Many of you in the TOC community already know or know of Oded Cohen. He’s been a leading thinker within our community for decades and a major contributor to the current TOC body of knowledge.
Please read on to hear more of Oded’s fascinating TOC-journey, his latest book and a touching TOC story.
Q1. Hi Oded. We've not met before and I only know you by reputation. I know you've been at the core of TOC development for decades, that you've co-authored a wonderful TOC book, that you've just published a brand new TOC book but that's it. Could you tell us a bit more about your TOC journey - how it started, the journey itself and where you are now?
Well – this is quite a long story. I will try to condense it.
It started in 1978. I then was the head of a data processing department in a large Israeli manufacturing company – Soltam – producing Cannons, mortars and saucepans. These were the early days of MRP and I was involved in developing a fully integrated management information system for manufacturing. I met Eli Goldratt, and got to know his scheduling software – OPT. We checked the OPT on two production lines and got outstanding results in reduction of lead time and on-time deliveries We used the software for a while and then I moved to another job in another company. I used the concepts of the software in my role as the assembly manager for semiconductor equipment.
In 1982 I joined Creative Output, Eli’s company and moved to the UK to help building the local company together with Alex Meshar and Avraham Mordoch. We focused on selling the OPT software, implementing it and integrating the concepts known as the “rules of OPT”. We worked with brand names such as Lucas, STC, Rolls Royce and others.
In 1983 Creative Output became more and more successful worldwide, and yet – selling the software was difficult in spite of the track record and the remarkable results that were achieved through the use of the software and the methodology. The analysis of the difficulty brought us to realize that besides a bottleneck there is also a market constraint. Not that the market for our product was limited, but that our ability to persuade the market to buy from us was limiting our growth. This realization brought us to focus on teaching and training managers in adopting the suggested way of managing. This realization also created an internal conflict in the company between the software people and those that were devoted to continuous improvement. The polarization was so strong that it caused a crisis that brought Eli Goldratt and his people to leave the company.
The next phase was the construction of AGI – the Goldratt Institute in the end of 1986. This was a partnership between Eli Goldratt and several people, most of them from Creative Output. I was the partner in charge of the UK and some countries in Southern Europe. After a year in Spain I moved back to the UK. As Creative Output was sold and OPT was trademarked – the term TOC was invented. We first focused on developing and teaching the Jonah Program. This was a ten day program for top management to get the essence of production solutions and the underlying thinking processes. The first Jonah Programs were taught based on the production solution and the Goldratt simulator. In 1991, after a request to develop a special Jonah Program for the service industry (for an insurance company and for a college) the thinking processes of TOC were defined and a set of guidelines were established to help in constructing and teaching them. Thereafter, this program became the standard Jonah Program.
1991 was the year that the UK AGI network was established. Several people that used to work at the EITB (the engineering training board in the UK) created their own group and were promoting the Competitive Edge approach (based on the Race). Among them were: Jim Bowles, David Marks, Mike Dinham, Karl Buckridge, Ted Hutchin and others. The network included also John Tripp who I have known since he joined Creative Output in 1984 and Alan Cohen who was the associate for the new information system software packages that was called “Disaster”.
Parallel to the full thinking processes (TP) work we were also developing the daily use of the TP. In 1995 I wrote the MSW – Management Skills Workshop, a set of five working booklets covering six daily tools: conflicts, half baked solutions (NBRs), chronic conflicts, lieutenant cloud, clear instructions and achieving ambitious targets (IO maps). This program was intended to give the Jonahs the practical tools to use the thinking processes to help them in managing their own areas on daily basis. It was apparent that the Jonah Program is the process to develop a strategic solution while the managers also needed tools for enhancing their ability to make decisions and resolve managerial challenges continuously. After developing the program I went on a grand tour visiting TOC communities of Jonahs and AGI network teaching and communicating the program. It was amazing to see how the TOC knowledge and thinking had been disseminated with a lot of commonality. The whole community was talking the same language.
The first MSW was run in Israel in the spring of 1995. Among the participants were Alejandro Fernandez (now Goldratt Schools’ principal for Latin America), Philip Viljoen (now GS principal for South Africa and India), Barry Urban and Kathy Suerken (CEO of TOC for Education). The MSW was adopted by the TOCFE and I conducted several programs for the teachers, headmasters and counsellors. Thereafter – the MSW was developed by TOCFE to become TACT – thinking and communication tools.
