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com

27th InternationalConferenceofthe
TOCPractitionersAlliance TOCPA
www.tocpractice.com

August1618,2016Johannesburg,SouthAfrica

ImplementingTOCSupplyChain
ManagementruleswithinaglobalHigh
TechCompanyinrecordtimeusingSAP
andSimulationModelling
CASESTUDY
Dr Alan Barnard, Goldratt Research Labs, South Africa
17th 18th August, 2016

27th InternationalConferenceoftheTOCPractitionersAlliance TOCPA

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Dr Alan Barnard
Dr. Alan Barnard is one of the leading experts in the world in Theory of
Constraints (TOC) and frequently worked with Dr. Eli Goldratt, creator of
Theory of Constraints, on large and complex projects around the world. He
is the CEO of Goldratt Research Labs (USA), Chairman of African
Phosphates (RSA) and The Odyssey Institute (USA). Alan is also a board
member of TOCICO and the Dr. Eliyahu M. Goldratt Foundation.
In 2009, Alan was awarded a PhD in Management of Technology &
Innovation, from the Da Vinci Institute, with a thesis titled How to identify
and unlock inherent potential within organizations (private & public) and
individuals?. Alan is also the author of 2 chapters in the McGraw Hill
published Theory of Constraints Handbook and is currently working on a
new book.
Alan has worked as a strategy advisor for global companies such as ABB,
BHPB, Microsoft, Cisco, SAP, Random House, African Explosives and TATA
Group in the Private sector and also with UN DP, UN WFP and Utah State
Government in the public sector. The common objective of all these projects
was to apply Theory of Constraints PRINCIPLES to develop PRACTICAL
MECHANISMS (PRACTICES) to help them identify and unlock inherent
potential to achieve more with the same resources in less time.
Alan is also the chief architect of HARMONY (www.harmonytoc.com), a
collaborative web app nominated for the 2013 Silicon Valley Business App
awards. It is used by 100s of organizations around the world to design,
validate/communicate, plan, implement and audit their Strategy & Tactics
and to resolve strategic and tactical conflicts.

Contact info
alan@goldrattresearchlabs.com

27th InternationalConferenceoftheTOCPractitionersAlliance TOCPA

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CaseStudy:TheCompany

27th InternationalConferenceoftheTOCPractitionersAlliance TOCPA

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StandingontheShouldersofGiants
StandingonShouldersofGiants:4ConceptsImproveOperations/SupplyChains
InStandingontheShouldersofGiants,GoldrattidentifiedthatbothFord,Ohno(andGoldratthimself)
followedfourconceptsorprinciples(calledthe4conceptsofimprovingandmanagingsupplychains):

1. ImprovingFlow(orspecificallyreducingdemandandsupplyleadtime)shouldbeaprimary
objectiveofoperations
2.

ThisprimaryobjectiveshouldbetranslatedintoaPracticalMechanism thatguidestheoperation
whennottoproducetopreventoverproduction (doingthingsthatshouldnotbedone)

Ford:UseSpace
Ohno:UseInventory(kanbans)
Goldratt:UseTime(Buffers)

3. AbolishLocalEfficiencies(andotherlocaloptima)
4. AFocusingprocesstocontinuouslybalanceflow mustbeinplace(torebalancedemandand
supplywhenchangestakeplace)

27th InternationalConferenceoftheTOCPractitionersAlliance TOCPA

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Whatmanagementdecisionmistakes
doTOCApplicationsandTOCRules
helptoprevent?
EffectivelyandEfficientlymeetthedemandplacedonmy
Part
ContinuouslyImproving&Synchronizing(Balancing)Flow

1.PLANNING

2.EXECUTION

Decisionsbeforewestartwork

Decisionswhilewedowork

DECISION1A

DECISION1B

Howtoallocate
Howtomakereliable
resourcesandbuffersto commitments,prioritize
(efficiently)meet
workandcontrolWIP
demand?
release?
(OLDRULE)MISTAKE1A

(OLDRULE)MISTAKE1B

Ignoringbacklogwith
Causeselfimposed
makingcommitments&
peaksorMisallocate
Resources(onForecast) notcontrollingreleaseof
WIP
and/orLocalBuffering
NEWRULE1A

NEWRULE1B

Removeselfimposed
QuotingonPlannedLoad
peaksandDynamically
&PrioritizedWIPRelease
allocateResources&
Control
AggregateBuffers

3.MEASURE&IMPROVE
Decisionsafterwecompletedwork

DECISION2A

DECISION2B

DECISION3A

Shouldwechange
prioritiesand/ordo
batching/multitasking?

Whenshouldwe
expediteworkand/or
whatshouldbe
reported?

Whatshouldbe
measured
(andwhatnot)?

(OLDRULE)MISTAKE2A

(OLDRULE)MISTAKE2B

(OLDRULE)MISTAKE3A

Usinglocal
considerationsfor
Priorities&Batchingor
Multitasking

Dishonestorlate
reportingand/orToo
muchorLackof
Expediting

NEWRULE2A

NEWRULE2B

SingleDynamicPriority
System+Singlepiece
flow

Dailyhonestreporting
andActiveBuffer
Management
(expediting)

DECISION3B

Whenandwhereshould
improvements/
investmentsbemade?
(OLDRULE)MISTAKE3B

UseLocalefficiency
Localoptima
metrics&variancesto
decisionsresultingin
decidewhenandwhere unbalanceddemandvs.
toimprove
supply
NEWRULE3A

NEWRULE3B

AbolishLocalEfficiencies Focusedimprovements
useParetoanalysisof andresizebufferstore
flowdelays(reds/blacks)
balanceflow

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HowdidweDESIGN theTOC
basedSupplyChainSolution?
HighTechCompany S&T

27th InternationalConferenceoftheTOCPractitionersAlliance TOCPA

HowdidweTEST theTOC
basedSupplyChainSolution?

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27th InternationalConferenceoftheTOCPractitionersAlliance TOCPA

www.tocpractice.com

HowdidweTEST theTOC
basedSupplyChainSolution?

27th InternationalConferenceoftheTOCPractitionersAlliance TOCPA

www.tocpractice.com

HowdidweTEST theTOC
basedSupplyChainSolution?

27th InternationalConferenceoftheTOCPractitionersAlliance TOCPA

www.tocpractice.com

HowdidweTEST theTOC
basedSupplyChainSolution?

27th InternationalConferenceoftheTOCPractitionersAlliance TOCPA

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HowdidweIMPLEMENT
theTOCbasedSupply
ChainSolutioninSAP?

27th InternationalConferenceoftheTOCPractitionersAlliance TOCPA

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ActualResultsachieved?

27th InternationalConferenceoftheTOCPractitionersAlliance TOCPA