Applying Theory of Constraints to Manage Bottlenecks

A bottleneck can be defined as a point of congestion in a system that occurs when workloads arrive at a given point more quickly than that point can handle them, creating a queue a longer overall cycle time in the process line.

The theory of constraints is an important tool for improving process flows. The implications of the theory are far reaching in terms of understanding bottlenecks to a process and better managing these bottlenecks to create an efficient process flow.

The theory of constraints is an important tool for operations managers to manage bottlenecks and improve process flows. Made famous by Eliyahu M. Goldratt in his book The Goal, the implications of the theory are far reaching in terms of understanding bottlenecks to a process and better managing these bottlenecks to create an efficient process flow. Simply put the theory states, “the throughput of any system is determined by one constraint (bottleneck).” Thus to increase the throughput, one must focus on identifying and improving the bottleneck or constraint.

Goldratt in another book, "Theory of Constraints", outlines a five-step process to applying the theory:

1. Identify the process’ constraints
2. Decide how best to exploit the process constraints
3. Subordinate everything else to the above decisions
4. Evaluate the process constraint
5. Remove the constraint and re-evaluate the process

More Information: Six Sigma. http://www.isixsigma.com/methodology/theory-of-constraints/applying-theory-constraints-manage-bottlenecks/

Just In Time

Just in Time application

The basic concept of Just In Time (JIT) in a manufacturing process is to have “the right material, in the exact amount,  at the right place and at the right time”, so the storage of inventories waiting to be processed, which means waste of resources, is avoided. 

JIT practice includes the use of many disciplines as Statistics, Industrial Engineering, Materials and Production Management, Costs and Planning.

The idea is to see the inventories as a way to generate waste and cost, so it should be eliminated as soon as they do not contribute to manufacturing process issues. Also, it should be removed the idea of keeping inventories to hide problems related to the production processes as machines availability and reliability, production process variability and capacity and low flexibility of employees and equipment to switch production conditions.

Main benefits of JIT include the improvement of the flow of goods from warehouse to shelves, the reduction of the set up time,  minimization of storage space and reduction of possibility for inventory breaking/expiring, a more efficient use of employees with multiple skills, a better synchronization of production scheduling with the demand, improvement of supplier and customer relationships, elimination of waste and support for improvement in quality and productivity.

What is Kaizen?

According to Masaaki Imai, who introduced it in his book  "The Key to Japan’s Competitive Success" (1986). Kaizen is the practice of a continuous improvement process inside an organization. 

Today kaizen is recognized worldwide as an important pillar of an organization’s long-term competitive strategy. Kaizen is continuous improvement that is based on certain guiding principles:

• Good processes bring good results

• Go see for yourself to grasp the current situation

• Speak with data, manage by facts

• Take action to contain and correct root causes of problems

• Work as a team

• Kaizen is everybody’s business

• And much more!

One of the most notable features of kaizen is that big results come from many small changes accumulated over time. However this has been misunderstood to mean that kaizen equals small changes. In fact, kaizen means everyone involved in making improvements. While the majority of changes may be small, the greatest impact may be kaizens that are led by senior management as transformational projects, or by cross-functional teams as kaizen events.

Reference: Kaizen Institute.  http://ca.kaizen.com/about-us/definition-of-kaizen.html