Theory of Constraints Handbook - James Cox Iii [131]
1. The resource centric mindset is still the prevailing viewpoint. This explains why even when TPS is applicable and is adopted, the results are less than what is possible.
2. The specific mechanisms for preventing overproduction—space in the case of Ford’s assembly line and inventory in the case of Ohno’s TPS—are not applicable to all manufacturing environments.
In his article, Goldratt proposes a different and more universal mechanism for preventing overproduction. He proposes the use of time. To prevent overproduction or producing early, one should not make the material available early. Exactly how we determine the time when material should be released and the additional rules for managing flow are described in the following.
Production Operations and the Five Focusing Steps of TOC
In this section, we discuss the application of the core principles of TOC to production operations. As discussed in other chapters, the 5FS provide the rules for determining how any given operation should be managed. These steps (Goldratt, 1990b, Chapter 1) are listed below:
Step 1: Identify (or choose) the system constraint.
Step 2: Decide how to exploit the system constraint.
Step 3: Subordinate all other decisions to the above.
If we desire to improve the performance of the system to a level higher than possible with the current constraint, then we must
Step 4: Elevate the system constraint.
This step can change the constraint or the decisions on how to exploit the constraint. Hence, the need for Step 5.
Step 5: If, in Step 4, the constraint is broken, then go back to Step 1. Don’t let inertia become the constraint.
Production is only a part of most manufacturing business organizations, that is, it is a subsystem. The true constraint of the business may or may not be in the production subsystem of the organization. If the constraint is chosen to be another subsystem or the market, then the role of production in the five-step process is under Step 3—Subordination. In this case, production should be managed by the rules of Simplified Drum-Buffer-Rope (S-DBR) discussed in Chapter 9.
The other possibility is that we choose the constraint to be in the production operation. More specifically, the capacity of a specific work center is chosen to be the constraint. By this choice, the company is making the statement that its business strategy is to make money by finding the best ways to exploit the available capacity at this work center. Clearly identifying the specific resource that will be the constraint (Step 1) and then finding the rules to exploit the capacity of this constrained resource (Step 2) are the key elements of the DBR system for managing production operations.
In this section, we present the DBR system for managing the flow of products in production operations. The scope of decisions that are involved in exploiting the constraint goes far beyond managing the flow of products. For example, the choice of which products to market has a significant impact on the total Throughput potential of the factory. An excellent discussion of this case (referred to in the TOC literature as the PQ example) can be found in The Haystack Syndrome (Goldratt, 1990a, Chapters 11–13) and is also discussed in Chapter 13 of this book. For our purpose, it is assumed that we know what products are being sold and who the customers are. The challenge we are addressing is how best to manage the flow of products so we are able to satisfy this customer demand while keeping inventories and expenses to a minimum.
Characteristics