Theory of Constraints

Between a rock and a hard place - the Theory of Constraints

The Theory of Constraints (TOC) helps us to identify, manage and relieve bottleneck processes.

A constrained system is one in which the throughput achievable is limited by a process which is running at or near its maximum capacity - a bottleneck. TOC provides rules for operating the system so as to maximise throughput(measured by money generated or patients treated etc, as appropriate to the system) while minimising costs.

TOC offers an alternative accounting mechanism, throughput accounting, which avoids the distortions introduced by cost accounting and a logical problem-solving framework for resolving dilemmas.

TOC and lean operations are complementary approaches: many businesses will find that the TOC tools provide a quicker return than lean, providing a foundation upon which subsequent lean development can build.

Sherpa Consulting will help you to identify the constraints in your business processes, and will teach you how to apply the Theory of Constraints to manage the processes efficiently and effectively. We will show you why the cost accounting systems used to measure your business can adversely affect profitability, and will teach you more effective alternatives.