Systemizing your approach to management

Business901 Podcast Transcription
Implementing Lean Marketing Systems
Systemizing your Approach to Management
Copyright Business901
H. WILLIAM "Bill" DETTMER. Senior Partner, Goal
Systems International. Bill is one of the most
recognized experts in the Theory of Constraints
field and more specifically the Logical Thinking
Process. He has 8 years graduate level teaching of
systems management, systems analysis, human
factors, management control systems,
organizational behavior and development, Theory
of Constraints, Total Quality Management, and management of
research, development, testing, and evaluation. More
importantly, he brings a level of experience to these subjects that
few in the world are able too. Bill has available on his website, a
series of 12 brief papers called the "Systems Thinking Series."
Each is 2-5 pages long and addresses a discrete aspect of
systems thinking.
He has 23 years' experience in military operations, logistics,
strategic planning, operational planning, training, large-scale
systems deployment, project management, and contracting.
Delivered 20 facilities construction projects on time and under
budget for foreign government and has successfully completed
multi-national logistic support project 30 percent ahead of
schedule and 25 percent under budget. Bill also directed a
medical services program treating 110,000 people in remote
third-world locations in less than 14 months. Bill has authored or
co-authored the following books.
Guest was Bill Dettmer, a Systems Thinker
Related Podcast: Systemizing your approach to management,

Joe Dager: It is my pleasure today to have Bill Dettmer, the
senior partner of Goal Systems International and author of The
Logical Thinking Process. Bill is a long time Theory of Constraint
expert and TOC consultant. I am quite honored to have him as
part of my podcast today. Bill, could you give me an introduction
of your organization and yourself?
Bill Dettmer: Well, thank you, Joe, first of all for the
opportunity to be with you here today. In answer to your
question, I would say that my company is more of a consortium
than it is a company. I work together with a number of people
who are themselves experts in specific areas and in most cases
they are experts in either functional areas or geographic areas
that I can't reach.
When I have an opportunity to work on a project of some sort
that is either beyond my skill or knowledge base, I have other
experts that I can draw on to bring in for those purposes. It's
worked out very nicely because each of my associates is a
consultant in his own right. They do the same thing. So, I've got
a nice little network going here. And, that's basically how my
organization functions.
Joe: When I think of Bill Dettmer, I think of the logical thinking
process. You have probably taught me more about the logical
thinking process than anybody else. Your first book on that
process was probably in the 90s, wasn't it?
Bill: Yes, that was Goldratt's Theory of Constraints. I wrote that
in 1996. That was when I was relatively new to the thinking

process. I'd only had about three years' exposure to it. At that
time, I think it was only about four years old as an organized
methodology. I wrote that basically in self-defense because at the
time I was teaching masters courses at the University of
Southern California in systems management. I was incorporating
TOC principles specifically on the thinking process in my course
work.
Unfortunately, teaching in a formal university environment, there
isn't the time for the give and take of shall we call the Socratic
approach or the brute force approach in learning. You've got a
limited amount of face time in the classroom. You have to provide
materials for the students to read ahead of time so that they
have at least some basis for discussion, and taking advantage of
that limited class time.
There was nothing, absolutely nothing at that time - this is from
1993 to '96 - in that area. So, I basically wrote what I
considered, what the university referred to as a course reader. I
basically data dumped everything that I had in the notes that I
took when I went through the Goldratt Institute's Jonah program.
I just wrote it all out in note form. I said all right, if I had to
translate this to somebody, how would I do it? I basically
converted it into a book that was published, actually by a print
shop at the university, in a soft cover. It was intended just as a
course reader to support individual professor's courses.
The students not only liked it, but one day I got a telephone call
from the university's print shop and said we just got a call from
outside the university that wants 30 copies of your course reader.
It wasn't even connected with the course. And I said, "Where did
it come from?" They said "Boeing in Seattle." That was a
complete surprise to me.

I said, "Well OK, what are we going to do about that? Well, we
can ship it to them. Well, OK. So they did, and then low and
behold over the course of the next six months we sold more than
about 400 of those that way.
I came to the realization - this is in 1994, '95. I think I better
look for a publisher here, it's about time. So, I wrote the
manuscript, I found a publisher. That publisher happened to be
the American Society for Quality, their quality press division, and
they've basically been my primary publisher ever since that time.
One of the things that I learned as a professor at USC is that you
have to really be on top of your game depth wise if you're going
to stand on the other side of the lectern from the students
because you've got to be deeper than one question in the subject
matter in order to be able to teach it effectively.
Joe: You have really developed the logical thinking process into
using it as a tool for strategy?
Bill: Yeah, that's true. The interesting thing I think that most
people don't realize is that problem solving, which is what the
thinking process was originally conceived for and strategy
development are basically opposite sides of the same coin. All
that strategy development is complex system problem solving
raised to a medal level. You're now looking at it from a whole
system business perspective on how this business functions
within its competitive environment. Or even if it's not in a
competitive environment, in whatever environment it does
function in.
So, rather than trying to find out using the thinking process why
we can't get more widgets out the door which would naturally
lead you into a process analyses and the lengths of the chain and
all of the usual Theory of Constraints concepts, all you're doing is
turning the same tool outward and saying all right, how does this

