Thursday, December 30, 2010

Focus and Leverage Part 26

Future Reality Trees - Basic Principles

In the last blog we discussed using the CD to break the assumptions of a conflict. When you break an assumption you create an injection or idea. The injection is something that if it existed, then the assumption would be broken and the conflict is resolved. It is possible to generate several different ideas, each sufficient to resolve the conflict. The choice now becomes which injections do you want to pursue – which one gives you the best results? We use the Future Reality Tree (FRT) to test these ideas.

A Future Reality Tree is a sufficiency-based logic structure that is used to check ideas. It is possible that an idea that has good possibilities for success might also contain some flaws or negative effects. Knowing that some bad can co-exist with the good is probably why the common technique used to evaluate an idea/decision is a list of pros and cons. This technique isn't all bad. Unfortunately, it does not provide enough information as a means of systematically elevating your idea to create a good solution nor does it enable you to check if the "pros" will really result from the idea. The FRT first validates that the selected idea will lead to the desired results. If it doesn't, the idea is supplemented with additional injections until all desired results are achieved. Then, the FRT uses any potential problems (negative effects) of an idea as a means to improve the idea instead of a reason for dismissing it.

The Future Reality Tree is based upon three fundamental assumptions:
1) It is better to know what the idea yields before acting on it.
2) The future is predictable to the extent that current causalities are understood.
3) Negative side effects, as long as they are determined before the idea is implemented, provide the means for improving the idea.

In many ways the Future Reality Tree is a simulation model for ideas. It simulates the system to react to an idea with no limits on the number of ideas that can be simultaneously tested. Using the FRT, the existence of Injections (ideas) is assumed and their inevitable effects are predictable using well-scrutinized cause-effect-cause relationships. Usually, single injections are insufficient to cause the desired effects, but during the process of building the FRT additional Injections can be discovered that are needed in order to reach the desired result.

Sometimes a brilliant idea can turn sour. Has it ever happened that what seemed like a good idea produced less than the anticipated results? What seemed to be a good idea in the beginning quickly starts to generate some negative effects? The old adage that: “too many times the medicine is more harmful than the disease” could very well true.

Remember, as a sufficiency based structure the tree is read “If the base of the arrow, then the tip of the arrow” and the ellipse represents a logical “and” statement. The additional injections noted in the example tree are the ideas you have generated along the way to keep your good idea on track and stable. Those additional things that must exist in order for your idea to work.

Future Reality Tree

Future Reality tree can be used for:
• Testing the merits of ideas before taking action.
• Construct a solution that yields a high degree of assurance that the existing undesirable effects will be eliminated without creating devastating new ones.
• Check for and prevent potential negative ramifications of an idea.
• Build a Strategic plan.
• Verbalize and communicate a vision.

Building an FRT can take some time to construct, but a good FRT is worth the effort. It is always better to test your ideas before implementation rather then find out after the fact that the idea wasn’t so good. It’s a way, if you will; to view your idea in “Fast Forward” and make sure you like the end results. If you don’t like the results, and you can’t come up with additional injections to nullify the negative effects, then go back and select another idea to implement.

In the next blog we will discuss the Steps to construct an FRT and look for the positive and negative effects that can come from ideas.

Bruce H. Nelson

Saturday, December 18, 2010

Focus and Leverage Part 25

Conflict Diagrams – Steps to Construct and Categories

In the last blog we discussed some basic principles for Conflict Diagram. In this blog we will discuss the steps to construct and the different categories that a CD might fall into.

The Steps
There are basically 4 Steps to construct a workable CD and following them in order presents the best chance for success.

1. Identify a scenario where you know, or suspect, a conflict is blocking the achievement of an objective.
In today's ever changing and demanding world, there always seems to be many situations in which we think there is “No way out”. The feeling is that we are somehow caught between a rock and a hard place with no way to resolve the problem. This feeling of frustration occurs only when the conflict is blocking the way to achieving something that we really want. These types of dilemmas are the situations that benefit the use of the Conflict Diagram.

2. Concisely verbalize the dilemma.
Sometimes the real dilemma or problem in a situation is not as clear as it should be. By concisely verbalizing the dilemma you're half-way toward solving it. If you don’t clearly understand the problem, then it is very difficult to provide an effective solution. By identifying the conflict objective, requirements and prerequisites that make up the dilemma, you will develop a very concise verbalization of the dilemma. Verbalizing and understanding the dilemma provides an excellent starting point for effective problem solving.

3. Surface assumptions that support the existence of the dilemma.
Within whatever system you are operating there are many things that we assume to be absolutes. In others words, they appear to be things we assume we can’t change. There are many instances when assume these things to be concrete – things that are somehow unchangeable. Yet there really are very few things in systems that are unchangeable. The purpose of Step 3 is to separate the wheat from the chaff, in other words a way to separate the actual “facts” from the perceived “fiction.” Once you understand what’s real and what isn’t the task become much easier.

The assumptions are the answer to the question on the solid lines of the diagram. In other word, “in order to have A” – I must have B” “Because….?” It’s the assumptions that make the lines solid and we want to break an assumption. When the assumption is broken, the line is no longer solid, and the conflict can be resolved.

