Theory of Constraints
Theory of Constraints (TOC) is an overall management philosophy introduced by Dr. Eliyahu M. Goldratt in his 1984 book titled The Goal, that is geared to help organizations continually achieve their goal. The title comes from the contention that any manageable system is limited in achieving more of its goal by a very small number of constraints, and that there is always at least one constraint (Wikipedia).
The five focusing steps in the Theory of Constraints are:
- Identify the constraint (the resource or policy that prevents the organization from obtaining more of the goal)
- Decide how to exploit the constraint (make sure the constraint's time is not wasted doing things that it should not do)
- Subordinate all other processes to above decision (align the whole system or organization to support the decision made above)
- Elevate the constraint (if required or possible, permanently increase capacity of the constraint; "buy more")
- If, as a result of these steps, the constraint has moved, return to Step 1. Don't let inertia become the constraint.