business fit into the world or the environment in which it's
functioning? Same process, same procedures, just a different
target.
Joe: When you think of Theory of Constraints, you think of it so
much internally. This is an external method of use of it.
Bill: Yes. You could actually, you could say that. But one of the
things, you know, it's interesting that, and I'm glad you brought
this up, because one of the things that I've discovered in using
this for a strategic tool is that there was a crucial question that
had been completely overlooked in the use of the thinking
process for its first seven or eight years. You've been through all
of the materials on TOC and you know that the three key
questions originally were what to change, what to change to, and
how to cause the change to happen.
I realized very soon when I started looking at the application of
the thinking process to strategy, that the key question, the very
first question that ought to be asked is why change? Why change
to begin with?
This forced me to say, OK, I need to find some sort of a standard
benchmark for what should be happening in a system's or an
organization's world before I can determine what to change. In
other words, what to change implies something's wrong. Well,
against what standard do you judge that? You judge that against
a standard of what should be happening.
If you wanted to look at it this way, there are really four
questions. The first question is what should be happening, what
to change, and what to change to, and how to make the change
happen.
This kind of drove me in 2002 to start considering the addition of
another tool to the thinking process panoply, specifically the IO

map, or intermediate objectives map, which helps to define a
system's goal and the limited set of critical success factors that
enable that goal to happen. Then a hierarchy of supporting
necessary conditions below that in order to make those critical
success factors happen.
Joe: When I look at the trees and the logical thinking process,
one of things that I always struggle with is it seems very
cumbersome to learn. Granted if I would take a class it might
help. It seems like it's not, that it's not intuitive, or it's not
something that... You know in today's world we're so used to
opening up the piece of software, sticking a CD in and using it.
Maybe that's the whole purpose because I got to think through it?
Bill: Yeah, yeah. I would say that there is a certain element to
that and it's not easy to learn, even if you have access to a book
that's as comprehensive as "The Logical Thinking Process" book
that I wrote. It's still; it's a tough row to hoe. I guess all I can say
is when you're doing something as important as tinkering with
the organization, do you really expect it to be as easy as just plug
in a piece of software and enter some data into some blocks and
let the computer do your thinking for you? I think most people for
that the answer would be no. Although enough people have
bought SAP that you would think that there's probably some
counter opinions out there as well.
Joe: I just happened to ask the other day, to a group of people,
is anybody using decision making software out there besides the
people that are selling it?
Bill: That's a very good question. What was the response?
Joe: I didn't get a lot of response back?
Bill: I can understand that. Well, the short answer is that the
basics behind the Logical Thinking Process are really what they

called the category, what Goldratt referred to as the Categories of
Legitimate Reservation. These are the eight rules that govern
logical relationships in any system. Those are very simple when
you start looking at them. But, it's when you try to say all right
now how do I convert those into something usable in a specific
situation that's both coherent and complete? Then you start
getting into something that's a little bit more difficult. The tool
that most... The thinking process that most people have had
historically the most difficulty with has been the current reality
tree.
I was one of those people at the very beginning. I struggled. It
took me three days in my Jonah Program to build my first current
reality tree. And I said there's got to be a much easier more
effective streamlined way to be able to do this without sacrificing
any of the quality of the output. It took me years to figure out
how to do that by a brute force approach. I finally got it now to
where somebody who really understands the process and has the
benefit of the using an IO map to start with can complete a
current reality tree even the first time in about four or five hours.
Maybe the quality of the first effort may not be so good, but you
know practice makes perfect. You do it enough times and it
comes out very quickly. Now there's no reason why any of these
tools should take longer than a couple of hours to put together an
analysis on the system.
Joe: How do you get someone introduced to that process?
Because I think that step into it is a big step.
Bill: Yeah, that's an interesting question you ask and I cannot
say that it's a real easy solution. There's an old saying that when
the student is ready the teacher will appear. One of those kinds
of things is what I think really applies in this area. People have to
be ready or searching for something. This is not the kind of thing
that you can force feed. This is not a technology-based marketing

approach. In other words, you have to identify a need and say,
"Well, take a look at this" because this may be exactly what you
need.
I find that I don't do much active marketing. My book, my
website and so forth, basically does the marketing for me,
primarily because if somebody's not really interested in logical
thinking, going out and giving them a sales pitch or spam email
or whatever overwhelming sales approach you might try, that's
not going to get them interested.
Joe: I look at the thinking process tools and I see the
evaporating cloud and I see like five blocks up there and it seems
really easy. Then the next thing I know is that I feel like my mind
is saying, scribbling on a wall here with the whole thing and really
breaking down the process.
Bill: Yes, it is, it's actually a two way process. There's an
inductive and a deductive component to it. But, the deductive
component is the part that has to begin first. You have to start
from the general and work your way down to the specific, then
you can extrapolate back up to the general again. This is one
reason why I like to try to start with a statement of the goal and
the critical success factors of a system. Whether that system is
an individual in his or her own life or whether it's a multinational
corporation, start with that and now start deconstructing it down
to determine where things are going wrong.
Or get down into its component parts, analyze the interactions
between the two and then patch it all back together again and go
inductively to a solution. It can get to be very complex at times.
But, the good part of it is that this methodology, it's not an
individual thing. In other words, it doesn't require one person to
sit down and do it all themselves.

