New Workshop Helps BC Manufacturers Boost ROI

(Newswire.net — January 31, 2015) Vancouver, BC — Small- and mid-sized manufacturers participating in Steve Jackson’s Theory of Constraints workshop in Vancouver, B.C. on February 13th will examine an approach to rapid performance improvement that challenges not just traditional manufacturing methods but even some iconic aspects of Lean Manufacturing.

The Theory of Constraints (TOC) first gained wide recognition through its depiction in Dr. Eli Goldratt’s business novel, ‘The Goal.’ Both Forbes and Time Magazine list the book among the most influential business books published. Amazon CEO Jeff Bezos says ‘The Goal’ is one of 3 books his managers had to read as frameworks for sketching out the future of the company.

Steve Jackson is a Partner in Synchronix Technologies, a Vancouver-based consulting firm established in 1994. He has been a TOC specialist for 26 years. He first learned the TOC under the 6-year tutelage of the late Dr. Goldratt.

“My goal is that everyone in that room will walk out knowing how to leap-frog their performance past every competitor in B.C. in under 90 days,” says Jackson. “And that includes out-performing competitors that are using the most popular improvement technologies, such as Lean or Six Sigma. And by ‘out-perform’ I mean in such factors as lead time, on-time delivery, and productivity.”

Full workshop details can be found here.

But improved competitive performance will not be enough.

“If a manufacturer cannot translate internal performance improvements into sales, profit and ROI growth, then I’d argue that the improvements are mostly a mirage. They look good, they make the people in the company feel good, but the impact on the ROI is often negligible.”

Jackson says the approach he’ll cover in the workshop is different. “Theory of Constraints may not have a very attractive name but what it does have is a 30-year history of fast, direct and substantial bottom line results when it’s used stand-alone. There have been hundreds of published case studies that confirm this. But I’m not advocating that it be used stand-alone. TOC is even more powerful when used in conjunction with other technologies.”

Jackson points out that manufacturers these days can choose from any number of improvement technologies. Theory of Constraints is actually the least well known. Lean, mostly derived from the Toyota Production System and which targets the elimination of waste; and Six Sigma, which targets the reduction of defects in manufacturing processes; are by far the most dominant.

But he says that despite almost universal support for the most popular of these technologies from professional bodies, large consulting firms, even some Government-funded organizations, the track record is disappointing.

“All of these technologies are capable of producing solid results in the right environments. And there genuinely are a few impressive implementations. Yet despite the enormous popularity of Lean, for example, many companies simply don’t see great results. And many that claim to be successful implement only fragments of the body of knowledge, while still claiming to be Lean.”

Jackson suggests that it’s almost taboo for a company to admit their disappointment with Lean because — wrongly — they feel it must reflect badly on their management. “If everyone else is saying it’s the right thing to do, then they believe everyone else must be right.”

In fact many studies have suggested that the failure rate for Lean is between 50% and 95%. Proponents argue with some justification that the definition of “failure” leaves room for interpretation in these claims.

Jackson says that this argument, while it has some merit, is a double-edged sword. That like the fragment users, many claimed successes are only considered a ‘success’ based on definitions which have a great deal of wiggle room.

“Many times, even when a company has successfully implemented Lean or ERP software or can point to experienced Six Sigma specialists who are doing great work, managers tell us — quietly — that their positive results inside the plant simply haven’t translated into the sales, profit and ROI growth that they’d hoped for.”

Highlighting the value of his workshop to all small- to mid-sized manufacturers, regardless of their interest in or investment in other improvement technologies, Jackson stated that the 1-day Vancouver workshop will focus 100% on strategies and tactics that convert quickly — sometimes within days — to significant profit boosts.

He stresses that despite challenging some aspects of the dominant technologies his aim is not to present an “either/or” impression when all the methodologies and philosophies are weighed.

“One of the problems is that manufacturers tend to identify themselves by their improvement technology,” he says. “You’ll hear employees say ‘we’re a Lean company’ or ‘we’re a Six Sigma company.’ This immediately imposes a limitation on the potential improvement.”

Jackson says that the best solution is to take whichever tools and technologies work best in a particular environment to make the successful conversion between local improvements and the bottom line. This can mean that TOC, Lean and Six Sigma could be and often should be ALL deployed simultaneously.

“Theory of Constraints is an excellent tool to provide an overall framework for fast improvement that reaches the bottom line, by highlighting the leverage points,” says Jackson. “But the best tool or methodology to make the necessary improvement a reality might be inside Lean or Six Sigma or anywhere else. We want to pull-in whatever will give us the biggest results, the fastest.”

He acknowledges that this meets resistance from some managers who consider the Lean textbook to be sacrosanct. “A sacred cow is a sacred cow regardless of whether it’s a throwback to traditional manufacturing methods or whether it’s a textbook or checklist element of Lean that has no value — or is even harmful — in a particular situation.”

Jackson is blunt: “Sacred cows exist simply to be slaughtered. If a company wants to gain the largest performance improvements in the shortest time and see them translate into ROI, management needs to drop the dogma and focus on what works.”

The Theory of Constraints workshop is the final one of four 1-day workshops conducted by local topic experts, earlier sessions being on Process Improvement, An Introduction to Lean, and Six Sigma.

Details of all 4 workshops can be found here.

The workshop contains some advanced TOC material never before presented in B.C. It will cover a wide range of topics including TOC’s applications to production, distribution and supply chain, sales and marketing, Throughput Accounting, pricing strategies to generate a target ROI, quality management, purchasing, R&D, capital acquisition, process improvement, new product introductions, project management, and strategic planning.

“Friday 13th,” says Jackson, “Is unlucky for their competitors.”