The Theory of Constraints (TOC) is an important optimising technique that focuses on improving the throughput of work at the (usually) single bottleneck or constraint in the workflow.
This Skills Module draws together a number of the 12Faces articles on the subject. One research project demonstrated that 89% of improvement in a manufacturing business came from the application of TOC. Yellow Belt.
There is usually very few, and often just one, thing that causes a logjam in your business.
This is true of many types of business; not just manufacturers of products.
The articles covering various aspects of this important topic are gathered together. Learn how this important optimising technique can improve your business.
TOC needs to become an ingrained habit so that you are always looking for the opportunities to dramatically improve your businesses throughput.
Main TOC Principals
Listed here are examples of the more detailed and specialist applications of TOC for you to work through in the Skills Module.
When a Bottleneck is Good - Theory of Constraints
Yes, sometimes it is a very good thing to have some bottleneck in your production system. This article introduces the concept of TOC, expected results, the cost of a negative bottleneck and how to identify and implement remedies.
Covered in the Skills Module article: SM5.1 When a Bottleneck is Good - Theory of Constraints (TOC)
80/20 and TOC
The amazing 80/20 Rule is an optimising technique. 80/20 demonstrates that some parts of your business are up to 16 times more valuable than other parts. When the 80/20 Rule meets TOC, it is the 12Faces equivalent of Godzilla meets the Hulk!
Links, for both Skills Modules, provided in the article: 80/20 Principle and the Theory of Constraints
Theory of Constraints in Retail
Retailers probably don't think of themselves as a workflow business but this article shows that TOC can apply to them and how to take advantage of the technique.
Covered in the Skills Module article: SM5.2 Theory of Constraints - Retail
TOC to Optimise Sales Funnel
The Sales Funnel is a well-known method of describing the several layers that a possible customer needs to pass through en route to becoming a customer. Each layer contributes more information about your business to the potential customer to encourage them to purchase. The Theory of Constraints (TOC) can show you the very first place you should look at in your Sales Funnel for maximum increase in sales.
Covered in the Skills Module article: SM5.3 TOC to Optimise Your Sales Funnel
Drum, Buffer, Rope
These are three technical concepts for implementing TOC effectively once you have learnt to find the constraint in your business.
They give you methods for tuning the workflow process to 'feed' the constraint in the most efficient manner so it always works at maximum throughput and therefore profitability.
Covered in the Skills Module article: SM5.4 TOC Drum, Buffer, Rope Optimisation Techniques
Demand Driven Materials Requirement Planning (DDMRP)
DDMRP follows on from Drum, Buffer, Rope and is based on sound flow-based principles. It is based on five sequential components and provides planning and execution performance improvements in variable environments.
Covered in the Skills Module article: SM5.5 Demand Driven Materials Requirements Planning
12Faces believes TOC is one of the fundamentals that every business person needs in their "toolkit" of skills.
The best way to grasp this concept is to apply it.
If you want to take advantage of what you have been reading here, pause right now.
Signup for the Skills Module and identify the Constraint in your business. Then think about how you can take the greatest advantage of it.
We are confident your time will be very well spent.