What is this thing called TOC?
The most common question about the
Theory of Constraints (TOC) is,
"Huh?"
Eli Goldratt defines a Constraint as,
'Anything that limits a system from
achieving higher performance verses its
goal.'
One definition used by Eli Goldratt for
TOC (slightly edited) is:
'The Thinking Process that enables people to invent simple solutions to seemingly complex problems.'
Here's my definition:
The Theory of Constraints states that every system must have at least one constraint limiting its output.
Consequences of the Theory:
1. The more complex the system, the less independent process paths exist, so the lower the number of constraints. (Usually, complex systems have only one constraint at a given time.)
2. A system of optimum processes can not be an optimum system.
3. An optimum system runs the constraint (or bottleneck) at optimum capacity (focused on the goal of the system), and all other process steps must have excess capacity.
The TOC International Certification Organization (TOC/CIO) is evolving a definition, which I modified slightly to read:
TOC is management philosophy developed by Dr. Eliyahu M. Goldratt based on the principle that complex systems exhibit inherent simplicity, i.e., even a very complex system made up of thousands of people and pieces of equipment can have any given time only a very, small number of variables – perhaps only one (know as a constraint) – that actually limits the ability to generate more of the system’s goal.
Due to popular request, I have added
my definitions
of TOC terms. These definitions are
subject to your input and improvement;
please let me know how to make them more
correct and useful.
TOC is compatible with, and supportive
of, many theories and tools used in
Total Quality Management (TQM). It
complements TQM strongly in helping to
focus the parts of a system that need
process improvement; i.e. focus
improvement on the System's constraint.
It is a method of implementing W.
Edwards Deming's Profound Knowledge
principle of 'Understand the Theory of A
System.'
The primary departure of TOC from much
of TQM is that TOC does not support
continuous improvement of every process.
Instead, TOC puts the focus on
continuous improvement of the System.
While most TQM acknowledges the
importance of focus on the system, few
tools enable people to do so. Some 'TQM'
based process improvements have stumbled
onto the system improvement focus. For
example, the success at Motorola appears
to be due to using Cycle Time as the
focus tool. This caused them to identify
and elevate the constraint of the
system. Likewise, when Ford focused on
the overall process to develop the
Taurus, they had to look at the system.
(I have thought about a paper on this,
but haven't had the time to do the
research. Any 'game' graduate students
that would like to co-author such a
paper, please contact me.)