Why is TOC consultation important in business?
TOC (Theory of Constraints) consultation/application is all about systemic thinking i.e observing and studying the entire business as one system and not as multiple independent parts. When one studies the business in parts, then there is a chance that one might miss the deeper underlying causal relationship among the multiple parts, which governs the system’s output. Further, any action taken to improve the situation in one part might negatively impact the other part/parts, thereby jeopardizing the system’s overall performance. The cause and effect linkages between the interconnected parts might appear complex but are inherently simple. In such an interconnected system finding a leverage-point, holds the key to transform the state of the system.
The ancient Indian parable of blind men and an elephant is a perfect example of what happens when one observes only a limited part of the system. It is a story of a group of blind men, who have never come across an elephant before. They are instructed to learn and describe what the elephant is like by touching it. Also, each blind man gets to touch a different part of the elephant’s body, but only one part, such as the side, ears, leg, tail or the tusk. They then describe the elephant based on their limited experience and exposure. Each one had a different description of the elephant, which differed and many times was contradictory to each other. The moral of the parable is that human beings have a tendency to claim absolute truth based on their limited, subjective experience and they tend to ignore other people’s limited, subjective experiences which may be equally true.
So when a department head is asked during a review, ‘ what is wrong in his business? ‘, he is most likely to describe the situation like one of the blind men in the above example. And when his version is going to differ from the other department head/heads then, he might suspect that the others are dishonest or just putting some lame excuses in front of the management. This most likely leads to unresolved conflicts between the departments and a deeply rooted sense of distrust among the team members of these departments. Thus, to manage and improve the business, the top management must understand the underlying causal relationship between the interconnected parts.
The following video explains the above concept with an example:
