Throughput Increase Focused Productivity Improvement and Management

OBSERVE AND RECORD - ANALYSE - IDENTIFY OPPORTUNITY TO IMPROVE - REDESIGN - INSTALL - INDUSTRIAL ENGINEERING. PRODUCTS, FACILITIES AND PROCESSES.

#IndustrialEngineering   for   #SocietyProsperity  through #Productivity  #Improvement. 

INTRODUCTION TO MODERN INDUSTRIAL ENGINEERING. 

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Theory of Constraints

Theory of Constraints - Principle, Theory and Bundle of Practices in Productivity Management

https://nraomtr.blogspot.com/2024/09/theory-of-constraints-principle-theory.html

Summary - Book - The Goal - A Process Ongoing Improvement - Eliyahu Goldratt

https://nraomtr.blogspot.com/2024/09/summary-book-goal-process-ongoing.html

Theory of Constraints, a systems framework to help determine:

What to change? What to change to? How to cause the change?

TOC asserts that the goal of a company is to make more (and more) money. 

It describes three methods to achieve this goal:

Increase Throughput (T = Sales Revenue - Totally Variable Costs)

Reduce Inventory (I = investment blocked in the system e.g. receivables, inventory, fixed assets, etc.)

Reduce Operating Expense (OE = fixed costs)

Increasing Throughput is generally far more powerful (and sustainable) to increase money made by a business. To help organizations increase Throughput, he created the Five Focusing Steps in the Process of Ongoing Improvement ( POOGI):

IDENTIFY the system's constraint

EXPLOIT the system's constraint

SUBORDINATE everything else to the above decision

ELEVATE the system’s constraint.

AVOID INERTIA if the constraint has been broken, go back to Step 1.

Ud. 21.3.2026

Pub. 6.9.2024