____.
The analysis of the steel products POOGI team uncovered the following facts, which were in
direct contradiction with existing policies:
• Allowing green orders to sit was not helping the company maximize flow, and in many cases
led to expensive expediting later in the process.
• Moving an order to an equivalent resource that has open capacity, even if that resource is
located at another nearby plant, is the most cost-effective approach to managing production.
• The routings had not kept up with the growth of the company—as equivalent resources had
been added, the routings continued to identify a specific resource at a specific plant.
• As the company’s TOC implementation had progressed, the plant managers and supervisors of
the various plants had established robust interplant communications, and it could be quite easy
to identify where to move orders in order to ensure that orders “sit” only when there is no
capable resource available to process them.
The injections, then, became obvious and were communicated and implemented within days:
• If the resource on the routing is busy and another equivalent resource is available, move
orders to any equivalent resource that is available, irrespective of color.
TABLE 25-2 Steel Products Company Necessary Condition Assumptions
• Modify the routings so that equivalent resources are not an exception. (Upon subjecting the
injections to NBR, the company decided to take the approach to modify routings as new orders
are placed. As a make-to-order (MTO) company, this enabled the company to modify routings as
they were needed, and avoided the expenditure of key personnel time on making unneeded
modifications.)
If you would like to use the POOGI Cloud template in your organization, see Appendix D on the
McGraw-Hill website: http://www.mhprofessional.com/TOCHandbook.
Conflict can be seen as a gift of energy, in which neither side loses and a new dance is created.
—Thomas Crum
The Integrated TOC Thinking Processes
The whole history of science has been the gradual realization that events do not happen in an
arbitrary manner, but that they reflect a certain underlying order, which may or may not be
divinely inspired.
—Stephen Hawking
We have explored the fundamental assumptions and basic building blocks of the TOC TP, in
terms of the way that cause-and-effect logic, the protocol used for mapping the logic, the
mindset required, and the scientific premise on which TOC and the TP are based. By putting to
use the basics, you will be well prepared to use the full set of TP in order to improve any system.
To improve something means to make it better. And the only way for something to get better is
if it changes. Think about the vast number of variables in any organization, relationship, or
individual that could be better. If this is difficult to imagine, just think about the number of
complaints you make or hear throughout any given day! If you agree that some improvements
are better than others, and that the list of potential improvements outstrips the capacity
available to make improvements, then you would conclude that in order to ensure a meaningful
state of ongoing improvement, we must be able to systematically answer three fundamental
questions (Goldratt 1990):
1. What to Change? Given everything that could be changed, what should be changed? No
person or organization has infinite time on their hands, so if we are going to spend time making
changes, it behooves us to distinguish between the important few and the trivial many. We
should have a way to identify the variables that, if changed, could render the most significant
improvement to the system.
Throughout this chapter, I use the words system and situation. I am not using them
synonymously, though. A system is “a group of interacting, interrelated, or interdependent
elements forming a complex whole.” A situation is “the combination of circumstances at a given
moment; a state of affairs” (The American Heritage® Dictionary, 2004). We need both an
understanding of the system itself and of the situation (state) in which the system finds itself, in
order to find the answer to “What to change?”
2. To What to Change? Once we pinpoint what we want to improve, we should define the
improvement itself—the future improved state we intend to create—and articulate the specific
changes that need to be put in place in order for the desired improvement to become the
reality.
3. How to Cause the Change? By answering the first question, we have defined the critical few
variables in the system that we intend to change in order to improve the situation. We have
then designed the future improved scenario, highlighting the changes to make which will create
the new reality. Now we need to draw the map and detail the action plan that, when followed,
should bring us from the present to the improved future. The three questions of change are
pictured in Fig. 25-16.
The TOC TP are the tools used to answer the three questions of change. The Current Reality Tree
(CRT) uses cause-and-effect logic to create a map of the existing situation and pinpoint a core
problem—the common cause for many undesirable effects—and the answer to the question,
“what to change.” With the EC, the problem is verbalized as a conflict, and a direction for a winwin solution is established by uncovering and replacing at least one erroneous assumption of
the conflict. The Future Reality Tree (FRT) and NBR provide the process to create the logical
model of the future system. They are used to answer the question, “to what to change,”
highlighting the cause-and-effect relationships between the changes that will be made and the
desired future state that those changes are intended to create. The PRT and Transition Tree
(TRT) are the tools that TOC provides in order to logically derive and map what we need to do to
close the gap between the current state and the desired future. With these tools, we clarify the
obstacles that stand in our way, and what needs to happen in order to overcome them. The
newest addition to the TOC TP—the Strategy and Tactic Tree (S&T)—provides for the full
synchronization and communication of the implementation of a change. In Table 25-3, we see
the purposes and relationships of the TP tools.
FIGURE 25-16 The three questions of change.
I am sure we are all guilty of having what we think is a great idea, and then falling in love with
that idea to the extent that we spend our energy justifying, rather than validating, the value of
the idea. A great way to not improve a situation is to fool yourself about what the situation
really is and implement a solution for a non-problem. There is a term for this in TOC—
choopchick. A Yiddish slang word originating in Serbia, a choopchick is generally translated as a
triviality. In TOC, it is a dangerous form of triviality—it is a triviality that is believed to be
important, and thus a distraction from what the focus of attention should be. By making the
decision to take an internally honest, scientific, logical approach to answering the three
questions of change, we can help avoid implementing non-solutions and chasing choopchicks.
