INTRODUCTION

Many manufacturing companies reduce inventory &cycle time increase customer services and
see their net profit skyrocket.

A small printing co. expands with a new market with a new product, offering that unlike any
combination of product &services, it has ever offered before. The firm is rapidly growing
market share & profit.

A small consultancy firm doubles its size every year for five years while at the same time
enhancing its culture, profitability, stability &reputation in the market place it serves.

School going children solves their problems, study history with various interest &dramatically
improve their grads & test score.

All of these activities are different from each other yet they have same striking similarity each is
a system, each is successful, each use the thinking process to make the decision and take the
action that led to the result described above.

What is thinking?
Thinking is the highest mental activity present in man. All human achievements and progress
are simply the products of thought. The evolution of culture, art, literature, science and
technology are all the results of thinking.

Thought and action are inseparable - they are actually the two sides of the same coin. All our
deliberate action starts from our deliberate thinking. For a man to do something he should first
see it in his mind's eye -- he should imagine it, think about it first, before he can do it. All
creations-- whether artistic, literal or scientific --first occur in the creator's mind before it is
actually given life in the real world.

Thinking starts with a problem and ends in a solution. Thus, thinking is a tool for adapting
ourselves to the physical and social environment in which we are in.

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Thinking involves a term critical thinking which means determining the meaning and
significance of what is observed or expressed, or, concerning a given inference or argument,
determining whether there is adequate justification to accept the conclusion as true. Hence,
Fisher & Scriven define critical thinking as "Skilled, active, interpretation and evaluation of
observations, communications, information, and argumentation." Critical thinking can occur
whenever one judges, decides, or solves a problem; in general, whenever one must figure out
what to believe or what to do, and do so in a reasonable and reflective way. Reading, writing,
speaking, and listening can all be done critically or uncritically. Critical thinking is crucial to
becoming a close.

Thinking process

The thinking process was oriented by dr. eliyahu goldratt tom address the unique and complex
issue of firm that was implementing this theory of constraint in their production environment.

The theory of constraint is the unique management philosophy that strives for a rational or
scientific approach to management. It provides a way to simplify the complexity of human
based system and still keep the main issue under management control. Thinking process is the
methodology of the theory of constraints.

Hence A mechanism that allows us to verbalize, construct, analyze, and communicate cause and
effect relationships. And moreover, to propose feasible solutions to the problems that they cause
is known as the Thinking Process.

The thinking processes are generic tools to help people walk through a buy-in process. They are
also useful tools for any kind of human interactions. The Thinking Process is integral to the
systemic nature of Theory of Constraints and allows not only analysis of problems, but also the
construction of solutions and the communication and effective implementation of those
solutions.

The Thinking Process is a set of tools; graphical “trees,” which enable us to drill down into our
intuition to express the cause and effect relationships that we observe in our businesses day-to-

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day, but which are difficult to capture in reports, graphs, accounting statements, and project
plans. It allows us to capture those non-obvious leverage points which are separated in time
space and to portray their relationships in a simple and straightforward manner.

It is easy to consider the Thinking Process as an attachment to the Theory of Constraints,

something that is useful for overcoming initial resistance and ensuring buy-in. However this is
not the case, the Thinking Process is absolutely integral to Theory of Constraints.

The Thinking Process allows us to work through the sequence of;

(1) What to change.

(2) What to change to.
(3) How to cause the change.

The Thinking Process performs a number of functions often simultaneously. It allows us to

interrogate the situation in a systematic and logically precise way, allows us to analyze and
synthesize, communicate the situation, and to generate organizational knowledge.

The Thinking Process enables us to work through the sequential layers of agreement to obtain
an implement able solution. We do this using the intuition of the people involved – remember
some of the cause and effect relationships will be separated in time and space, but if we include
the critical people we will develop an understanding of the whole problem we are dealing with.
Let’s look at verbalizing our intuition and organizational knowledge creation.

Verbalizing Intuition

If we are to limit ourselves in using the Thinking Process to recording cause and effect which is
already explicitly understood, although separated in space in time amongst individual members,

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we would in effect be doing “process mapping” which was common while business process re-
engineering was popular. The real power, however, comes from verbalizing our intuition – our
tacit knowledge – that which is not yet explicit.

“We grossly underestimate our intuition. Intuitively we do know the real problems, we even
know the solutions. What is unfortunately not emphasized enough is the vast importance of
verbalizing our own perception. As long as we will not verbalize our intuition, as long as we do
not learn to cast it clearly into words, not only will we be unable to convince others, we will not
even be able to convince ourselves of what we already know to be right. If we don’t bother to
verbalize our intuition, we ourselves will do the opposite of what we believe in.”

The Thinking process meshes well with the concepts of tacit and explicit knowledge developed
by Nonaka and Takeuchi. Specifically “…tacit knowledge contains an important cognitive
dimension. It consists of schemata, mental models, beliefs, and perceptions so ingrained that
we take them for granted. The cognitive dimension of tacit knowledge reflects our image of
reality (what is) and our vision for the future (what ought to be). Though they cannot be
articulated very easily, these implicit models shape the way we perceive the world around us.”

