CH: 6 Constraint Management

Constraint

Any factor that limits the performance of a system and restricts its output.

Bottleneck

The capacity constraint resource whose available capacity limits the organization’s ability to meet product volume, mix, or demand fluctuations.

Theories of Constraints (TOC) Step 1

Identify the system bottleneck(s).

Theories of Constraints (TOC) Step 2

Exploit the bottleneck(s).

Theories of Constraints (TOC) Step 3

Subordinate all other decisions to Step 2.

Theories of Constraints (TOC) Step 4

Evaluate the bottleneck(s).

Theories of Constraints (TOC) Step 5

Do not let inertia set in / repeat.

Key Principle of TOC - Flow vs Capacity

The focus should be on balancing flow, not on balancing capacity.

Key Principle of TOC: Maximizing Efficiency

Maximizing the output and efficiency of every resource may not maximize the throughput of the entire system.

Key Principle of TOC: Bottleneck Impact

An hour lost at a bottleneck is an hour lost for the whole system.

Key Principle of TOC: Inventory Necessity

Inventory is only needed in front of bottlenecks and in front of assembly and shipping points.

Key Principle of TOC: Work Release Frequency

Work should be released into the system only as frequently as needed by the bottlenecks.

Key Principle of TOC:Non-bottleneck Activation

Activating a non-bottleneck resource does not increase throughput or promote better performance.

Key Principle of TOC: Capital Investment Perspective

Every capital investment must be viewed from the perspective of global impact on throughput, inventory, and operating expense.