Theory of Constraints — A Concise, Expert Management Briefing

Several "layers" of TOC consultants Individuals and larger consulting companies Charlatans exist and will probably grow in number! A new wave of consultants are just being taught

TOC Consultants: not just one tribe

This isn't the standard discourse on how to choose a consultant. Just some background issues that you might want to consider when you look for a consultant.

In many ways, you can view TOC consultants in layers.

Layer 1: The pioneers

When Eli Goldratt first introduced his (then) unusual concepts into North America in 1978, he was bucking every trend in manufacturing, and Eli, his company and his concepts were at war with a huge body of knowledge that was still itself revolutionary, and had the backing of every manufacturing organization in the Western world — MRP, just evolving into MRP II. So the people who joined and worked with him were the first of several waves of intelligent, highly motivated contrarians who enjoyed the contrarian position, enjoyed the shock-power of the Goldratt concepts (Cost Accounting: Enemy #1 of productivity! for example), enjoyed rocking boats, and believed deeply in the concepts. They also had to REALLY know the topic because they had to prove everything, every time.

In those days the topic was mostly production planning, scheduling and management, with the alignment of all other resources, naturally. There was no solid distribution solution, marketing or sales solution, project management solution, strategic or people solution ... in fact the Thinking Processes did not even exist. Barely even a concept. There was software to support the scheduling; in fact, the software was the core of the whole thing in those days. But knowledgeable consultants were vital to help companies apply the concepts that the software supported.

Those people were the first wave of TOC consultants, and several are still active today, 27 years later. Quite simply, those still around are typically hugely experienced in the production application, darned good, and expensive (but worth it). They tend to have a strong background in the Distribution and supply chain environments, too. But few have any real know-how in the Thinking Processes or the applications that use them ... the sales and marketing solutions, for example.

Layer II: The best rounded TOC Consultants on earth

Eli disconnected from that company in the 80's, shifted focus to the concepts and away from software, and founded the Avraham Y. Goldratt Institute, determined to work with independent consultants and have only a few partners and a minimal level of payroll employees. Over the 6 years from 1988 through 1994 Eli introduced the Theory of Constraints as a formal body of knowledge, developed the 10-day Jonah Course to teach it (using PC-based simulations we still use today), grew a network of independent consultants, worked with that network to develop the TOC Thinking Processes (and learn how to teach it, then how to teach the teachers), and baby-sat, monitored and drove the development of all the other TOC applications.

This was a second wave of TOC consultants, and they are unique in that they typically received 99% of their training from Eli Goldratt, typically spent literally hundreds of hours locked in smoke-filled rooms with Eli and Bob Fox developing "product launches" and marketing plans, developing new workshops, testing out new ideas, typically all have a solid base in every TOC application, and the Thinking Processes are typically 2nd nature to many of them (there are a few exceptions) because they didn't just learn them, as later TOC consultants did ... they helped develop them, in more smoke-filled rooms in New Haven but also in Rotterdam, or Jerusalem ... wherever Eli happened to be at the time. The Theory of Constraints applications have continued to develop since those days, but I'd estimate that 95% plus of the non-production applications and the Thinking Process techniques were formed in those 6 years.

Layer III: one application at a time

Then in summer 1994 there was the beginning of a minor mutiny. Many of this network of consultants formally or informally quit the AGI network, and severed most of their connections with the AGI. Bob Fox, Eli's partner for many years, went his own way; other partners did, too, in the following years. New ones came aboard, naturally. But now the AGI approach to LIcensing independent consultants changed. People had to be individually licensed for each application. It became much more difficult (and expensive, and time consuming) to be licensed in several applications, to become proficient in the Thinking Processes, to become a certified instructor of the Jonah material. The consultants from this phase until the present, I consider the 3rd wave.

Many consultants became 1-man bands. Several failed, in large part because the success of a small consultant is more a factor of marketing than consulting skills, and the disdain for marketing activities of consultants in all fields is well known. A few companies formed with more than 1 or 2 employees. Today, in North America there are a handful of companies with 5 or more TOC consultants, and a very few with 10 or more TOC consultants. Some remain "pure" Theory of Constraints. Others are "stealth TOC," developing their own brand and perhaps coming in under the radar of the Lean proponents, but still TOC-oriented in their implementation practices.

Watch out for the charlatans

One problem has always been the TOC charlatans. We watched one of the high-profile consulting companies in the 90's put on workshops in Theory of Constraints ... knowing that not one of the instructors had taken any formal training or had any experience in TOC! That branch office had just bought a case of Eli Goldratt's book "The Goal," though, a couple of weeks before, so I suppose they considered themselves qualified! I sat in on a guest speaker's seminar at a conference; the topic was Theory of Constraints and the speaker was not only misinforming the audience, he was doing so in a manner that was very detrimental to the TOC. I had a gentle chat with him afterwards. He admitted he'd never had any formal training but had read the books.

Fortunately, today there is the TOC-ICO organization; an independent organization that offers International Certification as a TOC "expert" in individual Theory of Constraints applications based on a set of quite strict criteria. Not all who are indeed experts in TOC have applied; but those who have applied and been Certified have demonstrated both theoretical and practical know-how, so that's a decent start.

The 4th Wave: in a hurry ...

Now (2005) there's a fourth wave of consultants beginning. Eli Goldratt's Viable Vision program has created a tremendous swell of interest in the Theory of Constraints, and he needs independent consultants to work with him. Some of the old-timers have rallied once more to his side (from all three prior waves), but not all; and certainly not enough to meet the demands arising from the Viable Vision program. So, to ensure he will have enough he has started an organization designed to provide intensive training to people (typically consultants in other fields of endeavor) who might have no TOC background to begin with, to a level such that they leave with sufficient know-how to be effective in a Viable Vision implementation.