Let’s repeat that; although they cannot be articulated very easily, these implicit models shape
the way we perceive the world around us. This is why it so important to verbalize these factors
and the Thinking Process gives us just the structured methodology to articulate these ideas that
we have been lacking before.

However, there is a further equally important aspect to the verbalization of tacit knowledge –
during the process organizational knowledge is created. “... the subjective and intuitive nature
of tacit knowledge makes it difficult to process or transmit the acquired knowledge in any
systematic or logical manner. For tacit knowledge to be communicated and shared within the
organization, it has to be converted into words or numbers that anyone can understand. It is
precisely during the time this conversion takes place - from tacit into explicit, and... ... back
again into tacit - that organizational knowledge is created.” The trees that are the product of the
Thinking Process allow us to convert individual tactic knowledge to explicit group knowledge.

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In effect the following is occurring;

(1) Individuals verbalized their own tacit knowledge as explicit knowledge.

(2) The group internalizes this explicit knowledge as shared tacit knowledge.
(3) Organizational knowledge is created.

Let’s not underestimate the importance of tacit knowledge as leverage against constraints. We
will develop the idea further in the section on strategic advantage, but let’s add quote from
David Hurst to underline the importance of the issue; “The most dysfunctional constraints are
usually those that are tacit rather than explicit. Elements of formal organization such as
restrictive rules and policies are at least easily identified and can be changed. The more
insidious constraints are the strictures imposed by … the almost invisible influence of culture,
and the pervasive effects of growth in organizational size .”

Indeed it has been said that the Thinking Process “may be the most important intellectual
achievement since the invention of calculus.” High praise indeed, but like all things it requires
proficiency, and proficiency in this case comes through practice. However, there should be no
lack of examples to practice on.

Cause and Effect

We might like to consider the Thinking Process tools as Lego sets for constructing business
solutions, or dare I say it, as “transformer toys” for adults because too often one tool has a habit
of transforming into another as we work with it.

Let’s have a look at the simplest case.

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We can read this diagram by saying; “if” cause “then” effect. We have simple statement that if
the cause is present then we expect the effect to be present as well.

Let’s look at this the other way around. What if we start with the observed effect, we might call
this a symptom.

We need to ask ourselves what is the underlying cause of this symptom. Maybe there are two
underlying causes giving rise to it.

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Fortunately life isn’t usually so complicated (even though it sometimes feels like it is). More
usually we have several symptoms arising from one common cause.

In either case the Thinking Process tools are incredibly powerful.

In most cases, even where we know that there is a singular common cause, we are forced to
treat the symptoms as two separate problems requiring two separate solutions.

It is a characteristic of complex problems that they require complex solutions to be resolved. If

we try to resolve a complex problem with a complex solution, we can be sure that we haven’t
addressed the underlying causality and the real problem hasn’t been removed.

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 Need of thinking process

Modern business is plagued with examples of organizational failure and poor strategic
Decision-making, often the result of misleading data and unsupported intuition. It is Obvious
that we are in need of a Thinking Process which enables us to verbalize our Intuition and
emotion, and then rigorously test our assumptions using data and Cause effect.
TOC has such a Thinking Process which organizations can use to confirm exactly what their
core problem is, what they need to change to, and how they can most successfully execute that
change. Often companies do not investigate these vital points before Pursuing improvement
initiatives and this can prove costly. The brilliance of the TOC Thinking Process is the way it
enables organizations to an sour all these questions and Test new strategies before investing
valuable resources in them. The following paper investigates the reasons behind corporate
failure and explains how The TOC Thinking Process tools are used to ensure the development
and execution of Successful strategies and improvement initiatives.
Origins of the “silo mentality”
We are living in a complex world. As globalization increases, the world grows smaller – And
even more complex. A hundred years ago, most commercial business was small, relatively self-
contained, and vertically integrated. In the early days of the automobile, for Example, Ford
Motor Company owned and operated the iron mines and rubber Plantations needed to produce
steel and tires for cars, and owned its own transportation System and retail outlets. After World
War II, however, things started to get complicated. Economies boomed and vertically integrated
companies could no longer keep up. Companies began to “horizontally integrate”, assigning
parts of their operations to Independent companies in a bid to make management problems
smaller and easier to Manage. The result was increased decentralization and specialization;
different parts of an organization became focused exclusively on their own discrete
responsibilities. Increased complexity caused leaders and managers to lose “visibility” of the
whole and Become focused on their own group or department, developing what is known as a
“silo Mentality” – those in one functional silo gave almost no thought to what was going on in
The silos around them, how it impacted them, or how what they did affected others. This

