TOC

The Theory of Constraints (or TOC as it is often abbreviated) is a management philosophy meant to help a company achieve their main organizational goals.According to the Theory of Constraints, you must identify what constraints are preventing your business from achieving its goal.Every company has at least one constraint (or there would be no need for process improvement).These constraints can be internal resource constraints, market constraints or policy constraints.Naturally, different kinds of constraints need to be handled differently as issues such as realm of influence will definitely play a role in what types of options are and are not practical.

To give you a little history on the Theory of Constraints, TOC was made popular by its developer Eliyahu Goldrat in 1984. In a book that Goldrat wrote entitled, "The Goal," he describes his Theory of Constraints concepts.In this book he gave the example of what a popular constraint on a company might be.He used the example of a specific machine that was responsible for the production of a good.This good could only be produced at the speed and quality that the machine was capable of.Any need to increase the production was hindered by the operating capabilities of this machine.Therefore, that one specific machine was a constraint for the company.

The Theory of Constraints is often referred to as way of thinking that is then turned into a method of operation.TOC begins with understanding the world around us and translating the influences that we observe into our own working environment, all the while identifying ways to improve.An understanding of the relationship between cause and effect is also important in TOC.Something called the "Thinking Processes" of TOC outlines a series of steps which combine cause-effect and our own understanding.The Thinking process encourages us to have a paradigm shift in our thinking.This means that we are able to set aside pre-conceived notions and realize that even though our assumptions about things are always changing the basic principles or rules by which they are governed do not.The market is constantly changing.Companies that are able to change with it to continue to do what it takes to meet the needs of the customer are going to thrive.Companies set on doing things contrary to the new demands of the customer are most likely going to suffer.

Coming up with an entirely new way of thinking on your own may be near impossible as the suggestion itself is a contradiction.Therefore, researching the methods of other successful companies and learning more about TOC will help to broaden your horizons and will serve as an introduction to a new way of seeing challenges.Applying the Theory of Constraints begins with identifying what is constraining you from more positive results.In order to manage a constraint, you must be able to identify it.The next thing that you must be able to do is to exploit the constraint.Focus on how to improve productivity.Consider changing such things as schedules, mechanical operations, or speed of output to see if any favorable outcomes are possible.Consider that the problem may have more to do with an operator than the mechanical devise.If this is so, the solution to your constraint may be far more manageable and affordable than what you previously thought.The next concept that you need to be familiar with is the idea that changing one part of the system will affect the whole method.Take these larger scale effects into consideration and have plans for their execution as well.Finally you must be able to step back and determine is the newly changed output has been improved.This could apply to the production line as well (meaning that the product may be the same but the method of production has been freed from a constraint).If there is not marked improvement than the process of identifying a constraint and working to eliminate that constraint must begin again.