If making money is your goal, throughput is your obsession

In a for-profit organization making money is the goal and the limitation to making more money is called a constraint. Conversely, a constraint is a limiting factor to get more out of the system. There is only one constraint which is the most limiting factor restricting the Throughput. Throughput is the rate at which the … Continue reading If making money is your goal, throughput is your obsession

Schragenheim’s concise history of constraints

The definition of a constraint in Theory of Constraints (TOC) has varied as the corpus grew and matured. Still today it is confusing for newbies to sort out what is meant with "constraint", depending how they got their basics in TOC. Thanks to Eli Schragenheim, one of TOC's founding fathers, and the related post on … Continue reading Schragenheim’s concise history of constraints

Performance improvement: simple things can earn big results

Silly things can cost a lot in terms of productivity and output.  In this video interview, Philip Marris  asks me about lessons learnt while helping a pharmaceutical plant to improve productivity and deliver drugs to patients faster. It is about how simple actions solve those silly small problems and bring big results at literally no cost.

You are probably wrong when identifying your bottleneck

Things moved on since Eli Goldratt’s revealed Theory of Constraints through his business novel and bestseller “the Goal”. Most of today’s processes are more complex than 30 years ago: supply chains are stretched over the globe, new products are launched more frequently and batches are changed more often, among others. Thus identifying the bottleneck or … Continue reading You are probably wrong when identifying your bottleneck

Be prepared for success!

Some improvements in operations can be so effective that management should better be prepared for success, otherwise it can ultimately turn out as a splendid blunder. This post is a kind of sequel of “Your next bottleneck is elsewhere (and in the future)” and based on a true experience in pharmaceutical industry. The story takes … Continue reading Be prepared for success!

Your next bottleneck is elsewhere (and in the future)

Theory of Constraints provides the five focusing steps, an iterative improvement process which aims to focus efforts on the sole system constraint (often a bottleneck). These five steps are: Identify the constraint (bottleneck) Exploit the constraint; improve capacity utilization Subordinate all non-constraint resources to the constraint Increase the capacity of constraint if relevant Repeat step … Continue reading Your next bottleneck is elsewhere (and in the future)

Introduction to Throughput Accounting

Throughput accounting comes early for all studying Theory of Constraints.  The simplest is about the 3 KPIs: Throughput (T), Operating Expenses (OE) and Inventory (I) - later changed to Investment - and their relationship for higher profits. Later, Throughput accounting is used to make sound decisions to maximize profit despite limited means, favoring the products with highest "octane", which is the … Continue reading Introduction to Throughput Accounting

Beware of bottleneck hunting!

In the following video interview, Philip Marris (answering Clarke Ching's questions) states that the five focusing steps of Theory of Constraints are wrong! Well it needs some more listening  to understand the wisdom behind the provocative statement. First, the five focusing steps (5FS) are basically ok. What bothers Philip is the fifth step after the … Continue reading Beware of bottleneck hunting!

One hour of Theory of Constraints experience, first hand

I was fortunate to "participate" in Philip Marris' interview by Clarke Ching for Clarke's podcast series. While making sure all the video and sound was properly taped, I listened to the talk. Latter, editing the video, I had more listening. Now that Clarke made the video public, it's time to share: Clarke chats with Philip … Continue reading One hour of Theory of Constraints experience, first hand