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Mentality may have improved local efficiencies but it devastated overall system Performance.
Sub optimization, the term given to the relationship between increasing Efficiency at the
expense of broader system effectiveness, abounds in business today and it is the core reason
behind most corporate failures.
To solve the sub optimization.
Problem we need to return to broader system thinking. More specifically, we need a way Of
creating a visual representation of the cause-effect relationships among the various “Silo”
components of a system. This is where the TOC logical thinking process steps in.
It written consent of The TOC Centre of Australia Pty Ltd is fundamentally a system thinking
tool, which works through the three main questions faced by any company:
(1) What to change?
(2) What to change to?
(3) How to cause the
Change?
What to Change?
Professor Sydney Finkelstein, author of “Why Smart Executives Fail”, carried out a 6 year
Study of over 100 companies and business leaders. His results highlighted four main Reasons
behind organizational failure. One reason was organizational breakdown which “Relates to
information and control systems in the organization.” He noted that “often -Critical pieces of
information are lost or dropped along the way and therefore never understood.” How can any
organization possibly know what to change if it does not have all the information? They can’t.
So they end up making changes which are generally ineffective. Often deep policy and
paradigm constraints are hidden behind what we tend written consent of The TOC Centre of
Australia Pty Ltd to call “problems”. No matter how many of these “problems” are solved and
how many Modifications are made, if the underlying policies remain unchanged the company
will see no improvement. The Current Reality Tree (CRT) is the TP tool used to identify the
key constraint within an Organization, the constraint responsible for many of the system’s
current problems. The CRT is different to other tools used to find root causes in that it does not
focus on diving

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Deeper and deeper into the issues. It examines cause-effect relationships that exist between
conditions present in the system, discovers the common causes and finally Identifies the core
problem. It is a fundamental tool in any improvement initiative.
What to Change to?
Once the core problem has been identified we use another tool – the Conflict Resolution
Diagram (CRD), often referred to as the Evaporating Cloud) – to find out what we need to
Change to. Conflict within a system is an indication of sub optimization, which, as we already
know, is detrimental to the system as a whole. The CRD surfaces hidden Assumptions which
are subconsciously accepted as valid but which are, in fact, uncertain. By invalidating any
underlying assumptions not only is the conflict rendered moot, but Breakthrough solutions are
surfaced. The CRD is a very powerful tool, and enables us to:
• Confirm that conflict actually exists
• Identify the conflict perpetuating a major problem
• Identify all assumptions underlying the problems and conflicting relationships
• Explain in depth why a problem exists
• Create solutions in which both sides win
• Create new, breakthrough solutions to problems
• Resolve conflict
• Avoid compromise
The CRD provides us with possible solutions, but it does not guarantee that they will Actually
work. Professor Sydney Finkelstein listed “executive mindset failures” as another Major cause
for organizational collapse. “This is all about getting the strategy wrong and believing we have
the assumptions about the marketplace, customers, and competitors All worked out, when in
fact we don’t.” Some refer to this as the ready-fire-aim syndrome. Senior managers are often
too quick to embrace a proposed change without first asking 2 Very important questions:
• Will this change really deliver the results we want?
• What adverse side effects can we expect?
The Future Reality Tree (FRT) logically tests the effectiveness of a proposed course of Action
before any time, energy or resources are invested in it. Once the FRT has verified That the

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action chosen will deliver the desired results, the Negative Branch (NB) tool is Used to identify
any adverse new consequences the proposed action might have so they Can be counteracted in
advance. Written consent of The TOC Centre of Australia Pty Ltd.
How to cause the change?
Thus far, the Thinking Process tools have provided us with a well researched idea for Change -
the next step is turning that idea into reality. Ideas are not solutions until they have been
converted into effective action.
• What obstacles stand in the way of our implementing this bright idea?
• How do we overcome these obstacles?
• What must we do – and in what sequence – to turn our ideas into reality?
The Prerequisite Tree (PRT) helps execute the transition from proposed to physical Action. It
identifies the obstacles that may prevent the proposed course of action from Happening and
determines ways of overcoming these obstacles. The Transition Tree (TT) Is then used to
develop detailed step-by-step instructions for implementing the chosen Course of action.
Thinking Process to Avoid Company Failure
Finkelstein’s research also found two other reasons why companies Fail: “delusions of dream
company” and “leadership behavior”. When an organization has been successful it suffers
“delusions of a dream company”: it believes it knows the entire ban sours so shuts down
alternative points of view and critical Enquiry. Even the most stable and well established
organizations have born witness to Product flops and strategic disasters: the Ford Edsel (1957),
Coca-Cola’s “New Coke” (1985), McDonald’s deluxe line (1996), Levi’s Type 1 jeans (2002)
are all perfect Examples. Even the best of the best get it wrong, and as Ross Bonander states in
his Article on Failed Product Launches “there will always be companies whose greed prevents
them from doing the most basic of homework”. “Leadership behavior” refers specifically to the
executives. An illusion of pre-eminence in an executive can result in them dominating others in
terms of their decision making, Thinking and behavior. Executives with this mind-set often fire
or remove all those who disagree with them, leaving the organization with inferior decision
making and, in turn, reduced adaptability and flexibility in the marketplace.
Tools used in thinking process
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Organizations and executives who commit to a culture of Systems Thinking and Continually
make practical use of a logical thinking process will be at significantly lour Risk of committing
any of those faults found by Finkelstein to be responsible for company Failures.
Basically there are eight tools which are used in thinking process. These are:-

1. current reality tree

2. Evaporating Cloud

3. Core Conflict Cloud

4. Future Reality Tree

5. Negative Branch Reservations

6. Positive Reinforcement Loop

7. Prerequisite Tree

8. Transition Tree

The Thinking Process tools allow us to derive simple solutions to complex problems and to
implement these solutions.

