Many organizations have failed to achieve their objectives in the long run. There is the urgent need of the organization’s management to come up with a strategy to curb the challenges hindering the achievement of the goals. Intermediate objective (IO) which consist of current reality tree (CRT) and undesired effects (UDEs) can be used to highlight the problems and the methods which can be applied to solve the problem (Djorgovski, et al., 2013). XYZ is a copper mining company located in Chile.
The company has not achieved its objectives in the past. The reasons pertaining the failure to achieve the goals has been related to improper mining methods, low quality and quantity of mining products which lead to low profit margins. This report therefore shows the IO map, CRT map and the undesired effects as well as roots associated with the XYZ limited. A clear way is shown on how the goals can be achieved thus maximizing the gains.
Intermediate Objective Map
The Intermediate objective map is an adaptation of current reality tree. IO map helps organizations to establish the objective and critical success factors and necessary conditions for every system (Harmening, & Schaeffel, 2008). Generally, it shows the standards of success or failure in an organization. The new CEO of the XYZ Company has developed an IO map to aid in achieving the company’s goals. The major goal of the XYZ Company in Chile’s mining industry is to increase the profit margin. There are various factors which are key in achieving the objective. The factors include quality and quantity of the company’s productivity, improving in the mineral extraction method and its efficiency.
Current tree diagram (CRT)
Current reality tree is way of analyzing companies or organization problems at once. The root is usually identified, which is the common cause of the problems. A current reality tree (CRT) aims at improving the condition of an organization by eliminating or minimizing the problems or challenges. A graph or a table is drawn to show the procedures. When a tree is complex, it can be interpreted either from bottom-up or top-down. The development of the tree is top-down all time, from symptoms to critical root causes.
When more than one arrows are directed to an entity, the base entities of the arrows are the likely causes. The different arrows are analytical “inclusive OR” associations.
In the case where the arrows are surrounded by a curve, it implies that logical “AND” relationship: All causes must be present at the same time for the effect to take place.
The CRT focuses on leveraging the same way the theory of constraints does. The aim of a current reality tree is to find and get rid of the main cause, the entire tree of dependent undesired effects vanishes. Evaluating the condition with a current reality tree is better rather than the efforts wasted using the undesired effects (Wagner, 2015). Merging the full efforts on the sole main root causes is much more suitable.
Indeed, in this kind of condition, the undesired effects of the XYZ company makes its management fail and encounter difficulties in achieving the high profit margins goal through quality and higher productivity of its copper minerals.
In case where the company doesn’t have a clear company strategy, the management raises its goals and objectives without a good order, this leads failure in the company operation upon completion of the current reality tree, and the tree can be read bottom-up or top-down (Morin, & Hutt, 2001).
The Current Reality Tree (CRT) is one of the Thinking Processes analytical tools. The Undesirable effects (UDE) are clearly shown as well as the associated roots. The root cause is the core problem which faces an organization. In the case of XYZ limited the quantity and quality of the minerals as well as the extraction methods forms the Undesirable effects.
Current Reality shows the problems which hinder an organization from achieving its goals and the solutions which can be taken to address the problem.
Undesirable Effects (UDEs) are the challenges that an organization encounter, suffer from or have to cope with. UDEs can also be seen as the causes of the problems (roots). The CRT is a tool of addressing the challenges.
As for numerous expounded problem solving techniques and tools, constructing a current reality tree is not needed for every challenge or problem. The CRT was designed to specifically solve the complicated, system extent and multi-factor problems.
A current reality tree (CRT) comprises of more or less a V shape with the topmost and many undesirable effects on the top, also other undesired effects (UDEs) that are causes from topmost UDEs and their own causes, and so on down to the less crucial main causes, usually situated (near or) at the base of the current reality tree (CRT).
Theory of constraints
The theory of constraints puts into account a series of steps known as the five focusing steps. XYZ has used the 5FS in its operation. The steps are:
Identify the constant – in order for XYZ Company to increase the productivity of copper, it must fight the current constraints hindering it from achieving its goal. Alleviating the current problem will lead to another new challenge. Through the process of XYZ identifying its increased productivity with minimal costs, the company discovered this through a current reality tree, pointing out the casual relationships between undesirable effects.
Exploit the constraint
After the XYZ Company identified the constraint of unsuitable machinery and poor technology, it should move forward to maximize its productivity at the challenge. That is, the challenge should be 100% used. The company looks forward to maximize on the challenge of modern technology, improvement of quality and quantity production of copper. Through exploiting the challenges, XYZ Company will be able to achieve its set goal of reaping high profit margins.
Subordinate everything else to constraint
The constraint is the highest limiting machinery or technology that hinders XYZ from attaining its goal. XYZ should thus give the constraints much more resources so that it can be fully utilized.
Elevate the constraint
After the productivity of the constraint is maximized, XYZ Company resources solving the constraint should be expanded so as to increase the productivity of the company. To increase the constraints, XYZ needs investments, such as purchase of new machinery or recruit manpower.
Prevent inertia from being the constant
After the machinery and technology issues have been addressed, the company will experience a new constraint within its operations. XYZ will need to hike the throughput of the new addressed constraints to exploit the new constraint that may arise.
The Evaporating Cloud
The evaporating cloud is one of the six processes thinking under the theory of constraints. It is also known as the conflict resolving diagram. The EC is mainly designed under the theory of constraints to address dilemma circumstances or conflict. XYZ copper mining company has adopted EC by diagraming the logic behind its challenges in attaining objectives and methodologically evaluating the assumptions behind its logical approach. The company’s EC comprises of a set format involving five boxes named A, B, C, D, and D’ as shown below.
XYZ Evaporating cloud
The XYZ limited has been constant in making profit due to various challenges. The challenges are referred to as undesired effects (UDEs) and are linked to a root which associates the problems. Intermediate objective (IO) map is developed to show the goals aimed by the XYZ limited, the necessary conditions and the critical success factor. The main problem facing XYZ limited is failure to achieve the estimated profit margins. The challenge can be associated with low copper productivity in the mines, low quality of mined copper and poor extraction methods of the copper.
However the goal of increasing the profit margins as stated in the current reality tree (CRT) can be achieved by increasing the copper productivity as well improving the quality. XYZ limited should adopt the modern technology in mining to safeguard the well-being of the employees and increase productivity. Incorporating the critical factors of success, undoubtedly XYZ limited will achieve the objectives.
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