xvii If I could sum up the Theory of Constraints from my 12 years of research, experimentation,
success, and failure, it would be two words: focus and leverage. The Theory of Constraints guides
management toward where and how they should focus resources to leverage return on investment and how the approach should be
continuously monitored and communicated to the rest of the organization to... create continuous improvement.
p.13 The biggest barrier to communication is the inability to explain our intuition in such a way that the
undesirable effects being experienced are clearly linked to the root cause.
p.16 The examples are numerous, but the underlying cause remains the same. Any improvement process
that ignores the need to focus and manage the constraining resource is not going to maximize profit.
p.20 If a company is going to harness the focusing power of TOC [Theory of Constraints], the organization must
not only identify the key areas for managing throughput, but also must educate all supporting areas on how to elevate their
actions/measures and change their behavior to support exploitation of the constrained capacity resource. Continuously solving
the causes of starvation or downtime at the constraint creates a continuous improvement cycle. Without the ability to cause
all other resources to subordinate to support the constrained resource, a company will be unable to exploit the constraint
and therefore unable to exploit their investment to achieve the highest return.
p.21 The existence of a limiting factor makes the conventional process of relevant costing or the conventional
process of selecting relevant information insufficient unless the relevant costs or data are considered in light of the constraining
resource.
p.31-32 The core idea in the Theory of Constraints (TOC) is that every real system, such as a profit-making
company, must have at least one constraint. If this were not true, then the system would produce an infinite amount
of whatever it strives for; in the case of a constraint in a manufacturing company, it would be infinite profits. Because
a constraint is a factor that limits the company from reaping more profits, then a business manager who wants more
profit must manage constraints. There really is no choice in the matter. Either you manage the constraints
or they manage you. The constraints will determine the throughput of the system whether they are acknowledged
and managed or not; therefore, managing the constraints determines the rate of return on the investment a company
will experience.
The Theory of Constraints simplifies managing a complex environment if the environment can be
optimally managed around a few constraining resources. Instead of managing the dependencies of every event and
every resource to every other event and resource, all resources manage their events around a few constraining resources. The
simplicity of the system is the ability to monitor and leverage a few key points in the operations flow. The clarity gained
from understanding the role of the constraining resource allows a company to see the environment without confusion resulting
from all the noise inherent in any complex system.
It is the noise in the system that stops us from understanding how to create simple solutions
focused around the system leverage points, the limited resources... The beauty of TOC is that it simplifies
a complex environment to the point that it can be understood, aligned, and managed. TOC creates the bridge to focus
and define the criteria for relevant information to evaluate clearly and choose among the best of multiple alternatives.
p.32 1. Identify the weakest link, which is the constraint... 2. ...The weakest link should set
the pace for the entire system... 3. Concentrate improvement efforts on the weakest link... 4. If
the improvement efforts are successful, eventually the weakest link will improve to the point where it is no longer
the weakest link... the new weakest link must be identified
p.33 Unfortunately, because of the way The Goal [by Eli Goldratt] was written, TOC [Theory of Constraints]
was generally pigeon-holed as a "manufacturing thing" relevant only in a job shop that is having difficulty meeting due dates.
This impression is incorrect. TOC is a broad-based management strategy tool that has been successfully applied to
specific situations, such as production scheduling, distribution, project management, and marketing, but, more importantly,
it is a repeatable, proven process to solve chronic problems by surfacing breakthrough solutions.
p.34 The principles laid out in The Goal are simply examples of the application of the TP [Thought
Process] to a particular set of problems generic to the production floor. Using the TP, the Theory of Constraints is no longer
inappropriately confined to the shop floor. The generic TP approach involves building logical trees, which basically are cause-and-effect
diagrams. Starting with observed symptoms of problems, cause-and-effect reasoning is used to deduce underlying causes, or
core problems. Other logical trees are then used to identify and refine solutions and construct step-by-step implementation
plans.
p.41 An organization's unresolved conflicts define the effectiveness of the organization.
p.77 Theory of Constraints is a thinking process that requires people to make logical decisions
based on the current environment using key barometers... the barometer must correctly model the system and reflect the constrained
activities of the organization.
p.90, 92 All non-constraining resources must subordinate to these critical areas; in other words, take actions
to ensure that there is no disruption in the ability to exploit the constraining resource... Measuring subordination is difficult
but is the key to TOC success.
p.93 An organization will ultimately define its success by how well it can resolve conflict.
p.103, 104 The cloud [in TOC terminology] is a logical diagram of conflict designed to force us
to examine our logic around why we are insisting we must take certain actions. Examining the reason why we believe
the action is necessary can cause us to come up with a breakthrough solution to our conflict... The power of the cloud
is self evident, as it allows the group to verbalize the conflict with which they are intimately familiar
because they live it daily. The ability to come up with a solution to what has appeared unsolvable generates instant
buy-in to the process.
p.115 Failing to recognize the effect of the limited resource guarantees that we will often choose alternatives
that are less than optimal and perhaps even detrimental.
p.128 The [Theory of Constraints] cloud is designed to take a reading of the environment
and discover if the action we are proposing is based on sound assumptions.
