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Theory of constraints

Theory of constraints holds that every system's output is governed by its weakest link — its bottleneck. Improving overall throughput requires identifying and exploiting that constraint before addressing other resources.

ByHoang TruongUpdated

FrameworkTheory of constraints

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Every system has one bottleneck that caps total output. Managing it means five steps in order: identify the constraint, exploit it for maximum output at low cost, subordinate every other resource to its pace, elevate its capacity if still insufficient, then find the new constraint that emerges once the old one is relieved.

Where it fits
SubjectCost AccountingAdvancedTopicStrategic & Lean Cost ManagementAdvanced

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PracticeCORE

A production line has three work centres in sequence. Centre 1 can process 500 units per day, Centre 2 can process 320 units per day, and Centre 3 can process 450 units per day. According to the theory of constraints, which action would most directly increase total daily throughput?

Select an answer to check your understanding.