Most executives believe that no one can tell them how to do better in order to achieve more of the goal of the organization. This is a very comfortable thought, and it could be logically based on the claim that the one who achieved so nicely so far is able to continue to do even more.
This article deals with judging the potential of a “theory” to make a dramatic change to well established businesses. The opportunity to judge the potential is conveniently provided by a conference in Paris in June 22-24. But first, let’s built the rationale.
The point is that human beings use their own experience and knowledge to achieve their desires, but eventually they are also limited by them. All human beings create huge amount of paradigms that they follow without challenging them. It is an absolute necessity as we can focus our attention only on limited number of issues.
This limitation could open the way for exchanging thoughts with clever people who are external to the specific organizational environment in order to focus on very few paradigms that deserve to be challenged. This requires an open-mind from the executive, and a dialogue with someone else who has a different set of paradigms, stemming from different experience and maybe even a “theory” that points to several common, yet flawed, paradigms.
There is ultra-high potential value behind being able to challenge a common paradigm that is spread in the specific business area. The updated paradigm could be used to vastly improve the business and the competitors would not be able to understand what happened and how to react back. A simple example is the meteoric success of SouthWest Airlines, which opened the door to other low-cost airlines. Uber is another example, and so are many examples where disruptive technologies made the change. The point is that it doesn’t have to be a technology advance to make a huge difference; it could be just a good challenge of a common business paradigm.
The first important “yes, but…” is that changing a common paradigm is risky, even dangerous, both to the organization and personally to you. There are always unknowns when we make a change in spite of the best logical analysis.
The other obstacle to changing paradigms is based on having to rely on an outsider, usually a consultant, that is anxious to suggest changes, because this is the core of his/her business practice.
So, risk and suspicion prevent CEOs and other c-level executives, from being triggered to challenge some rooted paradigms. How these obstacles can be overcome?
Coming to a conference that is based on a management pragmatic theory is an easy and affordable step. The part of the underlining theory helps because behind many different presentations there is a certain well agreed upon logic that has been already tested to a certain degree. Being exposed to various case-studies helps to understand the applicability of the new paradigms to the specific business environment. Being exposed to many presenters helps to realize, in a somewhat more objective way, who seems to be able to help challenging some rooted paradigms.
The Theory of Constraints, TOC, is a pragmatic approach to management, starting with the goal of the organization. The late Dr. Goldratt, who established key insights of TOC, had the passion to make management a science, meaning put cause-and-effect logic, as the most practical means to identify the inherent simplicity and be able to challenge key paradigms without exposing the organization to huge risk. You easily get this line of thought through the famous book The Goal.
TOC has challenged several key paradigms; the most notable one is the truly flawed paradigm of having a “cost-per-unit” associated with a product. The term ‘constraints’ already points to a new paradigm of diagnosing what truly limits the performance, without going lost by claiming “we are limited by many causes, so the situation is complicated”. There is more to TOC and you are invited to be exposed to it.
Eventually, if the direction of TOC looks “possibly viable”, then such a conference should provide you enough material to digest. Risk can be grossly mitigated by carefully listening and using proof-of-concepts to truly check the impact on the business.
The 18th annual conference of TOCICO, Paris, June 22-24, information and registration:
https://www.tocico.org/events/register.aspx?id=1319084&itemid=9e6d4fbe-f4fb-487a-b603-1fb494e73275
BIO:
Throughput Economics: Making Good Management Decisions, by Eli Schragenheim, Henry Camp and Rocco Surace. The publisher is Routledge, which is part of Taylor & Francis Group, and it belongs to their Productivity Press, ISBN 978-0-367-03061-2. The book appears also in eBook format.
Amazon and other retailers offer the book and you can always go directly to: