A New Perspective For Enterprise Administration

With more companies dealing with people who work from home and the possibility that offices will never be the way they were, the times have never been more ripe for a complete rethink of how the company works and how it works.

It is not enough to have interesting ideas or suggestions. It requires methodology and tools, and you need to know what you are doing and why (i.e. have an epistemological framework). In this series, we present a completely new perspective on an existing method of working with projects as the key to transforming organizations, away from fragmentation and silos, towards smooth and effective work as a synchronized whole, no matter how decentralized the company may be. This has been at the core of our work at Intelligent Management for the past decade.

In 1997, I was one of the few Larry Gadd, Dr. Goldratts Publishing at North River Press, the Critical Chain galley received. At the time, I had no idea how much this would have changed the way my professional life developed (and had an impact on my personal life).

It is very difficult to overestimate your contribution to management. Simply put, Critical Chain is the foundation for a complete rethinking of the role of management (and business school curricula) and for initiating a new paradigm for the wise use of human resources.

For us at Intelligent Management, Critical Chain has been a constant source of inspiration (and a challenge) to take its limitless impact to the next level. The work we have done over the past 10 to 12 years builds on my first book, Deming and Goldratt: The Decalogue, which was written with Goldratt’s partner, Oded Cohen. (It was the first book published by Goldratts Verlag on the Theory of Constraints (TOC) and not written by Goldratt himself.)

This work was a constant feedback between theoretical development and validation on site. It has been explained in several books (“Sechel: Logic, Language and Tools for Managing an Organization as a Network”, 2010, “Quality, Participation, Flow: The Systemic Organization”, 2016, CRC Press and “Moving the Chains -“). An Operational Solution to Complexity in the Digital Age ‘, 2019, Business Expert Press.) We’ve also written hundreds of blog posts, given webinars, and more.

The essence of the work is as follows: A new, truly systemic organizational design results from the understanding of Critical Chain Project Management (CCPM), which enables companies to overcome the prevailing hierarchical, silo-based organization. We called it “The Network of Projects”.

True to the spirit of continuous innovation and development brought about by the message of Dr. Deming and Dr. Goldratt, we at Intelligent Management have taken another step to make their knowledge more available and practical.

In 1997, Dr. Goldratt “Critical Chain” and threw the gauntlet into the sleepy world of MBA programs. He was guilty of not being innovative enough to equip students with really useful (and usable) knowledge. The arena he chose this time around was “New Product Development” (and the project management that was required to bring the product to life).

Just like he did with “The Goal” (production and logistics) and “It’s no luck” (marketing, sales and distribution), Dr. Goldratt examines the current reality of project management, shows his self-limiting beliefs (assumptions) and develops a groundbreaking solution, Critical Chain Project Management (CCPM).

At the core of Critical Chain, just like Drum Buffer Rope in The Goal, there is the sensible yet revolutionary concept of Finite Capacity Scheduling: you cannot have the same person work on two different tasks at the same time. The planning must be realistic.

Critical Chain (CC) was immediately hailed as a breakthrough innovation by the Community of Theory of Constraints (TOC) and widely recognized as a breakthrough by project managers around the world. However, it took several years for CC to be adopted on a significant scale. Even today, only a tiny fraction of PM professionals have a solid understanding of it.

Why is that? In my opinion, two main factors contributed to the relatively limited spread of CCPM.

• It has always been envisioned as a project management technique and aimed at PM experts, arguably a category with limited power to influence organizational change.
• Just like quality management, project management has been broken down into a “silo” (the PMO office …) and packaged in diplomas and certifications that are organized and managed by the PMI (Project Management Institute), the most staunch denier of finite capacity planning (but, hopefully convinced the earth is not flat and Neil Armstrong went to the moon). Even today, PMI does not make CC a part of its curriculum.

In other words, the “critical chain” transformation message and its revolutionary approach to human management has been largely marred by misleading communications and commercial interests.

A new perspective for corporate management

At the dawn of the new millennium, every single element of knowledge necessary for management to develop into a legitimate social science (similar to economics, sociology, etc.) was there, published and internationally available. Both Deming and Goldratt had developed theories, principles and methods to move management from the quicksand of empiricism (“Let’s try something and see what happens” – I don’t really know what I am doing) to the safe shore of epistemology (” If I do that, I expect that to happen. ”(I have a theory and seek its scope through planned experiments.) Fundamental to this new perspective is the understanding that an organization is a system, like Deming was in the 1950s To paraphrase Deming, an organization is a system; a network of interdependent people and resources who work in processes and projects to achieve a common goal.

Deming illustrated this with his ‘Production viewed as a system’ diagram, which we presented below.

Image provided by Intelligent Management, Inc.

In addition, some management thinkers in universities around the world began to point out the fallacy of prevailing management methods, which was almost always based on cost accounting considerations. The overarching theme of “Complexity” was beginning to rise, and from the 9/11 tragedy to the 2007 financial crisis and the 2020 pandemic, the world had to grapple with it. In Part 2 of this series we will examine what complexity means for companies and which core problem prevents companies from achieving sustainable growth.

This is the first article in a series! If you want to read the next one, click here.