TABLE 25-3 The Purposes and Relationships of the TP Tools
The effect of choopchiks within the management process can be devastating. Attracting
attention to relatively unimportant issues diverts efforts from genuinely significant concerns.
—John Caspari, Handbook of Management Accounting
Reinforcing the Mentality of a Scientist—Jonah’s Approach
It is one thing to get on my soapbox and ask you to be internally honest, scientific, and logical.
However, this chapter is about providing you with a practical means to actually do so. Here are
four simple steps that can guide you to a good understanding of the present situation, the
future you want to create, and the decisions and actions you would need to take to turn the
future you want into reality.12
1. Entity Existence. Verify that each entity really does exist in the environment that is being
analyzed. If an entity is something that cannot be directly confirmed, physically observed, or
numerically verified—use the scientific method. For instance, a person smiling is something that
is physically observed. What a person is thinking, or what we assume is a person’s attitude, is
not physically observed and can only be directly confirmed by the person. Predict another effect
that must exist as a result, and check for it. If the effect exists, you have increased the likelihood
that the intangible effect exists. If the predicted effect does not exist, then you have eliminated
the likelihood that the intangible effect exists.
Let us revisit the lamp example from earlier in the chapter. At one point, we predicted that the
power was out in the rest of the neighborhood. The street was dark, which was an additional
effect of a neighborhood power outage. If we had looked outside and saw all of the streetlights
and the lights in our neighbors’ homes brightly lit, then we would have known that there was
not a power outage in the neighborhood. It would not have been an entity that existed in the
situation we were analyzing.
2. Entity Clarity. Ensure each entity is stated clearly and concisely, as a simple yet complete
sentence. A good test is that when you read the entity statement aloud, it needs no further
explanation. An indicator that the statement is not yet clear enough is if you read it aloud to
someone and feel compelled to explain further what it means.
3. Causality Existence. Validate that each cause and effect relationship identified in the analysis
really does exist in the situation being analyzed. Even when you verify that the described
elements do in fact exist in the situation or system being analyzed, it could very well be that the
hypothesized cause-effect relationship between them does not. Here is an example.
I know a young woman who had a persistent headache. The headache was there when she
woke up in the morning, throughout the day, and when she went to sleep at night. It simply did
not go away. After a couple of weeks, she went to a local urgent care center.13 After asking a
few questions and short examination, the doctor formulated his hypothesis and prescribed a
solution accordingly. His hypothesis of the woman’s problem was that she had a simple tension
headache. He prescribed a painkiller and told her to go home and relax. A simple analysis of the
situation, in the doctor’s view, would have looked like Fig. 27-17a. Unfortunately, even though
every entity in the tree did exist, and even though for most young adults stress is the cause for a
headache, it was not in this case.
FIGURE 25-17 Validating “causality existence.”
A week or so and many pain pills later, the headache was not only still present, it had worsened,
and she had become nauseated and disoriented. The young woman went to the emergency
room at a local hospital. After a short interview and examination, the ER doctor formulated his
hypothesis, which was that there was something physically going on in her head, possibly a
tumor. He ordered a CT scan, which verified the existence of a quite large tumor in the left
frontal lobe of her brain. (See Fig. 25-17b.)
I am not illustrating this case in order to pass judgment on either of the two doctors involved. I
am illustrating this case in order to show that even though the same conditions might exist in
two different realities, they have a cause-and-effect relationship in one of those realities and
not another. The young woman did have some stress in her life, and she did have a headache.
Tension is the cause for headaches often, but not always.14
Check the causality! It doesn’t take long to ask any or all of these questions: Why?
How do
I/we/you know?
Is this always the case?
Under what circumstances is this the case?
Under what circumstances is this not the case?
Oh, really? Why?
4. Causality Clarity. Ensure each cause-effect relationship is modeled clearly and concisely. A
good test is to read aloud the relationship as an “if-then” statement or as a “because”
statement. An indicator that the cause-and-effect relationship is not yet clear enough is if you
read it aloud to someone and feel compelled to explain further what it means. For instance,
look at Fig. 25-18. The cause-and-effect relationships would be read as:
• If [B] and [C], then [A]; or [A] exists because [B] and [C].
• Additionally, if [D], then [A]; or [A] also exists because [D].
FIGURE 25-18 Cause clarity.
As we explore the full, integrated TOC TP, I will use examples from the case study of a bank,
which was described in detail by Cox, Blackstone, and Schleier (2003) in their book, Managing
Operations: A Focus on Excellence. (Used by permission, © Cox, Blackstone, and Scleier)
What to Change?
Mad let us grant him them, and now remains that we find out the cause of this effect—Or
rather say, the cause of this defect, for this effect defective comes by cause. Thus it remains, and
the remainder thus.
—William Shakespeare
In order to answer the question, What to Change?, we will use two of the TP tools: the CRT and
the EC. Over the years, two approaches have emerged as “standard.” The “Snowflake Method”
is considered to be the more traditional approach, mainly because it is an older method than
the “Three-Cloud Method,” and the “Three-Cloud Method” is generally easier for people to
learn. The main difference between the two approaches is the sequence in which the two tools
are used, and in which the core problem is identified. The “Three-Cloud Approach” tends to be
easier to learn. Both methods have proven to be quite effective in gaining an understanding of
the situation and the core conflict (core problem) that has prevented the otherwise natural
harmony to be in place.
