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Theory of Constraints, Critical Chain Project Management, Lean : industry consulting & training - Marris Consulting
What is Theory of Constraints?
The Theory of Constraints (TOC) is a productivity improvement methodology that emphasizes the importance of identifying the primary limiting factor (i.e., the constraint, or bottleneck in manufacturing). By focusing on systematically improving this constraint until it is no longer a limiting factor, organizations can achieve their goals, while gaining greater control over operations.
Also referred to as “Constraints management”, the Theory of Constraints was developed by Dr. Eliyahu Goldratt in 1984 in his bestselling book, “The Goal”.
Understanding the Theory of Constraints (TOC)
The Theory of Constraints (TOC) uses a scientific approach to improve the performance of process and manufacturing industries. It hypothesizes that every system consists of multiple linked activities, one of which acting as a constraint (or a bottleneck) upon the entire system and thus limiting growth. When properly identified and managed, constraints provide the fastest and most efficient path to improve profitability. When ignored, they may lie idle and waste system capacity.
Despite its name, the Theory of Constraints is extremely practical and provides a wide set of tools to improve any process of your organization, including:
Production - Operations
The Five Focusing Steps
The Five Focusing Steps of Theory of Constraints is a specific methodology for identifying and eliminating bottlenecks or constraints in a production environment. It is a cyclical process, consisting of 5 stages: identify the constraint, exploit it, subordinate everything else to the constraint, elevate the constraint, then repeat the process.
Drum-Buffer-Rope
The Drum-Buffer-Rope (DBR) System is a methodology consisting of synchronizing production to the bottleneck.
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The “Drum” is the bottleneck, i.e. the resource setting the pace of the overall process and determining the total throughput.
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The “Buffer” is the level of inventory needed to maintain constant production, ensuring that fluctuations in non-bottlenecks do not affect the bottleneck.
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The “Rope” is a mechanism based on the bottleneck capacity, used to set the level of work which will enable an optimal flow without creating a build-up of excess inventory.
Critical Chain Project Management
The Critical Chain Project Management consist of project management tools based on the acceptance of the projects variability.
This methodology is based on the planification of activities of a project with focused duration (without margins), and then the variability is managed by a project buffer put at the end of the project to protect the end date.
To change from a Critical Path planning to a Critical Chain planning, the following steps need to be followed:
- Delete individual margins inside each task of the project to get only the value added time to do the work
- Do a levelling of the resources, a CCPM planning is always considered with limited resources
- Identify the Critical Chain: it is the longest path of a project, taking into account logical links and resource dependencies.
- Insert the buffers: the project buffer mutualizes safety margins of critical tasks. It represents about one third of the total project length.
The monitoring of a project executed with the Critical Chain methodology becomes easier thanks to the Fever Chart an indicator based on the progression of the project and the consumption of the project buffer.
Throughput Accounting
Throughput Accounting is an alternative accounting methodology that attempts to remove problematic distorsions introduced by traditional accounting practices, in order to accurately measure progress towards the goal and facilitate decision-making.
TOC Thinking Processes
The TOC Thinking Processes consists of a set of strategic and problem solving tools based on the logic of cause and effect. By identifying, challenging and correcting unexamined assumptions, Theory of Constraints’ Thinking Processes allows to create breakthrough solutions across a wide variety of situations and environments.
This methodology is used to answer the following questions, which are essential to TOC:
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What to change?
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What to change to?
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How to cause the change?
What are the benefits of Theory of Constraints?
Implementing the Theory of Constraints (TOC) has yielded outstanding results for companies around the world. One of the most appealing aspects of Constraints Management is that it inherently prioritizes improvement processes.
A successful Theory of Constraints implementation will have the following benefits:
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Increased profit
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Reduced lead times
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Reduced inventory
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Improved capacity
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Fast improvement
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Reduced conflict between team members
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Reduced firefighting
Implementation of the Theory of Constraints with Marris Consulting
Marris Consulting is an expert company in Theory of Constraints training and consulting. With over 25 years of experience, our consultants have gained a unique knowledge in implementing Theory of Constraints in manufacturing and process industries. For more information about our TOC consulting and training services, please do not hesitate to contact us.
About Marris Consulting
Marris Consulting is an industry consulting and training company specialized in the Theory of Constraints (ToC) and Critical Chain Project Management. We focus on improving the performance of manufacturing and process industries by using Constraints Management combined with Lean and Six Sigma. To boost project performance, we also use Critical Chain Project Management (CCPM), which we sometimes combine with Lean Engineering. Our 2-day performance audits, our performance consulting services and our project management, Lean, ToC & CCPM training by our industry consultants offer a wide range of solutions to help our clients around the world reach the highest possible levels of performance.