6/13/2007

The Theory of (Personal Productivity) Constraints

My friend Dave Olson writes an intriguing post:
How do you increase your capacity?

* Emotional capacity
* Financial capacity
* Productivity capacity
* Relationship capacity

If the key to growth in life is capacity, then you’ve got to learn how to do more.

Right?

WRONG!

The key to increasing your capacity is doing more… of less. At least that’s what I think.

I believe that when he first said "you've got to learn how to do more" he meant "more" as in "new and different things than you already know". And when he says that's the wrong approach, I stand up and salute!

Dave continues:
"If you concentrate on doing only the things that YOU should do, you will become more effective."

Amen to that!

I've heard other people tout the "focus on your strengths" approach; most notably Marcus Buckingham, author of Now, Discover Your Strengthsand the brand newGo Put Your Strengths to Work. But that seems a bit counter-intuitive. Shouldn't I work on fixing my weaknesses?

Dave finishes his post by asking:
"What are you good at? What unique things do only you do?"

My response:
"I see connections other people haven’t (probably to maintain their sanity). For instance, your “focus on your strengths” is analogous to Eli Goldratt’s “focus on the constraint” in production systems."

Dave asked for a bit of clarification, since he hadn't heard of Goldratt (!)

Eli Goldratt is an iconoclastic genius. His book The Goalwill forever change your understanding of manufacturing and production processes.

For.e.ver.

If you haven't read the book, go hit that link and ask for express shipping. Or run to your local library or book store. They've got it. You will thank me.

But if you've read the book or just want the spoiler notes, here is why I think that Goldratt would agree with Dave's statement.

Eli's basic thesis is that any production system of nontrivial complexity is constrained by at most one or two steps in the process. In the book the constraint is a machine known as Herbie. The machines upstream from Herbie can make all the parts they want, but if Herbie can't process them they will just stack up as excess inventory. The machines downstream of Herbie are dependent upon his output, so they can't go any faster than he can. The entire system's capacity is controlled by the capacity of the constraint. You can spend all the money you want on improving other departments and other machines, but every dollar will have been wasted. You would have been better off flushing them down the toilet, because at least then you wouldn't have an expectation of improvement!

Faced with this problem, Goldratt outlined a five step process for maximizing the throughput of a system:
  1. Identify the system constraint
  2. Maximize the throughput of the constraint as is
  3. Subordinate everything else to the constraint (for the reasons stated above)
  4. Invest in adding constraint capacity, if prudent
  5. Go back and see if the former constraint is still the constraint. If not, rinse and repeat.

Let's say you run a take-out pizza joint. You've got a pretty good crew. Your dough crew can knock out 1 pie per minute. The sauce and toppings guys can handle three per minute. The oven requires 15 minutes to back a pie, with a capacity for baking 5 pizzas at a time.

Where is the constraint?

Yep. The oven. No matter how fast you create 'em, that oven can only crank out one every three minutes. So if you want to increase your throughput, all you can do is increase oven capacity. So let's say you invest in one of those conveyor-belt models that can churn out a pizza every 45 seconds. Now where is the constraint?

So that's the theory.

Now, how does it relate to personal productivity?


You decide the pizza business doesn't allow you to express your creative self. So you become one of those sidewalk chalk artists.

How do you make money? People throw money into a handy receptacle you provide for tips.

What is the constraint on how much money you make? It's your ability to create compelling artwork.

But that's not the only thing you do. You have to keep your permits and finances in order. You need to find good locations to work. You need to interact with potential patrons.

But is your time better spent adding a juggling act or refining your ability to render those eye-popping 3-D effects?


The time may come when you want to scout new locations, but is that something you need to do yourself, or can you get someone else to do it?

Your unique talents are usually the things that gets rewarded the most in the marketplace. By focusing your efforts on improving your unique value proposition, you maximize your throughput / monetary value. You can work to improve in other areas because it's fun or you don't want to bother finding someone else to do the work, but you're not really maximizing your capacity.

And that's why Eli Goldratt, Marcus Buckingham, Dave Olson, and I are all on the same page on this concept.



posted by Mike at 5:29 PM


7 Comments:

Anonymous Karin H. said...

Hi Mike

Great books, all three of them. I put The Goal in my 'combined snippets' as a foundation block for your business.

At the moment I'm reading 'Go put your strengths to work - 6 weeks plan, so it will be a while before I will write my review and experiences about it.

Am with you on that same page ;-)

Karin H. (keep It Simple Sweetheart, specially in business)

4:05 AM  
Blogger Bob said...

Mike, we just used a Theory of Constraints workshop on our engineering alliance management to help identify bottlenecks in relationships between us and our clients.

Amazing how this can be used in the relationship world just like the manufacturing world!

6:34 AM  
Blogger Mike said...

Karin,

I look forward to your review of the new book. Buckingham is offering a series of free teleseminars starting in July. I signed up to see what he has to say.

Mike

7:14 AM  
Blogger Mike said...

Bob,

It IS amazing how widely applicable the TOC Thinking Processes are. If you haven't read "It's Not Luck", you may want to check it out. It introduces the concept of the "unrefusable offer" in dealing with customers. Fascinating stuff!

Mike

7:17 AM  
Blogger Troy Worman said...

Great post, Mike. I am a big fan of Goldratt, Buckingham, Olson, and, who was that other guy?.

4:24 AM  
Blogger Mike said...

He's some wild man who shows up and rants in this space.

8:21 AM  
Blogger ALLYSON said...

Hello Flaviu
My name is Allyson Evans and I work for the Marcus Buckingham Company and was wondering if I could get you email, so that the president of our company Kevin Small can get in contact with you regarding some of our products and feedback.
If you could send me this information with your name, email, and URL of you page I would greatly appreciate it.

Thank you so much for you time,
Allyson Evans
The Marcus Buckingham Company
allyson@marcusbuckingham.com

11:57 AM  

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