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SD HyPE (*Hy*pothetical *P*roblem *E*xploration).

Posted: Sun Jul 07, 1996 12:35 am
by bbens@MIT.EDU (B. Budiman)
A

Esteemed SDists:

First let me thank everyone for the wondrous discussions on SD consultings
(applications). While I learnt a lot from the messages posted on this
list or sent to me directly, I am still somewhat puzzled with applying SD
to identify challenges/problems. So, please allow me to propose a HyPE
(*Hy*pothetical *P*roblem *E*xploration) that is intended for everyone to
participate in applying the suggestions available thus far to explore
some hypothetical problems that anyone can suggest. To start, let me pose
a problem in production/distribution that may be dear to the brain (and
heart) of members of this list. I am now asking other members of this
list to continue with the problem description that we will all contribute
to resolve it.

I will collect the explorations and create a web page that everyone can
access. This web page should be updated biweekly (or monthly, depending
on the extra time I have.) I hope this will take off so that we can
create a collection of stories that will increase our understanding of SD
& ST applications in general.


Legal stuff:

I, the de facto moderator of HyPE Web Page (to be created in the near
future), am currently working on a thesis in Manufacturing Process Design
and Control; therefore, not currently working on any manufacturing
(production) consulting project whatsoever.

The HyPE problems are fictitious and is intended for enhancing SD learning
and applications. Any similarity in names and situations is purely
coincidental. The proposed solution is by no means complete and the
participants are not liable for the use of any of the stories in SD HyPE.
The content is entirely public domain. Some illustrations, when available,
are copyright of the artists and may not be used without prior written
consent.

CONTRIBUTORS MAY NOT USE THEIR ACTIVE CONSULTING PROJECTS AS HyPE STORIES.

End of Legal stuff.

HyPE 1:

A manufacturing plant generates high revenues but also incures high costs
such that it is barely profitable. The vice president of manufacturing of
the parent company, MomPop & Co., has asked us, consultants with Consulting
R Us, to work with the plant manager to first identify challenges and
problems that this plant is facing. Next, we are to present a proposal
that will alleviate the problems. The objective is, of course, to improve
the "bottom line."

The vice president (VP) thinks that the high costs are due to low
productivity of the plant. The plant manager (PM) argues that the plant is
so productive that it can fill any order the plant receives on time. The
PM, on the other hand, thinks that high costs are due to inefficiency in the
ordering/distribution system within the company that causes huge inventory
and waste. The company will close down this "unproductive" plant if the PM,
with our help, cannot identify the problems so that corrective actions can
be taken. The PM has approximately thirty days to identify problems and to
propose corrective actions to boost the plants profitability. The threat
of plant closing has caused some anxiety in the workforce; morale starts to
take a nose dive!

As a rookie consultant with Consulting R Us, I am assigned to work on
this project. Due to the nature of the problem that is similar to the
beer game, I will use the SD "Standard" Approach (SA). The challenges I
am facing are three folds. First, although I have two contradicting
"hypotheses" making it a prime object for the SA, the VP or PM are not
familiar with SD or ST; neither have played the beer game nor read the
Fifth Discipline. Second, the thirty-day deadline may not be sufficient
to create thorough hypothesis testings as required by the SA. Third,
I am faced with some "soft" variables such as workforces productivity
and morale--it is obvious that there are contradicting productivity
measures within the company: capacity to produce (VP) and lead or cycle
time (PM).

*** Anyone is invited to contribute to make this story alive ***


HyPE-for-Thoughts 1:

o Measures and their relevance to represent the intended states of the
systems, e.g., "is lead or cycle time depicting productivity?"
"is high cost an indication of low productivity or
capacity to produce?"
"what is a metric for morale?"
o The current focus is the "troubled" manufacturing plant, yet it may
creep out to cover the entire organization.
o Thorough hypothesis testings may not be feasible due to time limitation.
Additional tool from the consulting bag of tricks may be necessary, but
what?

*** Anyone is strongly invited to transform HyPE into foods for thoughts ***


Thank you for everyones attention. I do hope this will take off. In
case it didnt, thank you for letting me present this idea to you.

Regards,
Benny Budiman
bbens@mit.edu