The years of 1991 to 1997 we devoted to the development of the thinking processes as well as the TOC solution for distribution, project management and the unrefusable (“Mafia”) offering for marketing. The article “My saga to improve production” by Eli G formalized the 5 layers of resistance to change recording our collective experience. Layer 6 was added as acknowledgement of the UK reality (when managers exposed to a new idea would say “yes” and do nothing).
Gradually, we incorporated programs and activities in promoting the TOC for functional solutions – production, distribution and project management. We developed the 5 day programs that were geared to give companies the knowledge of the TOC solution as well as the outline of the implementation plan.
In 1996 I met Martin Powell who joined me and since then we have been working together.
Eli Goldratt retired from running AGI in 1997 (when he became 50 he decided that it is the right time to retire and do the things he wanted to do). In 1999 Eli produced the eight sessions of the Goldratt Satellite Program. These lectures were used as the base for 4x4 program with the objective of transferring the knowledge and helping companies to decide on embracing TOC holistically. This program was a combination of 4 days viewing and discussing the lectures and 4 days of detailed TP analysis of the company and determining the holistic solution for them.
In 1999 Goldratt UK together with Alex Knight and his team from Ashridge Consulting Group had a major project at Norwich Norfolk Hospital. This was in conjunction with the first private financing initiative (PFI) for a hospital in the UK. The project covered the new hospital, new integrated (paperless) information system and improvements in work practices. Naturally we were also involved in the millennium projects.
In 2001 Eli Goldratt came with the idea of developing certification for the TOC profession. The idea was to create some case studies describing the scenarios of some companies and asking the TOC practitioners to come with suggestions about the potential growth of these companies and how to go about it. The plan was to gather at least a hundred of such cases and to use them for the certification. We managed to collect just a few case studies before this idea was used as a spring board for the creation of TOCICO.
TOCICO was created in a meeting of the TOC community in November 2001. A founding committee was elected and I was chosen to be the first chairperson of the organization. It was intensive work to get all the parties together and to construct the organization that will be the home for the TOC community. This year is the 9th year anniversary of the TOCICO.
In January 2002 I left AGI. I continued the TOC activities in the UK and some of countries in Europe in partnership with Martin Powell through our British companies.
In 2002 and 2003 a group of people were gathered around Eli Goldratt with the view of helping him to make TOC the main way. For most us it was obvious that this direction must be taken. Even though we made a lot of progress in formalizing TOC, the basic concepts, the Thinking Processes and the functional solutions, the level of acceptance of TOC was not as high as we expected. We recognized that we had a severe marketing constraint. The Goldratt Group was constructed as a virtual organization where all the members volunteering to contribute 50% of their time for as long as needed. The group direction was synchronized through the top of the GG S&T tree (level one and two) that determined the role and activities of Goldratt Consulting (GC), Goldratt Schools (GS) and Goldratt Marketing Group (GMG). I became the head of Goldratt Schools. GS is run by several principals – Eli Schragenheim, Shri Mokshagundam, Martin Powell, Alejandro Fernandez, Philip Viljoen, Jelena Fedurko, Frances Su and a wonderful team of faculty members that teach TOC in universities around the world (please visit http://goldrattschools.org ).
In September 2003 Eli G. conducted a one day seminar in Belfast, Northern Ireland. This was the beginning of the Viable Vision approach. The first VV seminar was conducted in February 2004 in India. The first company to embark on the VV was GCP Godrej Consumer Products in India. Goldratt Schools was asked to prepare TOC consultants for serving as application experts on the GC projects. We built the TOC Application Expert Program (AEP) to teach the logistical applications – MTO, MTA and Distribution. We started with 4 weeks program and gradually extended it to seven weeks over 3 months. From June 2004 to 2008 we ran 25 programs all over the world. Wherever the sales process of GC started (usually with a seminar of Eli G.), GS was there to develop the necessary resources for the VV projects. All together we developed nearly 500 TOC application experts (the majority of them successfully passed the GS exams as well as the TOCICO certification). Unfortunately, the majority of our graduates did not participate in the VV projects but many of them have successfully used the knowledge and know-how to develop their own practices and bring benefits to their clients.
In December 2005 GS started a major initiative – a TOC Expert program covering all aspects of TOC and VV solutions. This was a 26 week program that was run in India for participants from India, China and Brazil.
The introduction of the S&T tree for the standard VV solution has marked also the change of the implementation process. The implementation is done on a step by step process covering one box (entity) of the tree after another. The responsibility of the implementation was shifted to the company and as such there has been very little demand for TOC application experts. GS shifted its activities to providing knowledge and support to the TOC community and to the academics in several regions that we operate in.