You can throw man power at the situation and in point effect, I
think this process lends itself very well to coordinated groups, in
other words groups of problem solvers. For example one of the...
I'm about to start a thinking process course that will include a
guy coming from Siemens Energy Division. They build big power
generators that go into electric power plants here in the US.
They have some major complex problems with their organization.
A guy that's coming into this course has been trying to get into
this course for the last three or four years. Finally, he's gotten
through to somebody there that they've got complex problems
that they can't solve basically any other way than with a systems
approach to the whole thing. So, they finally said OK, you better
go get this training.
He's going to come and learn about this and he's already got a
team of engineers there that are frothing at the mouth to get
busy and start building. They built a wonderful IO map on their
own just from reading the book. It's in some respects maybe a
little more complex than it needs to be but you know that's what
they put together. They like it. They're happy with it. They say
this reflects the situation.
Now they've kind of got the fever. You sort of have to get
involved in it in order to do that. He's going to be going back with
this knowledge and he'll be basically the internal facilitator for
this because he'll know how to do the system and how to
facilitate it.
Joe: When I look at Logical Thinking Process, it seems like that
it’s a step above the Five Why process. I'm a lean guy so I'm very
familiar with the Five Why. How can you sit there and tell senior
management we're going to solve the company's problems with
Five Whys?

Bill: Yeah, you really can't. And senior management is really a
special case. The people who are in the middle of the
organizations are the ones who really appreciate these tools more
than the folks at the senior level. Folks at the senior level are
usually too involved with the big picture to get involved with the
details. There are exceptions in this, but in most cases that's the
case. Their attention spans, I like to say that a CEO has an
attention span of a five year old child. If you can't get the
message across in 15 minutes, forget it. He's on his way to the
next meeting or the next issue on his plate.
I've actually been in meetings where after the 15 minute point,
I've seen the CEO sitting there jotting notes down, and it's not
jotting notes about what's being said, it's notes about what's
going on in the next problem that he's trying to solve. In other
words, they've lost him already.
The short answer is you cannot get them involved in the details of
the process. All you can do is get them involved with the
recognition that there is a problem, there is a process, and there
are results that can come out of this process.
One of the things that I discovered in the course of the seven or
eight years after I wrote my first book is that CEOs will not sit
still while you go through a 70 or 80 element current reality tree
to identify the problem. They just will not. You have to have a
way of getting your message across quickly.
I basically figured out a way to distill the most complex trees,
which are current reality and future reality, into what I refer to as
executive summary trees. It's the same general content, the
same conclusions, same general root causes or injections without
all the detail. It looks more like a flow chart than it does a true
logic tree.

It is suitable for presentation to an executive audience and you
can get the same essential message across in much less time.
Then if they have detailed questions on well how did you make
this leap from here to here, then you're prepared to show them
detail, but only if they ask for it.
That was not something that had ever been given to me in my
original training. I don't think anybody even kind of realized that
that was necessary at the time. In many cases they still don't.
Executives just won't sit still for this set of stuff. So, you've got to
be able to get in, get the message across, and get out.
In the literary world, its common knowledge that it takes a lot
more energy and effort to write a short story than it does to write
a novel. The reason is because in the novel there's not limit to
the size. You can basically write as much as you want in as much
detail as you want. But in a short story, you've got to get it all
compressed and without losing any of the essence, much more
difficult to do.
That is essentially the same, the big challenge, using the thinking
process. On the one hand, you can't get away from doing the
detailed analysis. If you fail to do that, you may end up solving
the wrong problem or coming up with the wrong solution.
But, when it comes to the presentation or the coordination of the
results, you better be able to distill it down to something that can
be dealt with in a short period of time because if you can't, you're
going to lose them, you'll lose your credibility, the solution will be
ignored.
Churchill once said man occasionally stumbles over the truth but
usually he just picks himself up and continues on. That's the risk
that you run if you don't know how to present what you've done
in a detailed analysis.