Current Reality Tree (CRT)
We find in the course of nature that though the effects be many, the principles from which they
arise are commonly few and simple, and that it is the sign of an unskilled naturalist to have
recourse to a different quality in order to explain every different operation.
—David Hume
A CRT is a cause-effect model of an existing situation. The main use of a CRT is to answer the
question, What to Change?, so the cause-effect relationships that are focused on in the CRT are
the UDEs—the aspects of the situation that we want to improve.
One important aspect of the inherent simplicity concept is convergence. Goldratt explains that
“science is simply the method we use to try and postulate a minimum set of assumptions that
can explain, through a straightforward logical derivation, the existence of many phenomena of
nature” (Goldratt and Cox 1986, Introduction). When we look at a well-constructed CRT, we are
able to see clearly the very few causes for a much larger set of effects.
The grand aim of all science is to cover the greatest number of empirical facts by logical
deduction from the smallest number of hypotheses or axioms.
—Albert Einstein
Evaporating Cloud (EC)
The peak efficiency of knowledge and strategy is to make conflict unnecessary.
—Sun Tzu
By definition, a problem is something that we want to solve. In other words, if I have a problem,
then I want to replace it with its opposite non-problem. Whether a given problem is a core
problem (the cause for many UDEs), or an UDE (an element of the system that is undesirable), it
is an obstacle to harmony that should be eliminated. This means that any problem can be
verbalized as a conflict, which leads us to the use of the EC. In the “Snowflake Method,” the EC
is used to summarize a core problem reflected in a CRT that has been constructed by logically
connecting the UDEs. In the “Three-Cloud Method,” the Cloud is used to derive the core
problem and then logically connect it with the UDEs.
The “Snowflake Method”
1. Pick a subject matter. What is the system or situation that you want to understand better in
order to improve it? Perhaps you want to understand your markets better to develop a product
or offer that would address a significant need; or you want to understand your organization
better to determine why it is not growing faster, serving its customers better, or retaining its
employees longer; or you want to understand your supply chain to find the keys to improving
the relationships with both your suppliers and your customers; or you want to understand your
family or other relationships better to figure out what to change to make them more
meaningful. Hospitals have used the TP to understand what needed to change to improve their
emergency rooms and surgical centers; even a religious denomination15 used the CRT to
understand what was preventing it from better accomplishing its mission. The list of potential
subjects is limitless. There are two criteria that you should use to determine a subject on which
you will construct a CRT:
a. You really care about it to the degree that you intend to roll up your own shirt sleeves when it
comes to implementing the solution.
b. You have enough experience to have some intuition about it.
2. Identify several aspects of the situation that are undesirable, and write them as entities.
These entities are called UDES. An UDE is defined as an entity that describes an element of the
situation that we want to improve; in other words, it describes an aspect of the system that is
undesirable, and which we would like to change. Try not to identify fewer than six or more than
twelve in this early step of the process. This simply defines the starting point for the analysis.
3. Your intuition will point you to some of the UDEs that are closely connected to each other
through cause and effect. Starting with these, construct the cause-effect map that shows how
they are ultimately connected. Remember to verify that the entities really do describe elements
of the situation as it exists, validate the causality, and ensure that what is written is clear and
understandable. Once you are satisfied that you have a cluster that is solid from a logical causeeffect perspective, go back to your list of UDEs and, one by one, let your intuition guide you to
the area on the tree to which they are connected, and then use cause-effect logic to connect
them. Do not stop until all of the UDEs are contained in the diagram.
4. If your intuition tells you that the tree you have is not telling the whole story, add the causes
and effects so that it does. You may also discover that many of the entities you initially defined
as UDEs really are not, but that others in the tree really are. Go ahead and identify the “real
UDE’s.”16 Remember to keep the view of the scientist.
5. Check the entities that are causes only. Can you identify one that is responsible for the
majority (say 70 percent or more) of the UDEs in the tree? If so, you have uncovered a core
problem. If not, select the few that together are responsible for most of the UDEs and see if you
can identify the common cause for them. If not, don’t worry—your work on the CRT has
provided you with enough understanding of the situation that you would be able to use an EC to
clarify the core problem and establish a direction for the solution.
6. Construct the EC in order to crystallize the core conflict of the system. There are two
approaches to constructing the Cloud from a CRT. One approach is to summarize the CRT.
Another is to use the core problem that has been identified in the CRT as the D entity, its
opposite as the D′ entity, the goal of the system as the A entity, and fill in B and C based on the
understanding of the system that has been established by constructing the CRT.
The Bank Case: What to Change, Snowflake Approach
A brief background (step 1) to the bank case, as provided by Cox et al. (2003):
The bank has a problem with employee turnover and pay levels. Other businesses pay more
than the bank can pay for entry-level positions and hire the bank’s employees. Employees are
constantly turning over so the bank is unable to develop loyalty with its customers . . . .
In order to get a holistic view of the bank and not just of an individual within the bank, the
Branch Manager, the Head Cashier, and the Director of Human Resources defined the UDEs
(step 2). They checked for the existence and clarity of the entities, and after some
wordsmithing, the list of UDEs they used to begin their CRT was:
1. Many bank tellers quit and take better job positions.
2. Some single-parent bank tellers quit to make more money on public assistance and be with
their children.
