Bottleneck
Bottleneck: the process resource with the least available capacity, which caps the output of the whole system regardless of how much spare capacity other stages have.
FrameworkTheory of constraints
See it move
A painting booth bottleneck offers 300 minutes a day. Product X needs 5 minutes and earns €30 contribution, or €6 per bottleneck-minute; Product Y needs 3 minutes and earns €15, or €5 per bottleneck-minute. Devoting all 300 minutes to X yields 60 units worth €1,800, versus 100 units of Y worth only €1,500.
The formula
Variables
- Contribution per unit of bottleneck time (€/hour)
- Contribution margin per unit (€)
- Bottleneck time required per unit (hours)
Ranks products by the contribution they earn per unit of the scarce (bottleneck) resource, the basis for product-mix decisions under a binding constraint.
Check yourself
A bakery's ovens are the bottleneck, with 240 oven-minutes available per day. Loaf A needs 8 oven-minutes and earns €3.20 contribution per loaf. Loaf B needs 4 oven-minutes and earns €2.00 contribution per loaf. Which loaf should the bakery prioritise, and how much contribution can it earn per day if it dedicates all oven time to that loaf alone?