Joe: So really, it's an executive summary of the logical thinking
process that you go through in the trees.
Bill: Precisely. And the other thing that I've learned that you
don't do is you don't give it to him all in one bite. I remember
when I was in the Air Force, commanders always would say,
"Don't bring me problems, bring me solutions." So, what we
would have to do is we would have to come to the presentation
with a complete soup to nuts summary of well, this is the
problem we're up against and this is what we've decided to do,
step by step, and this is why we think it's going to work and now
we need your approval to implement it. And, the boss would say,
"Right, go and get it, go do it, or no, don't do it that way, do it
this way, but go get."
Well, the problem is in most businesses, they don't want to deal,
especially with the big important issues, in one 15 minute
session. They recognize that there's a risk associated with making
changes. They want to contemplate it a little.
So generally, when I teach my students to use the thinking
process in the organization, I will have them go through each of
the tools individually in a separate session. It may take a month
before they ever get to the future reality tree. It may take two
months.
But, they'll start with getting agreement that this is what the
organization's goal and critical success factors are. Once
everybody's kind of in agreement on that, then they go on and
analyze the problem, come back a little later with a current
reality tree that says well remember, we all agreed this is what
the goal and the critical success factors are. OK, here are the
areas that we're not meeting those, A, B and C, D, E and F are
just fine, but A, B and C we've got problems. And here are the
reasons why. The current reality tree gives those reasons why.
Then you have the discussion as to do you agree with our

analysis? Well, when you get the agreement with the analysis,
now you have the charter to go ahead and say all right, solve
those problems.
Then you go away and you start working on the solution to the
problems. You come back and you present the problems and say,
remember, this is what we said the problems were. Well, here's
what we've come up with in the way of solutions.
You don't tell them anything that they don't need to know to
make a decision. Make it slender and let them ask the questions
on things that they want and then provide the information.
That's the biggest problem that I had as a consultant was trying
to tell them too much and losing the audience that way. I think
many consultants are that way. You want, we want to impress
people with our knowledge rather than solve their problems.
Joe: We take all these “consultanize” things and all the different
methods, it seems we still go back to Socratic questioning. It's
really one of the better ways to learn.
Bill: Yes, that's true. It really is. You just mentioned something
that I think is critical to understand here and that is that neither
the thinking process nor TOC in general are the be all and end all
in the world of business or organizations. The big value, I believe,
of both TOC in general and the thinking process in particular are
that they absolutely excel as targeting mechanisms. I used to use
the analogy of a gun laying radar in the military environment.
TOC is a really good gun laying radar. It identifies the target. It
zeros in and tracks it. And at that point, then the executive can
decide what kind of weapon to put on that target. Is it going to
be a missile? Is it going to be artillery? Is it going to be air to air?
Well, the same type of thing. TOC and the thinking process can
identify the problem and then the system manager or the

consultant can decide well, the appropriate thing to use for this
particular problem is going to be Lean or Six Sigma, or something
along those lines.
Let's say, design of experiments. We need to do some
experiments on this particular situation to determine. In other
words, you will pick out, it will identify problems in such a way
that it's almost intuitive that well, this is the perfect tool. It
comes from a completely different discipline but this is the tool
that we need for this particular problem.
Yet, TOC allows you to maintain that systems approach to make
sure that you're not fiddling while Rome burns.
Joe: You talk about your military experience and things and I
really see the influence in your discussion of bringing Boyd's
OODA loop into the process. Boyd was brilliant and never got
really full credit, I think for...
Bill: Yeah, you're absolutely right about that.
Joe: I see Boyd's OODA loop being used more and more people
in referencing of it, but I didn't realize you referenced it as much
as you did and as early as you did in your processes.
Bill: Yeah, that's true. I came by that in kind of a back door
way. I have a friend dating back to the '70s who retired as an Air
Force major general back in the early part of this last decade.
And he went to work for a consultant, a defense consultant in the
Washington D.C. area. We exchange emails on a weekly basis. He
sent me an email one day and said hey, you ought to check this
book out. This is really cool. It was a book by Robert Coram
called Boyd: The Fighter Pilot Who Changed the Art of War. I
said, OK, it looks kind of interesting.
So, I picked it up. That was the first I'd ever heard of Boyd. It
was really a biography. It wasn't a technical book. It was a

biography. But, I became fascinated by it because they had to
explain some of what he was talking about in his concepts in
order to really give depth to biography. And I said, dang, this
OODA loop is not only is it great, but it fits in beautifully to the
kind of system thinking that I tend to groove on.
So, I started learning more and more about it. I got in touch with
Chet Richards, which was one of Boyd's accolades back in the
days when they were both working at the Pentagon, and read
Chet's book on it.
I immersed myself in it and I said, "Man, this is great, this fits in
so nicely with systems thinking and gee, I can just see how this
folds seamlessly in with the thinking process because the thinking
process is not a one time shot thing, it's an iterative process just
like OODA loop is: you observe, you orient, you decide, and you
act."
Well, that's exactly what happens with thinking process. You're
observing what goes on around you. In the orientation process
you're building your trees and part of that is also the decision on
what to do and then you go act.
Well, but it doesn't stop there. It feeds you back to the beginning
again. Once you've made a change to the system, you go back
and you look at the results of the system and how is the system
performing now. Wow, we need to do another reality tree
because though most of it is the same, there are some changes.
It's not performing in quite the way it was before. Hopefully, it's
better, sometimes it's not. If not, why not. Well, that's the second
issue, iteration of orientation.
So, I really became very much interested in that. And, I have to
say that the definitive volume on Boyd's philosophy and the
OODA loop is a book called "Science, Strategy and War" by Frans
Osinga. And it's a little deep reading, but if you'd read some of