3. Many bank teller job vacancies occur each year.
4. The bank’s budget for hiring, training, and raises is quite small.
5. Some bank tellers (students or their spouses) quit at college graduation.
6. Bank teller jobs are low paying entry-level positions.
7. The bank loses a lot of revenue from past, existing, and potential customers.
8. Some tellers make errors in customer accounts.
9. Some tellers do not know how to handle multiple complex transactions.
10. Some tellers are extremely slow.
11. Many customers go elsewhere to bank.
12. Many customers complain about poor service to other customers (existing and potential).
13. New employees do not know the names, likes, and dislikes of loyal customers.
The team immediately identified three causes for UDE #3 and mapped them accordingly (step
3), as illustrated in Fig. 25-19.
They then added UDE #6 to the cluster (step 3-2 Fig. 25-20).
They continued to follow the steps (step 4), and Fig. 25-21 is the CRT on which they agreed
reflected the reality of the situation.
of the vast majority of the “real UDEs.”
FIGURE 25-19 Bank CRT step 3.
FIGURE 25-20 Bank CRT step 3-2.
As you examine the bank’s CRT, you may find yourself questioning some of the entities and the
cause-effect relationships as they are represented in the model. If so, and if you had been sitting
in the room with the bankers at the time, your reservations might have helped them end up
with a more “perfect” CRT. Nevertheless, I do believe this is a “perfect example” to share with
you. It is from real life, not an ivory tower. Real managers expended real human energy to
understand their environment better for the purpose of making decisions and taking actions
that would cause real improvement for their bank and their customers. “Perfect” logic may be a
good aspiration to help you keep the mindset of the scientist. However, it is quite inappropriate
to spend an exorbitant amount of time to map out “the perfect CRT.” Do not allow “analysis
paralysis” to set in! As you will see, the full set of TP provides excellent safety nets. Even if the
CRT is not “perfect,” the subsequent steps will help you pick up anything important that you
may have missed.
The Branch Manager summarized the CRT in the Cloud shown in Fig. 25-22.
The bank team identified entity #140 (step 5), “The bank is unable to maintain an adequate pay
structure to provide stable employment.” If the bank would have instead constructed the Cloud
using the core problem entity as the D entity of the cloud, the Cloud may have looked like the
one shown in Fig. 25-23.
Note that in either case, the conflict is well represented in the CRT (step 6).
FIGURE 25-21 Bank CRT.
The “Three-Cloud Method”
The first two steps are the same as in the “Snowflake Method.” Define the subject matter and
identify several (6 to 12) UDEs. The next step leads us to identifying the core problem in the
form of a conflict—a core conflict—and the subsequent steps are used to identify the causeeffect connections between the core conflict and the UDEs. We will pick up from Step 3.
FIGURE 25-22 Bank Cloud.
FIGURE 25-23 Bank Cloud 2 UDE the bank puts up with being unable to maintain an adequate
pay structure to provide stable employment.
3. Select three UDEs, making sure to select them from diverse aspects of the system. A good
guideline to follow is to select UDEs that do not seem to be connected to each other via cause
and effect. Create a Cloud for each of the selected UDEs according to the template shown in Fig.
15-24.
Three of the bank’s UDEs, verbalized as ECs, are shown in Figs. 25-25 through 25-27.
4. From the three Clouds, create the Generic Cloud of the system, which is the core conflict.
When you examine the three Clouds together, you will be able to uncover a theme for the As,
the Bs, the Cs, the Ds, and the D′s. I find Table 25-4 useful, and have used it to illustrate how the
bank’s three specific UDE Clouds are converted into a Generic Cloud.
Now you can create the Generic Cloud as seen in Fig. 25-28.
The bank’s Generic Cloud, according to the Three-Cloud Method, is shown in Fig. 25-29.
Notice the similarity between the Cloud in Fig. 25-29 and the Cloud that was generated with the
core problem (entity #140) identified in the Snowflake Method (Fig. 25-22).
5. The CRT is completed by establishing the cause-and-effect linkages between the core
problem and the UDEs.
FIGURE 25-24 Template for UDE Clouds.
FIGURE 25-25 EC for bank UDE 13.
To What to Change
My interest is in the future because I am going to spend the rest of my life there.
—Charles F. Kettering
We will utilize a few of the TP tools to answer the question, To What to Change? The Cloud that
has already been constructed is used to surface assumptions, identify those that are invalid, and
define the initial injection for the solution. We will then complete the solution with the FRT and
NBR.
FIGURE 25-26 EC for bank UDE 12.
FIGURE 25-27 EC for bank UDE 1.
TABLE 25-4 Converting the Bank’s Individual UDE Clouds to a Generic Cloud
FIGURE 25-28 Generic Cloud template.
FIGURE 25-29 Bank Generic Cloud based on three clouds.
Evaporating Cloud
There are three ways of dealing with difference: domination, compromise, and integration. By
domination only one side gets what it wants; by compromise neither side gets what it wants; by
integration we find a way by which both sides may get what they wish.
—Mary Parker Follett
Earlier in the chapter, as well as in Chapter 24, we learned how to surface assumptions and
identify injections using the Cloud. Therefore, let us go directly to the bank case. The bankers
used the Snowflake Approach to build their CRT and the Cloud they used was the summary
Cloud (Fig. 25-22). The team examined the various necessary condition relationships, and when
they reached the assumption that held D and D′ as being in contradiction with each other, they
realized that they had found the key to the solution. The reason that the bank was unable to
raise the pay levels of entry-level employees and raise the pay levels of existing employees was
that the bank’s budget for hiring, training, and raises couldn’t be increased. Nobody at the bank
had the authority to increase the total budget for hiring, training, and raises. However, the
branch manager did have authority over the total budget. What would happen if they were able
to shift money from hiring and training to salaries? If such a shift could enable the bank to pay
new employees more, and also enable the bank to better reward existing employees, then the
turnover would be reduced, and the volume (and thus the cost) of hiring and training would be
reduced!
