This Focused Performance Weblog started life as a "business management blog" containing links and commentary related primarily to organizational effectiveness with a "Theory of Constraints" perspective, but is in the process of evolving towards primary content on interactive and mobile marketing. Think of it as about Focusing marketing messages for enhanced Performance. If you are on an archive page, current postings are found here.
Monday, May 04, 2009
Applying "Science" to Investment -- From the NY Times: They Tried to Outsmart Wall Street, about the rise and fall of "quants" in the world of investment.
Gotta love this quote:
"In physics there may one day be a Theory of Everything; in finance and the social sciences, you’re lucky if there is a usable theory of anything."
Goldratt's New Book -- Having backed off a bit from the TOC community, I haven't really been paying attention to The Choice - Eli Godratt's new book. Wondering if it's worth it. Any body have any thoughts on it?
We've been crazy busy merging the different parts of our services business. I'm still trying to figure out how the bit I did read on resource replenishment would actually work without getting too deep in data. I think I'm losing my TOC persuasion skills or at least my confidence in them, or maybe just the time/energy to apply them.
These intro sections have a lot of what I expected, and a few intriguing teasers. "Services on Demand" reviews the nature of services versus manufacturing, with a focus on what Rickett's considers the most extreme type of service - Professional, Scientific, and Technical Services (PSTS).
The chapter on TOC runs through the basic applications of TOC, with a high level intro on how they're used in producing and delivering "goods" and nodding at how they might or might not apply to delivering "services."
About to get into the meat of the details of how he's adapted the TOC apps to services. The most intriguing teaser - for the next chapter - is in applying Replenishment to Resource Management. Even without getting into the details, the mere mention of that triggered a "DOH!" a-ha moment, as I'm expecting to see something about keeping a pipeline of resource inventory loaded for quick access when needed. I'll see over the weekend if I'm on track on this.
Ricketts' list of TOC applications for services also mentions replenishment as part of the multi-project solution for services as well. Interesting, though no prediction as to where he's going with this yet.
Watch for further comments as I move through the book.
Flow On - Over at gapingvoid, Hugh brings together the questions of relevancy and flow, and suggests that Sig might have a point suggesting that "flow" is "next."
Hate to break it to them, but those of us who have been familiar and worked with Goldratt's Theory of Constraints have long emphasized the understanding and management of "flow" as a means to assuring relevancy of activity. Whether in manufacturing, distribution, or projects and multi-project systems (like R&D product development or engineering shops), the goal of the owning parent system is the prime determinant of relevancy of activity.
And for these systems, from those as large as the whole corporation to those as small as a project team or production cell, the means to achieving the goal are a set of interdependent activities linked by handoffs physical, informational, or transactional. The "flow" of these handoffs (think a project task network, or a process flow chart) should be limited only by the capacity of strategically selected constraint functions, which then allow a simplified focus of management on assuring the flow of work to, through, and from these constraints.
Unfortunately, too many organizations ignore or are ignorant of the importance of constraint management, and allow too many irrelevancies -- too many erroneous assumptions -- too many misleading measurements -- to distract from the focus on flow. Too many organizations focus too much on managing capacity and cost of irrelevant parts of the system instead of focusing on managing the flow for the real source of more goal stuff -- system throughput. (If you can grow the top line - the bottom line (the goal for for-profit entities) is much more assured than if you obsess too much on the lines in between. You can only cut costs so much before hurting throughput. Throughput is potentially unbounded.)
Once the idea of flow through the system as the source of organizational goal attainment and relevancy is understood, it's a lot easier to move on to personal flow and relevancy.
- Eli Godratt's new book. Wondering if it's worth it. Any body have any thoughts on it?
the other day. So far, I've read the first "Foundations" section with it's Introduction and chapters on "Services on Demand" and "The Theory of Constraints."
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