Page 95 - The Handbook for Quality Management a Complete Guide to Operational Excellence

82 I n t e g r a t e d P l a n n i n g S t r a t e g i c P l a n n i n g 83

want to make as much money as it can—no limits. But employee security
and satisfaction, as a necessary condi tions, should be established at a
well-defined minimum level. A for-profit company’s goal can’t expect to
satisfy its employees without limit, but the organization should recog-
nize the need to achieve a certain level of employee security and satisfac-
tion as one minimum requirement for achieving the goal. This is not to
say that all necessary conditions are zero-or-one in nature. Some, such as
customer satisfaction, can be increased, and doing so can be expected to
improve progress toward the goal. But even such variable necessary con-
ditions have practical limits.
The importance of identifying a system’s (organization’s) goal and nec-
essary conditions is that they become the standard by which all results are
judged and all contemplated decisions are evaluated. Did yesterday’s, or last
month’s, actions better satisfy a necessary condition or contribute to realiz-
ing the goal? If so, the organization knows that it’s making progress in the
right direction. Can we expect the decisions contemplated today, or next
week, to advance the company toward its goal, or to satisfy a necessary con-
dition? If so, the deci sion is a good one from the system perspective.

The Five Focusing Steps
Once the necessary conditions are established, constraint theory pre-
scribes applying five “focusing steps” in order to continuously proceed
toward satisfying those necessary conditions (Goldratt, 1986, p. 307).
Goldratt created the five focusing steps as a way of making sure
manage ment “keeps its eye on the ball”—what’s really important to suc-
cess: the sys tem constraint. In one respect, these steps are similar to the
Shewhart Cycle: Plan-Do-Check/Study-Act (Deming, 1986). They consti-
tute a continuous cycle. You don’t stop after just one “rotation.” The five
focusing steps (Schragenheim and Dettmer, 2000, Chap. 2) are:

1. Identify. The first step is to identify the system’s constraint. What
limits system performance now? Is it inside the system (a resource
or policy) or is it outside (the market, material supply, a vendor …
or another pol icy)? Once the system constraint is identified, if it
can be broken with out much investment, imme diately do so, and
revert to the first step again. If it can’t be easily broken, pro ceed to
the second step.
2. Exploit. Decide how to exploit the system’s constraint. “Exploit” means
to “get the most” out of the constraining element without
additional investment. In other words, change the way you
operate so that the maximum financial benefit is achieved from
the constraining element. For example, if the system constraint is
market demand (not enough sales), it means catering to the market
so as to win more sales. On the other hand, if the constraint is an

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