Current Reality Tree

A Current Reality Tree (CRT) is a way of analyzing many system or organizational problems at
once. By identifying root causes common to most or all of the problems, the CRT can greatly
aid focused improvement of the system.

This process treats multiple problems as symptoms arising from a few ultimate root causes. It
describes, in a simple visual drawing, the main perceived symptoms (along with
secondary/hidden ones that lead up to the perceived symptom(s)) of a problem scenario and
ultimately the apparent root cause(s) or conflict. The benefit of doing this is that it much easier

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to identify the connections or dependencies between these. Thus, focus can be placed on the bits
which would cause the biggest positive change if tackled.

A current reality tree is a statement of an underlying core problem and the symptoms that arise
from it. It maps out a sequence of cause and effect from the core problem to the symptoms.
Most of the symptoms will arise from the one core problem or a core conflict. Remove the core
problem and we may well be able to remove each of the symptoms as well. Operationally we
work backwards from the apparent undesirable effects or symptoms to uncover or discover the
underlying core cause.

Example

A CRT begins with a list of problems, known as undesirable effects (UDEs.) These are assumed
to be symptoms of a deeper common cause. To take a somewhat lively example, a car owner
may have the following UDEs:

1. The car's engine will not start.

2. The air conditioning is not working.
3. The car's radio sounds distorted.

The CRT depicts a chain of cause-and-effect reasoning (IF...AND...THEN) in graphical

form, where ellipses or circles represent an "AND". The graphic is constructed by:

 Attempting to link any two UDEs using cause-and-effect reasoning. For example, IF the
engine needs fuel in order to run AND fuel is not getting to the engine, THEN the car's
engine will not start.
 Elaborating the reasoning to ensure it is sound and plausible. For example, IF the air
intake is full of water THEN air conditioning is not working. Amplification (because air
is not able to circulate) gets added as in-between step.
 Linking each of the remaining UDEs to the existing tree by repeating the previous steps.

This approach tends to converge on a single root cause. In the illustrated case, the root cause of
the above UDEs is seen as being a faulty handbrake. Core Problem or Core Conflict: In

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business situations, however, it is quite possible that we will not be aware of the core problem
in the first instance, and instead we will arrive at a core conflict. It will looks like:

In fact we must expect this to be more common. If we are aware of a core problem and it is
within our area of control or even influence, then we will try to do something about it.
However, consider the case of a core conflict. Even when we are in total control of the situation
we may let the conflict continue to exist because both of the entities Neutral Effect A and
Neutral Effect B are required in order to satisfy something else. The entities that give rise to all
the problems are not perceived to be a problem by themselves. Constructing a current reality
tree is the first and most critical step on the path to improvement, because it makes us verbalize
the symptoms and the underlying causes; down layer by layer to the real core problem or
conflict. If we know the real underlying problem and can work out how to overcome it, then we
have a very simple and powerful way of overcoming our symptoms.

Conclusion:

The CRT is a sufficiency-based logic (if..., then...) tool that is used to fully describe an existing
situation. Its purpose is to understand (only to the level of detail necessary for the group to
achieve consensus) how the various issues and problems they face are related to each other, to
their policies, measurements, and practices and to the generic/root/core conflict identified
through a process.

Evaporating Cloud

The Evaporating Cloud is suited to finding a solution to conflict between two parties or two
points of view. The method requires the participants to find 'win-win' solutions because it
emphasizes that both parties are trying to reach the same ultimate goal.

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This understanding of conflict can be diagrammed as follows:

B <—— D B <—— Some D

/ ↑ / ↑
A conflict OR A conflict (not enough D)
\ ↓ \ ↓
C <—— Not D

Where A is the Objective, B and C are Requirements, and the D nodes are Prerequisites that are
in conflict. The lines or arrows connecting the nodes represent the rationale or causal
assumptions that are used to link the nodes.
In order to have objective A, we must have requirement B...
In order to have requirement B, we must have prerequisite D…
In order to have objective A, we must have requirement C...
In order to have requirement C, we must have prerequisite D…
But prerequisites D and D' are in conflict...

Steps in problem solving:

1. Decide that we really must solve the problem.

2. Draw the cloud and define clearly the conflict, the common goal, and the intermediate
assertions.

 What does each party want? This will be boxes D and NOT D. Clearly identify why they
can’t both
be met.
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  Identify the underlying requirements--the reason why each party needs what they want.
These are
Boxes B and C.
 What is the common goal that ties B and C together? This can be difficult to determine,
but unless
There is a common goal there would be no conflict! Maybe it’s as simple as “we both
keep our
Jobs”; but there has to be something.

3. Obtain agreement that the definition is correct.

4. Look “under the arrows” and review the causal assumptions.

Conclusion:

Evaporating cloud reflecting its roots in the application of the techniques associated with
scientific method to those "soft sciences" like management and behavior is that in any system
that is brought together for a purpose, there is no such thing as real conflict, but only
unexamined assumptions. The cloud allows a clear statement of the perceived dilemma and
provides a route for the surfacing and scrutiny of those assumptions.

