The Goal Final Calabosession

.Oftentimes when you're at a crucial decision point, apathy will sneak in. It's like poison gas and construction industry. It's that, oh, we've all felt it. Cuz construction, it's every single. You gotta get up, you gotta open gate 5:00 AM whether it's raining, whether it's 80 degrees, whether it's below freezing, people that open the gate every day salute, because that is respect, especially if you're there all the time. And that's super important. But we also have a lot of stuff that don't necessarily add. I struggle with this. If you devote 40% of your energy to nva, non-value added activities, but required non-value activities. So it's like these things that we have to do to be compliant for many reasons. Code for laws, for policy, for whatever. We gotta do that. But each time you do that, you have a limited amount of energy. So every time that you do that, there's not much left. I learned recently, I'd say recently, like in the last 12 to 18 months. around that non-value add or incidental, for whatever reason, the word incidental is more meaningful to me than the non-value add is when I think about it, it is incidental or non-value add as the work is currently designed. So the meaning the work can be redesigned to also minimize the non-value added or incidental work, but it doesn't just go away. So point, I guess, bigger picture, we can go in there and eliminate the waste. We can go in there and make some Band-aid adjustments to remove the waste. But if we want to have a greater impact on the waste and the incidental, the work will have to be redesigned. What up? Yo back? I know it's been since, like last year since we posted anything new. Uh, sorry for leaving y'all hanging, but we're back. We're gonna have like a series of back to, back to back releases here in February, end of March. Um, and I'm super happy . The final collab session with Mr. Thomas Lame is finally out. We had some technical difficulties, thought I lost the file. Plus I also launched a couple other crazy ideas that you'll hear a little bit about. but this episode, man, it's the finale. There's tons of like juicy, good deep conversation about all kinds of stuff that I love, all the stuff that Thomas loves, and also Thomas leaves like a major, major announcement that I know is going to impact him personally and also is gonna have tremendous impact for the entire. So you gotta listen all the way through, uh, to, to, to get an idea of what that is cuz it's a big one. It's a really big one. And I'm grateful to him that he chose the Learnings and Missteps podcast to, to make that announcement, even though he made it like six months ago. And I've been sitting on it. And of course we're gonna show that l and m love to our people, the folks that support us, the folks that are behind us, the patrons, and the ones that leave us. Our comments, patrons, appreciate you very much. It's a brand new year, 2023. We ain't going nowhere. We're gonna keep it. Appreciate all your contributions, folks. If you're up to contribute some funds on this bad boy, bring it and if not, awesome. We appreciate every second, every minute, every thought, every share, every comment, every like, everything that you gift us with. We deeply appreciate that and wanna show some. Specific love, uh, to one of the LnM Family members who left us an amazing comment. Mr. Umu says, I did stop and closed the book and questioned my relationship with people many times throughout the reading, I thought about my girlfriend, workers on site, and even an old lady in the coffee shop. . I knew connecting people makes a difference but I actually never knew how to. Thanks for normalizing vulnerability. Jesse and Jennifer and Sou. Appreciate you, my brother. You've been showering us with love in your comments out there, and most importantly, I love that it's impacted you in some kind of way, and so please keep sharing that my man and folks, y'all out there, you find 'em on LinkedIn, hit 'em up, Mr. O's got it going. And one last announcement. Oh, you may have seen it. You may have heard of it. It's one of those little crazy ideas. The name came from Ms. Stephanie Brown, we got a group, it's called The Emotional Bungee Jumpers, and it's a group of industry peers mentoring each other, learning with each other, networking, growing together. I, I'm not gonna give you all the details. It is, I'll just say this. It is a mind shifting experience and it will enhance your abilities to. Which are going to enhance your relationships, so you need to hit it up. We're gonna have a virtual call once a month. I'll leave a link in the show notes. That way if you're a little bit curious and if you wanna share it with somebody else that you think may get some value or is looking for some connection, um, find the link in the show notes and here we go, man. Y'all gotta, y'all already gotta listen to Mr. Thomas LeMay. The question is how do we apply this to our work? And that's the function with theory of constraints, is in constructions you gotta blend CPM with last planner, with constraint log, with location based management. So you start to package things together and then you just start looking for Herbie . I was working thinking through a little further into the future with my client, I'm gonna be teaching some sweat equity improvement. How do I help them select the task with the greatest return on investment potential for return on investment? It's like, how can I frame it in such a way that it's easy for them? Like stupid Herbie? I just need to ask them, let's look historically with what some level of consistency, what are the bottlenecks in your projects? Where does shit slow down, over and over again? , identify those and if you have any strategic relationships with those trade partners, that's the second criterium, so that we can do something that's sustainable instead of just a science experiment, which I'm happy to do and I can transfer the knowledge with an experiment, but ideally it would be have a major impact on their business, yeah, a stack improvement on the work they're already doing versus trying, just throwing whatever they did out. Yeah. In the book, the Theory of Constraints, the chapter, the Herbie chapter is in here, Gold Rats. Two selected readings from the book is the encounter. So when Alex confronts Jonah, he accepts that he's not the expert. He needs help. That's selected reading one. And then the second chapter that Gold Rat includes in another book as the height. Those, those are the two kind of key moments. And then the realization that Herby, even though he is the slowest, he's also the most burdened . The only thing that he can do is work harder, but working harder is the exact opposite. The thing that he needs to do, he needs to unload and to unload. It takes courage and assertiveness by the leader. We're at chapter 30, right? That tipping point. Oftentimes when you're at a crucial decision point, apathy will sneak in. It's like poison gas and construction industry. It's that, oh, we've all felt it. Cuz construction, it's every single. You gotta get up, you gotta open gate 5:00 AM whether it's raining, whether it's 80 degrees, whether it's below freezing, people that open the gate every day salute, because that is respect, especially if you're there all the time. And that's super important. But we also have a lot of stuff that don't necessarily add. I struggle with this. If you devote 40% of your energy to nva, non-value added activities, but required non-value activities. So it's like these things that we have to do to be compliant for many reasons. Code for laws, for policy, for whatever. We gotta do that. But each time you do that, you have a limited amount of energy. So every time that you do that, there's not much left. I learned recently, I'd say recently, like in the last 12 to 18 months. around that non-value add or incidental, for whatever reason, the word incidental is more meaningful to me than the non-value add is when I think about it, it is incidental or non-value add as the work is currently designed. So the meaning the work can be redesigned to also minimize the non-value added or incidental work, but it doesn't just go away. So point, I guess, bigger picture, we can go in there and eliminate the waste. We can go in there and make some Band-aid adjustments to remove the waste. But if we want to have a greater impact on the waste and the incidental, the work will have to be redesigned. And so for me, that helps me. , get away from the argument that you've probably been a part of where people like to debate, whether it's value add or incidental and No, it's, no, it's required. Like whatever, let's redesign the work and let's make it all smaller. , let's respect everybody. So now all of a sudden it's a win when the neighbors who have this policy that they don't want to be disturbed. Cause it's early in the morning and they're normal people. And then us crazy construction people, we show up at oar early . Yeah. Because we want to go home at a reasonable hour to beat the traffic. But then the deal was like, Hey, this worked out well. But the idea was I had to be brave enough to break the rules. Yes. Like I had to be, because I was the supervisor, I was the superintendent of the site. . Yes. And I wasn't the, I wasn't in charge of the entire project, but I had control of that gate. and we worked it out and effect was we didn't get in trouble. It was a win-win. So sometimes like you're gonna come across the situation where you're gonna come up to policy, or you're gonna come up to a rule, or you're gonna come up to some situation that it's gonna require a decision because the constraint will become non-physical. We've talked about this all along, this whole time that, uh, they had to, the constraint was we don't have a budget to go buy another Ncx 10 robot. We don't have a budget to build another heat treat oven. But guess what? It's in our power to send these parts to a third party like that. So that right there and that moment is courage. It takes courage. and the apathy. So if you're, if you're swimming in an ocean of apathy, you won't remove that constraint. And the only people you will punish then are the workers for two months that they won't get home until nine o'clock at night. And then plus they gotta get up. So they're getting six hours of sleep. That's how we designed that cycle of injury. And this is just one instance, and I'm not saying this is rampant throughout the industry, but it is . You wanna talk about the goal and wrap this up? Yeah, no, let's talk about the goal . So we talk about courage, we talk about sometimes you gotta break the rules. Sometimes you gotta, you gotta push it because if you don't push it, you come up to these constraints and the constraints will win. And if you let the constraint win, the only people that get punished, the workers, the only people get punished are the workers. . And then you get into this cycle of we need to make improvements based upon these Hollywood metrics that we're talking about. You're not actually dealing with the real problems that you've discovered, you've ran experiments on, and now you've come up to say, Hey, we need to do this decision. So what happens in chapter 30 is they broke the rules, knowingly broke the rules, they made a side deal with the union, they did all this side work, and now it paid off. They had a write up in one month, 17 and a half percent profit lift. And I was just looking at some of the recent manufacturers that are publicly traded and they're making not that much lift in profit and their