4. Generate breakthrough ideas that will invalidate at least one of the assumptions.
Generating the breakthrough idea is the primary function of the CD. To surface an idea that completely eliminates the assumption. When you surface the assumptions on each arrow, ask yourself “What must exist in order for the assumption not to be true?” Whatever the statement is, this is your injection or idea to replace the assumption.

Categories of CD
Most Conflict Diagrams will fall into one of these four (4) categories. This section provides some hints about how to construct the CD based on what type of category it falls into. These definitions will tell you which entity to fill in first and which one second…etc. Where do you start and what do you do next. What steps to take within each of the categories of CD’s.

1 - Negotiation: your opinion versus someone else's

2 - Crisis: current reality versus desired reality

3 - Classic: I know what I don't want

4 - Core Problem: concisely verbalizing the core problem from a CRT

By constructing and using the CD you have surfaced the injection or idea that you want to implement into your reality. How do you know if your idea will generate the results that you want/need? In the next segment we will discuss the Future Reality Tree (FRT) as a means of testing ideas, not only of the positive impact, but also to surface any negative branches that might exist with your idea.

Bruce Nelson

Sunday, December 12, 2010

Focus and Leverage Part 24

Conflict Diagrams - Basic Principles

Of all the tools associated with the Thinking Processes, I have found the most useful and the one I use most often is the Conflict Diagram. It seems that solving conflicts are part of everyday life. No matter how much you plan, no matter how careful you are, there always seems to be conflicts. So, if conflicts are a normal aspect of everyday life, and decisions are required to solve conflicts, then having access to the best tools to resolve conflicts is paramount.

Conflict Diagrams are necessary condition-based (necessity-based logic) structures used to verbalize and resolve conflicts (dilemmas). In the past this thinking tool has come to be known by many different names. In the early days of TOC development it was known as the “evaporating cloud”. It has also been referred to as the “conflict diagram” and the “conflict resolution diagram”. Whichever name you choose the structure remains the same. I have chosen the term Conflict Diagram.

Typically, resolving conflicts involves investing time (sometimes large quantities of time) in finding a compromise upon which both sides will agree – however reluctantly. Yet there are many times when there is no acceptable compromise that both parties will agree to. The problem with a compromise is both sides have to give up something in order to achieve common ground. When a compromise is used the end result is usually so diluted that it jeopardizes the achievement of an important objective. Unfortunately, many objectives are compromised through this process of seeking consensus on a solution that in the end the results are not satisfying for either side. The compromise process usually results in a “lose-lose” situation. In other words, neither side achieved what they really wanted. If such is the case, wouldn’t it make more sense to spend the necessary time trying to eliminate some conditions (assumptions) in reality that need changing rather than to compromise the objective? In the process of compromise it makes sense that breakthrough ideas are usually hidden to us – we are geared to looking for compromises. Perhaps generating the idea (injection) that creates a “win-win” without a compromise would be a much more acceptable platform to resolve conflicts.

By rejecting the tendency to compromise the stated objective, one gains the ability to:
1) Set objectives based upon what is wanted/needed rather than on that which is currently deemed possible.
2) Challenge vital assumptions that sustain the conflict.
3) Find paradigm-shifting ideas that increase the likelihood of achieving the objective.

The Conflict Diagram provides a concise verbalization of a problem. What is a problem? It is usually defined as a situation where you are unable to get what you want. From this definition it is easy to see that one element of the Conflict Diagram is a description of what you want – the objective – and another element of the Conflict Diagram is a description of something that is preventing the achievement of the objective. In essence – clearly defining the conflict. Once the situation is clearly defined and the entities of the conflict are clearly verbalized the stage is set for generating breakthrough ideas.

Most people have had an idea come to them from out of the blue. You know, you have been thinking about a problem and then all of the sudden you wake up one morning and a brilliantly simplistic solution comes to you. What blocked you from being able to solve the problem before? You probably had some assumptions about a necessary condition that didn’t really have to be necessary. Once you realized this at some level, you were able to come up with a way out of the predicament. Finding breakthrough ideas comes through challenging assumptions we make about our reality. The assumption based thinking (human behavior) is an essential part of the Conflict Diagram.

Structure of a Conflict Diagram
The “A” entity is the objective. It is the statement that defines what you really want to do. The “B” requirement is a statement (entity) that defines something that must exist in order to achieve the Objective “A”. The “C” requirement is the statement of an additional requirement that must exist to achieve the Objective “A”. “D” is the prerequisite statement (entity) for “B”. “E” is the prerequisite statement for “C”. The conflict, when it is surfaced, will reside between “D” and “E” (HENCE: the lighting bolt arrow). The statements written in “D” and “E” will usually be opposite statements. For example, the statement in “D” might say “do something”, and the statement in “E” will say “Don’t do something”, The line between “D” and “E” represents the tug-of-war between the two statements. As a necessity based structure it is read: “In order to have “A”… I must have “B”. In order to have “B” I must have “D”. The same rules apply to the lower leg of the diagram: “In order to have “A”… I must have “C”. In order to have “C”… I must have “E”.

