Theory Of Constraints Principles Research Articles

Applying the Theory of Constraints Principles to Tourism Supply Chain Management

Tourism supply chain management has become an important research topic as individual firms no longer compete as isolated entities but rather as supply chains in the tourism industry. Despite the evidence that benefits can be gained to improve profitability, competitiveness, and customer satisfaction, the research on how to manage the tourism supply chain is very limited. This research contributes to the literature by applying the theory of constraints (TOC) with systems thinking to tourism supply chain management. It proposes that the key issue in tourism supply chain management is the coordination of business activities and the TOC with systems thinking can effectively support tourism supply chain coordination of the various links and processes. The article examines the TOC performance measures and the drum–buffer–rope model in the context of tourism management and applies the focusing process of the TOC as a continuous improvement approach for tourism supply chain management. The research findings suggest that, given modifications to the TOC terminology and the principles, the TOC principles can work as an excellent approach to facilitate the tourism supply chain management.

Applying the theory of constraints to the logistics service of medical records of a hospital

Management of patient records in a hospital is of major importance, for its impact both on the quality of care and on the associated costs. Since this process is circular, the prevention of the building up of bottlenecks is especially important. Thus, the objective of this paper was to analyze whether the Theory of Constraints (TOC) can be useful to the logistics of medical records in hospitals. The paper is based on a case study conducted about the 2007-2011 period in the Medical Records Logistics Service at the Hospital Universitario Virgen Macarena in Seville (Spain). From April 2008, a set of actions in the clinical record logistics system were implemented based on the application of TOC principles. The results obtained show a significant increase in the level of service and employee productivity, as well as a reduction of cost and the number of patients’ complaints.

Profit optimization in machining service providers using principles of the Theory of Constraints

This paper proposes a method for machining service providers to determine cutting speeds that could maximize their financial returns. This is done based on measures considered by the Theory of Constraints (TOC). It starts by defining the cutting parameters and their relationship to the machining costs. Also, TOC principles are examined in relation to the financial gains obtained as a result of the bottleneck analysis. Next, this paper proposes to combine both sets of concepts in such a way that a relationship between financial gains and cutting speed is established. A graphical solution identifies the cutting speed that maximizes the financial gains for a given part at the bottleneck equipment. Finally, a linear programming approach expands the concept for real-life situations where several different parts are machined at several machining equipments. Hence, this approach could be helpful to machining service providers for maximizing their profitability at the same time they fully utilize their bottleneck equipment, in line with TOC principles.

Revisiting local TOC measures in an internal supply chain: a note

While the global theory of constraints (TOC)-based measures of throughput, inventory and operating expense are well known, the literature on local measures of throughput dollar-days and inventory dollar-days (TDDs/IDDs) is sparse and inconclusive. This paper shows how adherence to these measures naturally puts a non-TOC company on a continuous improvement path by assisting in identification of the constraint and implementation of a drum–buffer–rope (DBR)-like system. Thus, by simulating a small company, this note highlights the relationship between TDD/IDD measures and a DBR system, which further promotes TOC principles. Ultimately, we provide future research avenues into the role these measures can play in the development of a holistic incentive system and the implementation of a DBR-like system across the supply chain network.

Bottleneck Management in Discrete Batch Production

Today, production planning and scheduling becomes very important part of production management because companies have to react to dynamic market conditions and rising customers requirements for shorter delivery times, lower prices and better quality and services. They can use a lot of sophisticated methods and approaches to make their planning processes more efficient and thus meet growing customers requirements. However, using these new approaches is not so easy in all types of production systems. This paper deals with production planning and scheduling in discrete batch production that is just an example of very complicated production system. This type of production process is susceptible to demand fluctuation and facility exceptions and this implies bottleneck shifting. Therefore it is quite difficult to implement methods such as Theory of Constraints (TOC) for production planning improvement in the standard way. One part of this paper is a case study wherecurrent production planning and scheduling in real factory is improved just through the use TOC principles.

