Theory of Constraints Handbook - James Cox Iii [217]
A lot of data needs to be collected, processed, and managed. The TOC pull distribution/replenishment solution requires very frequent updates of data, as well as relatively high data accuracy levels in order to be the most effective. An axiom in inventory management applies: the lower the inventory level, the better the accuracy and management of inventory must be.
Software helps standardize processes. It formalizes the processes required for data collection and processing. However, some complexities exist with software; the IT department must cooperate fully. For example, if IT insists on using a self-made solution rather than a ready-made system, the implementation might be delayed by several months and sometimes even years. A proper financial justification focusing on the increase in T and reduction in I investment based on the rapid implementation of a turnkey system is hard to deny.
Let me elaborate on this last point. In order to be able to make the project a success, three groups in the company must cooperate with each other. They are:
The owner
The end users
The IT staff
Each has their own goals, needs, and wants. Each must buy-in to the solution for it to be implemented and managed effectively.
The owner is defined as the top decision maker in the organization. Since the TOC pull distribution/replenishment solution requires changes that typically require high-level authorization, it is best to convince the top decision maker to embark on the TOC solution. Customarily, the owner’s goal is to get the best financial results possible for the organization, as his personal compensation (if he is not the owner himself) will usually be measured this way as well. Therefore, to convince the owner to embark on a TOC project is relatively straightforward as TOC directly targets financial results through the T channels. However, the owner plays another, more important role in the TOC project; by demonstrating his personal and active involvement in the project and radiating the project’s top priority to everyone in the organization, the owner can make the project very successful. Without his championing the project, the project might suffer from lack of others’ attention, dragging the implementation out for months, and eventually leading to poor results.
End users implement and manage using the new processes demanded by the TOC pull distribution/replenishment solution. The end user includes “anybody who performs an action with or according to the software.” The end users, while less effective as individuals, are very influential as a group. Therefore, the buy-in process here is no less important. Proper training must be conducted, explaining the reasons for the change of processes.35 Users can buy-in to the concepts but not perform the required processes to make it happen. The end user goal is convenience, and it is important to educate the end users and thoroughly explain why after switching to the new methodology the end user’s life would become much simpler, not more complex, especially when he will be able to have much better control in meeting his job responsibilities and much higher visibility in the organization. It is also very important to create a win for the end users by reaching the goal of the implementation—the best way is to tie the success of the project to their own income by bonuses, stock options, or otherwise. This will ensure they will be totally committed to the changes they need to endure and will willingly embrace them.
The IT staff function is central to any big initiative, especially the TOC distribution solution. IT has a major impact on the start of the project. They must install the software and make sure it is running correctly. They must import or link the software to inputs and outputs, and then later perform maintenance and updates to the software. IT can really affect the parameters and are usually the internal experts in the company for setting the correct parameters in the software. The