The New Beginning Part 3

Part 3 is a continuation of my blog series on Matt Hutcheson and my new book, The New Beginning. This book is written as a business novel and is a sequel to my last book, The Secret to Maximizing Profitability.  Here is a link to the new book:  https://www.routledge.com/The-New-Beginning-A-Business-Novel-on-How-to-Successfully-Implement-the/Sproull-Hutcheson/p/book/9780367688370 and a photo of the cover:

In Chapter 6, entitled Simpson’s New Beginning, located in Detroit, Michigan, Tom meets with the new Plant Manager, Matt Maloney.  Tom presents the basics of the Theory of Constraints and then a detailed presentation on TOC’s version of accounting known as Throughput Accounting. In this presentation, everyone in attendance gets to see how, by using this form of accounting, a different product mix can change the company’s profitability.  They also discussed the basics of Lean and Six Sigma, or at least how both had been used to improve Simpson’s profitability, but not at the level they had wanted or expected.  Simpson’s attempt to use Lean and Six Sigma was, of course, prior to having received assistance from Tom.  The chapter ends with Matt asking Tom if there was a way to combine Lean and Six Sigma with the Theory of Constraints.  Tom explained that they will see exactly how to combine the best of all three methods when he returns for another visit.

Chapter 7, entitled Maximo Health Center Complex’s New Beginning, begins with a review of potential performance metrics that they might use at this complex of hospitals to track their improvement results.  Tom plans a visit to Maximo Health Center Complex to present the basics of TOC, the importance of identifying the system constraint, plus a detailed look at Throughput Accounting to a group of leaders from each of the six hospitals within this complex.  His presentation of Throughput Accounting includes a case study, of all things, a sock making company.  At the conclusion of this training session, Tom invites Pete to a presentation on how to combine Lean, Six Sigma and the Theory of Constraints, to be held at Simpson Water Heaters in Detroit, Michigan.  Pete agrees to attend along with two LSS Black Belts from his complex of hospitals.

In Chapter 8, entitled Simpson Water Heaters Next Meeting, Tom presents how best to combine Lean, Six Sigma and the Theory of Constraints which will result in major improvements to profits.  Tom explains that too many companies believe that the key to improving profits is through how much money can be saved, when in reality profit improvement should be based upon how much money can be made.  Tom then presents a detailed look at how to combine these three improvement methodologies, the necessary tools, actions and focus and finally the expected deliverables.  This chapter ends with Tom explaining that he would be back to Simpson Water Heaters to present several other key methodologies, namely TOC’s scheduling and replenishment methodologies, as well as something called the Goal Tree.

In my next post I will continue with my series on Matt Hutcheson and my new book, The New Beginning, scheduled for release on March 5, 2021.

Bob Sproull