Core Conflict Cloud

The Core Conflict Cloud is an Evaporating Cloud that emerges from analysis of a Current
Reality Tree, which is one of the Thinking Processes introduced in Eliyahu M. Goldratt’s novel
it’s Not Luck. The Communication Current Reality Tree

The communication current reality tree is a clever combination of the necessity-based logic of
the cloud converted to sufficiency-based logic and then combined with the sufficiency-based
logic of the current reality tree to describe the relationship between observed undesirable effects
(symptoms) and the underlying core conflict.

It does this by combining the positive aspects of both tools;

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 (1) Current realty tree – shows the core problem as the source of many undesirable effects.
(2) Cloud – shows the core problem is not the product of any one person.

We will often see communication current reality trees used in Theory of Constraint applications
to show the dynamics of the existing situation. It is, after all, a communication device. The
cloud and current reality tree are each, of themselves, an analytical device, but the combination
doesn’t seek to analyze, it seeks to inform. Let’s start with a cloud.

As we have seen previously in the section on clouds this tree is based on necessity-based logic
and is read as follows; in order to have the objective we must have requirement A, and in order
to have requirement A we must have prerequisite A. On the other hand in order to have the
objective we must have requirement B, and in order to have requirement B we must have
prerequisite B. However prerequisite A and prerequisite B are in conflict with each other.

We know also that underlying each of the arrows are some universalized assumptions.

Let’s draw these in also.

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So now we have a cloud and the supporting assumptions for each arrow. We need to turn this
necessity-based logic into sufficiency-based logic. The mechanics of this is to turn the arrows
on the cloud around, so that we get “if objective then requirement,” and because we know the
assumptions it becomes “if objective and assumption, then requirement.”

Let’s do that then.

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So now we have a cloud converted to sufficiency logic. What we do next depends upon how
we reached this stage. If there is an already assembled current reality tree, then it needs to be
tied back with cause and effect to the prerequisites. If we are using the 3 cloud method, then we
will develop the communication current reality tree directly out of the prerequisites using the
undesirable effects that we listed in constructing the specific clouds.

Let’s give some indication of what this might look like.

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So there we have it. A communication current reality tree. A tree that ties the undesirable
effects back to the core conflict – the rock and the hard place, demonstrating that the core
problem is not the deed of any one person.

3 Cloud Method

The three cloud method is, I believe, a Socratic tool which serves the purpose of both
determining the core conflict and building consensus amongst members of a group who may
have little intuition for the situation of other members in the group. It doesn’t’ replace the rigor
of the current realty tree in determining the core conflict.
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However, where the 3 cloud method comes into its own is cross-functional groups. Properly
facilitated the 3 cloud method will negate the 5th layer of resistance at the early stages of
analysis. We might think of it as a strategic tool then rather than as an operational tool.

How Do We Build It?

A generic cloud of the problem is constructed from at least 3 individual and specific clouds that
address the general problem – either single clouds from different individuals or multiple clouds
addressing different aspects from one individual. The underlying assumption is that a deeper
generic conflict gives rise to each of these specific clouds.

The generic cloud is constructed by summarizing each of the entities in each of the specific
clouds into one common entity. The generic cloud can then in fact be used in a communication
current reality tree to build out to all the undesirable effects. Brief descriptions can be found in;
Lepore and Cohen, and also Smith Breaking the cloud with a generic injection sets the direction
of the solution and the injection can be used to develop the future reality tree. Constructing a
future reality tree will give rise to negative branch reservations and obstacles which must be
dealt with.

The process is very effective, however, needs to be properly facilitated to be truly successful.
Be aware that it exists, but leave it until we have confidence with the communication current
reality tree.

Conclusion:

Core conflict cloud is a combination of conflict clouds based several UDE's. Looking for deeper
conflicts that create the undesirable effects.

FUTUR REALITY TREE

A future reality tree allows us to map out our future expectations given that we will introduce
something new into our reality – the injection that we developed to break our current reality
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problem or core conflict. A future reality tree allow us test the future outcome using known
cause and effect to check that what we want is what we will get. This page is a brief
introduction, further information can be found in several published texts (1-3).

At its simplest, a future reality tree might be thought of as a current reality with all the
undesirable effects (UDE’s) changed to desirable effects (DE’s). Let’s draw that. In fact we
will rename the final entities as desirable outcomes.

The presence of the new idea or ideas as injections will change reality from undesirable
outcomes of the present to desirable outcomes of the future. Maybe we need several different
injections to achieve this.

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The future reality tree is the tool of choice in gaining understanding and agreement that the
solution we have decided upon will account for all of the undesirable effects that we currently
experience and built into our current reality tree.