The injection the bank used to begin to develop its solution was, “The bank uses monies for
hiring and initial training to raise the pay for entry position pay levels.” We now use this initial
injection as the starting point for the full solution that will be detailed in the FRT.
Future Reality Tree and Negative Branch Reservation
A human being fashions his consequences as surely as he fashions his goods or his dwelling.
Nothing that he says, thinks or does is without consequences.
—Norman Cousins
The FRT and the NBR are both processes that model the predicted effects of injections. The FRT
is used to model the intended effects—the desired improvements—that comprise the full
solution. FRTs typically contain several injections and many entities. They show the cause-andeffect model of how the injections enable the achievement of the objective of the Cloud and
the opposite of (elimination of) the UDEs that were described in the CRT. The NBR is used to
show how an injection would lead to undesired consequences, and then modify the idea (by
modifying an injection or adding additional injections) to the degree that predicted undesirable
consequences would be prevented. The guideline is to build the FRT first, and then use the NBR
process to modify and solidify the solution to ensure that it is win-win-win.
The steps to construct an FRT and NBR are shown in Table 25-5.
The FRT (inclusive of the resolved NBRs) of the bank is shown in Fig. 25-30. As with the CRT,
when you examine the bank’s FRT, I have no doubt you will identify entities that could use more
explanation and causal connections that are flawed. Moreover, I have no doubt that if you had
been with the team that constructed the tree, your reservations would have helped them to
create a “more perfect FRT.” Nevertheless, you are looking at real work done by real people. The
results spoke for themselves. This analysis was completed 15 years ago. The bank implemented
the injections. Employee turnover dropped like a stone, customer service improved, and the
bank grew. A decade later, tellers and managers alike greeted customers by name, and the bank
enjoyed the loyalty of its customers and employees.
TABLE 25-5 Constructing an FRT and NBR
Unfortunately, a few years ago the bank ended up being acquired by a larger bank, and then
again by an even larger bank, and the policies and procedures of the conglomerates were
installed. Neither tellers nor managers know the customers, and rarely does one see a smile in
the bank. Customer and employee turnover is back to the levels it experienced at the time of
the original analysis.
The fish stinks from the head.
—Yiddish proverb
FIGURE 25-30 Bank FRT.
How to Cause the Change
A thought which does not result in an action is nothing much, and an action which does not
proceed from a thought is nothing at all.
—Georges Bernanos
Three TOC TP are used to answer the third question of change, How to Cause the Change? With
the PRT, we identify the obstacles that make implementation of the injections difficult and
create a logical map of Intermediate Objectives (IOs) that will overcome the obstacles. TRT are
used when it is necessary to define the specific, detailed actions that will be taken in order to
achieve a given objective. Finally, the S&T tree is used to integrate the output of all of the TP
into a synchronized whole that fosters communication and synchronization necessary for the
successful implementation of major initiatives.
Prerequisite Tree
Obstacles don’t have to stop you. If you run into a wall, don’t turn around and give up. Figure
out how to climb it, go through it, or work around it.
—Michael Jordan
The PRT17 takes advantage of the same type of “necessity” logic approach as the EC. With the
EC, we are modeling a set of necessary conditions that are thought to exist in the current reality
of a conflict. With the PRT, we are building the necessary conditions to create a logical roadmap
to move from the current situation to the desired future. We will use Fig. 25-15 (which was used
previously in the EC section of this chapter) to highlight the use of the logic. In both cases (Cloud
and PRT), B cannot be achieved unless A is in place because of an aspect of the current reality
that exists. When we are using the EC, we call this aspect of current reality an assumption.
When we are using the PRT, we call this aspect of current reality an obstacle. When we use the
EC, we begin with the entities “in the boxes” (A, B, C, D, and D′), and then surface the
assumptions. When we are using the PRT, we begin with the obstacles, and then define the
entities “in the boxes” (intermediate objectives).
In Chapter 24, you will find detailed instructions for creating a PRT. Here are the basic steps:
1. For each injection, list the major obstacles to achieving it. An obstacle is an entity that exists
in the current reality, which, due to the fact that it exists, prevents an injection from being
reality.
2. For each obstacle, define an IO—an entity that, once implemented, causes the obstacle to be
overcome. An obstacle can be overcome by eliminating the entity or by finding a way around
the entity (the entity would still exist; it would simply no longer be an obstacle to achieving the
injection).
3. Using necessary condition logic, map the order in which the IOs must be implemented.18
The Bank’s Prerequisite Tree
The bank identified six injections in its FRT:
TABLE 25-6 Obstacles and Intermediate Objectives for the I/O Map and PRT
• The bank uses monies from hiring and initial training to raise the pay for entry-position pay
levels.
• Personnel develops a competitive pay package for workers.
• The bank provides workers with advanced training.
• The bank conducts exit interviews to determine reasons for turnover.
• Personnel uses the bank’s best workers to train new workers.
• Top management recognizes the difference between turnover and growth.
Table 25-6 illustrates the obstacles and injections that the bank developed for the injection,
“Personnel develops a competitive pay package for workers.”
The PRT for the injection is illustrated in Fig. 25-31.
