1. James R. Holt, Ph.D., PE. Jholt@wsu.edu http://www.vancouver.wsu.edu/fac/holt/ Jholt@wsu.edu http://www.vancouver.wsu.edu/fac/holt/ Constraints Management Washington State University’s Engineering Management Program http://www.cea.wsu.edu/engrmgt/ http://www./ The Theory of Constraints: Physical Process Games The Nickel Game Instructions (Watch these instructions in to see the animations)

2. Another Issue in Operations that Surfaces: Batch Size Often times, we focus on getting the most out of our resources. We tend to measure this by efficiency –Amount of time working/Total Available Time –This is a lagging measure that looks back in time. –Lets Play and efficiency game. I call it the Nickel Game This also applies in projects where everyone (engineers or workers) focus on being efficient versus having an efficient delivery system.

3. The Nickel Game You are bored in Staff Meeting. You start shuffling a bunch of nickels in your hand. Finally, you catch the attention of a few in the group. “You folks are pretty competitive. How about playing a 3 minute game and see who is best?” Who can resist? HHHHHHHHHH

4. The Nickel Play: Time each person to do the flips HHHHHHHHHHLLLLLLLLLLHHHHHHHHHHLLLLLLLLLLHHHHHHHHHH

5. New Nickel Play: Time Each person again. Individual Efficiency Decreases System Efficiency Increases And so on.. H L H L HHH L H L HH L H L L H H H L

6. 6 Help the Group Understand Each Nickel was a Project. First Scenario: The impact of having every individual work to their highest efficiency delayed the projects (nickels) so they all came out after a minute or so. Second Scenario: When individuals gave up their own efficiency and focused on moving the projects (nickels) the first project came out in 15 seconds and the last at 30 seconds (or so). Ask the audience how many nickels were in the queue when they received them from the first Scenario (ten). Ask the audience how many unfinished tasks they have on their desk, in their file cabinets, in their day planner, things they should be home doing right now? (much more than 10). Ask them if any one else is waiting for any of the tasks they should have already performed? (of course). Ask them if they understand the impact of their attempts at “being efficient” has on the whole system they work in?

7. Try the Dollar Game: Uses Pennies, Nickels, Dimes, Quarters, Dollar Coins HHHHH LLLLL HHHHH LLLLL HHHHH HHHHH LLLLL HHHHH LLLLL HHHHH

8. Dollar Game: Traditional Fashion Play the game with ten coins of each. Shuffle the coins and process as they come out of the bag. Pass the coins along after ten flips Record individual efficiency to do the 100 flips. Record the completion time for the last coin of each type. People already know how to WIN at getting the projects done. Its hard to stop them from passing the work until all ten flips are finished.

9. Dollar Game: Small Batch Fashion Pass each coin along as its flipped. Record Individual time to flip all 100 Record Time last coin of each type finishes. HHH LL HH LL HH And so on.. H L H H L L H L H

10. Dollar Game: Based on Project Value The Dollar Coins represent a project worth $100 Million in value The Quarter Coins represent a project worth $25 Million The Dime Coins represent a project worth $10 Million The Nickel Coins represent a project worth $5 Million The Penny Coins represent a project worth $1 Million What now? Would they change the sequence of which coin they worked on?

11. Advanced Dollar Game Consider the situation were some of the five people in the Dollar Game is handicapped when doing certain coins (can only flip with one hand). –The first Person is slow with Dollars –The second Person is slow with Quarters –The third person is slow with Dimes –The fourth person is slow with Nickels –The fifth person is slow with Everything! How will you release work if the goal is to minimize flow time (start to complete) of each project?