What is theory of constraints (TOC)?

Business & Management
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#1

The theory of constraints (TOC) is a management paradigm that views any manageable system as being limited in achieving more of its goals by a very small number of constraints. There is always at least one constraint, and TOC uses a focusing process to identify the constraint and restructure the rest of the organization around it. TOC adopts the common idiom "a chain is no stronger than its weakest link.

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#2

“There really is no choice in the matter. Either you manage constraints or they manage you. The constraints will determine the output of the system whether they are acknowledged and managed or not”

Identification of constraints allows management to take action to alleviate the constraint in the future.

Five Steps Of TOC

  1. Identifying the constraint
  2. Decide how to exploit the constraint
  3. Subordinate everything else to the
    decision in step 2
  4. Elevate the constraint
  5. Go back to step 1, but avoid inertia