Just as a current reality tree isn’t a current reality tree without at least one negative reinforcing
loop, a future reality tree should also have a positive reinforcing loop – a so-called virtuous
spiral. As things get better, they get even better still. We should try to engineer positive
reinforcing loops into our future reality trees. It makes them more robust. In fact we are
leveraging the situation in a positive manner. For example just as our wing child had difficulty
leaning to read because s/he wasn’t reading, now as the child starts to read (desirable effect)
s/he can read better (desirable outcome) and then starts to read more and more often (positive
reinforcing loop).

We read a future reality tree in the same way as a current reality tree; if cause, then effect.

While it is easiest to visualize a future reality tree like this, most often the future reality tree will
not have a near 1:1 mapping with the prior current reality tree, but will grow its own shape as
we engineer the solution. The important point is to make sure all of the previous UDE’s are
overcome. Moreover, we want to do this with the greatest “bang for bucks.” If we find that we
are using lots of injections to force the desired solution, then maybe the core problem wasn’t
sufficiently uncovered in the prior analysis.

Usually as we develop our future reality tree, we experience the situation where our best intents
give rise to one or more new negative outcomes. Clearly we are not aiming to introduce new
problems. We call these new but presently un-realized problems “negative branches.” And we
must cut them out – prune them, before we put our future reality tree into action.

The future reality tree is a very specific representation of desired results and the steps involved
in achieving those results, and not a bland business vision statement.

Conclusion:

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The objective of the FRT is to communicate a vision of how to change the undesirable effects
found in the CRT to desirable effects. Again, like a CRT, construction is best done by
individuals or very small groups, while the most effective use of group interaction (and those
gains from experienced facilitation) is in scrutiny, clarification, and completion of the solution.
The FRT is the first step to address the second reason for groups to come together, figuring out
WHAT TO CHANGE TO.

NAGATIVE BRANCH RESERVATION

A negative branch reservation is a cause and effect analysis that proves how one entity leads to
a negative outcome.  NBR is usually associated with the analysis of a concern to do with a
solution.  A concern has been rose ~ "this bright idea might lead to more problems than it
solves".   Usually the NBR starts from a positive effect and then at some point it turns negative. 
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There are 3 objectives of a negative branch analysis: firstly, to identify if the suspected negative
outcome is real, secondly, if it is real, to try and find ways to cut the negative branch and thirdly
if it is not possible to cut the negative branch, to make the inventor reconsider the direction of
the solution and to consider looking for a new starting point. This graphic illustrates a negative
branch of an UDE.  The difference between an UDE NBR and a more usual NBR is that the
backbone of the usual form is a prediction of effects rather than a backbone of effects that exist
now.

PREREQUSITE TREE

The pre-requisite tree ought to be considered the most important tree in the Thinking Process
suite. It is the tree that allows us to overcome the obstacles that stop us from implementing our
plan. It is also the tree that in fact becomes the implementation plan. And it is the tree to which

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timelines, responsibilities, and accountabilities can be assigned to. It is also the tree that I have
most often seen skimmed over.

There is an English saying that we can plan to fail, or we can fail to plan. The pre-requisite tree
occupies the position of “plan” amongst the Thinking Process tools. Scan it at our risk.

In developing the future reality tree and trimming any negative branches we are really
developing our solution, we tailor it to our specific circumstance. Now we must deal with the
substantial reservations the “yes buts” that tell us there are still real obstacles that block our
progress. After all if an injection to a future reality tree is simple enough we would “just go out
and do it,” and then we wouldn’t need to write a pre-requisite tree for it. If we find we can’t
just go and do it we need to stop and think for a while.

The pre-requisite tree is composed of two elements, an obstacle and an intermediate objective.
The intermediate objective is the action that we must undertake to overcome the obstacle.
There might be several independent obstacles to an injection as in the example below (A and
C), or several dependant obstacles in a chain (A and B). The obstacles are either things that
exist now, which we must remove or overcome, or things that don’t exist now which we must
obtain.

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How do we read a pre-requisite tree? Like this, from top to bottom; In order to achieve the
injection we must fulfill the intermediate objective in order to overcome the obstacle.

How Do We Build A Pre-Requisite Tree?

How do we build a pre-requisite tree? Below is a brief description, more detailed descriptions
are available in the references (1-3).

Firstly we need to choose the injection to address and then request all the obstacles, and all the
intermediate objectives that will overcome the obstacles. Dettmer uses the Crawford Slip
method to great effect to solicit obstacles and intermediate objectives for the pre-requisite tree.

So our first step will look like this.

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Second step is to sequence these pairs.

And therefore we have our completed tree. There may be some steps for which there are no
obstacles, but it is useful to add the step for clarity (we must have it), if so add it as an
intermediate objective by itself.

In fact we really only need to know about the intermediate objectives – after all they are the
sequence of things that we are now going to do in order to action our injection and make our
future reality tree implementable. A short-hand way of displaying a pre-requisite tree as
intermediate objectives alone is called an intermediate objective map or an IO map for short.