the like Chet Richard's book "Certain to Win," it's a natural follow
on. It really is. And it dovetails, as I said, with TOC. It's almost
like they were separated at birth.
Joe: In reading the chapter that you put in the TOC handbook. I
noted that even though we talk about iterative reaction and we
talk about feedback, it's really proactive rather than reacting
because we're doing it so quickly. Is that a fair take on it?
Bill: It really is a fair take. And, this is the thing that I think is so
wonderful about the OODA loop. And as an organization or a
person goes through the UDE process, it can take varying lengths
of time. Boyd would do it in a 40 second aerial engagement and
go through it multiple times in that 40 second period.
Organization takes a little bit longer but it need not take that
much longer. They do it whether they're conscious of it or not.
But, the fact that they are conscious of it makes it easier, shall
we say, to direct that effort and force faster cycles of the OODA
process.
So, what is that except continuous improvement? I mean, you're
deep in that area because of your exposure to Lean and Six
Sigma, continuous improvement is an iterative process. The
OODA loop is comparable to Deming's PDCA cycle.
Joe: Well, I like to argue with most of these things. Master one
of them because the five focusing steps, the OODA loop, the
PDCA cycle, Deming, they're all very much the same. We have a
little different tools that we use to get it and you have to master
the tool set because if you go back to what I think about the
Boyd thing and in a combat aerial thing, is that mastering the
thinking process, you do it intuitively and you do it well. If you
master Deming or if you master PDCA, you do it intuitively and
you do it well and guess what, you run your business well.

Bill: Yes. There's an issue here that relates to the iteration, the
repeated iterations or the repetitions, the doing it over and over
and over again, the continual refinement. The idea is that when
you go through OODA loop, every time you go through that loop,
you know a little more about the system than you knew before
and it keeps getting tighter and tighter and tighter and the cycles
through the loop get faster and faster and faster.
Well, one of the books that I really love and I happened on to it
only as a result of reading more about Boyd's work, is a book
called "The Book of Five Rings," and it's written by Miyamoto
Musashi who died in 1645. He was the quintessential; he was the
paragon of what a samurai warrior is all about. The guy was the
best swordsman that ever lived. He wrote this book to summarize
exactly how to be an expert swordsman. One of the things he
said in there is that he said "practice is the only way that you will
ever get to learn what the way of the warrior is about." Words
can only bring you to the foot of the path. You must practice until
intention becomes no intention and the sword becomes no sword.
What that is basically saying is just what you said about intuition
or intuitive application. He's saying "I don't need to see what's
happening and consciously think about it. As soon as I observe it,
I immediately intuitively do the right thing to act and the sword is
not a tool in my hand, it's an extension of my arm." So, that's
what no intention and no sword means.
Well, what does this do except it allows you to skip over the
decide step in OODA loop, and Boyd was very much in favor of it.
He said if you are fast enough to observe and orient yourself, you
can go directly to acts without having to decide what to do.
That shortens your cycle, and it puts you inside your opponent's
decision cycle. So, it's a real interesting gestalt. It all fits together
here, and I think that the thinking process can be a real key part
of that.

Joe: I think it is. But one of the things that - and this is going to
be my Six Sigma side coming out. Don't you have to support all
this with data? Don't you have to be formulating the data to do
that because the data leads you down a path that allows you to...
You can't be intuitive about everything because sometimes just
the outward appearance of something lies to you if you don't
have the supporting data.
Bill: Yes, you're absolutely right. Where does the data become
most important? The data is most important in the identification
of the problem. It's not in the creation of the solution because
that's a projection of what should happen in the future. It's not in
the establishment of the goal and the necessary conditions
because those are value judgments. But, when you start to
analyze what the problem is, in other words when you're building
the current reality tree, that's where data become really
important. One of the key lessons I try to convey in my thinking
process courses is the most critical of all of the categories of
legitimate reservation is entity existence.
Why is that the case? Because you're building a tree that reads,
"If this, then that" through multiple layers, maybe 10 or 15, from
a root cause all the way up to an undesired effect. You can have
absolutely perfect lock-tight logic in every one of those
connections. But, if one of the statements in there is erroneous or
faulty or just flat wrong, then the entire thing falls apart.
I use the example of the buffalo herd. Have you heard that one?
It's been around on the Internet a little bit. It's supposed to be a
conversation exchange between two guys from "Cheers." The two
guys that sat at the end of the bar, Norm and Cliff. The mailman
and the salesman, right? Cliff is explaining about the buffalo
theory, and he says, "The human brain is like a herd of buffalo. It
can only go as fast as the slowest buffalo. When buffalos are
hunted, and the ones that are the weakest that fall back in the