stock prices are recovering. This is not financial advice , but if you made that much of a increase in profit, people are gonna take super notice two ways. One, be like, damn, this is amazing what's happening over here. We gotta take a look at this. We gotta get a closer look at that. That's one way. The second way is they're lying, they're cheating. They're, they're somehow skirting the policies. And this happens to, in chapter 30, and, uh, Hilton Smith, who's in a position of influence, he's the, uh, I guess the second in command at Unico in this particular division. So he's number two, and he has operational influence on this particular plant. And he goes in and has his, his own audit team. This is some BS by the way, chapter 30. Instead of celebrating or just go and be like, Hey, tell us about how you did this increase. And instead of doing that, immediately was like, we're gonna run an audit on you. We're gonna come out and audit all of your parts, blah, blah, blah, blah. . And even though the prime customer of Unico, the paying, who pays all the bills, by the way, Bucky Burnside flies in on a helicopter and he guys are awesome. This particular plant. See, even in the face of that, he said, now you guys are lying. And uh, he comes in. I was like, that's some bs, that's some serious bs. So there's a tipping point. So now all of a sudden, division headquarters has to make a decision. Are we gonna go with Alex's method of do these five focusing steps, run experiments, and then rearrange your process based upon what you find that's current. And that means everything's on the table. There's nothing that can't be changed out and including if we have to go to a third party, all this stuff. So there's that. That's one way. The other way is, let's keep doing this the same way we've been doing this for 20 years, these metrics. Say so. Right? And we trust these metrics and we trust them so much that we've created Vice presidents of the metrics, accountants, we've hired people, there's computer software companies that deal with this stuff. There's dashboards. This is 1980, so there's no Power bi, these are all printed. So this is a very manual process. This is very labor intensive to do this step. So you have to make a decision because if you make this decision, you put all those people in the traditional method, you put them at risk. And the risk is not that, hey, they're all gonna get fired. The risk is like they have to change the way they do business to this new method. And that's scary. I, as a person who is interested in Lean as a person that is interested in continuous improvement, as a person who's interested in not trusting, Traditional methods , because I'm programmed that way. You're often seen as an outsider and you'll face adversity because lemme tell you, the traditional way is profitable. Sometimes the traditional way is the way too , but not always. Or if you say it depends people, it's scary. So what do you think? Have you faced that? The The fear? Totally. And I would say, I guess in a more personal way in that I've learned, when I'm coaching people one-on-one, people get stuck. They're stuck because that next step, they don't know the answer to the next new step. We know the answer to the steps that we've been taking cuz it's like the ant trail, right? We've been going back and forth that trail for years. . So there's nothing to worry about. And taking that new step is, it's terrifying. It's about energy. You'd said it earlier, right? It's about bringing the energy and the enthusiasm and okay, what is the one step we can take to get there? The smallest, easiest thing that you can do, cuz we're talking about the tipping point. If you're on the tipping point, all you gotta do is get your little foot over it and then it's downhill from there. And so it's really challenging of what's the worst thing that could possibly happen? Can you tolerate that? Yes. Okay. So what's in your way? What's keeping you from taking that step? Why don't you want to? All these reasons. Ah, and so for me it's really when I'm coaching somebody one-on-one and they're deflecting or pushing back, the way I interpret those things is not them rejecting. That's the recipe for me to get you to take that step. All of those things you just listed about, why not? Let's examine 'em. Let's pull 'em apart. And once we tease 'em out, it's, oh, they're not that big and scary anymore. Oh cool. Let's do something. And it gets 'em over the edge. And the rest is exciting because it's all brand new. Or another thing I'll do, especially if they trust me, is I'll push 'em over the edge by me taking an action step, right? A simple example is when I played ball baseball in high school, and even now when I'm in meetings or there's like some heavy stuff to talk about and like energy was low, people are tense. Guess what? As soon as I get up to bat, I don't care. I am going to be diving head first in the first base. Pi, I don't care if I got a base hit out the infield, I'm gonna dive head first into first base. Because it's gonna get people amped up and disconnected from all the garbage that they're worried about. Or when I'm in a meeting or in a session, when somebody asks a real question, a leader will ask, so what do y'all think? And everybody's, oh my God, this could mean my career, this could be my race, it could be my promotion. I'll just say something stupid. And that's the first thing that comes off of my head. And like, why do you always wear a green ? And it's goofy, but it's intended to poke a hole in that pressure system that everybody's hiding in. Cuz we're all just human beings. Let's just get there. Malcolm Gladwell has that tipping point book. Once you hit the tipping point and you go downhill, spreads like a wildfire. And the one example, I'm trying to remember, I think it was Instagram back in like 2010, 2011. It was, it's it, it was around before that, but then all of a sudden, Everybody needed an account. Everybody's got one now. Yeah. I even have one. I'm not even like social bio, like I have some interests. Once that idea hits that tipping point, it spreads like wildfire. Yes. Um, and it gains its own momentum. Yes. And then there's, so then you, but you can't do it by yourself. You need help. So there's, let me see here. I'm trying to think. There's three people that you basically, you need the people that can make the connections. Yeah. So if you're gonna have it spread like wire and get it over the tipping point, you can't be a maverick leader. Maverick leader will get it to the tipping point, but it won't make it go over. Yep. Maverick leader is Steve Jobs comes to mind. Okay. Maverick leader, Maverick leader. But Steve Jobs not by himself. He's got Wazniak, he's got a whole, the. There's a whole giant organization over there, so it's Malcolm Gladwell talks about that. So you got it. You can't just have the maverick leader. You need people to make the connections. Yep. Because okay, all of a sudden, this is a great idea. How are we gonna scale this? And now it's okay, this, we need to talk to sales, we need to talk to marketing, we need to talk to operations, maintenance, the every, everybody, everything's on the table now. So you gotta make all these connections. Then you've gotta have people that are emphatic, got that energy. Sometimes those people aren't the connectors. These people are, they're sprinkled in every organization. They're those special people who you just think of. Amy Campbell always comes to mind for me in our organization because she just, this is amazing. She's not a connector, but she's got the juice. just reinforces a thing out there and she has that energy and she doesn't let off of it either. It's super contagious. So to spread something like wildfire, you gotta have that. Yes. It's that fuel. So if you keep pouring, if you have the Amy Campbell on the fire, just, and then you gotta have the experts who be like, that is a great idea. I know how to execute this. Yeah, . And so they'll go make it happen. And then generally speaking, in construction, I wanna say this like your, your senior PMs, your senior superintendents, not leadership. These are people on projects who can execute them. And once you have that, it's a preto. It's the 80 20 rule. Once you get 20 people, once you have that, you get past that tipping point. I just butchered that book, Malcolm. I'm sorry. But . But 20% of your, the people that do that who are like the Amy Campbells of the world will bring 80% of the people with them. Yep. It's crazy. But, so that tipping point happens at Unico in chapter 30. And guess what? Guess who saves the day? And really what happens is Bucky Burnside flies in. He's, I wanna shake the hands of the people who delivered this order, the craftspeople, the machinists, the electricians, the, you know, all the people that work in this facility. The most important customer flies his helicopter in. And he is like guys and gals. I've been ordering 1000 of these parts. That was my order, my new order. And this month is 10,000 who it's a 10 x revenue increase. So if JP Morgan wasn't involved now, they definitely are interested. Now there's some analysts getting involved. So all of a sudden now from profitability now a person who is so raving customer that they will fly to that particular plant and land and go congratulate the people that did the work. Yeah. And he wants to personally shake the hands of the people that do it. And then at that site he announces that I'm gonna 10 x my orders from this facility . And guess what? Oh, by the way, this is a spoiler alert. When you 10 x your sales, we can rearrange some leadership at a company . Yeah. And that's what happens. And they decide that Alex Roos way is the way. That's almost the end of the story. It's not the very end, but they, in chapter 31, Alex has gotta go defend himself. Now, have you ever had that reinforcing thing happen? Somebody comes in and just be like, you guys knocked it out. and it's just like all smiles and just it, it really feels good. Yes. When I was at td, it was a significant change in leadership for the San Antonio Business Unit, and it was a result of me. I was gonna leave, I was actually gonna leave construction entirely. I was gonna go work for a school district and be a family support liaison. And the leadership's like, you know, we want you to stay. And I said, okay, if you want me to stay, I'm not gonna be doing this job anymore. I was a superintendent at the time, or general superintendent, I can't do this anymore. And I didn't have to, I had paid off all of my debt, so I was like, I'm gonna go do something meaningful now. And so they let me train and so I put together transitional training, blah, blah, blah. And so we're doing it begrudgingly with a pile of a whole bunch of other work that I still had to do. The challenge was, it was hyper focused on foreman. , little bit of superintendent, but that was it. No project management, nothing else, right? Just stay in your little box. New leader comes in and he spent some time doing some investigation. Then he is, yes, this thing that you're doing, we need to scale it. You're not gonna be doing it after hours anymore. You're gonna be doing it during the day. We're gonna be bringing the foreman in, we're gonna bring the superintendents in, gimme a plan. Like, whoa. And I'm like, hold on, this is a little Now, before that, we're doing it after hours. And it was voluntary when he came in, he's, oh, they're gonna get paid to do this and you're gonna get paid to do this. This is what needs to happen. They go, okay. So now it was