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The pre-requisite tree is the tool of choice for gaining understanding and agreement that there
are no obstacles that cannot be overcome in implementing our proposed solution. Furthermore
it allows us to gain agreement on the correct sequence and plan to implement the solution. The
pre-requisite tree turned on its side becomes a template for a Critical Chain project if the proper
assumptions are made. The full picture is

Conclusion:

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This is an effortless way of identifying which "bites of the elephant" we'll bite on first in our
attempt to consume the whole thing. As a group effort, this process benefits (as does the
solicitation of NBR s as reasons we shouldn't take a particular path of action) from the
diverse and different views of the group's members. The more obstacles that are raised, the
more complete the implementation plan of HOW TO MAKE THE CHANGE HAPPEN will
be, resulting in fewer surprises along the way.

TRANSITION TREE
We have identified the core problem causing most of the undesirable effects.  We know
where we want to go having determining the injections that will result in the desired
outcome.  We have also outlined the map; the logically sequenced intermediate
objectives.  All the groundwork has been done, but if we don’t take action, reality will
not change. In determining the needed actions, attention should not be on what we plan
to do, but on what we want to achieve.

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The “backbone” of the transition tree is the detailed description of the gradually evolving
change we envision occurring. The “ribs” are the actions needed to cause that gradual change
until the objectives are met. 
This method forces us to carefully examine which actions are really needed and if they are
sufficient to guarantee the required change. Too often we rely on a set of actions just because
“it’s the thing to do,” without checking if they really fit our particular situation.  But above all,
putting the gradual change as the backbone of the plan provides the safety net which is essential
when planning the future

This method forces to carefully examine which actions are really needed and if they are
sufficient to guarantee the required change. Too often we rely on a set of actins just because
“it’s the thing to do” without checking whether they fit our particular situation.

Conclusion:

This last tool further supports the need to describe HOW TO MAKE THE CHANGE
HAPPEN. Sometimes a plan is developed by a group for other people to use. Sometimes
getting from one IO in a PRT to another requires a finer level of detail in terms of action and
results. Including the TT here for completeness of the list of TOC Thinking Processes, it
may be a stretch to think of it as a facilitation tool, as it's really a communication and
empowerment tool, allowing the recipient of it to follow a path of action with clear
understanding of what to expect along the way and why to expect it.

Thinking Process with Product Design Chain

Applying the thinking process with the product design chain (PDC) could be very beneficial.
This application could be used to resolve a problem or to improve a system, based on the
characteristics of the product and nature of the design process. In this study, three integrating
modes: series, parallel, and feedback of TP logic with PDC Of three types of products: new

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products, upgraded products, and customized products are proposed. Which is summarized as in
Table 1, and depth details are discussed as in the following paragraphs.

.Type of Product Integration Mode The Role of TP Tool used

What to Change?
New Product Series What to Change To? FTPA
How Cause to
Change?
What to Change? CRT
Upgraded Product Parallel How Cause to FRT
Change PRT
TT
How Cause to FRT
Customized Product Feed Back Change PRT
TT

WHRE:
FTPA= Full Thinking Process Analyze
CRT = Current Reality Tree
FRT = Future Reality Tree
PRT = Perquisite Tree
TT =Transition Tree

Series Mode
Series mode, demonstrated in following figure, is used for the new product design process to
handle the overall
Activities within the PDC cycle. For new product design, most product characteristics in the
four design
Stages: product concept, detail engineering, process engineering, and prototype manufacturing
are unknown
And the resulting outcomes are uncertain. FTPA is integrated into the procedure in a series
mode after each
Of the four design stages. Where FTPA uses all five-application tools to analyze a system or
situation in order to identify the core problem, develop solutions, and determine

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 implementations right after each of the four stages. For each stage, FTPA plays a role as a
problem solver in reviewing the previous steps and overcoming discrepancies that are found. In
consequence, the quality of design is improved.

TECHNICAL PART,
DISCRIPTION COMPONENT,
SUPPLIMENT

PRODUCT FTPA DETAIL FTPA

Design CONCEPT ENGINEERING
frame work

Customer
requirement
PROCESS FTPA PROTOTYPE FTPA POST
ENGINEERING MENUFECTRING LOUNCH
Competitive ACTIVITY
product

Parallel Mode
When a product already exists and needs to be upgraded, customers have already provided
feedback for their specified requirements. In such situations continuous improvement is needed
by manufacturers to maintain a competitive edge. Integrating the TP parallel with the PDC is
called the parallel mode in this study and is
Depicted as following figure. While conduct the parallel mode, the manufacturers have already
experienced
How to manage the process and how to control key technologies. The TP tools CRD, FRT, PRT
and TT need only to be applied. The tools act as a consultant for consulting the problems
whenever there is a need. The best way to handle upgrading products is consulting the TP tools
which help to resolve conflicts between functions and cost and to focus on the factors that
should be considered for the product upgrade process as the reference for improving product

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 function, replacing components, and correcting the specifications. The manufacturers can then
devote their efforts to accomplishing the upgrade. For example, the customer feedback that
there is a specific specification has not been satisfied. In such circumstances, this specific
specification is a core problem, a new specification established directly from the result of CRD
and crucial improvements and relevant actions. Consulting TP tools in a parallel mode not only
solves the product development problems but also is beneficial for proposing a better alternative
for product development

TECHNICAL PART,
DISCRIPTION COMPONENT,
SUPPLIMENT

MODIFICATION DETAIL PROCESS PROTOTYPE POST

REQUIRMENT ENGINEERING ENGINEER MENUFECTRING LOUNCH
ING ACTIVIT
Y

CURRENT REALITY TREE

FUTURE REALITY TREE
PREREQUSITE TREE
TRANSITION TREE

Feedback Mode
Feedback mode of TP integration, demonstrated as in Figure 3, is normally applied to the
customization of Products, such as in original design manufacturing (ODM). Customization of
products is defined for existing products that customers have already given the specifications
and characteristics for these products. To meet the customer’s requirements, the manufacturer
needs to review the PDC in order to search for better manufacturing technologies and
management methodologies for cost reduction and process improvement.