Since 2009 I have been working intensively with my colleague – Jelena Fedurko, in bringing TOC and the TOC knowledge to Russia while continuing to develop, conduct special programs and keep on writing.
In 1999 I wrote together with Domenico Lepore the book – Deming & Goldratt.
In 2008 I wore the first edition of Ever Improve. The full edition was printed in June 2010.
Q2. I'll come to your first book shortly, but could you tell us about your new book? From what I understand it's a combination of two approaches to TOC production and a new way of framing the TOC thinking processes.
Ever Improve has combined new and vintage knowledge. Over the years we have gathered a lot of experience, ideas that work, ideas that do not work, and many iterations of attempts to transfer the TOC knowledge so that it becomes accessible to the people who want to learn TOC.
TOC has two different solutions for production management: the MTO for the Make-to-Order environment and the MTA for the Make-to-Availability environment. The origin of the MTO solution goes back to the days of OPT and hence most of the concepts are over 30 years old (that is why I call them vintage and not just old). In reality there are companies that are building their products to forecast in anticipation of future sales. Traditionally it is called make to stock. The view of TOC is that stock is the means to provide availability and hence the MTA solution was developed. The realization that the MTA is different from the MTO has been revealed gradually over the last 5 years. Now it is formal and official – these are the two applications of the production solution for different environments. The book contains the two solutions.
The new full edition of Ever Improve has five parts:
1. TOC Systematic Approach – the U-shape
2. The Reality of Production and Operations Management
3. TOC solution for MTO
4. Implementing TOC Solution for MTO
5. TOC solution for MTA.
The first edition of Ever Improve was published in 2008 and covered the first three parts. Since then it has been used by companies to implement the MTO solution and has brought results and benefits. I do hope that the new and full edition will continue to bring value to companies and individuals who want to enhance their managerial abilities and ever improve the performance of the systems under their responsibilities.
The book can be obtained from:
What you refer to as a new way of framing the TOC thinking processes is not really new. It is a variation of the way I used to present the full TP map for many years. In the TOC material from way back you can find the TP Map. This came from the desire to provide a graphical presentation of the internal flow of the thinking processes from the CRT to the TrT (Transition Tree). There was also a desire to show which entities prove the bridge between the different elements of the TP. I used to show the structure of the current reality (UDEs, CRT and Core problem) on the left side, the future reality (core driver, FRT and DE) on the right side. I put a link between the core problem and the core driver. The GS team pointed that it looks like a U and one of the students prepared the slide that has been used since then. So the U-shape may be a new reference name but the concept has been there a long time. Yet, once we started to use it we saw that there is a need to add clarity and precision of every element of the U-shape.
TOC contains a lot of knowledge. I was looking to help our students in organizing the relevant knowledge in a structured way to capture the logic, to be able to store it and to be able to retrieve it. The U-shape provides a platform in which all the relevant pieces of the knowledge have their own unique place organized in a logical and systematic way. My students were saying that the U-shape gives them the confidence that even if they do not know a part of the knowledge they can position themselves on the U-shape and rely on the logical connections to find the answers.
Q3. What is your favourite TOC story?
In a journey of more than thirty years there are many stories. I can write a story for each decade or even for each year. The stories that I like are about the way TOC has been integrated in the personal life of the individual as well as into the social life.
One example is a story about using “The Goal” for a company outing.
I became the MD of Creative Output UK in the summer of 1984. Later this year The Goal was published. It took some time for the book to be accepted by people in Creative Output. This year I spent Christmas and New Year with my family in Scotland. This is when I discovered that you can ski in Scotland. Actually, it was three days of great skiing with a couple of days trying to survive in the tough weather conditions on the Cairngorm. When I came back to London, I shared my experience with my colleagues in the office. Many of them did not know that it is possible to ski in Scotland. So, I came with an idea – to have a company break in Scotland and combine The Goal with skiing.
In February 1985 we took a long weekend break. We caught the night train from London to Aviemore and got there on Friday morning. We had three wonderful days of skiing and took the night train back to London. And The Goal? Well, we had prepared copies of the chapters of the book that contain the story with Julie. When we were on the train to Scotland every wife got a copy and was asked to read it during the journey. We announced that we will have a discussion on this material.
On Friday afternoon we had a very interesting and involved discussion about the book. Most of us in Creative Output worked before in manufacturing companies. Some of the wives that read the book said that they had never been aware of the life of their husbands at work. They really probed and wanted to know if their husbands had the same problems and hectic life as Alex Rogo. The book gave them an entry to know and understand the reality of their husbands as production managers.