more realer really, in that we were, it was money, right? Leadership was leaving site to come to the office to get this training, and it was real dollars being spent. and I couldn't, it was a long-term game, so I couldn't really see the gain at that time. But after a year we looked at the numbers like, yes, productivity has gone. We're killing it. We are killing it. We're gonna keep doing this. And the fun part was, I believed it was going to be awesome. And the only data points I had was me applying the things that I was teaching. Like I applied those and I had a lot of success. So that was it. Like I was the only one. And so I said, well, this is what I'm doing. Let me teach it. But I didn't know, except for my own circumstances, right. And conditions change and all that. And so it took over a year to, took at least a year to see the financial outcome. Nice. You just. You did a spoiler alert for Chapter 31, . Oh, did I? Oops. Oops. But that's exactly what happens to our hero. Nice. Chapter 31. So it was The Tipping Point is on, and Alex gotta go to headquarters and he's got some explaining to do. He's in the meeting. Bill Peach, ceo Hilton Smith. Let's call him the C o O. Okay. And Alex Rogo, plant manager. So we got, we have a chain of command and Hilton Smith is called Alex. In all of the data has been trans transmitted ahead of him, so he's gotta go defend his theory. Yep. And he goes in there and out of the gate, they're already arguing and Alex asks the question, is the goal of anywhere division to reduce costs? And Hilton Smith goes, of course it is. And Alex Rogo goes, no, that's not the goal. The goal is to make money. You trapped him. And the, uh, senior accountant Kravitz says, yeah, we're here to make money . And Alex says, I'm going to demonstrate to you that regardless of what our costs look like, according to the standard measurements, my plant has never been in a better position to make money. And so it begins, he starts to lay it out, and I'm just imagining like a montage of graphs and charts. But he basically goes in there and he tells him the stories. This is what we did. We sent this to third party. We found Herbie. The Herbie was the Ncx 10 and the heat treat, just laying it out, just hitting him. And he's telling all facts, these are not like stories. Remember how he was talking like this? Here's the data. And he basically goes, Hilton. What we're dealing with is your fundamental assumptions. Straight up calls his boss out in a meeting in front of the CEO and he says, your assumptions of how to run this entire business unit are wrong. He says, I can't see that you're dealing with anything fundamental like this is a standoff now this is what Hilton says. This is what you're dealing. It is common sense. You're dealing with the machinists, you're dealing with stuff on the shop floor. This isn't corporate improvement. We deal with data and numbers and dashboards and graphs and charts like we're not talking to the union. Why would we do that? That's insanity. and Alex Straighten turns around and says, no. The way that your cost accounting system is fundamentally flawed, the way these metrics are measured, they're not correct. They wreak havoc. And then for us to meet these metrics, We have all this crazy expediting, none of this leads us towards the goal and the goal, again, make money. And they basically get to the point where, hey, we have an assumption that the level of utilization of any worker is determined by his own potential. That's false. Oof. It's totally false because of dependency, right? Yes. If everybody's working at a hundred percent and it's not an optimized system, we're gonna create all kinds of inventory. It just wreaks habits. So he basically proves that to them. And he says, it's not an individual performance that matters. It's the accumulation of everybody's individual effort towards the goal. That means, hey, some people need to work at a hundred percent, but some people need to work at 80%. Some people need to work at 60%. Yes. . So if somebody So Hilton basically challenges somebody's working. We're getting the use out of. No, that's wrong. We assume that utilization and active activation is are the same. Activating a resource and utilizing a resource are not synonymous. If we're just doing stuff to do stuff, we create inventory. And if we're doing stuff to do stuff, we just spend op operating expense. We just paid salaries, we pay for raw materials to get fab, and none of this, we can't sell any of it. So it just piles up in huge inventory. Yes. So he basically tells him, he said an hour lost at a bottleneck is an hour lost out of the entire system. And I think if I recall, it was like $3,600 an hour. At this point. Hilton's says, no, an hour loss is just an hour loss at that single resource. Oh, no. It's all about bottlenecks. Bottlenecks, temporarily limit throughput. Maybe your plan is proof of that. , but they have little impact on inventory. And that's what Hilton Smith is saying. He's how the manufacturing world works. You have to build up your inventory. This is, this is way it is now. You don't have to build up inventory, you need to make stuff Exactly. To order. So if we exploit the bottleneck, govern both throughput an inventory. If we explain bottlenecks, we don't change them. We say, Hey, if we need 10 parts per hour and the bottleneck is 10 per hour, that's exactly, we're not gonna make any more. Don't put any inventory aside from a buffer in front of that bottle. What do you think? Well, the interesting thing I'm thinking of job sites, right? Where ah, you need more people, but before you, there's a bottleneck. Okay. And, but still, let's go get busy everywhere else. Go ahead and start. And you can start here and you can start there. And we know like according to the book, and like reality, you're losing money. , all that busyness is not productive. It feels good, but it's not productive. And what's worse is your increasing risk of injury to human beings. When if you let the constraint or the bottleneck drive things, you can actually minimize the safety risk. But what we do is you need more people. And really you want me to bring more people to do more waste faster? That's what you're asking for. Like how about let's evaluate the system? And I think that's what this book is talking about. Let's evaluate the system and optimize the system and then bring the people. But we do it. The other way around, bring the people and then, oh no. Then we blame the people. You know why I don't, it says we're afraid of complex systems. Ah, we're afraid of nanosphere. Like a very complex system. Like a, like a construction site. Yeah. Many people have a construction site with more than 20 people are very complex. Absolutely. You have trades, you have design, you have a budget, you have schedule, you have, there's vehicles evolved. Right. Things moving around. And that's scary. Yeah. But if you're afraid of complex systems, cause it's very dynamic. It's very complex. There's lots of people, there's all kinds of stuff. We'll try to simplify. That's the first thing we try to do and will drive. It drives us to dissect the complex systems into subsystems, leading management into local optimums. . Yes. You don't have enough time in the day to study it. This is why like the visualizations behind me Yes. Are so effective because it allows us to take a very complex system and break it into chunks, and I get it. This is how human brains work. But we can't start to separate those systems into local optimums. You can't do that because if you start to put stuff into local optimums, then we're not aligned with the goal. And then our own fear. You were talking about that fear of the unknown. Yeah. If we were fear of unknown, it drives us to finer and finer resolutions. driving into more and more details that direct management attention into go. And now we're optimizing the noise. We now have two schedules. One we give to a client, one we give to the truth. We're trying to optimize the noise because now all of a sudden we have a political situation on our hands. , oh man, that we can't tell the truth because if the truth was actually known, we, it would be a problem. I don't, we don't knowingly this. This is just happens. This just happens. This is how society works. And then our fear worse, the fear of conflict. So we have a fear of the unknown. Yes. The unknown is this is a situation we don't wanna approach because of conflict. My takeaway from chapter 31 was we were afraid. What do you think? We talked about masculinity, we talked about courage, we talked about assertiveness. And to make actual organizational change, you have to overcome fear. Yes, I think so. A couple things you're talking about, , the amount of energy it would take to assess or analyze a problem, a system with problems in it, and it's like the quick thinking and the slow thinking, right? Naturally we're gonna do the quick thinking, so who's the problem? The thing I can give a name to the people that are touching it. It takes less energy to do the quick thinking than it does to do the slow thinking, right? It's them. Let's make it's point at them and make it their problem. It's not their problem, but let's make it their problem. Or even worse, let's make them the problem when actually they're the only people that are gonna help you get out of it. , like they're the ones that are gonna do the work. The other thing is, as it relates to fear, I don't even really know how to say it, so doing something different. . Accepting a significant change can cause loss of identity. And I was listening to Spencer Easton's recent podcast, the Change and the Loss of Identity. There are economies built around the current systems. There's degrees to that. There's money to get into a career, to earn money, to charge a client that they're going to use a particular, they need attorneys. They're gonna use this system so that they can protect themselves in litigation. So that feeds into attorney. Like there's this whole economy built around some of these systems that aren't serving the goal. and so we're gonna make a change to the system. Not only are we like making them uncomfortable to change because we don't like to change to begin with, we're also threatening their careers. We're threatening their livelihood and really threatening an economy that is a reality. So it's not to say that people are scared, it's to say that there's a real threat. The change is a real threat. We're not thinking about all those other things, but was the hierarchy of needs security? All of a sudden that foundational need is threatened. And so the point is, it's okay for people to resist for me anyways. There's no value in me judging them because they happen to be human like me. The trick is how can I discover the way to help? lower their concerns about the security question or how can I help them realize that they're having a security fear mm-hmm. so that we can think and speak through that to understand what that means. I think you're right. It's not something to be afraid of. We're gonna face resistance and if we're gonna make organizational change, even on a local level, you're gonna face resistance. And that's always just part of, if we give up at the face of resistance Yeah. Don't even do it. Yeah. What are you doing? So we have to be emphatic about change and the face of resistance. It's gonna be part of the road. Yeah. But also a little dissent is healthy. Absolutely. Because you're like, yeah, you know what? Damn, that was a good idea. We gotta make sure we capture that piece. But, uh, I'll