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 TP tools FRT, PRT, and TT are sufficient for reaching these goals as well as for focusing on the
features that need be modified or added.

PRODUCT DESIGN CHAIN

COUSTEMISED DETAIL PROCESS PROTOTYPE POST

REQUIRMENT ENGINEERING ENGINEERING MENUFECTURING LOUNCH
ACTIVITY

FUTURE REALITY TREE

PREQUISTE TREE
TRANSITION TREE

Conclusion:

Hence due to global competition, rapid changes in technology, and market fragmentation have
resulted in a need for shorter product cycles. Creating a framework for product development is a
significant objective for businesses. The following are the four conclusions of this research for
integrating the TP into PDC activities.
The PDC can be used to build a framework that links customers, product design engineers, and
manufacturing planners. They then can analyze worth and quality, set specifications, conduct
design reviews, and plan for the eventual safe reuse or sale of products. The key factors
identified in the PDC offer the primary strategy for determining how to shorten. The time
needed to complete a project and to improve the product manufacturing process and quality.

CONCLUSION

The Thinking Process is integral to the systemic nature of Theory of Constraints and allows not
only analysis of problems, but also the construction of solutions and the communication and
effective implementation of those solutions. Over the above pages we have examined 8
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different tools, the current reality tree, the cloud, the future reality tree, and the pre-requisite
tree. We have also examined some derivatives, the negative branch reservation, and the 3 cloud
approach. We have seen these trees already, and learnt the basics of how to construct them.

The Thinking Process allows us to work through the sequence of;

(1) What to change.

(2) What to change to.
(3) How to cause the change.

The Thinking Process performs a number of functions often simultaneously. It allows us to

interrogate the situation in a systematic and logically rigorous way, allows us to analyze and
synthesize, communicate the situation, and to generate organizational knowledge.

These are basic tools to help people walk through a buy-in process. They are also useful tools
for any kind of human interactions. The buy-in process has the following steps Gain agreement
on the problem

1. Gain agreement on the direction for a solution

2. Gain agreement that the solution solves the problem
3. Agree to overcome any potential negative ramifications
4. Agree to overcome any obstacles to implementation

The thinking process, as codified by Goldratt and others:

 Current Reality Tree (CRT, similar to the current state map used by many
organizations) - evaluates the network of cause-effect relations between the undesirable
effects (UDE's, also known as gap elements) and helps to pinpoint the root cause(s) of
most of the undesirable effects.
 Evaporating Cloud (conflict resolution diagram or CRD) - solves conflicts that usually
enable the causes for an undesirable situation.

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 Core Conflict Cloud (CCC) - A combination of conflict clouds based several UDE's.
Looking for deeper conflicts that create the undesirable effects.
 Future Reality Tree (FRT, similar to a future state map) - Once some actions
(injections) are chosen (not necessarily detailed) to solve the root cause(s) uncovered in
the CRT and to resolve the conflict in the CRD the FRT shows the future states of the
system and helps to identify possible negative outcomes of the changes (Negative
Branches) and to prune them before implementing the changes.
 Negative Branch Reservations (NBR) - Identify potential negative ramifications of any
action (such as an injection, or a half-baked idea). The goal of the NBR is to understand
the causal path between the action and negative ramifications so that they negative effect
can be 'trimmed.'
 Prerequisite Tree (PRT) - states that all of the intermediate objectives necessary to carry
out an action chosen and the obstacles that will be overcome in the process.
 Transition Tree (TT) - describes in detail the action that will lead to the fulfillment of a
plan to implement chances (outlined on a PRT or not).

Bibliography

De Geus, A., (1997) The living company: habits for survival in a turbulent business
environment. Harvard Business School Press, pg 82.

Senge, P. M., (1990) The fifth discipline: the art and practice of the learning organization.
Random House, pp 12, 64, & 114-115.

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Goldratt, E. M., (1990) What is this thing called Theory of Constraints and how should it be
implemented? North River Press, 162 pp.

www.wikkipedia.com

www.focusdperformancr.com

www.dbrmfg.co.nz

Thinking for a change Lisa j.scheinkopf

www.nait.org

Goldratt, E. M., (1996) My Saga to improve production, Avraham Y. Goldratt Institute

Goldratt's Theory of Constraints - A Systems Approach to Continuous Improvement by

William Dettmer ISBN 0-87389-370-0

Thinking process by eli schragenhiem

www.tocca.com.au

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