- What is theory of Constraint?
- Theory of Constraint definition
- Types of constraint:
- Internal constraints
- External constraints
- Benefits of TOC
- Types of tools used in Theory of Constraints methodology
What is theory of Constraint?
Theory of constraints (TOC) is defined as management methodology which is introduced by Dr. Eliyahu M. Goldratt in year of 1984 in his Noval. It is introduced to provide support to the organization to meet the goals without any failure. This is focus on the way of performing task in case you have some limitation in path of task. This theory tell us how to achieve goals with available resources and non-removable constraint. .
As per TOC there is always some constraint are often referred to as bottlenecks in any business or activity and if we stuck on the constraint it is difficult to achieve the goals so that we have to identify the solutions by keeping the constraint in mind.
Theory of Constraint definition.
TOC is defined nas the theory which guides to achieve the goals in presence of constraint. This theory explains that we can’t eliminate the constraint but we have to choose the way to achieve the goals with present constraint.
Types of constraint:
Constraint are often referred to as bottlenecks are always present in the system. Because like variation constraint are part of system. So we have to analyse the constraint and find the available solution to achieve the goals.
Mainly constraint are two types
- Internal constraint
- External constraints
Internal constraints:
These are the constraints which are present within the organization which create obstacle during achieve defined goals. These are known to management and the organization peoples. But after all the target is to achieve the goals of organization with the constraints.
Some of the example of internal constraints:
- Availability of equipment’s
- Competent manpower
- Poor process
- High variation in product output
- Low process capabilities
These all constraint are often referred to as bottlenecks can leads to customer demand failure but organization have to supply quality product to customer.
External constraints:
These are the constraints are often referred to as bottlenecks which are not present within the organization but having impact on organization due to which hit create disturbances to meet defined goals.
Sometimes these are known but sometimes these are unknown to management and the organization peoples. But after all the target is to achieve the goals of organization with the constraints.
Some of the example of external constraints:
- Legal requirement compliances
- Traffic operator strikes on roads
- High customer demand
- Competitor pricing policy
Benefits of TOC ( theory of constraint)
- Increase in organization profits
- Improve brand image of organization
- Build customer confidence
- Opportunity to get new business from customer
- Improvement in capacity
- Reduce cost investment on high inventory
- Confidence to provide material with less lead time
- Improvement in existing process
Types of tools used in Theory of Constraints methodology:
- Focusing Five Steps
- Thinking Processes
- Accounting Throughput
Thanks for your attention during the topic on theory of constraint. Hope you like it and you feel confidence and you as value in your knowledge.
Thanks again for your support, we will meet again with new topic to enhance you are knowledge.
