The New Beginning Part 4

 Part 4 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.

In Chapter 9, entitled The Next Step at Maximo Health Center Complex, begins with Tom going to Maximo Health Center Complex to present TOC’s Parts Replenishment Solution and the Goal Tree.  He then explains the basics of how the Min/Max methodology works and why it typically results in excessive inventory with high levels of stock-outs.  He then presents TOC’s Replenishment Solution and why it typically results in a fifty percent reduction in inventory while virtually eliminating stock-outs.  Because of the length of time it takes to present this material, he reschedules his session on the Goal Tree for the following week.

 In Chapter 10, entitled   Drum Buffer Rope at Simpson Water Heaters, Tom flies to Detroit to present the details of Drum Buffer Rope (DBR) which Tom describes as a production planning and scheduling methodology.  Tom explains that DBR is designed to regulate the flow of work-in-process inventory through a production line based upon the pace of the slowest resource.  Tom explains that there are three schedules that must be maintained, namely shipping, the constraint, and material release.  Tom finishes his presentation by describing the importance of something he refers to as protective capacity.

 In Chapter 11, entitled Maximo’s Goal Tree, Tom presents a simple strategic tool used to create improvement plans.  He explains that the Goal Tree is a logic diagram that helps companies understand why they are not achieving their goal.  He then defines the span of control and sphere of influence that must both be defined before construction of a Goal Tree.  Tom then presents the basic structure of the Goal Tree by defining the Goal, Critical Success Factors and Necessary Conditions and then walks the team through the step-by-step process of how to create one.  The team of high-level executives from Maximo, then creates a high-level Goal Tree including lead and lag measures.  Tom then explains the process of using the Goal Tree to assess their organization, which the leaders do.  The chapter ends with Tom instructing the leaders to go back to their hospitals and create individual hospital Goal Trees.

 In Chapter 12, entitled Developing an Improvement Plan at Simpson, Tom explains that there is another part of the Theory of Constraints known as the Logical Thinking Tools.  He explains that many people who have gone through training on these tools have come away not knowing how to use them.  He then explains that the Goal Tree is a short-cut that can be used to assess a company’s weak points.  He then describes two types of logic, which are necessity-based logic and sufficiency-based logic.  He then explains that the Goal Tree uses necessity-based logic.  He goes on to explain the basic structure of a Goal Tree and then presents a case study of a manufacturing company creating a Goal Tree and then uses it to assess their company.

In my next post we will continue with this series on Matt Hutcheson and my new book, The New Beginning.

Bob Sproull