Theory of Constraints Handbook - James Cox Iii [693]
The TOC systems approach requires that you first understand the system, its goal, and measurements. Then you can apply the Five Focusing Steps2 (Goldratt, 1992, 307):
1. Identify the constraint(s).
2. Decide how to exploit the constraint(s).
3. Subordinate/synchronize everything else to the constraint(s).
4. If needed, elevate the system’s constraint.
5. If the constraint has been broken, go back to Step one. Do not let inertia become the constraint.
The application of these steps in a situation where the system constraint is physical is usually obvious and straightforward. However, often it is not a physical constraint. The nature of many constraints in organizations is policy constraints. In that case, the Five Focusing Steps break down into three questions (Goldratt, 1990, Chapter 2):
FIGURE 36-3 Money Making Box (Adapted from the “Structured Presentation” 1990, © Avraham Y. Goldratt Institute) Used with permission, Avraham Y. Goldratt Institute, a Limited Partnerhip.
1. What to Change?
2. What to Change to?
3. How to Cause the Change?
The TOC methodology looks at the world through the eyes of cause-and-effect logic and focuses on managing system constraints, interdependencies, and variability.
Discords that can Block the Effective Integration of TOC and Lean Six Sigma (LSS)
There are many synergies between the methodologies. They are all customer focused and want to provide the best value for the customer. Lean and TOC focus on creating a pull system to increase flow through the process and shorten the lead time to market. However, there are several discords between the methodologies that if not handled carefully will diminish the gains the organization can achieve from their improvement efforts.
In the early stages of the “design” of a system, there is a difference in approach between Lean and TOC.
Most Lean designs calculate Takt time, the rate at which you need to produce to meet customer demand, and then attempt to balance resources and equipment to that rate. Capacity in any operation that is greater than the amount needed to satisfy demand is considered waste. Improvement initiatives then focus on how to eliminate the waste in order to “balance” out the capacity and be equal to the demand. Due to variation, most Lean designs today will make sure that the cycle time of each operation is some percentage below Takt time, but the goal for the design of the “ideal” system is to have a balanced line with little or no “excess” or waste. In this “ideal” system, the capacity of each operation in the system would be balanced to support a cycle time just slightly shorter than the Takt time. Note that in this case, every operation in this ideal system could become the system’s constraint if there is any variation in demand, product, or processes.
FIGURE 36-4 Balanced or unbalanced.
The TOC approach believes that there is a constraint in every system, and the constraint dictates the output of the organization. An hour lost on the constraint is an hour lost for the entire organization; thus, we don’t want to “starve” the constraint. A TOC design would have some sprint or protective capacity on non-constraints to ensure that the constraint can be exploited to the fullest extent possible. This “unbalanced” capacity allows all operations to focus on how they are impacting the operations of the constraint and thus how their actions are impacting the Throughput of the total system. Figure 36-4 shows the difference in how a balanced line and unbalanced lines are set up. When integrating TOC and Lean, the correct choice must be made.
If there is no variation, in either process times or demand, a balanced line can work. This is obviously not very likely and Dr. Deming suggests there will always be variation. An unbalanced line enables one to protect Throughput from that variation. Variation anywhere in a balanced line can immediately have a negative effect on the Throughput of the organization. Continued variation at different operations in a balanced line will dictate that you eliminate