The structure of a Conflict Diagram is such that it presents both sides of an argument or dilemma. Each side of the dilemma is commonly referred to as a leg. One leg presents your side of the conflict, and the other leg represents the other side of the conflict. Each leg appears valid to the person or group presenting those statements. Each leg appears to define the “necessary conditions” to achieve the objective. But each leg is in conflict with each other. One side says, “Do this” and the other side says, “Do that”. You can’t do both – so what do you do? In the next segment we will discuss the uses for Conflict Diagrams and the steps to construct a Conflict Diagram.

Bruce Nelson

Saturday, December 4, 2010

Focus and Leverage Part 23

Creating the CRT

In the last blog we discussed the elements of the CRT, with the promise to share a CRT from a real situation.

Without revealing company names, let’s start with some background on the particular company. They are a major producer of electronic components, mostly in the form of circuit cards. They are major supplier to other companies in the electronics industry. The plant was configured with seven (7) major assembly lines. Most lines were dedicated to certain types of boards, but there was also several with cross-functionality. In other words, the same type of board could be produced on more than one line. The most notable problem, and the reason they called us, was they were suffering from very high levels of WIP and not being able to meet on-time delivery demands from the customer.

We started our analysis with them by interviewing the workers on the line. We were first looking for the perceived UDE’s that existed.

Collecting UDE’s

The UDE’s provide a very important piece of the puzzle you are trying to solve. But, BEWARE: Not ALL UDE’s are really UDE’s. It’s important when you collect UDE”S to have people write them down in the form of answering a question. For exmple; “When I think of the current system, it bothers me that…” The “that statement” becomes the UDE. The more people you talk with, the better the UDE list will become. Another important factor is to note the commonality between statements. Five or six different people might all say something different, but all six mean exactly the same thing. When you find an UDE that fits this category – you’ve found an important UDE. It is also important to filter the UDE’s – to separate those emotional statements from logical statements. As an example, suppose during the UDE collection someone responds back to the statement with “It bother me that my boss is an idiot!” No matter how true that statement may, or may not be, it is an emotional statement and not a logical statement. Spending the necessary time on the front end to filter the UDE’s can translate into a much smoother process when constructing a CRT.

With that said, here is the final UDE list developed for this company:
1. The front of the line is measured in utilization minutes.

2. The back of the line is measured in boards per day.

3. RM’s are sometimes not available for production runs.

4. Testing takes too long to complete for some boards.

5. FTC and CQA perform the same function.

6. Some test equipment is not effectively used.

7. 100% of the boards are tested.

8. Boards can be rejected for cosmetic reason and not functionality.

9. Some batch sizes for some boards are too large.

10. Some FG’s sit in testing waiting for transfer to FG inventory.

11. Testing is not considered part of the production line.

From the 30 or so different UDE’s collected the list was reduced to the above list. Each UDE seems to be a separate problem with no clear correlation between them, and each is causing its fair share of Undesirable Effects in the system. So, the hunt was on to discover correlation between the UDE’s and surface a probable Root Cause.

Constructing the CRT

With the UDE list we are trying to build correlation between the entities. In other words, are there any two of these entities where one can cause the other? When you find those two it becomes the starting point to build the rest of the CRT. Continue building until all, or most of the UDE’s have been connected. Figure 1 shows how these entities were connected to show the CRT. You’ll notice that the entity boxes each contain a number at the top. This is nothing more than an entity address. This method helps when scrutinizing using the CLR’s to be able to point out entities quickly in order to make a connection. Those entity numbers with an asterisk (*) were entities from the original list. You will also notice some entity numbers without an “*”. These entities surfaced during development of the CRT as predicted effects and additional causes from the CLR’s

Using the CRT to formulate the sufficiency based logic you can see that from the original UDE list we were able to show cause-effect-cause relationships between all of these undesirable effects. The root cause in this example WAS NOT an entity listed in the original list, but rather a root cause that was exposed because of the CRT. In this case it was policy constraints. I say constraints as plural because this company has so many measurements they were trying to record, and some of these measurements were in direct conflict with each other. You’ll notice at the bottom of the CRT the two measurements – one for minutes and one for boards. In their mind high machine utilization was equal to producing lots of boards. They had very expensive equipment and the only way they could justify the equipment was to keep it busy all the time. Because of this measure they continually loaded the system with work, which created a vast work-in-process (WIP) inventory, much longer lead times, and consequently missed due dates.

In the end, policy measurements were changed, or eliminated, and the system was structured as a Drum-Buffer-Rope system with the test equipment being the drum. By using the test equipment as the drum we were able to release (“pull”) work into the system at the correct rate. This was a much different environment than trying to “push” work into the system for the sake of efficiency. The overall WIP reduced dramatically, the lead-times were shortened to hours rather than days, and on time delivery skyrocketed. Revenue jumped $350M in 6 months time and all because a CRT helped them understand what the real root cause was.
In the next blog we will discuss the Conflict Diagram and review some basic principles for its use and structure.

Bruce Nelson