go to chapter 31. Ooh. I'll just read it cuz it's great. and Hilton and Alex, they're at an impasse. They both think they're right, and the problem is Hilton is the boss, . Here's the problem. He basically says that Hilton says miracles exist only in fairy tales. He's basically saying that he's lied this whole time and that he's twisted up. And Alex, who has a good relationship with the CEO, walks into the Bill Peach's office and he straight up tells him, what's the verdict? Is my plant being closed? He's like, face to face. This is in person. And Bill Pecos. Not at all do you think we're such bad managers that we would close a gold mine at that moment. He tells Alex, we're having this meeting with Alex. The reason why Alex got called into headquarters is that we're gonna make some organizational changes around here. Bill Peach is going to the corporate. He's getting promoted, so he's going up the ladder and his replacement is not Hilton Smith. It's Alex Rogo. So Alex gets the nod that Alex is the new CEO of that division and that Alex has complete operational influence to now make this happen across the entire division. . That was the tipping point and the reason why you have to, when you're at in the face of adversity, and even if it's your boss, stick to the facts. Be like, we did this. This is why we did this. We made this decision. We sent that to a third party. They like laid it all out on it. Now all the facts are there. Yep. And if you are completely transparent, you think you're right. Don't hold back. Like show that these are the facts. These are my decisions. It's how we came for it. We did ran an experiment. This is what we found out. We found Herbie. We unloaded the Ncx 10. And yes, there are questions about productivity. And reason why productivity is off is because the fundamental assumptions were wrong. just laid it a boom, boom, boom. And at the end of the day, uh, the leadership of that company was like, yeah, we're making the decision and our tipping point is this is the way and the rest of the kind of the book is like a victory lap But before he walked into that meeting, he tried to get advice from Jonah. . Yep. And Jonah's, no, this is no longer, I can't advise you. This is not a process improvement thing. I can't help you in a leadership or political situation cuz Jonah's only a third party all of a sudden, like at the end of the day, it was Alex making the calls. He thought he was just following Jonah's rule, right? Jonah's advice. But at the end of the day, it was his decisions and his judgment and his movement making decision and getting his team together. And today it came full circle to it. Like it was always Alex's and his team's ideas and methods and his energy. What do you think? So a couple things. I think one finish, I'll start with Spencer and then I'll go to the other thought. So Spencer, I understand where he is coming from on the CPM thing, but I don't think it's a. CPM problem. I think it's a human being problem. I've seen every system become weaponized, and I think tax a phenomenal system too. And I'm gonna put money down that says people can weaponize tact as well. Any system can be weaponized. There's a whole lot of other things, contracts, et cetera, that add the sharpness of cpm. It really sets it up to be a good weapon. And then people are people. So naturally, I think that's the situation there. And I think what Spencer can accomplish is influencing organizations in such a way that they change the way they treat people because of his energy. Like he's a change agent, 100%. . Yeah. So when we start changing the culture of the organization, then things just don't, or it's possible that things won't be weaponized. So that's one point. The other point, as you were talking where he's going to Jonah and Jonah's like, I got nothing else for you. Right? Yeah. This is all you. I remember it just reminded when I read the book, and even now what you're talking about, I was like, man, I remember that time I was setting up a crane. We're doing a pick downtown, San Antonio, super busy part of downtown. So we had to do it at night in the middle of the night road closures, permits, the whole thing. We're picking rooftop equipment, whatever it was, and we've been planning this for weeks and all of a sudden the night of the pick, we got weather, but there was a forecast for ring. So I call my boss. It was right by the Riverwalk, San Antonio Riverwalk. Oh damn. The one thing that I didn't plan for, and anybody out there, if you're planning work downtown near like a party, bars and stuff. Yeah. You better have people dedicated to keeping people out because they're coming outta the clubs lit up like, Hey, let's wanna take a picture by the crane who get outta here. We're swinging equipment, . Anyway. Anyway, I called my Jonah, his name was Jim Jones, who he's passed, but he was an amazing mentor for me, and I'm like, Hey, Jim, like here's the deal. If we reschedule, I can't get the crane back for whatever. Just all the stuff. And he tells me, so you're worried about making the decision? I'm like, what do you mean? He's, you're the superintendent. You've made all these calls. You have all the information anybody else is gonna have. I said, okay. So you can say yes, and it gets rained out and you're gonna feel like a dummy. You can say no, and it don't rain, and you're gonna feel like a dummy. , I can't tell you what to do. And I'm like, what? Wait a minute, what do you mean? This is your call? This is when the student becomes the teacher, . This is the transition. Yep. I'm like, oh. He's like, I'm gonna support you no matter what, but you gotta make this decision. I said, can you at least tell me what you would do? He said, no, I'm not telling you. This is all you son of a gun? Did I like bite my fingernails to the nub? Hell with it we're doing it and it didn't rain. And his point, like the lesson similar to the book was I've been making very important decisions for a long time with all the information that was available to me. And sometimes they work out and sometimes they don't. That's what I walked away with. . How is this different than the other decisions? Except for my concern about the money we were gonna lose and the time is gonna have on the schedule. What can you do? You gotta make a decision and go with it. Roof. Roof picks. Crane, downtown San Antonio. Weather. Yep. You're talking serious consequences. Yes. Many aspects. Financial consequences. The rest of the book is the Victory lap. Cool Hand Lou stays on. Yes. Bang Lou Accountant now is the cfo. Imagine you have this guy who you've now convinced to change fundamental accounting principles based on these, this theory. what? Inventory. Operating expense. Let's only worry about these. These are the metrics that we gotta worry about. Yep. Throughput is sales. So this our capability of selling stuff. And Bob Donovan. new plant manager. Yep. Bob Donovan went from an operations leader. So basically a superintendent to a general manager. Yep. That's Stacy. Stacy, the productivity, she's got a new corporate job, so they all have these divisional positions and they can't stop there. Now you gotta go get to work, you gotta get new goals. Yes. The goal was no longer making money at Unico in this particular local environment. Now we gotta make it on a divisional level. Oh yeah. They start brainstorming. Now we have a divisional about . Yes. So what they do, this is, and this is advice. Remember how they were meeting every single day. Okay, we got this, we did this experiment, and these are the metrics we're gonna do. Morning meetings on a divisional level, that means daily huddles in headquarters. Yep. I was just gonna set that right there. Yep. It's so important. If you're working towards a goal, you'll meet every single day. Yes. That's chapter 34 in a nutshell. . But, uh, don't change the method. Change the scale, what worked before. Experiments, simulations, metrics, time in motion studies, all of the things, all of those continuous improvement activities that we talk about all the time. Go do it. Do it, and do it. We need Spencer Eastman to come in and crack the whip. Go hire him. Yes, go hire Spencer. Yes. One thing I've noticed over and over again, and I've been guilty of it also and will be guilty of it in the future, is what you just listed, was the thinking. and the way to discover the optimization, what we typically do is the exact optimization that we did at Project A. We're gonna take that tool and we're gonna do that at Project B, but there's different conditions at the other between the projects, and so that copy paste approach doesn't apply. The thinking is what is universal. We had done a 5s, the project where my four guys, Doug, Al, Noah, I'm sorry, I know it sucked for y'all, but it was amazing. We're doing everything we're doing just in time delivery. We're doing five ass, we're doing a ton of prefab, which was standard. We rolled out iPads on the job. We used the Trimble. full last planner system, just full, I shouldn't say full because people will argue that last planner, my understanding, like we were doing all of these things and it was their pretty much their first exposure to all of it. And it was painful for them cuz it, it was all brand new. One of the things we did was what our deployment or application of 5s was because we had a problem, all the gang boxes and it was just the plumbing crew. Somebody was hoarding the tools and so every box had its own set of tools, but somebody would hoard 'em or take 'em downstairs and never bring them back or whatever. And so I said, we're wasting too much time going back and forth trying to hunt down snap cutters and whatever. Here's what we're gonna do. We're gonna have these spec cuz these are the tools that every floor needs, every crew needs. We're gonna have a standard box of. X amount of X and et cetera, and we're going to paint them a specific color. There was the green box and the blue box and the yellow, like all the tools were painted. So it was very easy to see who's hoarding the tools and where do they belong. And so that minimized the up and down like, well, the next prize was a big project that was coming up and they're like, Hey man, what did y'all do over there? Because we heard y'all didn't lose $90,000 worth of tools, which was like a chronic habit that we had after a job was over, all the tools were gone, and nobody stole 'em. Nobody used them, but they're gone. So there was a lot of benefits to it. And what'd you do? I said, this is what we did. So what did they do? They copied and pasted the toolboxes that I was using and applied it to a different job, but that job, it wasn't cast iron, it was pvc, and they had a very small plumbing scope and mostly pipe fitting scope. So they didn't have the tools they needed for the pipe fitters. . And so it was the thinking, the evaluation of the system that helped us come up with that solution. But the easy thing to do was copy, paste. Yes. The tool. Long story, but that's what I meant. No, you're a hundred percent correct because when you get to optimization, it happens on a very local level. Yes. And it doesn't always apply because, and the reason why, especially in construction, there's a lot of mix. When I say mix, it's even if you're doing highrise work, one highrise is way different than another, just in scope. So you can't just say, whatever happened here is gonna happen. Exactly. Over here, it's impossible. We've already proven that through at least 12 hours of talking about it. . Yeah. You have dependent events and you have statistical