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Velocity. Part 1- Introduction

E.M. Goldratt is quite well known for his “Theory of Constraints” (TOC) approach, largely popularized through two business novels: “The Goal” which introduced TOC to the world of recurring operations management and “Critical Chain”, which did the same for the world of project management.  Goldratt and his followers have done it again! This time for the world of continuous improvement management. In the brand new business novel, “Velocity” [1], Dee Jacob , Suzan Bergland, from the AGI-Goldratt Institute and Jeff Cox, one of the co-authors of “The Goal”, have put together a story telling about realizing rapid and significant continuous improvement results through integrating three approaches: TOC, LEAN and Six Sigma. They call this TOCLSS. Workshops and conferences promoting Velocity and TOCLSS are popping already all over the place.

The idea the novel tries to convey is that “improving everything is not the same as everything improving”, that most traditional continuous improvement ventures, including improving project management maturity, are bound to fail. Most of these approaches try to improve everything at the same time and result in very small improvement, because much effort is spent on improving things that will generate very small value, things that are simply not constraints. So LEAN, Six-Sigma and the like do not produce good results if applied without taking care of real organisational constraints. And since those constraints or bottlenecks are not well identified in most organisations, traditional approaches have us working very hard to achieve almost no improvements.

I had only finished reading the introduction to the novel and I already wanted to know more about the basics of TOCLSS. I was realizing that I was intuitively applying some of these elements with my clients in improving their project-based management processes; TOCLSS could give me a complementary model to both explain and improve my own approach to continuous improvement in the world of project management. I decided to “google” the thing. Well, I found that TOCLSS was already quite discussed on the Internet and had been preceded by a very similar integrated approach, TLS (standing for the same three things as TOCLSS). This integrated approach is even trademarked as iTLS ™ (for which an official certification exists) when applied in this specific sequence[2]:

  1. Apply TOC to focus on what needs to be fixed (focus on bottleneck)
  2. Apply Lean to eliminate waste (focus on value) 
  3. Apply Six Sigma to optimize process variability and error (focus on quality variability)

I also found a major article by R. M. Pirasteh and K. S. Farah[3] that summarizes the results of a study made in a large manufacturing company, on a vast continuous improvement program that covered 21 different plants.  This study involved over 200 continuous improvement team leaders, working on 101 different continuous improvement projects over a 2-year period:

  • 11 plants applied a Six Sigma approach – these 11 plants (52%) contributed only 7% of the total savings of the program
  • 4 plants applied a LEAN approach – these 4 plants (19%) contributed 4% of the total savings of the program
  • 6 plants applied TLS – these 6 plants (29%) contributed the most, 89% of the total savings of the program

Those are very significant results to support “constraint-based” improvement programs. I see how this can also be applied to project management processes improvement, with an adjustment to take into account adaptability, something I will talk about in my next blog. I find that I have a lot of pondering to do about achieving “Velocity” through TLS and how we can accelerate project management processes improvement by adapting TLS to the project world.

This is a major breakthrough, that has been going on for at least the last four years. Was I the only one of us sleeping through the birth of TLS? About time I woke up to Velocity!

[1] “Velocity: Combining Lean, Six Sigma and the Theory of Constraints to Achieve Breakthrough Performance – A Business Novel”, Dee Jacob , Suzan Bergland, Jeff Cox, Free Press, January 2010
[3] “Continuous Improvement Trio – The top elements of TOC, lean, and six sigma(TLS) make beautiful music together”, REZA M. PIRASTEH and KIMBERLY S. FARAH, APICS Magazine, May 2006,   

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