pack are the ones that are killed off first. This natural culling is
good for the herd. It allows the herd to move at a faster rate."
He says, "In the same way the human brain can only move as
fast as the slowest brain cells." So he says, "If we kill off the
slower or weaker brain cells, then the brain becomes a faster,
more deadly machine." He says, "So, as we know, drinking beer
kills off brain cells, so that's why the more beer you drink the
smarter you feel."
I used that example in the thinking process because I built a little
tree out of it, and the logical connections are absolutely dead
tight. But, there are two statements in that tree that don't have
entity existence. One is that the human brain is like a herd of
buffalo.
The other one is that alcohol kills only the slowest brain cells. You
take those two, and because you render them to be erroneous,
the entire beautiful, logical construction is worthless. So, what I
tell all the people who go through my course is, "You better be
able to look at every block in that current reality tree and either
find expert testimony or data to support the accuracy of that
statement." So, that's where your data fits in, Joe.
Joe: I think you're right on. I think that's a great message,
especially for my audience when we talk about customer value
and customer identification. I look at the logical thinking process
is even a great way for, if you would master it, for a sales person
for a marketing organization to take a customer through a buying
process.
Bill: Yes, it could very well be. Goldratt kind of did that back in
1994 with the beginnings of what he called the Mafia Offer.
Basically, the concept was to build a current reality tree that
showed that the solution to the customer's problem was the
resolution of an undesirable effect that came from a certain point

in the sales process. If the sales person shows how logically they
are, what it is they're selling is the solution to the customer's
problem. The place where most people go wrong, though, is...
Well, consider the approach of most high tech companies. We sell
solutions. Eli Schrangenheim said to this, “I hate that. How can
they possibly say we sell solutions when they don't even know
what my problem is?”
That's a very key point there. How can you say, the only way you
can say we sell solutions is if you try to put everybody's problem
in the same box and it all looks like this. Well, that's not the case.
Even if it is the case, every organization likes to think but we're
different. Let me start with the basis that you're different whether
you are or not, we'll start with what you perceive to be your
situation and we'll work our way down to what your problem is.
Then if you have the solution for that problem, then it makes
your sales job a lot easier because now you can prove that by
reversing the polarity on this unfavorable current reality tree with
your solution all good things are going to come to pass.
It could be very powerful. But again, you can't overwhelm them
with detail. When it comes in the analysis, you've got to have
that detail in order to be sure that you're right. But, when it
comes to the presentation, there's a whole different, a whole
different scheme is needed.
That's one reason why my company's slogan is constructing and
communicating common sense. There are two completely
different animals there. The construction requires the detail and
the comprehensive aspect of it, but the communication, you've
got to now boil that down to something that resonates quickly.
Joe: So, we go back to providing an executive summary?
Bill: Yes, basically.

Joe: Then if you dig deeper in the subject or even break it off
and go to some of the other decision makers within the
organization who wants more detail, then you take them through
that process.
Bill: Right. And, you know what the toughest thing for a
consultant to do using the thinking process is you go through this
wonderful logical analysis, you come down to a root cause, and
all of a sudden you realize oh, my God, their root cause is an area
I've got no solution for them. It is so difficult to say I can help
you to identify what your problem is, but I can't help you solve it
because I don't have the expertise to do it. That takes a really big
man or a woman to say I don't have your solution, but here is
your problem, it's well identified.
Now, this is another reason why I like to maintain a big network
of professional consultants because that improves the chances
that I can say I can't solve your problem but I have somebody
that can. He is an expert in this area right here. It isn't me, but
this is it. What have I done? I have not solved their problem
directly but I have solved their problem because I have connected
them with the right person.
Joe: I think that's a great way to look at it because one of the
best books that I have read on the sales process is by Mahan
Khalsa with "Let's Get Real or Let's not Play." It is a Stephen
Covey book and its really never have been given the credit that I
thought it should have. What he does is he goes through a
decision process and then he steps out and says 'let's get real
about it,' we are either there, we have the solution or we tell
them we don't. Move on.
Bill: This is one of the things that I think is really valuable about
the thinking process. I may even have an intuitive idea of what
their situation is. Because if you see enough organizations of
similar types, you can pretty well say that there is a high

probability that they are suffering from the same kinds of
problems. But, if you want to be a true neutral arbiter of the
situation, you can go in. I could promise them that I may not be
able to come up with a solution to your problem. But, I can
guarantee you that we will identify what that problem is. Even if I
don't have the solution for it, together we can find out who does
and put you in touch with them.
And boy, as soon as they realize that you are not out to try to sell
widgets or software or something, in other words the whole effort
is now focused on solving their problem, not selling your product
and you are willing to recognize that maybe you don't have the
solution, they become much more trusting of what you tell them.
Joe: I think everybody tries to do that as a salesperson, to get
on that side of the table with them. It is not about sitting across
the table; get on the other side with him. We have all been
taught that. But, it is pretty hard to let go after you have invested
the time, because who is paying for the time.
Bill: Yes. That is absolutely true. And unfortunately you have
to... I feel that if I am going to be able to live with myself, I have
to be able to say I have reached the limits to what I can provide
this customer. Ethically I have to tell them they need to go
someplace else. I will not try to tell them that I have all the
answers. I think that there are a lot of consultants out there that
say, we will partition your problem to fit into our little box here.
That's what I call the Procrustean solution. Are you familiar with
the mythology of Procrustes from Greek mythology?
Joe: No. I am not.
Bill: Well, in the old days the pilgrims used to make their up to
Mount Olympus to worship the gods in Greece. And it was a long
trek and they were on foot. They couldn't do it in one day.
Invariably at the end of the day they got to the hut of Proclus