fluctuations. So the mindset that we were talking about, if you don't carry that forward, but if you just try to copy and paste the methods or the tactics or the strategy you Yeah. And, and in fact it won't even help you, it might even hurt you. Sounded like that one. Oh, it hurt. Yeah. Yeah. It hurt like long term hurt because the guys that were out there doing the work was like, man, this is stupid. Jesse, you, that was a stupid idea. I'm like, no, that's not what was supposed to happen. And so like, because of that experience, they said, we ain't doing any of that lean crap. It doesn't work. let's, yes, chapter 36 kinda lays it out. I have another book that has five steps to introduce Theory of Constraints Management System into an organization. What you're talking about, take this mindset and introduce it into a system. Number one. Conduct theory of constraint education. That's the first thing thing you do. Ooh, you introduce this theory . We'll talk about those universal principles. Then you also train people that when we're talking about constraints, these are the fundamental principles of it. So introducing this new concept, I'm not just gonna give you a constraint log, , I give you last planner system. I'm not just gonna give you weekly work plan. I'm not gonna give you pole planning. I'm gonna be like, Hey, the reason why we do this is to find a problems, find Herbie. And when we find Herbie, what we're going to do, we're not gonna blame Herbie. We're not gonna make Herbie work harder. We're not gonna send delay letters to Herbie's, vice President of Operations, We're not gonna have come to Jesus meeting with Herby. We're gonna look in Herbie's backpack and pull out the iron skillet. That's what we're gonna do first. So you have to teach people that, cuz that's a mindset chip. Yes. Number one out of the gate. So all of a sudden learning and development programs at your company should be incredibly powerful if they're off to the side, if they're pain in the butt, change your mindset. Two, integrate theory of constraint into existing management processes. This is a scary one because if we have dashboards, if we have meetings, if we have a normal cycle, the way we evaluate construction projects, typically you're a bunch of metrics. And if you're using Theory of Constraints, those metrics are now challenged. The way we look at the schedule, the way we look at the design, the way we look at. How people are interacting with each other. The way we look at cleanliness on the job site, everything's now on the table. So if you're gonna introduce theory of constraints into your existing management system, your existing management system is now on the table for change. Oh yeah. Now all of a sudden it's okay. So number one, we gotta teach people how to do it. Two, we gotta do it. Yes. Number three, financial systems not immune. Your financial systems are also, so if your operational systems, the way we schedule work, the way we staff the projects, the way we organize the crane, the way we schedule the hoist, right, that's incredibly important. But also how we look at how we financially measure our profitability, our throughput, and our operating expense. Those are now on the table. And this is from Dr. Golder three. complete theory of constraint projects other than major changes to logistics infrastructure. That means now all of a sudden, your core processes now have to follow this method of continuous improvement. The way we staff projects, it's not about judgment anymore. It's a system , the way we make decisions on pursuing clients. It's not a judgment call anymore. It's now a part of a system, is these are now challenging fundamental processes in our organization. Yeah, so once you challenge financial, now we challenge the way we get work. The fifth step is to establish theory of constraints into logistics with drum buffer, rope flight chain management. . So supply chain management in construction is, for me would be us plus trades, plus design. Design for me is our capability, the capability for me to get a permit so I can execute. Now, I'm not managing an architect, but I'm just saying, I'm giving them feedback. Hey, this process is happening. You're not an expert in scheduling. That's what I do. You're an expert in designing. So now there's a give take situation. So now there's this open communication. So it's like we're gonna change the way we execute the design process. So now our sphere of influence or Right, it's gotta grow. Yes. So now we've changed everything within our own company, within our own organization. Now we have to get outboard and start to mess around with supply chain. So supply chain, now we're getting vendors involved, and then all of a sudden we have to get our owner. , the people who we work for, they need to change their behavior. That's scary. What do you think about that? So that's Dr. Gold's advice of how to get started with theory of constraints. This isn't my advice, I'm just reading a chapter out of a book, right? But , what do you think about that? So one is, I've seen this cycle so many times with teams, with companies, with business units, or they have a system they may not like. They may not completely understand it, but the system is delivering the outcomes that they've been seeking. And then they say, okay, that scale, that's expand our revenue target goes up. Or let's just say they're disciplined and they say, you know what? We did good this year. Let's do it again next year before we reach or overextend ourselves. And then that big, sexy high profile project comes along. It's going to take them way beyond the goal. , they're target, they're revenue target, but man, it's a big sexy one. Their name's gonna be on the tower crane, and everybody's gonna see it all over the city, and it's gonna be in the paper. Like all the stuff governor's gonna be there. Yeah, all that. The president might come by, the president may come by, so they go take that job. And now they're, they've, not only did they go past their goal, which everybody say, yay, fireman arsonist syndrome. Yay. You surpassed the goal. But their system is not designed to execute a 30% extension of a goal. That was a stretch goal to begin with. So now their resources are extremely stretched. They gotta bring a bunch of people in. New people that don't understand the system, they haven't codified their current system. . So now they got all kinds of new things that they're, that's going to screw it up. Yeah. They're gonna underperform. The client's gonna be pissed and they're gonna be back in the pooper again. And that's a cycle that happens. Oh, they do good. They start building their presence in, in the market. Take on more than they are prepared for. And then back again. And oh, and ooh, what's going on? You really don't understand your system yet, You can't bring people in. You can't scale without the teaching. Right. You talked about the teaching piece and helping people understand the thinking. I'll go as far as to say the culture. What is the culture and how do you integrate people into that culture? Everything is on the table. If you're not prepared, if you don't understand it, you're gonna be in trouble. We're gonna be in trouble. I forgot what my other point was. Let's just wrap up the book. Stacey is now in charge of the expeditors. Of all the, and all Unico, she modifies the tag system. So don't do a green tag, red tag. She's okay, find bottleneck, blah blah, blah, do this thing. And do they have that 10 x order? They find new clients in Europe, this is chapter 38. Now through the power of theory of constraints, they've now increased their capacity. So they were like, okay, we can make better deals. And now we're going global with this unicos going global with this. So they're growing their company and uh, Alex does a little bit of retrospective. And then remember the fifth step is like you have to start to integrate your supply chain. Yes. Like now all of a sudden you can't just do optimization with your, within your own company. Now you have to spread your wings. And I really like what Toyota did they have TSS C? Yes. Where they train their vendors. I don't know if it's free. Probably is to the vendor, maybe not, but they train their vendors on, Hey, we're, we do big work in the automotive and, uh, industrial world. Toyota. We're training you on how to do business with us. We're gonna teach you how to do it and not only teach you how to do business with us, but teach you our optimization techniques. Yep. Yep. So that it'll, it, it will infiltrate into your organization and it'll have dual benefit. Yes. It'll help us because you'll be super reliable on our supply chain, cuz we have this wacky production system at Toyota, but also it elevates Johnson Controls. Just as an example, Johnson Controls makes all kinds of components for all kinds of automotive industry, but really they really took off when they got in, introduced to the Toyota. Production system, but Johnson Controls is, uh, they do work with us. . Yeah. So I get to see the benefit. They do all kinds of controls for a lot of our, the companies we work for, and they're, sometimes they're a trade partner. We hire them direct. So we now they're, how does this, that fifth step get into the supply chain? It ripples out so far. All of a sudden, these control contractors that do work with automotive industries, these are sensors and devices that also get installed in buildings, , and now this system, this ecosystem of continuous improvement has now infiltrated the construction ministry. It's really cool. Yeah. That's chapter 37. You gotta go beyond, and it doesn't matter if it's a competitive advantage or you start to think about things like a physicist, and that's Jonah, or that's Dr. Gold at the heart of things. His formal training is in physics. He's a doctor of physics and think about complex systems. The most complex system in the universe is the universe. Yes. And who studies the universe? Those are physicists. So it's really cool. I'll try to loop it back. , you can continuously lower your pricing and become a competitive advantage and you can win work that way. We can win work with, we'll shorten our schedule and we'll have an advantage with pricing and then we'll just beat everybody down to that. Yep. That's one way to do it. The opposite way is let's do this continuous improvement method and not only limit, don't limit the continuous improvement within the walls of our organization, but outside of our industry, outside of our right. Yep. Think about Toyota like they now influence us in construction. Yes, so much where we devised a production system called the Last Planner, and that's now helping us become more optim optimized in our production. It's just the way we plan work, and I don't think we stop there, but that's really Chapter 39, almost the end of the book. There's new problems at the plan, there's new bottlenecks. And then at home, Julie, Alex's wife, remember how his children helped him figure out this drum buffer rope. Julie, who is a, studies. Socrates. Yes. The Socratic method. The scientific method. So if then, yep. . Yep. If you have, if then deduction. She explains. Consider the scenarios that can arise and how to prepare for all the effects. So if this happens, then this happens. If this happens, then that's it. So you do this method of evaluation and all of a sudden now at the divisional level, they don't use metrics anymore. They use these methods of evaluation. And all of a sudden now it's, Hey, let's apply this cycle time not only to the production side. Let's start to