Chaos to success sme transformation using toc
- 1. Moving the Indian economy from Third World to First! Preparatory Course to become Knowledge Partner with SME Entrepreneur
- 2. ▪ You believe that ▪ Learning is a life-long pursuit ▪ Purpose of knowledge is implementation / adoption ▪ WIN-WIN is the best attitude ▪ You want to ▪ Experience “Give me a lever long enough and a place to stand, I can move the world.” ▪ You are ready to challenge the myths ▪ Entrepreneurship = Start-up = New Idea + New Money ▪ SMEs cannot afford “HIGH VALUE” consulting ▪ New MBA Graduate needs support in the beginning of their career Who should take this course?
- 3. ▪ Not a course in THEORY – You will not earn a PhD ▪ No spoon-feeding – Pointers will be given for self-study ▪ Not for collecting credits – You will be required to put in serious effort What the course in NOT?
- 4. ▪ Why Change: ▪ Convincing the SME Entrepreneur for Chaos to Success Journey – Growth, Realising the dream, Peace of Mind ▪ What to Change ▪ Analysing the SME Current Reality using ▪ TOC Thinking Processes – Interviewing key stakeholders both internal as well as external ▪ Financial Reports ▪ Operations Reports – ERP Data – Sales and Material Receipt transactions ▪ Material Flow Patterns ▪ Identifying the leverage Point ▪ Few changes that have potential to delivery tremendous results Chaos to Success Course Outline Transforming SME
- 5. ▪ What to Change to ▪ Measurements and Review – Managing People ▪ Goal, Critical Success Factors, Necessary Conditions ▪ Standard TOC Templates ▪ B2B MTO, ETO - Operations ▪ Supply Chain, Distribution and Retail ▪ Projects ▪ Marketing and Sales ▪ What to Sell ▪ How to conduct a Sales Meeting ▪ How to manage Sales and Marketing Function Chaos to Success Course Outline Transforming SME
- 6. ▪ How to Cause the Change ▪ Getting a buy-in of the Entrepreneur and her Team to Act ▪ Preparing the Action Plan ▪ Executing the Action Plan ▪ Monitoring Progress ▪ Making course corrections Chaos to Success Course Outline Transforming SME
- 7. ▪ Reading Material to understand the basics ▪ Discussion on learning from prescribed books. Novels on Theory of Constraints by ▪ Dr. Eliyahu Goldratt ▪ Bob Sproull ▪ Others ▪ A Live Project ▪ Complete lifecycle of selling, analysing, solution development, road-map preparation Method of Teaching
- 8. Inherent Simplicity 8 Leverage Point Is there a smart way to get better results with minimum efforts?
- 9. One Focused Initiative ….Significant Results Metric Mean % Revenue (Increase) 68% Inventory (Reduction) 50% Lead Time (Reduction) 70% On Time Delivery (Improvement) 60% TOC Implementations Industry Results* *Survey conducted by Prof Balderstone and Mabin ^ Estimated • Significant improvement in MTO Reliability and Lead Time • Significant reduction in Working Capital • Significant increase in Profit and Profitability Possible Impact
- 10. Theory of Constraints ▪ Any processing system has a very limited number of constraints ▪ The constraint limits the output of the entire system ▪ By controlling and maximizing the output of the constraint, you can control and maximize the output of the entire system 10
- 11. Analogies to understand the concept Chain is as strong as it’s weakest link Bottlenecks define the rate of flow of the complete system
- 12. 1 2 3 4 WARNING!!!! If in the previous steps a constraint has been broken, go back to step 1, but do not allow INERTIA to cause a system's constraint. IDENTIFY the system's constraint(s). Decide how to EXPLOIT the system's constraint(s). SUBORDINATE everything else to the above decision ELEVATE the system's constraint(s). Five Focusing Steps ~ Y I S / / 0 6 2 0 0 9 ~ 5
- 13. Cash Machine 1 3
- 14. Constraints awareness Implications of ignorance •Capacity to increase wealth is frittered away by inadequate exploitation of the constraint •Scarce resources and time spent on improvement efforts which will inherently not bear any results •Conflicts in the organization when non-systemic criteria used to disburse resources and rewards •Decisions taken which would be counter productive and may jeopardize the very existence of the organization Implications of knowledge •Focusing improvement efforts where it will have the greatest immediate impact on the bottom line. •Excess capacity identified!!! •No additional Capex required •Cash released due to WIP and FG inventory reduction •Efficient use of resources / capital •Providing a reliable process that insures Follow Through •Release of “Management Time” for quality / quadrant II activities
- 15. What makes us confident in delivering promised results? Organizations unaware of their constraint/s (most organizations fall under this category) have at least 30% underutilized capacity •Constraints are neither good nor bad. They are just facts of life •Either you manage the constraints or constraints manage your organization To sell the excess capacity, we help our clients to create and market “Decisive Competitive Edge” Offers •30% additional sales •No increase in Operating Expense We help our clients to take all necessary and sufficient steps to make and sustain the change. •Measurements and review mechanism •Policies related to various stakeholders •IT System Enhanced capacity through elevation of the constraint •Investment a fraction of traditional expansion mode of increasing capacity •Growth trend continues and profitability increases
- 16. Identified poorly addressed significant need of the market Build capability to deliver to the significant need better than the competition Capitalize on the unique capability to generate higher throughput. Sustain the increased flow by managing capacity enhancement smoothly.
- 17. Identified poorly addressed significant need of the market Build capability to deliver to the significant need better than the competition Capitalize on the unique capability to generate higher throughput. Measurements Measurements ITSolutions ITSolutions Sustain the increased flow by managing capacity enhancement smoothly.
- 18. Identified poorly addressed significant need of the market Build capability to deliver to the significant need better than the competition Capitalize on the unique capability to generate higher throughput. Measurements Measurements ITSolutions ITSolutions Sustain the increased flow by managing capacity enhancement smoothly.
- 19. ABOUT YAGNA ▪ Professional 'Cooperative' of Consulting entrepreneurs ▪ Passion and expertise in executing CHANGE ▪ Skin-in-the-game approach. ▪ Sense of urgency with focus ▪ Logical thinking leads to effective and efficient actions.
- 20. CHAOS TO SUCCESS IN 90 DAYS ▪ Success is possible in 90 days, ▪ Yagna Resultants create the foundations for sustainable initiatives ▪ Can be maintained over the life of the business. ▪ Possible with whatever available resources within the organization.
- 21. The Yagna way is to break the myths that – ▪ Sustainable and Measurable growth cannot be achieved within a short duration of time ▪ Growth is not possible without pumping additional capital into the business. THE YAGNA WAY
- 22. To help SMEs take their rightful place on the global stage and help move the Indian Economy from Third World to First World in this lifetime. YAGNA’S VISION
- 23. INTERESTED? If you’re excited by Yagna’s revolutionary way of business and wish to seek partnership with Yagna Resultants, do get in touch with us at: YAGNA ENTREPRENEUR SUCCESS SERVICES LLP. C-6/2, GERA’S EMERALD CITY, SITE NO.66, BANER, PUNE – 411 045 Tel: +91 99220 02351 www.yagnaworld.com