I heard from Peter Senge that before he was 20, he was almost obsessed with interdependence. And when investigating more about systems thinking, all the authors agree on the holistic vision, where the whole is more than the sum of its parts.
Systems are not just groups of elements. They are also the interactions between its elements. And what a system produces is generated as a flow through these interactions, as an emergent characteristic of the system as a whole, and that cannot be obtained in any other way, even if we have all the parts available without interacting.
In his book The Fifth Discipline, Senge says that the fifth discipline is systems thinking. And this is very relevant for companies because companies are systems, therefore, managers should try to accelerate the flow as a first consideration. Flow of materials or services to customers, bi-directional flow of information and money flow from customers.
Knowing this, the next step is to ask yourself how to achieve better flow. In my book Synchronization, I say that the main thing is to increase the synchronization between the different flows that occur within the company. In that book I explain that systemic contradictions reduce synchronization and show how they can be methodically eliminated. But there is another aspect of synchronization that I want to talk about here.
Let's define the word first. Synchronizing is making two or more things happen at the same time.
In complex systems, such as companies, there are several flows that are occurring and we must synchronize them to achieve production. What if one flow has a different rhythm than another? One of the flows has cycles of days while the other has cycles of hours, how to ensure that what one needs is delivered by the other at the right time?
Thinking about this issue of different rhythms, I came up with the case of a field that needs irrigation. There are days of rain, and those days the field receives the rain and does not need more. For the days when it does not rain we can use the water from the stream that forms when it rains. In this case, on rainy days we do not need the stream, but it is precisely on those rainy days that there is a stream, but if it does not rain there is no stream that we need.
How could we synchronize the stream water with non-rainy days? In other words, how can we synchronize irrigation when the rate of rainfall is intermittent but the need is continuous? The solution is known: a reservoir that collects water on rainy days and can be used on non-rainy days for irrigation.
The reservoir decoupled both flows, and allowed us to control the timing between these two flows of different rhythm.
In companies we have demand, production, supply and cash flows. And each of those flows has different rhythms. The way to achieve synchronization is with reservoirs. In Theory of Constraints (TOC) we call them buffers.
Buffers can be of physical inventory, they can be of time or they can be of installed capacity, or a combination of those possibilities.
For example, if you manufacture mass consumer products, the way to synchronize demand with production is with inventory for immediate delivery. Another example; If one manufactures to order, and receives orders that use several days of capacity, the way to synchronize production with sales is by giving delivery times.
Buffers are flow stops, so it is desirable to have the minimum possible to ensure synchronization. It is not good to have a lot of buffers. The guide here is to put buffers only between flows with very different rhythms.
TOC applications for managing flows are based on buffers and have proven to be the most effective over decades of experience. And the methods include how to manage the size of the buffers based on changes in rhythms.
Do you have symptoms of a lack of synchronization in your company? Perhaps the remedy is to build and manage a few buffers within your processes.