Theory of Constraints Handbook - James Cox Iii [288]
Finding the Core Conflicts within Continuous Improvement and Auditing
In science, there is general consensus that by “defining a problem precisely, you are halfway to a solution” (Goldratt, 1990, 37). Goldratt proposed a method called the “Evaporating Cloud” (EC; sometimes referred to as a Conflict Cloud or Conflict Diagram) to provide a practical mechanism for “defining a problem more precisely” by verbalizing the unresolved problem as an unresolved conflict in trying to satisfy two different sets of necessary conditions within the same system. By understanding the conditions that create the conflict (underlying erroneous assumptions about the system and behavior of its parts), we can gain insight as to what few changes will be needed to solve the core problem—the few changes that would “evaporate” the core conflict cloud of the system and therefore reduce or even eliminate the performance gap and related UDEs. Figure 15-4 shows an example of the core conflict in deciding which organizational structure to use—the conflict of centralize versus decentralize. In order to achieve success (A—The common objective in the conflict), managers must ensure the organization is efficient (B—a necessary condition for success). In order to ensure the organization is efficient, management feels pressure to centralize (D—Assumed prerequisite for satisfying the necessary condition of be efficient).” At the same time, to achieve success the organization must be effective (C—another necessary condition for success), which results in pressure to decentralize (D’—Assumed prerequisite for satisfying the necessary condition of be effective). However, if they centralize too much, some stakeholders will complain about increased bureaucracy and slower decisions (the negative consequences of jeopardizing the need for be effective or “Not C”), which they believe can be corrected by decentralization. However, if you decentralize too much, other stakeholders will complain about increased noncompliance and duplication or waste in common resources (the negative consequences of jeopardizing the need for be efficient or “Not B”). This method of using the conflict cloud to better define the problem helped in this case to understand that the real problem is the unresolved conflict resulting in oscillation between centralization (to prevent noncompliance and waste) and decentralization (to prevent bureaucracy and slower decisions). This centralize/decentralize conflict and its consequences can be seen in many organizations today and will continue, until this conflict can be broken.
FIGURE 15-4 Example of core conflict within an organizational structure.
However, what are the unresolved core conflict(s) faced by managers related to achieving ongoing growth and stability in their organizations? Step 1 in the process to “define the problem more precisely as an unresolved conflict or set of conflicts” is to identify the UDEs or generic bad decisions related to the errors of omission and commission in CI and auditing:
1. Not changing when you should or changing when you should not—mistakes in deciding on When to Change.
2. Implementing the wrong change (e.g., unimportant/nonurgent changes) or not implementing the right change—mistakes in deciding What to Change.
3. Implementing the right change in the wrong way (e.g., without full consensus or not fully resourced)—mistakes in deciding How to Change.
4. Not correcting or stopping (a change) as soon as possible when we recognize one of the above three mistakes were made—mistakes in auditing changes.
Step 2 simply involves verbalizing the actions/decisions related to each of these UDEs as part of an unresolved conflict. In Box D, we write the action we feel the most pressure to take when dealing with the problem. Box