A few things to note:
1. It is usually easier to build the PRTs by starting with the most ominous injections (the
injections that seem most difficult to achieve). By doing so, you will typically address the
“easier” injections in the process, and you will avoid multiple versions of the same tree.
2. Most of the intermediate objectives and injections are verbalized as entities rather than
actions. An objective, whether it is an intermediate objective or a high-level injection, is a
condition to be achieved, and an action is something that is done to achieve an objective. The
place where we would expect to see IOs written more in the form of actions would be at the
“bottom” of the tree; such IOs do not have other IOs pointing to them. At that level, we
generally “know what to do,” and the initial obstacles to be overcome are relatively minor. We
will see actions in the TRT and as in tactics in the S&T.
3. Each arrow represents the obstacle that exists which is preventing the injection from being
achieved. If an IO is pointing to another IO (e.g., 22 pointing to 23), the obstacle (in the arrow
that connects them) is also preventing the IO that is pointed to from being achieved.
4. Verify that each obstacle is, in fact, an entity that exists in the current reality of the system. If
it does not, it is an imagined obstacle, not a real obstacle, so there is no need to implement an
IO to overcome it.
FIGURE 25-31 Bank PRT for injection, “a competitive pay package for workers is in place.”
5. Validate the obstacle causality—is the existence of the entity that is claimed to be the
obstacle really an obstacle to the achievement of the injection or the IO? If it is not, then there
is no reason to implement an IO to overcome it.
6. Verify the IO causality—will the IO really overcome the obstacle and open the door to
implementation of the higher IO or injection to which it is pointing? If not, you need to select a
different IO.
As the PRTs are developed for each injection, identify any necessary condition relationships that
exist among various IOs or injections. This will help you integrate the implementation, rather
than simply having a collection of injections to implement. When the bank added to the PRT
those IOs it defined to achieve the injection, “The bank conducts exit interviews to determine
reasons for turnover,” the PRT expanded as shown in Fig. 25-32.
The full PRT, as the bank team wrote it, is illustrated in Appendix E of this chapter found on the
McGraw-Hill website: http://www.mhprofessional.com/TOCHandbook.
Transition Tree
Nothing happens until something moves.
—Albert Einstein
We finally reach the place where the rubber meets the road—it’s time for action! Some
injections and IOs are “no-brainers” to implement. There are others that you know intuitively
are risky unless you plan each step in a highly detailed, even choreographed, fashion. For
instance, conducting buy-in meetings with other stakeholders in the organization, conducting
important sales meetings with buyers or negotiation meetings with suppliers all fall under the
category of actions that should be planned meticulously. This is the function of the TRT.
The TRT provides a way to construct an intended action plan (a sequence of actions to be taken)
so that the need for each action, the predicted effects of each action, and the appropriate
conditions that need to be in place to trigger an action to be taken (and thus the logic of the
sequence itself) are all clear. The TRT is useful for planning an important activity, but equally
important for monitoring reality during the execution of the plan, so that that we take actions
that are needed when they are needed (when the action-appropriate conditions are present),
we don’t take actions that aren’t needed, and we know and are able to pinpoint exactly what
and why to modify if reality unfolds differently than the way we had planned. If this seems to be
similar to the approach a scientist would take when designing and then executing an
experiment, then you have caught on quite nicely!
FIGURE 25-32 Bank PRT expanded for injection, “a competitive pay package for workers is in
place.”
Never mistake motion for action.
—Ernest Hemingway
The basic structure of a TRT is illustrated in Fig. 25-33.19 The entities in the tree and the
structure of the tree are based on the following concepts:
1. There is a need to take an action.
2. The fact that an objective20 is not yet achieved and will not be reached without additional
action means that an action is necessary. In other words, action must be taken because there is
some obstacle still blocking the way, and human intervention is required to remove it. By
articulating the need for each action, we have an opportunity to check before taking action to
see that the need still exists. (If the need for the action goes away, there is no need to take the
action!)
FIGURE 25-33 Basic structure of a TRT.
3. The conditions are appropriate for taking the action. In his July 2001 article, “Transition
Tree—A Review,” Rami Goldratt articulates what makes conditions appropriate for taking the
next action.
a. I have the ability to take the next action, and
b. The next action will not lead to serious negative effects.
The sequence of actions is due to the need for the earlier action(s) to cause the appropriate
conditions for latter action(s) to be taken.
Let us take a simple example. You are standing at a busy intersection, and the nice restaurant
where you are meeting your friend for lunch is across the street. The fact that you are standing
on the opposite side of the street from the restaurant means that there is a need for you to take
an action, as you must get to the other side of the street. Your first action is to look at the traffic
light. The green “OK to cross” signal is illuminated, and traffic has stopped in order to allow
pedestrians to cross. The condition is appropriate for you to take your “walk across the street”
action, so you confidently do so. On the other hand, if the red “Don’t Cross” signal were
flashing, you would know that if you started to walk into the intersection, a car might hit you. In
other words, the conditions would have not yet been appropriate, and you would wait a few
moments until the light changed in your favor.
The steps to construct a TRT are:
1. Identify the objective and verbalize it as an entity. The objective of a TRT can be an
intermediate objective or an injection from a PRT or another objective.
