The theory of constraints focuses on eliminating all bottleneck activities in a process.
Theory of Constraints is system based philosophy which states that the constraint determines the performance of the systems. In other words, It is a methodology for identifying the most important limiting factor (i.e. constraint) that stands in the way of achieving a goal. Then the teams will work systematically until it is no longer the limiting factor. Show
Examples of constrains in an organization: Machines, people, policies, information, material etc. Theory of Constraints is based off a system developed by Goldratt in the year 1984. His book, The Goal, describes a process of ongoing continuous improvement. 3 Basic Measures are more indicative of they systems than Machine efficiency, equipment utilization, downtime or balanced plants.
Overview of the Theory of ConstraintThe underlying premise of theory of constraints is that organizations can be measured and controlled by variations on three measures: throughput, operational expense, and inventory. According to the Theory of Constraints, the goal of a company is to make money. Most constraints are NOT physical. They are the result of policies. Thus, you should focus your energy on decreasing operating expense, inventory, and investment while increasing through put. This mindset should be applied to the complete enterprise, so the critical constraint can be identified and exploited. Define goals of the company along with metrics for critical measures. Some Key Pieces
Focusing areas of Theory of Constraints
Lean and Theory of ConstraintsTheory of Constraints views all processes as a chain of events that executes sequentially. Remember a chain is only as strong as its weakest link? Well a 5 step process is only as productive as its slowest step. It does not matter if steps A and B can output 15,000 products a day because step C can only output 10,000. In addition even if steps D and E can handle more than 10,000 a day that’s still all they get handed off from C. So step C is a constraint on the chain/system. Theory of Constraints views the extra 5,000 products a day produced by steps A&B as waste, the cost of both producing and storing the extra parts is waste. Any extra machinery/people in A&B or D&E are waste. A common problem with Lean Six Sigma is project selection, often improving the efficiency of step A or D because they find “low hanging fruit”. These improvements are pointless because the system can still only function as well as step C so the cost of those projects is also waste. Theory of Constraints helps you find the constraints, Lean (and ToC) helps you improve them, Six Sigma helps you eliminate any errors. Additionally ToC introduces buffers to protect your constraint, so even if a machine in step B goes down you still have a little buffer of parts for step C to work on until it’s back up (remember the whole process can only work as fast as step C so if you don’t keep it busy then steps D&E will run out of things to do and stop). Buffers and ToC have a ton of other advantages so I highly recommend you look it up further. Thinking Processes in Theory of ConstraintsIn service and operation industry it is difficult to visualize the constrains in the work flow. Six sigma teams to explore methodologies to achieve organization goals. Thinking Processes help to identify the root cause of a problem by reviewing the symptoms systematically is called undesirable effects (UDEs). Organization get the picture of the situation by arranging these responses in a tree diagram. The Thinking Processes following three questions of Theory of Constraints: What needs to be changed?
What should it be changed to?
How to change it?
Drum Buffer RopeDrum buffer rope is a theory of constraint solution for scheduling and managing operations that have constraints in the process. In other words, it is the method of coordinating production to the constraint while focusing on minimizing inventory and WIP.
The drum buffer rope method works very well, especially in manufacturing with various product models, process times, and process flow. It provides the highest organization efficiency because it controls the production and maintains the inventory and WIP at a very low level. Example: Let’s assume we have four processes in a manufacturing shop. Mixing, machining, assembly, and shipment to the end customer. Each of the processes has different capacities, as indicated below. The above diagram shows that the assembly process is the bottleneck; it had only 90 pieces/hour. We can ship 90 pieces to the shipment area, with ten pieces inventory. Since the assembly is the constraint, it is the drum. The buffer is the ten extra pieces that have completed the machining process, and we need to maintain a certain level of inventory before the assembly process. Suppose if the mixing or machining process produces fewer pieces than their capacity, the inventory may go down before the assembly stage. As soon as the inventory decreases, the rope mechanism triggers the front to release more pieces. Benefits of Theory of Constraints
Theory of Constraints VideosTheory of Constraints Reading ListGreat introduction to the Theory of Constraints. Six Sigma Black Belt Certification Theory of Constraints Questions:Question: Which of the following statements is true about the theory of constraints? Taken from (ASQ sample Black Belt exam.) (A) It views a system in terms of discrete processes. Answer: Unlock Additional Members-only Content!To unlock additional content, please upgrade now to a full membership.Upgrade to a Full Membership If you are a member, you can log in here. Authors
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