Overcoming Limiting Beliefs to Achieve Transformational Outcomes
Introduction
Any organization that is seeking to grow or stay competitive in today’s marketplace is aware that they must continually evolve in one or more ways: increase market share of existing products or services, introduce new products or services, or increase operational efficiency. All CEOs understand this and typically set financial goals along with some strategies for evolving the organization to meet the goals.
Unfortunately, many CEOs and other senior leaders of organizations hold limiting beliefs that prevent them from creating and executing on strategies that could deliver transformational outcomes for their organizations. In this blog, we draw upon the insights provided in the book The Choice, by Eliyahu “Eli” Goldratt & Efrat Goldratt-Ashlag to understand these limiting beliefs and how to overcome them. The insights in this book are so impactful that I consider The Choice to be the most important business book ever written.
By way of background, Eli Goldratt, a physicist turned management consultant, began developing the Theory of Constraints (TOC) in the 1980s and introduced it to the world through The Goal, a business novel that was first published in 1984. Eli continued to build out TOC over the next several decades as he discovered the need for more tools and techniques through his consulting practice, Goldratt Consulting. In his consulting practice, Eli was able to help clients achieve truly transformational outcomes, often manyfold better than was thought possible in specific industries.
Eli’s daughter Efrat holds a Ph.D. in Organizational Psychology and The Choice chronicles many conversations she had with her father as she sought to understand the essence of how Eli used TOC to achieve transformational outcomes in organizations. More importantly, the book masterfully brings the reader along on the journey as Efrat works to believe and understand that achieving transformational outcomes doesn’t require the brilliance of Eli Goldratt. Instead, mastery of TOC concepts along with a mindset unfettered by limiting beliefs are the keys.
Limiting Beliefs
The diagram below is Efrat’s diagrammatic depiction of barriers to achieving transformational outcomes. The Choice includes an appendix “Efrat’s Notes” that supplement the chapters and includes many cause-and-effect diagrams like the one below.
As we see in the diagram, the barriers are all driven by the perception of reality as complex. It’s entirely understandable how this perception exists in a VUCA world (Volatility, Uncertainty, Complexity, and Ambiguity). However, as the diagram illustrates, with the perception of reality as complex, we look for complicated solutions, and these don’t work because complicated solutions camouflage the big persistent problems, (constraints) of what is limiting performance in a VUCA environment, i.e., Barrier 1. Furthermore, thinking that transformational outcomes cannot be achieved due to fundamental beliefs (e.g., traditional industry-specific ways of working, decision-making based on cost accounting, etc.), leads to Barrier 2. Finally, failing to identify big persistent problems leads one to only address smaller problems, to lower expectations about outcomes, and to stop when some improved outcomes have been achieved, i.e., Barrier 3.
We can now summarize limiting beliefs as follows:
- Acceptance of complicated solutions
- Compromises must be made in finding solutions
- Saying “I know”
- Win-Win solutions do not exist
- Scarcity mindset
The first two beliefs have been illustrated in the above diagram. What exactly is limiting about saying “I Know”? Of course, we know some things. In fact, we may be industry experts. However, we can never know everything that might lead to better solutions. Thinking we do, causes us to stop looking for better solutions.
In business, it’s all too common to believe there is a finite amount of opportunity to gain in fundamental ways (revenue, market share, etc.). This results in the belief that win-win solutions do not exist. For example, a manufacturer may believe their financial performance cannot increase without their suppliers or distributors getting less of what is viewed as a fixed size pie of revenue. This can be characterized as a scarcity mindset.
Inherent Simplicity
Eli Goldratt was trained as a physicist and therefore it’s not surprising that he drew from the words of Sir Isaac Newton:
‘Natura valde simplex est et sibi consona.’
Or…
‘Nature is exceedingly simple and harmonious with itself.’
Of course, not all that we observe in nature is exceedingly simple a priori. There are often years of work by one or more scientists to uncover the simplicity and harmony, such as Kepler’s Laws describing the elliptical orbits of the planets in our solar system or Maxwell’s four equations that describe all of electricity and magnetism.
As Eli moved into management consulting, he uncovered something strikingly similar:
‘When we break down problems via a logical, scientific cause-and-effect approach, we uncover Inherent Simplicity in root causes and associated solutions.’
Like fundamental scientific discoveries, there is often a need to perform significant logical, scientific cause-and-effect analysis to determine the root cause (aka constraint) of a business problem that limits performance to find a transformational solution. I’ll address this further in the concluding remarks.
Unlimited (TOC) Beliefs
With Inherent Simplicity as the cornerstone of TOC, we can now summarize unlimited beliefs, as espoused by TOC:
- Inherent simplicity will lead to simple solutions
- No compromises are necessary
- Increasingly better outcomes are possible by relentlessly pursuing them
- Win-Win solutions do exist
- Abundance mindset
When we use a scientific cause-and-effect approach, we uncover root causes that lead to simple solutions, and we avoid compromises that are made when we stop before identifying the root cause of problems. By not saying “I know”, we relentlessly pursue better outcomes. Eli Goldratt often obtained remarkable outcomes for his clients but would not stop with such success. He knew there were always even better outcomes by continuing to relentlessly apply TOC principles.
When we begin to experience simple solutions and increasingly better outcomes for our organization, we begin to uncover solutions that also lead to better outcomes for the entire system of which our organization is a part, e.g., the entire supply chain from raw material suppliers to a manufacturing plant to a distributor to a retailer to end customers. Thus, we find win-win solutions do exist and this corresponds to an abundance mindset. Once we’ve developed this mindset, it provides more motivation to continue relentless pursuit of better outcomes.
Concluding Remarks
Transformational outcomes that are beyond the imagination of most leaders are very possible and have been achieved worldwide through effective application of TOC. The success of TOC is grounded in fundamental scientific-based logical thinking by uncovering cause-and-effect relationships.
The TOC body of knowledge is substantial and continues to grow via the Theory of Constraints International Certification Organization (TOCICO). It is the hope of this author that more organizational transformation management consultants (internal and external) will take a deep dive into learning TOC. The TOC principles, techniques, and tools have proven to be very useful in a wide range of industries. While the learning journey can be substantial, so too can be the outcomes realized by your organization or clients with TOC as a skill set.
Regardless of whether you become a TOC practitioner, embracing the Unlimited (TOC) Beliefs will undoubtedly cause you to aim for better outcomes and to relentlessly pursue them. I strongly recommend at least becoming familiar with the foundational concepts of TOC. Please don’t hesitate to reach out to me at rich@sevawise.com if you would like some suggestions on how to begin your own TOC learning journey.
Rich Stewart is a Principal Consultant at Sevawise LLC and a TOC practitioner.