Improving Operations Strategy: Application Of TOC Principles In A Small Business

<p class="MsoNormal" style="text-align: justify; margin: 0in 0.5in 0pt; mso-pagination: none;"><span style="font-family: Times New Roman; font-size: x-small;">This paper demonstrates how small business managers can create and sustain competitive advantage by applying basic principles of Theory of Constraints (TOC) using a case study on a small family-owned pizza restaurant. TOC five focusing steps were used to reveal the business constraints and practical recommendations were provided that significantly improved throughput, resource utilization, and customer satisfaction without incurring any significant expenses. TOC performance measures encourage small business managers to find innovative ways of increasing throughput instead of simply cutting costs. Positive outcomes in this study demonstrate how small businesses effectively manage their operations and realize benefits using TOC principles.</span></p>

Peak management

Peaks occur when a firm accustomed to operating under market constraint conditions occasionally encounters peaks in market demand that temporarily exceed the firm's supply capacity. This paper defines the demand peak, classifies peak management (PM) conditions and prescribes a framework for PM. The Theoryof-Constraints (TOC) is expanded to handle the PM concept, introducing the two-policy concept: one policy for peak periods and another for non-peak periods. The paper outlines techniques to elevate the firm's peak performance by loading during the peak period. Distinct pricing policies for peak and offpeak periods are presented and a comprehensive methodology is suggested to deal with the PM problem, including labour policy, outsourcing policy and pricing policy. The paper demonstrates the methodology and techniques in a broad range of real-life management situations. Under TOC principles, the present analysis shows the different decision rules for the two periods and their substantial impact on the firm's overall strategy. Finally, the paper discusses the ramifications of operating under two distinct sets of rules, as well as the rules for making the transitions between an off-peak and a peak period.

A comparative study of line design approaches for serial production systems

Over the past decade two approaches, just‐in‐time (JIT) and theory of constraints (TOC), for designing and operating production lines have developed, each claiming to be the “correct” way. In addition there are still those who maintain that line balanced (whenever possible) is the optimal method. This study uses simulation to compare each of these approaches for designing and operating production lines under various levels of processing time variability, station downtime, and total system inventory. Not surprisingly, the JIT approach appears to work best when system variability is low. The TOC approach works best when system variability is high. This shows that lines designed using TOC principles perform significantly better than JIT lines when inventory is low, and JIT lines perform significantly better than TOC lines as inventory is added to the system. The traditionally balanced line did not perform best under any of the conditions used in this study.

Information technology in operations management: a theory-of-constraints approach

The theory of constraints (TOC) has recently gained much success in its application to industrial and service organizations. This paper applies the TOC principles to the management of information technology (IT) in the organization. The paper creates a four tiered model for the application of the TOC to IT, starting with TOC's throughput-driven business policy; on with the seven step resource management methodology; through the cost/utilization capital investment technique; and concluding with the drum-buffer-rope production activity procedure. We draw a framework and a methodology showing how IT can be more effective using the TOC way of management. In order to systematically explore the location of the organization's constraints we adapt to the TOC a synthesis of three established management frameworks: stakeholder analysis, the value chain and Boston Consulting Group's portfolio analysis model

Competitive factors and performance measurement: Applying the theory of constraints to meet customer needs

This article presents an analysis describing how the selection of proper competitive factors and modification to a firm's performance measurement system provide the means to control, coordinate and communicate product flow, from order receipt to customer shipment, through the production process. The article also discusses how modifications to the traditional manufacturing planning and control model to reflect the principles of the Theory of Constraints (TOC), along with the selection of proper competitive factors provide a means of synchronizing the production process to an ever-more demanding market. A performance measurement system that directs management's attention to the needs of the customers rather than to the internal concerns traditionally measured is advanced. A case study is included that characterizes the operation of an engineer-to-order manufacturing organization. This firm changed its competitive focus and its performance measurement system in response to a erratic sales pattern brought about by an inability to respond to customers requirements in terms of lead time and delivery promises. Using the principles advocated by TOC the organization was able to reduce lead time and improve delivery performance to a point where the operation became a preferred manufacturing location in the corporation. The cost measurement system was changed from a traditional standard cost system to a system utilizing TOC principles. A cost measurement system that measures global costs rather than individual component cost can also be a decisive factor in coordinating sales and manufacturing efforts within an organization. The relationship between these various factors is explored in the case study.

IS Management by Constraints: Coupling IS Effort to Changes in Business Bottlenecks

The Theory of Constraints (TOC) has recently proved successful in focusing industrial and service organizations. This paper applies TOC principles to the Management-of-Information-Systems (MIS) in the organization. Deming's process of on-going improvement (POOGI) manages the update of IS goals to accommodate changes in the business environment. The process includes the definition of goals for IS; definition of performance metrics; process improvement objectives for the short, medium and long term; and the identification of constraints limiting the quality of the current process design. We identify three modes of interaction between TOC and information systems: 1) subordination of MIS to elevate strategic business constraints; 2) focused treatment of constraints on the throughput of the IS unit; and, 3) the development of information systems to support the TOC methodology. We draw a framework and a methodology showing how MIS can be more effective using the TOC way of management. In order to systematically explore the location of the organization's constraints we adapt the Value Chain and Value System models to the identification of organizational constraints.