2. Write all of the actions you think should be taken, in the order you expect the actions should
be executed, and construct the “spine” of the TRT—the standard protocol is that the first action
to take is at the bottom of the tree, and the last is at the top. The final action should be pointing
to the objective. (See actions 1, 2, and 3, and the objective in Fig. 25-33.) If you cannot think of
any actions, it means that the obstacles are still too big for your intuition to guide you to the
actions to take. Go back to the PRT and identify the obstacles and IOs to a lower level—to the
point where you have identified an IO that your intuition tells you, “We can do this, and I’ve
already got some actions in mind.”
3. For each action, verbalize its associated entity cluster.
a. Verbalize the appropriate conditions for taking the next action. These are the effects of the
action (and are thus the entity to which the action is pointing).
i. What negative effects will be caused by the next action, unless I take this action? Verbalize
that they will not be created.
ii. What new ability do you have after taking the action that brings you closer to the objective
and enables you to take the next action? Verbalize the new ability.
b. Verbalize the need entity.
i. What is the need to take this action?
ii. Why is this action important? In order to . . .
iii. Why take this action? In order to . . .
c. Verbalize the working assumption entity.
i. Why does the action to take satisfy the need?
ii. What do you assume when you claim that this action satisfies this need?
4. Check the validity of the causality that links each cluster.
a. As verbalized, are the need, appropriate conditions, and working assumption that point into
an action to take sufficient to make the action specified the right action to be taken?
b. For any appropriate conditions that are intangible or not directly verifiable, identify and map
the effects that would be verifiable indicators (“the proof”) that the appropriate condition is in
place, as additional effects of the action.
5. Check for negative branches and make the appropriate modifications (modify actions or add
new actions in order to prevent the undesired consequences).
In the process of creating a TRT, you may find that you initially identified actions that really are
not necessary. You may also find that you need to add actions that you had not initially thought
of in order to close “sufficiency gaps.” You may also find that the sequence you initially had in
mind needs some rearranging. How wonderful that you find these things out on paper in the
planning stage instead of in reality! Consider how much time and effort you are saving as a
result!
I will provide an example of a TRT in the next section of this chapter, to illustrate how a TRT has
been used by the sales force of a company that is using TOC to build, capitalize, and sustain a
decisive competitive edge (DCE).
If anything is certain, it is that change is certain. The world we are planning for today will not
exist in this form tomorrow.
—Philip Crosby
The Strategy & Tactic Tree
“The people may be made to follow a path of action, but they may not be made to understand
it.”
—Confucius, The Confucian Analects
If an initiative aims to significantly improve an organization’s performance, then inevitably
changes would be needed to various tasks (decisions and actions) that the organization’s people
are doing. If the initiative is going to stick, then not only the tasks, but the thinking behind those
tasks must also change. Irrespective of an individual’s level in the organizational hierarchy, or
the functional areas in which they reside, each person in the organization wants the same
things—to understand how they fit in the big picture, why they are necessary to the whole, and
how they contribute to making a real difference.
For each change an initiative requires people to make, they need to understand the changes
that they need to make and why. If the answers to the following four questions are not
effectively articulated, organized and communicated, people will be forced to make their own
assumptions about the answers, and they will behave accordingly. And the likelihood decreases
dramatically that the initiative would be a success.
1. For each change I need to make, why do I need to make it?
2. What will the change achieve, vis-à-vis the goal of the initiative?
3. What do I actually need to do in order to make the change?
4. Why will the actions achieve the needed change?
The various TP applications discussed in this chapter provide a robust set of tools with which we
are able to fully and logically analyze and describe a core problem, the solution, the hurdles we
need to overcome in order to move from the current to the new reality, and even detailed
action plans to reach specific milestones and objectives. TOC also provides the recognition of
the layers of resistance and an effective approach to achieving collaboration and buy-in while
honoring the win-win principle (Chapter 20).
But as more TOC implementations focused on holistic organizational transformation rather than
single-function improvement programs, it became clear that the standard collection of excellent
TOC tools were insufficient to obtain the synchronization and communication required for a
major, holistic organizational transformation initiative to achieve and sustain the intended
improvements. And they did not provide the means by which anybody in the organization could
readily answer the four questions above.
A well written S&T is the TP tool that organizes the full analysis in a way that the answers to the
four questions are provided for each function across the organization, to the degree of detail
needed at each level up and down the hierarchy, in a single logical map.
The First Step: The Goal
When you look at yourself from a universal standpoint, something inside always reminds or
informs you that there are bigger and better things to worry about.
—Albert Einstein, The World as I See It.
FIGURE 25-34 Cost-and-Effect relationship of Strategy, Tactic, and Parallel Assumption.
Imagine trying to answer any of the four questions for everyone in the organization without first
having a clear definition of the goal—the purpose—of the initiative. I can’t either. Therefore,
defining the goal of the initiative is the starting point of the S&T. For example, the goal of a
Viable Vision initiative is stated as follows (with permission from Goldratt Consulting):
The company is an Ever Flourishing Company; continuously and significantly increasing value21
to stakeholders—employees, clients and shareholders.
But this high-level statement of the goal does not provide enough information to align and
synchronize the specific changes that the organization must make throughout its various levels
and functions. We also need a high-level understanding of how the company is going to become
ever flourishing. In an S&T, the purpose of the initiative is thus always described with the
following three elements:
1. The Strategy—The “What” of the Initiative
• The purpose of the initiative—the goal the organization is intending to achieve as a result of
the implementation.
