18
Feb
2011
Reaching the plateau of the U-curve, or:
When the 4 colors are not enough (part 2)
(RRR)
First, let’s remind ourselves the reason for the fact that in so many environments that claim to have no excess capacity, once DBR (and more so when BM) is implemented a considerable amount of capacity is revealed. The answer is that in the conventional mode of operation, which is dominated by the desire of people to look busy (and the need for high level of management interventions), the free capacity cannot be estimated by observing – or even measuring – the time that the relevant resources are standing idle. The only effective way to reveal the capacity is to change the mode of operation from pushing to be on the right hand side of the “U curve”, to operating within the plateau.
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11
Jan
2011
Reaching the plateau of the U-curve, or:
When the 4 colors are not enough
(RRR)
The audit process is based on investigating “mysteries”; or as Eli Schragenheim had called them in his landmark presentation in Cambridge – surprises. A mystery is an effect in reality that contradicts a predicted effect of the S&T tree. In a recent audit of an MTO company (producing metal cables of the kind that is used for holding elevators), two mysteries were evident. But first a little background:
The company had already implemented, to the letter, the left part of the RRR tree and had quickly improved its DDP from around 50% (which is typical to its industry) to the satisfactory level of 98%. They proceeded by properly exploiting the resulting competitive edge of this extreme reliability, to the extent that the market is no longer the constraint. Actually they are winning so many orders that the “load control” pushed their promised due-dates to be later than the market lead time. Since it takes a long time to add capacity (about a year) they are now contemplating a mechanism that would enable them to safeguard their preferred clients (“When given delivery lead times are (much) longer than the industry standard lead time, not only may orders be lost, but clients may be lost.” – RRR S&T step 4.13.2 – Capacity Elevation).
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