trim inventory in sales. Let's start to engineer sales on a big scale. And instead of fulfilling customer orders on a four week cycle, let's do two. What kind of sales can we generate on that? And obviously it'll scale up from there. And like now all of a sudden their confident level is increased as in the same, same realm. So it's, Hey, we can cut our inventory and we can cut our lead times in half, but also we got this. Yeah, no problems. Piece of cake. So chapter 40, I just want to put a, just hammer it. This is the end of the book and Alex and Lou, man, they're sitting in that corporate office. Like I, I imagine Alex has got the corner office and the high rise, like he's got his feet up chilling. Yeah, yeah. He's got the, yeah, he's got the big wig job now. And Lou the cfo, he is probably got a pint stripe suit on pint stripe suit. Talking to JP Morgan. Oh, yeah. Himself. I don't know if he probably wasn't around in the eighties, but definitely, definitely some Wall Street analyst. And they basically, they come down to this, they're like, all right, what are we gonna, what are we, if we could summarize this, what do we do? So they, they put three points and they ponder these three questions. The first question is, what to change? And the second question is what to change to? And the third question is how to cause the change. Yes. And as the fundamental theory of constraint is, decide what to change to and then what resources are we gonna apply to cause the change. And that is the theory of constraints. And he realizes at the end of the last few paragraphs of the book, he can't keep running back to Jonah Yep. And all of a sudden Alex realizes he must become Jonah. Oh, I think that's great. I think it's, it blows my mind that when you're in a leadership position, if you're still relying on third party people, and definitely we need third parties to get us outta sticky spots. But we gotta start to master the art of being complex situations. Confronting our fear, confronting new problems, confronting, being brave, being courageous, being assertive, being masculine. We have to do these things. These are things we have to do. Yes, we have to do these things though, . And if you're a true leader, you will do those things. Yeah. What do you think about that? That's the boom. That's the goal. That's the goal. Baby just dropped off. four hours. Yeah, no, I got, I'm running. My brain is low on calories cuz I've bumped, doubled down on my training. Got a five mile run in yesterday, three mile in today. And I have been disciplined about eating my prepped meals Only. No snacks. What's that? No snacks. Yes. Snacks, broccoli and carrots. Oh. because I like crunchy and I'm like, I'll do that. And that's not getting, that's not leading you to the goal. Yeah, like that, that Hershey bar or the number, yeah, the chips, the pork rice chips. That, that, that's not helping. So anyways, as you were talking, you reminded me of my two points that I forgot about earlier, but are totally relevant to this. We're talking about the courage and getting out there and changing one of 'em as it goes to client selection. I gave that scenario, that wheel of death that companies like to do. And I've asked this of leaders before and , you can guess what the answer is. Are we going to pick a client that drives our culture or that forces a culture contrary to the culture we're working to achieve? And because right now the hot word is culture, but when it comes down to it, the answer is yes. We're gonna pick that client even though it's contrary to our culture. Because we need the money or we need the revenue, whatever it is, back to the Hollywood metrics, do we really need it? Because we know on the back end of that, we know the cost of working for a client that is better served by another contractor. And so then the distillation of the system, I'm in business for myself and I've been critical of leaders making poor decisions for the sake of revenue. Yeah. Okay, so what are my selection criteria gonna be for clients so that they don't drive my culture and my business and it's super simple. One, is the leader prepared to get involved in the change? Ooh, what's change? We're gonna fig if you want me, if you want somebody to come in and fix your problem for you. There's plenty of other consultants out there that W are happy to do that. I am not. , if I'm gonna come in, we're going to work together to identify what to change, where to go, and how to make it happen. And ooh, we're gonna get here. Second question, what to change to? Yes. Yes. Where are we going? Where? What's the intended outcome and what needs to happen to get there? The second criteria is, do they have more cool people than butt heads? , super simple. The leader prepared to get involved and contribute to the change they're seeking. And do they have more cool people than buttheads? If the answer is yes to both of those, let's work together, right? We can work on a long-term relationship. And so the whole point of that little goofy story is we get to choose the clients that we serve. , but for some reason we pretend that we don't, we absolutely get to choose them, but because of these Hollywood metrics that lends itself to us being mediocre in our adherence to the values and the mission of the organization. So hopefully, if that stings you a little bit, I intended to sting you. And I'm not talking to you, Thomas, I'm talking to the listener. The other thing is, again, as it re we were talking about supply chain and one of the, like the things that needs to happen and as it relates to our industry. I, man, I, there's this guy, I can't remember his last name. His name was Tommy. He's the only superintendent I ever threw my hard hat at. Like I've had superintendents, GC superintendents threatened to stab me three times, throw hard hats at me across the table in a meeting cuz I was a pain in the butt. , I ne I only threw my hard hat at one superintendent and it was at Tommy and we worked so many projects together and I, it was never a pleasurable experience for either one of us. And he would always like, damn it, I don't know why the hell, why I gotta deal with you. I hate working with y'all. It was just always this kind of berating, I guess that was the way he motivated people. I don't know. And I'm like, bro, like what are you complaining about? You picked us and you actually have, it's in the contractor, in the specs or something where you can tell, like you can select the leader or de-select the leader. So please call the office and tell 'em you don't wanna work with me and tell your procurement department to stop contracting with us. If you hate us that much, you're picking us. And so the point of that is general contractors, superintendents, project managers will complain and complain about the trade partners. So first of all, you're selecting them, you pick them. don't like. Own that. You pick them now. Yes. Somebody in the organization probably made the decision based on some dumb metric, right? Low cost or whatever. But a lot of the complaints about the last planner system, man, we gotta teach 'em all the time. Like you. You know why? Because you keep bringing different people to the party. How about building some strategic relationships with specific trades or trade contractors and go down this path together? Unified, but we won't. Why? Because the next job with the client that may or may not align with our values is asking for something different. And so we're gonna deviate from our values, which is going to undermine the strategic rela or potential for strategic relationships, which is gonna increase the variation. On the job and steepen the learning curve for anybody that comes onto that project. Yeah. It doesn't happen by accident. Like we are doing it on purpose over and over again. And again, the complexity, because the effort it's going to take to get in there and really assess and adjust to, to minimize all that garbage. Let's just add another metric and another system and some more stuff. Yeah. To distract us so that we feel really smart, but we're having worse and worse experiences. Like life is sucking more. Like what other metric do you need? That would be a hell. The Power BI dashboard, the , yes. Life. Are we gaining or are we losing? Um, that would be. There'd be a lot to go into that. A lot of data points. . Yes. You know what if we had like selection criteria for trades, it's, I'm just like, like it should be more complex or there should be more criteria, but let's just say safety, communication, production. And they either get a happy face or a . Oh, it's a one or a zero. Yeah. If you wanna get like super fancy, what are their pr, their offsite fabrication capabilities? What is their BIM capabilities? Is it a smiley face or is it a sad face? Do they have a leadership development program, smiley face, sad face? Do they have a work? What is, how robust is their workforce development program? Is there an apprenticeship program? Happy face, sad face. Yeah. You're asking the third question, how to cause change. . Yes. All of those things that you're talking about, how to implement the, in the workforce or in the workplace, have a really good BIM department. Cuz now we can use machines to validate locations of things. Yeah. And minimize risk. Yes. How to improve communication. You teach people how to communicate effectively. How to have conflict resolution . Yes. Yeah. That's how you create change. Yes. That's, I'm trying to loop gold wrap back into your Yep. Yes, that's exactly, and the three lessons from the goal for me. Thomas LeMay here. Number one, throughput. That's flow. Yeah. If you're obsessed with flow, Adam Hoots. Yep. It's just an hour away from me. Just an expert. Spencer East. Another one. Obsessed with flow because flow is throughput. It's the Boy Scouts walking on the trail. Yes. Meet the goal of the hike until the last boy scout gets to the campsite. Otherwise, we have to send out a search party and Amber alert goes off. It's a serious situation. . Yes. We have to achieve the goal. . It's a big deal. So throughput is flow. Yes. Anything that upsets flow, anything upsets flow should trigger all kinds of emotion. The trash on the job site. Puddles of water. Oh yeah. Mud. Mud. Mud. How often we clean porta-potties. The are the way we use the hoist with a mathematical equation. The crane booking time system. I can go on and on, but flow. If we're not obsessed with flow, if we're only obsessed with the schedule and we're not obsessed with flow. . Yeah. We don't make any impact on throughput and throughput. Here's the thing about schedule. You're not done until you're done . You don't get occupancy until you meet all the criteria that is required for occupancy. That means that the fire alarms gotta go off. You've gotta have permanent power on the building. The permanent power on the building requires a utility company to do action that's outside of your, that's now in the supply chain. If we're only apathetic to the supply chain, we're not proactive in that effort, then we're just pawns in this giant chess game that's called the supply chain, right? We're not being proactive, we're just reporting the news. So we have to now all of a sudden, and we're, if we're thinking about flow, we have to go find Herbie. Constantly. Yes. Constantly. And in a, in a organization. Herby could be anywhere, could be in hr, could be in sales, could be in marketing, could be in accounting. Everything's on the table really. Throughput is about what's adding value and what's not. And once you make honest determination