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and special cause.4 They have different origins but both can adversely affect the performance of the company. Many different kinds of management philosophies have evolved attempting to minimize their impact. For example, in Lean, the kanban is used to signal variation; when it appears, it will start chocking the release of work to control the amount of work in process (WIP). This recognizes the fact that if work is authorized and released prior to resolving the cause of the variability, the queue increases, which will increase cycle time. Similarly, in Six Sigma, process control charts such as X bar and R charts look at specific process variability. This in turn highlights areas for improving an individual process while providing feedback in execution.

Many companies may see improvements with these approaches to managing variability. However, today there is growing consensus that something additional is needed to get them to the next level. There is a need for an additional classification of variability that will provide greater understanding and insight in choosing the correct planning, scheduling, and execution applications that will provide better focus. First, it is important to examine the confusion and negative impact that is being caused and view it in a historical context.

Tools Selection

In every organization, there is a requirement to plan, schedule, and execute a series of actions in order to provide a product or service. Specific TOC applications and tools have been developed to manage different parts of the organization such as departments, work centers, etc. The three predominant application solutions for planning and control systems5 are:

Project Management System—This is used to manage the projects in the company.

Production Planning and Control System—The origin of this application is in manufacturing. However, it has evolved into many other parts of the company such as the customer service and administrative areas.

Material Management and Inventory Control System (supply chain system)— Primarily focused on material procurement, transportation, warehousing, and inventory control.

Which application solution the organization uses is determined by the product or services provided to the market. It is interesting to note that many companies locked in old paradigms using production planning and control systems such as MRP and MRPII, measures, critical path project management and distribution systems such as DRP and DRPII have not taken advantage of the evolving thinking and technologies now available and are thus blocked from adapting them. Building on the emerging thinking and new tools available, companies are already leveraging on the conclusions reached by Schragenheim and Walsh (2004) that deeper understanding of when to use each of the logistical tools, the application solutions for Project Management, Production Planning and Control, and Material Management and Inventory Control will lead to powerful hybrid solution sets. An example will be shown later in the chapter. In fact, companies using holistic planning, scheduling, and execution techniques such as the Integrated Enterprise Scheduling engine which focuses on holistically managing the value-added chain Throughput rather than Throughput of the individual parts, are obtaining remarkable and sustainable results. The rationale and explanation for such an approach was highlighted in an article written by Schragenheim and Walsh (2004). Indeed for the first time it appears there are software solutions being developed recognizing the requirement and immense potential in being able to better manage the negative impact on the enterprise caused by the inevitable variability in execution.

A Closer Look at Variability

So let us take a more in-depth look at how variability affects an enterprise value-added chain. Figure 35-5 depicts workflow in an organization. The time to complete each task consists of set-up time plus work time plus set-down time plus resource queue time. In the case of a typical shop floor scheduling routing, this