2. The Parallel Assumptions—The “Why” of the Tactic
• The conditions that exist in reality that lead us to a specific course of action that would
achieve the strategy; the logical connection between the tactic and the strategy; a well written
set of parallel assumptions explains why the tactic is the course of action that leads to
attainment of the strategy.
3. The Tactic—The “How” of the Initiative
• What needs to be done in order for the implementation to achieve the goal.
If you were to model the S&T step using the cause-and-effect mapping process described in this
chapter, it would look like Fig. 25-34.
Table 25-7 contains the strategy, parallel assumptions and tactic that comprise the first S&T step
for every company that embarks on a Viable Vision implementation:22
Strategy without tactics is the slowest route to victory. Tactics without strategy is the noise
before defeat.
—Sun Tzu
Branching into Layers of Detail
Once the initiative has been defined at the highest level, we can derive the details that are
necessary to implement it. Let’s imagine your company is just beginning a Viable Vision
initiative, and the CEO has just completed reading to you the strategy, parallel assumptions, and
tactic of Step 1 of the Viable Vision S&T. What is the next set of information that is needed in
order to determine the specific tasks that people must carry out to implement the initiative?
TABLE 25-7 Strategy, Parallel Assumptions, Tactic and Sufficiency Assumptions.
Certainly, the first thing we need is the definition of the company’s decisive competitive edge.
What is it, and why is it appropriate for your company? What makes it different from the way
your company has competed in the past? Once this is understood, the next level of detail must
provide the guidance for building it and capitalizing on the decisive competitive edge. Given
that this initiative is about ongoing growth and stability, guidance is also needed on how the
company intends to sustain the decisive competitive edge while it grows. For each of these
aspects of the initiative, you must then know what it means in terms of the specific changes
that you and others must make in your day-to-day jobs, and it is important to assure that the
changes you need to make are not in conflict with those above you or below you in the
hierarchy, or with other functions.
Notice that your thinking is taking you to increasingly granular levels of detail. Each level of the
S&T provides more detail to the level above it. Figure 25-35 illustrates this, and provides the
themes of some of the steps that you would find on a typical S&T associated with a Viable
Vision implementation.
FIGURE 25-35 The S&T cascading levels of detail.
How do we know when a layer should be added? Albert Einstein defined insanity as “doing the
same thing over and over again and expecting different results.” Given that what we do is the
result of what we think, we can also define insanity as, “thinking the same way over and over
again and expecting different results.” The purpose of the initiative is to elevate the
organization’s performance. We have already established that this involves making changes not
only to the tasks that people perform, but to the way people think about their tasks and the
relationship between what they do and the purpose of the initiative. Therefore, we must
consider the potential for inertia—the tendency to think the way we’ve always thought when
determining or communicating the changes that must be made to achieve and sustain the
intended results of the initiative.
A layer is added only when there is a good chance that inertia will prevent the right actions from
being taken. Another way to say this is that if we don’t pay attention to the sufficiency
assumption, then the chances of implementing the tactic correctly or achieving the strategy are
dramatically reduced. The Sufficiency Assumption is the verbalization of the specific reason for
concern. In Table 25-7, you see that the Sufficiency Assumption that guides the next level of the
S&T is, “The constraint is management attention. The company must operate based on robust
procedures, otherwise the constraint is wasted.”
S&T Elements
Once we have defined of the goal of the initiative as the first S&T step, we have established the
single reason for anybody to be asked to make a change to the way they work or think: If they
don’t make the change, the organization would be blocked from achieving the goal of the
initiative.
As you see in Fig. 25-38, each entity in an S&T is referred to as a Step. From Level 2 downwards,
each Step contains several elements:
The Necessary Assumption—The “Why” of the Step
The reason that the higher-level S&T step cannot be implemented unless a change is made.
In other words, it describes the necessity for an action to be taken.
The Strategy—The “What” of the Step
The objective—the intended outcome—of the S&T step.
When the strategy is achieved, the need described by the necessary assumption is met.
The Parallel Assumptions—The “Why” of the Tactic
The conditions which exist in reality leading us to a specific course of action that would achieve
the strategy; they form the logical connection between the tactic and the strategy, explaining
why the tactic is the course of action that leads to attainment of the strategy.
The Tactic—The “How” of the Step
What needs to be done in order to achieve the strategy. In a well-written S&T step, the tactic is
obvious once the parallel assumptions are read.
The Sufficiency Assumption23—The “Why” of the Next Level
Explains the need to provide another level of detail to the step; if we don’t pay attention to it,
the likelihood of taking the right actions is significantly diminished.
Figure 25-36 illustrates the necessary and sufficient logical relationships between the various
steps in an S&T and their higher and lower levels. In the illustration, both 2.1 and 2.2 are
necessary in order for 1 to become reality. Once both 2.1 and 2.2 are implemented, 1 will have
been implemented, and the goal of the initiative achieved. Steps 3.11.1, 3.11.2 and 3.11.3 are
each necessary for 2.1. Once all three are implemented, the strategy of 2.1 will have been
achieved. Steps 3.12.1, 3.12.2, and 3.12.3 are each necessary for 2.2. Once all three are
implemented, the strategy of 2.2 will have been achieved.24
FIGURE 25-36 Logical relationship between steps and levels.
Communication, Alignment, and Synchronization
By using the S&T as the main vehicle to orchestrate and communicate an initiative, the answers
to the four questions that people must have in order for an initiative to achieve and sustain its
goal are readily available.
1. For each change I need to make, why do I need to make it?
• This question is answered by the Necessary Assumption.
2. Wha…