who was sort of like the gatekeeper for Mount Olympus. They
would spend the night at Proclus place and Proclus had one bed
that would fit all people. If you were too short he would stretch
you out like on a rack to fit the bed. If you are too big he'd cut off
your feet till you fit the bed.
That became the sort of like the catch word for the idea of
partitioning the problem to fit a preconceived solution and
consultants do that an awful lot. Now, we are going ignore these
aspects of your problem here because I really can't deal with
them.
We are just going to work on this part of it. Or we are going to
pretend that this doesn't exist or we are going to redefine it in a
way that my tool will work. That's huge. That's a big huge
mistake and is a disservice to the customer. And a consultant
that gets a bad reputation from that deserves everything he gets.
Joe: The other thing I want to touch base on is you use word the
'system thinking' a lot. Much as you use TOC and 'system
thinking' sometimes is such a big umbrella, such a big term to
people. What does that really mean to you?
Bill: OK, that is a really good question. I don't know that we
have the time to go into it in great detail. But, let's just say that
most thinking is analytical and has been ever since the
renaissance; the idea that systems are whole systems and are
complex things. We have a hard time holding it in our head, and
envisioning all of the interactions and so forth. What has typically
happened over the last several centuries is that people tend to
partition the system or break it down into its component parts.
Something that is a little easier to deal with, in other words they
try to bind the problem by this decomposition into parts. This is
the process of what they call analysis. It is a breaking down of
the system into simpler parts that they can deal with. The

problem there is that it is based on an erroneous assumption,
especially where systems particularly human systems are
concerned.
That is that "the whole is equal to the sum of its parts." That is
apparently not true. And all you have to do is look at let's say the
example of the New York Yankees from the last seven or eight
years before this last World Series. George Steinbrenner went
and put together the greatest collection of people that he could
with the money that he had. The top guys Robinson Cano and
Rodriguez and Jeter and all of these guys and pitchers. His intent
was to try to put together the best team from the best individual
parts well ignoring the fact that their success or failure is
dependent on how these parts worked together.
That's the synergy in a system. And that's what makes 'the sum
of the parts' assumption erroneous. But, that's what happens as
we break down systems into individual parts and just assume
that if we polish all of those parts up and put them back together
again they will function as the best possible system. It doesn't
work that way. So, the system is not equal to the sum of the
parts is actually somewhat less than that.
Joe: The connotation I use real quickly since we are on TOC
thing is the Herby thing or the Buffalo thing. The role players are
so important. Not everybody can be a star.
Bill: It is the interconnections, not the components themselves
that are places where most systems break down. And when you
can discover where those are, then you can tune the systems to
capitalize on the interconnections. For anybody that's interested
in getting more of a feeling for what systems are all about, or
'systems thinking' is all about, there is a source that I would send
them to and it is not the one everybody thinks of, which is Peter
Senge.

It is Gerald Weinberg. Gerald Weinberg wrote a book on 'systems
thinking' and it just came out in its 25th anniversary, a silver
anniversary. How many books that you know of that had been in
print for 25 years and are still selling like hot cakes. Weinberg's
book is.
And he as a professor at the State University in New York, I
believe - want to say Binghamton but I am not sure, it might be
Buffalo; it's one of the State Universities in New York. He has
been teaching there for years. And he teaches 'systems thinking'
and 'systems management.'
Truth be told, I came to Constraint Theory and I gravitated to it
because of my prior exposure to systems management. I was
teaching at the University of Southern California in their systems
management program and finding that what they were doing was
basically violating their own systemic principles.
They were looking to patch together a whole bunch of individual
discrete tools to try to cover different parts of the system instead
of, there were no real tools out there or concepts that were true
system synthesis tools.
I happened on Theory of Constraints and I said, “This is great.”
This just fits in so nicely with what I am teaching my students in
my classes because it really amounts to a systems thinking set of
tools. That's really how I got into TOC was because of my prior
involvement in systems management and systems thinking and
the fact that there was nothing of a synthesis nature in what we
were teaching.
Joe: That's a great description because I see how that applies.
That's really my theory of marketing. It is, not one thing works
anymore. It is a collection. And what's important is not the single
event, the single ad, the single white paper. It is the strength of
the connections between components.

