Thirty years ago, the new Cadillac Detroit Hamtramck plant was in trouble. It couldn’t make demand. It was in start up mode when I went to get my Master’s degree at Purdue University, and was still in start up mode when I returned in January 1987. This crisis drew a small cadre of GM’ers to a bottleneck identification tool called C-Thru, and a Theory of Constraints book called The Goal. By the end of the year, I had formulated the Throughput Improvement Process at Detroit Hamtramck, a method of addressing and resolving bottlenecks on a continuous basis.
TIP spread slowly from plant to plant, usually on a crisis by crisis basis. Eli Goldratt came to Detroit and GM to see TIP and cajole executives to use TOC. Top executives demanded any plants experiencing throughput problems must use the Throughput Improvement Process. Then came a tipping point. Plants started calling our Central Office group to come to their facility and install the plant floor logic, the software, and the business process. Eventually, it became the “standard work.” Every plant will have a TIP coordinator, all plant logic controllers will have data collection, each plant will have bottleneck analysis software, etc.
The process also spread into the design world, as the bottleneck problems that appeared again and again in current production systems where addressed and resolved in design. After that, future potential bottlenecks were resolved before they were ever seen in production. Then, the concept of designing in the bottleneck was implemented. Start up durations for new model launches that required significant manufacturing changes dropped from months to weeks.
Now, throughput improvement efforts have moved into General Motors suppliers. One of my contracts as a consultant has been to go to these suppliers, find the bottleneck, and resolve the issue at the bottleneck quickly, so that it does not impact production at a GM plant. However, GM does not pay me to implement the TIP process at suppliers, only increase production to meet demand.
The initial implementations showed a cause and effect impact of hundreds of millions of dollars before GM decided that there was no point keeping score – TIP was now part of the continuous improvement playbook in the corporation.
So, is it the most successful TOC implementation to date? Here are the supporting points:
And, of course, points against:
Some might argue that the inability to get into Design and Distribution had an impact on bankruptcy, but we’ll never know. While both Critical Chain and Distribution solutions are TOC programs, they were not designed around key factors in the TIP process, which I talk about in my book, “Addicted to Hopium - Throughput”, which is now available on Amazon. It’s also important to note that an energetic TIP process in a non-constraint plant may have little or no impact on the bottom line in GM plants, since additional throughput will not result in additional sales.
Why have you not heard of it? Obviously, General Motors considers it a competitive advantage. I was not allowed to tell people what the details of my job function were after I became an executive. The only publication that describes TIP in any detail was a presentation I made at TOC World 2000. It’s posted on my Kohls Consulting website and on the Goldratt website. The only other mention is when GM Research won the Franz Edelman Award in 2005 for its development of the bottleneck algorithms behind C-Thru.
So, to summarize. Another TOC implementation that would be more successful than what has been seen at General Motors would have to:
There are many great TOC implementations, and many of them in small companies. But is there another one more successful than this?
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