Theory of Constraints

No matter what you do, there is often scope for boosting overall performance.
A great way of doing this is to identify and eliminate “bottlenecks,” or things that are holding you back.
So how do you identify these bottlenecks?
One approach is to use the Theory of Constraints (TOC). This helps you identify the most important bottleneck in your processes and systems, so that you can deal with it and improve performance.

The Theory of Constraints is a philosophy of management and improvement originally developed by Dr. Eliyahu Goldratt and introduced in his book ‘The Goal’.
“A chain is only as strong as its weakest link,” is what the Theory of Constraints reflects.

Understanding the Theory

According to Goldratt, organisational performance is dictated by constraints. These are where bottlenecks occur that prevent an organisation from maximising its performance and reaching its goals. Constraints can involve people, supplies, information, equipment, or even policies, and they can be internal or external to an organisation.
The theory says that every system, no matter how well it performs, has at least one constraint that limits its performance – this is the system’s “weakest link.” The theory also says that a system can have only one constraint at a time, and that other areas of weakness are “non-constraints” until they become the weakest link.
You use the theory by identifying your constraint and changing the way that you work so that you can overcome it.
The theory can be used in a variety of situations. It’s most useful with important or frequently-used processes within your organisation.

The Five Focusing Steps of TOC
1: Identify the constraint
2: Exploit the constraint
3: Subordinate everything else to the constraint
4: Elevate the constraint
5: If in steps 1-4 the constraint has been broken, go back to step 1