of what's adding value and what's not adding value, what's waste? And we have to make decisions. And those decisions have consequences. , and then those consequences. The consequence, there's fear involved, right? Yes. So throughput is, you have to be, you have to be obsessive about it. And I definitely, I don't know if I embody that trait, but I, I, I'm in the realm , I'm obsessive about throughput inventory. Go look in the trash, be a CSI investigator. Look at piles of things. If you have a bottleneck. , how do you know? Because there will be inventory in front of him. So we have to be a complete investigator. All of your money in your system, it flows through inventory. Yes. It's, you can't escape that. You can't bill for something that, that you did not create. Yep. That's called fraud. That's a crime. don't do that. Also, not financial advice here, but inventory is, it's also something, inventory is something that you have not sold yet. You've made it, but you haven't sold it yet. Yeah. So it, it doesn't turn into cash until you've sold it. So if you can't get it out of your factory or your, you can't install the drywall on, on your wall because of design issues or because of it's dirty or because, hey, we're missing the backing or we're missing information if we're not understanding our issues and our quality problems and our change orders. then we don't understand anyone. Yep. The last one is operating expense. If we have to be financially sane, what I mean, financially sane , that's, uh, that's, that's a Thomas term. But I mean, my, what I mean by that, it's not a gold rat term, it's a Thomas term. Financially sane is being like all the money your system spends in order to turn inventory into throughput. Start measuring that. If you have traditional metrics and we all have them, we have them in our personal lives. Yes. We put those things like rent, salaries, taxes, your Spotify account, , like all, you gotta factor it all in. It all adds up. What you, the little Amazon purchases. Here and there because it's convenient. It adds up. You gotta put 'em all on the table and we have to look at them, whether it helps turn inventory into sales. Yes. So now all of a sudden, our operating expense, it's, you can't ever escape that. You can't escape operating expense. We have to pay people salaries. We have to pay people a very good wage for the work that they do. But if we can eliminate the wasteful parts of operating expense, like chasing down Hollywood metrics, Yes. Hours long operational review meanings. Oh my goodness. Where we're just regurgitating metrics that already exist that you can just go fine look at on your own, in your own time. We don't need to have 25 people explain how the schedule works. Yeah. Or the time that they spend polishing up that report. Yes. So that you don't know. There's a problem or Heidi, yes, there are hiding problems because here's the thing about getting in trouble. All. If I have to get in trouble 25 times or I have to get in trouble once, I'll pick the once , right? Absolutely. All day. And then even if once is worse than 25 little ones, whatever, it's all in one. Go get it over with . So don't rely on traditional methods. And then also, hey, if we're spending a bunch of time looking at Hollywood metrics, we gotta trim that and put that on the table. So that's the, my three takeaways from the goal is if we have issues and you have a schedule, set your due date of your issue according to the schedule. And then if you can't achieve, if you can't remove that issue by the time the schedule says it, change the schedule. . Yes. Cause that's what we need to if we It's gonna happen. Yes. So if, if we don't apply the resources to remove the bottleneck or alleviate the bottleneck, And we don't change the throughput, be like, we don't make the modification. We're in a, a course of disaster. We are heading into a place where it's, it's not gonna, whatever happens, it's not gonna be good. So we have to make those decisions. Those are my three takeaways from the goal. And once you start to do that and do that on a loop, yeah. I put these pictures behind me today because our, this mindset has now infiltrated our industry. And I talk about the goal every single day. Every single day. Uh, throughput, especially throughput. And, uh, it makes a huge difference. And when we make a huge difference in throughput and inventory and operating expense, we make a huge difference in alleviating problems of individual workers on job sites. It's like Thomas, breaking the rule of don't allow anybody on the job site

00 AM because that's the rule. , but who's gonna, who's the referee? That goal? Me. . Yep. So guess what? I'm breaking the rule. I'm letting these guys on so they can go home to their families. That's the only, the consequence is I might get yelled at, whoopty, do yell at me if these people could go home and quit. Yeah. So, yes. So that's the goal. Yeah, man. What do you think, so I'll talk about my takeaways, but you as, when you were talking about you gotta change the schedule, right? You gotta account for what's gonna happen because it's gonna happen. The second question, what to change? Two. Yep. And it reminded me of, I was working with the plumbing foreman. I was a plumber at the time. We were installing fixtures. It was a school, I don't know, middle school anyways. And I didn't have all the pieces I needed to finish hooking up the laboratories. . And so I, I'm like, Hey dude, I need these things. I need some extensions, I need blah, blah, blah. No you don't. I'm like, and I was like, it's okay. So then what do you want me to do? I want you to finish. I was like, I can't finish without these things. And so we, we went back and forth. I said, look, lemme show you. I showed, I said, here's what I'm missing. Okay? Times 50, whatever it was. And Jesse, but there's no money in the budget. And I said, okay, so do we just, when they have the punch walk, do we just put a sign on the sink that says, sorry there was no money in the budget and I don't understand you're gonna spend the money , let's just spend the money and get it done. Anyways, the whole problem, I'm creating an expense. Yes. We gotta get it done. And because, and like I found this problem on the first three, we got 47 more to go. So buy me 47 of 'em cuz I already checked our inventory. We don't have anything here. These are the extensions. Yeah, the tailpiece extension for the drain. And we needed some, a different kind of ADA boot on the prap because it had this funky turn on it, so I needed another piece there times 50 and yeah, it wasn't in the budget. And so when we looked at it anyways, there's a lot of reasons why it wasn't in the budget, right? It so we were able to remedy that. But pay me now. Pay me later. You're gonna pay if you don't want to get those things. Now I'm gonna continue installing and I'm gonna have to come back 50 times. Which is compounding the cost. Yeah. You moved the bottleneck to the end. You don't remove it, you just moved it. You just moved it. . I gotta come back now. So like my takeaways one like the big one be, and it helped me be more human to people when it came to change, because I'm a fanatic, right? I am one of the afflicted. And I can't help but throughput. Yeah, let's get, and so one of the hugest takeaways I got from the book was the bottlenecks never go away. They just move because you've optimized. So now you're an optimized system. What was functioning before is that may become the bottleneck and it will always move. And so that was so big to me because when we made changes to on site or whatever, something else would fall apart and I would accuse the person like, man, you used to be good. Now you suck. Was it that simple? But basically it's what it was it, they don't suck. The bottleneck just moved. Help them take something out of their pack so we can stabilize and even out the flow again. That was a huge takeaway for me because again, it helped. It changed the way I show up. It changed the way I treat people gigantic. The other is the inventory, right? Like wherever the in look for inventory and let inventory be a signal. You said this in your fives in relationships too. Really? That was my T take away. Was the clutter in your relationships? Oh yeah. Yeah. I was like that all of a sudden I was like, not only is this, we can put this in our work lives. Oh, like, oh my God. We can put this in our daily, like human interaction lives. If you're curious and I'd go Please, please go purchase. Please purchase Lean Love fives in relationships. Yes, clean in love. Yes. Maybe we'll do another recap of that one. . Yes. It's so universal. This is so universal. That's the point. It'll trickle into your home. Yes. So thank you Steve Turner for the daily huddle. Oh yeah. Oh man. Huge. Yeah, man. Nothing but good stuff. I don't know if Chris Davis, he was, he's with Turner still. He's another lean maniac. Huge theories of constraints, man. Okay. I think I did a huge fan of the goal. I called him, I think the other day I was running and he jumped in my head. Give him a heads up. Gabriel, we got a collab session on the goal. Be ready baby be He's a biker bicyclist. So I think I'm excited just to get his feedback on all this content because it's a lot of really great stuff. We're gonna do a live stream. So Chris, an eye baby, you wanna pepper this guy me with some bullets? Hit me. Yeah, that's great. That's great. Oh man. So I want to wrap this. Let's do it with a couple things, and this is a bit of a teaser Ooh, little teaser, because Jesse's encouraged me to put my words into ink and paper. So I think I, I think I'm going to do that. And maybe I'll just make the announcement here. So we're gonna make this a, a series, I think this is gonna be a series of publication. First, we're gonna start with some white papers with I glc, and just to start the process. I, so that, that's already happening. And then next thing is probably a, a formal book. Yeah. And so what we're gonna do, so I'm gonna, I'll tease it here because there is a method construction that we can link to theory of constraints and we'll, basically we'll talk about the principles that we spent hours and hours talking about. Those will be each chapters, and it'll be basically introduced like the. But it'll be talking about my project in San Francisco. . Yes. And then from there we'll have another follow up that'll talk about like the specific tactics that you can apply on your construction project tomorrow. I don't care if you're a trade partner, I don't care if you're, if you're in the supply chain. So if you're a millwork manufacturer, these, all of this is universal. If you're a field office coordinator Yes. And you just, or an office manager in the construction industry, you can apply this stuff to. And so line this out. I'm just gonna very summarize this very lightly here. . Yeah. But this is the start of that. And thank you, Jesse, for getting me over the tipping point. Yeah, baby. I love it. But, uh, you just made my day . I can do one five more miles right now. Oh yeah. But it happened. Tease it here. We're talking about the goal. So the first step of the process, these focusing steps, is identifying your system constraints. So identify all of your system constraints. So there's all kinds of chapters in there, but the way we do that in our constriction world is in our scheduling and planning methods. And they're, I'm not gonna go into all of the diatribe and all of the methods and tactics that go into scheduling and planning, but there's a lot. And really what that comes