Bill: Exactly right. Here is something you said just triggered this
in my mind. There is a saying I have heard that "it's wonderful to
find a little bit of logic to support the intuitive emotional decision
you want to make." And the fact of the matter is that that is a
kind of a microcosm for why the thinking process very frequently
fails in organizations. It is because the truly logical message that
it comes out with is in such diametric opposition to the emotion of
the moment of the decision maker that there is just no way they
are going to escape it, or accept it, I should say.
And as a result, they do what Churchill says, they stumble over
the trees. But usually they pick themselves up and continue on.
That's one of the areas I have been working and most heavily
over the last say three years. I am trying to come up with a
rational explanation and a solution for why it is that even when
perfectly good rational logical solutions such as the ones offered
by TOC are presented to executives that one of two outcomes
most often predominates. First off is it is either rejected out of
hand or if it is reluctantly accepted, eventually it dies out and is
not continued.
My research in that area has been taking me into the areas,
believe it or not, of neuroscience, to figure out how the human
brain works, and how mental models become embedded in neural
networks in the human brain, to the point that if it violates your
mental model, it doesn't matter how much logic is there, you are
going to do the wrong thing.
There is another wonderful book and I have to recommend it very
heavily by a guy named Laurence Gonzales. It is called "Deep
Survival. Who Lives, Who Dies and Why." It is a very sobering
look at people that are into extreme survival situations,
shipwrecked at sea, lost in the wilderness. Some people manage
to work their way through it very successfully, and other people
just curl up and die or work themselves into deeper trouble. It all

gets down to what they have convinced themselves in their brains
and whether they are able to set these things aside. I strongly
recommend that book because it gets into some of the same
issues and it is what got me into the question of neuroscience. It
led me to another author who happens to be a professor at USC
that I didn't know about, Antonio Damasio is his name. And he
wrote a book a classic landmark book in 1994 called "Descartes'
Error." He goes into the detail for why logic is not the basis on
which we make decisions but emotion is. Both of those books are
really, really important reading I think.
Joe: It is some great insight. Is there something that I left out
of this conversation that you'd like to add?
Bill: I can't think of anything right off hand except to say this. I
love the thinking process and I decided to focus on that thinking
process primarily because I saw it as being the most broadly
applicable and flexible tool that Constraint Theory provides. I like
that tool because of its flexibility, and it's scaleable. That's the
thing that is so cool. An individual can use the thinking process to
decide what they are going to do with the rest of their life. A
middle manager can use the tool to decide how to solve the
problems with which they are faced. And a senior executive can
use the tools to develop the strategy, their long term strategy for
the corporation. I've decided obviously since I wrote the book on
Strategic Navigation. That's the area that I really like to focus on
is helping companies to decide "where am I going and how do I
get there."
Joe: I just ask one simple question before we leave here. Which
is the favorite book you wrote?
Bill: I would have to say that "Strategic Navigation" is probably
the favorite book that I have written because I takes the reader
into the realm that I am most fascinated with, the whole concept
of strategy development and deployment. That's the one that I

like the best. Now, on the other hand, I have a great affection for
logical thinking process which is, it started out as a second
edition of 'Goldratt's Theory of Constraints' that I wrote in 1996.
At least when my publisher contacted me and asked me, you
want to do a second edition, I said sure. I realized very quickly
that the methodology had evolved so drastically in the ten years
since I had written it, that what I was writing was really a
completely new book.
When I taught the 'thinking process' in the late 1990s as I got
further and further away from the publication date of "Goldratt's
Theory of Constraints," I was having to supplement it more and
more with handouts and additional materials. I ended up teaching
the "Thinking Process" course in 2003, 2004 with a
supplementary binder that was as thick as the original book that I
had written.
I said all of the stuff really needs to go into the book. My
supplementary handouts are about 15 pages of exercises and
things, because it is all in that book. I really like the 'Strategic
Navigation' because that's the topic that is nearest and dearest to
my heart. But, I probably am more gratified with logical thinking
process at this point.
Joe: I would like to thank you very much. This podcast will be
available in Business901 blog and also the Business901 iTunes
store. So again thank you very much.
Bill: Well, thank you Joe, I appreciate it very much. You take
care. And let's keep in touch.

Joseph T. Dager
Lean Six Sigma Black Belt
Ph: 260-438-0411 Fax: 260-818-2022
Email: jtdager@business901.com
Web/Blog: http://www.business901.com
Twitter: @business901
What others say: In the past 20 years, Joe and I
have collaborated on many difficult issues. Joe's
ability to combine his expertise with "out of the
box" thinking is unsurpassed. He has always
delivered quickly, cost effectively and with
ingenuity. A brilliant mind that is always a pleasure to work with." James R.
Joe Dager is President of Business901, a progressive company providing
direction in areas such as Lean Marketing, Product Marketing, Product
Launches and Re-Launches. As a Lean Six Sigma Black Belt,
Business901 provides and implements marketing, project and performance
planning methodologies in small businesses. The simplicity of a single
flexible model will create clarity for your staff and as a result better
execution. My goal is to allow you spend your time on the need versus the
plan.
An example of how we may work: Business901 could start with a
consulting style utilizing an individual from your organization or a virtual
assistance that is well versed in our principles. We have capabilities to
plug virtually any marketing function into your process immediately. As
proficiencies develop, Business901 moves into a coach’s role supporting the
process as needed. The goal of implementing a system is that the processes
will become a habit and not an event.
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