into is what it talks about what's behind me here, and that's understand where things are difficult, , and give those difficult areas names. So it's like if we have a, and I call it density and we'll talk about density in the book, but start to focus your energy, start to focus our efforts, start planning our efforts, identify constraints by location. So you gotta draw cartoons. Here's a, here's something that you wanna do that you learned in kindergarten. Draw inside the lines. Yeah. We'll talk about why a location based management system is key to both, like a CPM method and less planner and tact. It applies. It's universal. Second thing, last planner system. It's effective. It it works. And the reason why it works, because it's collaborative. If you think about collaboration, it's one plus one equals three, or we were talking about one plus one to the N minus one, like it's exponential. The reason why, which you've now organized your work by location, now you can zoom in into a specific phase of work and now get the experts, get those trades in. And don't confuse them with this master schedule thing. Get that out of there. Just look at the visual aspects of that work. So we gotta get the BIM model extruded, we gotta get plans colored up, those kind of things. Sequence that up and then you get into this cycle . And that is a step two. If you're Eli Gold, that's how you, that's how you decide how to exploit the system constraints So exploiting the system constraints, you input your pull plan, you have the series of, I call 'em cartoons and we're gonna call 'em cartoons. And then you do the optimization thing. So you say, okay, we have the system constraints, we have these dates, we have these locations, we have the supply chain, we have these things input into the system. We now introduce our locations. So now we understand where, how things are gonna move towards stuff. We're going to do that things. and then all of a sudden we're gonna integrate our BIM models or our VDC departments or the design, the design aspects that if we have a complicated waterproofing system or we have a complicated curtain wall system, we have a roofing system, all of these expectations that these systems need, we're also gonna understand that. So that feeds into our so that feeds into our planning, that feeds into our execution, that feeds into our communication systems. And then the last, I don't, and that's the last thing, but it's the most important piece of input into the system, is talking to trades. So we're gonna talk about effective methods of how to talk to the Jesse Hernandezes of the world watch out tactics, that it's different. You have to approach communicating with a plumber. The language that you use, the visuals that you use are different than the tactics that you use with an architect. , yes. The language, and it's not completely separate, but it is, no, we have to use our words in a specific way, and we have to, my thing is give Jesse a microphone. So we're gonna record Jesse's voice as part of our planning and execution and optimization system, and only then will we do any kind of look ahead schedule, look ahead plan. And once we get into look ahead planning, there's, that's not the end all, be all. We now carry forth our constraints, our bottlenecks, and we're gonna exploit those. Yeah. So I'm gonna, we'll break this out into a system and Thomas, like you, you've probably done this, but I've never put pen to paper before. all the way to how to, what are the fundamental principles of executing a daily. Huddle, like how to stand which way to, what you're looking for if you were the facilitator, what are your eyeballs looking for? What are the things to do and talk about that. And um, if I was Eli Gold red, that's subordinate everything to the constraints. So it's like I'm taking these constraints and I'm having the people who are doing the work helping me helping as part of the design of the system, helping us move this project forward in a very systematic method. Yeah. And how to do that, how to execute that, what to look out for, what are pitfalls, what are traps, all those kind of things. We'll talk about that and give people advice on how to go execute the plan of the day and then how to. , do the CSI inventory, go look through the trash. Oh dude, yes. Time and motion studies. Like why does that feed into the system? And that's really it's step four in the theory of constraints is elevate the system constraints. So if you know you have constraints, exploit them, but then go study them. So I'm like, I'm gonna go look in the trash. So I'll teach people why it's important to look in dumpsters, because that'll indicator of what, what's happening and what's not happening, So we'll teach people about that. And then the last thing is elevation. So there's a leadership component and I'm gonna need some serious help. So here's the thing. I can need Jesse's help . I'm gonna need many people's help to give us really good leadership components. And that leadership is not only on the project leadership, like your senior superintendent's level, it's everywhere. It's all aspects. It's down to like first grade apprentices. Yeah. Uh, what to onboard them to do . Yeah. We'll start this process. So thank you, Jesse, for just giving me that little nudge, dude. Um, but we'll work on that. It's gonna be a while, but, uh, hopefully like people are interested in that. And Yes. So my ask is like, if you're interested in that, like comment, let us know what exactly what you're seeing, what you're hearing, and if the goal could apply to construction, what you, what you'd want to apply it to. What do you think about that? Yeah. Crazy about it. So I'm gonna get after it here in the next probably year, possibly two years. We'll see how it's long it takes. Yeah. Yeah. Get it started, baby. Get, I love. So idea to action the space. The people that I appreciate are the people that have the least amount of space between idea to action. And so what you outlined was, I'm gonna write a book and I'm gonna start with white papers. that gets you in that direction. And once you get that bad boy going, it's gonna go. And the white paper is the get the feedback mechanism. It doesn't take long to get a 30 page white paper out, but the, the idea is get it out there and then give it to experts and then they give us feedback and then, okay. Got it. Don't go down that path. Change it up. I'm exploring constraints . Yes. Yes. What's a constraint and a constraint to publication? It's a lot of editing, A lot of classic. Oh nice. Yeah. So processing. That's what I call it. Just lippe you Scrum to do his book. I'm gonna use t o C to do mine. Nice. Yes. . Dude, I think if there's anybody suited out there to do this, it's you. The exciting thing is you're gonna contextualize all of this. and color it with your real life experience of doing the damn thing in your work. You know what it smells like, tell you, feels like you from the role of responsibility to deliver the project, not from an observer role. You had responsibility in making the damn thing happen and you chose these tools and applied them. You chose the thinking and you applied it. You, it's not a summary of your observations. Yeah, it's about breaking rules and open ended gate at 5:00 AM man. Yes, it is a transfer of the experience that you learned, that you earned. That is gonna be so powerful. So that's one. That's another thing. Last thing is in terms of celebration, cuz now I'm lit up. I'm freaking excited. , I'm excited cuz I like to help people. I think what I'm what? Like my next. The body of work that I'm understanding right now that will help me make the biggest contribution into the future is helping people or introducing people to the promise they are intended to be. And so that's like getting past the little hangups and taking big steps and courageous stuff like this thing. So for me, you just saying that is like the is so fulfilling, man. I feel valuable. I, I feel like I am of value and I'm serving my purpose. Two, Keon and Joe, when they wrote their book, part of their like crazy idea, part of their vision was like, man, we need more stuff like this for construction. Yeah. And how awesome would it be if in three to five years all of these expert builders, there you go, lean builders. How awesome would it be if all of a sudden a whole bunch of other people start publishing content to help our industry? and here we are. Like it, it's amazing, man. This is, they were right before we started recording, we were talking about how Dr. Gold, he passed away in 2011. He missed kind of the golden era where really this, these concepts started taking hold. Yeah. At least in the conversation. Maybe they haven't taken hold in the mainstream, but uh, they're all of a sudden Chris Davis of the world now has a platform to stand on. Yes. Yeah. Hell yeah. Told them totally. Em, and like Joe and Keon, they're like big shots now. . Oh yeah. But they kill words. But they, Joe and Keon respect, you've, if without you I wouldn't have gone down this path and then Jen and Jess, without your step into the fray, I wouldn't have gone down this path. So this is all, it's a cumulative thing. So it's, it's a one plus one. Yes, people. It's an exponential thing. And hopefully the idea is again, it's to give some people some tactics and some inspiration, but also let's go inspire the next generation. Hell yes. So like Davis and Walker, maybe those guys are pretty inspirational. Yes, and we're definitely, yeah. Hell yeah. And we're definitely gonna talk about like how being super disciplined with your control points, Ooh. Leads to productivity. Yeah. Yes. So yeah. So here we go. Lean surveyor. Hello. Gonna take some that same with Jason Schroeder if you break off from the company that I work for now. Yep. And do your inspirational thing. I don't think I would be inspired. So thank you Jason and your organiz. And Katie especially, probably, she's probably the primary motivator, . And I'm Katie, just to just narrate my life because she has a very good way of doing that. But yes, so thank you everybody for doing that and we're gonna get after it and hopefully we'll see some white purpose in the next cycle. I, GLC and L C I. So that'll be the first opportunity for some feedback. So I'll look for that. Look for that soon. Yes sir. Damn, I think we just close on that shit. We're gonna do livestream, so come at me bro. Yeah babe, it's good. Ask me anything. Ask me anything. Really. This the goal. I picked this up. I picked it up off of a desk. I was just walking, I was on my way out of work and I looked at a desk and I saw this book and I was like, I'm gonna pick it up and I'm gonna read it. And then, so I didn't buy it. I wasn't inspired, I just was like curious. And from being curious, it took me into a whole different path. and, and introduce me to some awesome people, yourself included. And now I just surround myself with those people and I'm just so grateful to, to be able to do that. I'm very passionate about it, but also I want to pay it for, but, so here we go. Let's do it, man. Hell yeah. Do all right. Done. Man, you are one dedicated listener sticking with us all the way through to the very, very end. Please know that this podcast dies without you, and we invite you to share how the episode's impacting you, along with your thoughts, questions, and suggestions. You have been gracious with your times, so we added social media links in the show notes to make it super easy for you to connect with. be kind to yourself. Stay cool and we'll talk at you next time.