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Theory of Constraints Articles

Theory of Constraints Articles

Here are the links to page 23 – 4 – 5

A month ago, I wrote about how the Covid-19 crisis is making constraints blindingly obvious. These constraints limit the performance of a business but even when the crisis quietens down, constraints in your business will still exist. They will just go back into the shadows.

For 30 years I’ve believed that the Theory of Constraints (TOC) processes are very effective ways for a business to make substantial improvements.

So what does TOC have to say about the Covid-19 crisis?

I’d been planning to expand on this myself but then I found these videos on YouTube on the TOCExperts channel. I should warn you that they are all over an hour long but you have the opportunity to start learning how to apply TOC thinking to your business.

Video 1

This is what’s covered

Video 2 – Thinking About The Future

There are a few technical issues at the start of this video so you might want to jump to the 4 minute mark.

Video 3 – Post Covid-19 Scenarios and What You Can Learn From Them

I hope you find these helpful.

Books On The Theory of Constraints

If you’d like to know more about the Theory of Constraints, I recommend the following books as good places to start.

The Goal by Eliyahu Goldratt and Jeff Cox – This brilliant novel is where it all about as TOC is applied to a struggling manufacturing business.Goldratt has written other business novels that look at the TOC Thinking Processes (It’s Not Luck), project management (Critical Chain) and the retail industry (Isn’t It Obvious) but I feel The Goal is the place to start.

Forget the Urgent! by Matías Birrell and Javier Arévalo –

Absolute Certainty by John Haylock – This time the business novel is applied to an accountancy practice after learning TOC ideas from a web designer client.

 

in Business Problems And Mistakes, The Next Economic Crash

Viable Vision by Gerald Kendall

The full title of this book by Gerald Kendall is

Viable Vision: Transforming Total Sales into Net Profits

In my review posted on Amazon.co.uk, I gave the book 4 Stars. This means it is Good and Well Worth Reading.

Here is my review.

A revolution in your business

This is a manifesto for a revolution in your business using the full combination of thinking from Eliyahu Goldratt and his theory of Constraints.

Inevitably this presents a high level view of the ideas focusing in the what to do much more than how to do it. [continue reading…]

in Best Business Books

In my review of the book

The Logical Thinking Process: An Executive Summary by H William Dettmer

posted on Amazon.co.uk, I gave it 4 Stars. This means that it is Good and Well Worth Reading.

Notice “An Executive Summary” in the title. This is very much an introduction to a topic brilliantly covered by the author’s much more extensive book, also called The Logical Thinking Process.

At the bottom of the page is a video by the author, explaining the differences between his process and that originally developed by Eli Goldratt.

Here is my book review.

Very useful overview of Goldratt’s thinking processes

The author has written an excellent book explaining how to use the Theory of Constraints Thinking Processes. However, if you learn a little, you can easily get scared off by the strange terminology in the original thinking like Evaporating Clouds and Current Reality Trees. [continue reading…]

in 2 – Your Inner Game, Best Business Books, Business Problems And Mistakes

I am a big fan of the Theory of Constraints (TOC) and how it can be applied throughout a business to improve results.

It started on the factory floor with the challenge of how jobs could be better scheduled to reduce lead times AND inventory levels. It has moved throughout the business. In the business novel It’s Not Luck, Eliyahu Goldratt introduced us to both TOC for marketing and the TOC thinking processes.

The person who has made most progress with TOC Marketing is Dr Lisa Lang and her work on Mafia Offers (those customers can’t afford to refuse). [continue reading…]

in 4 – Lead Generation, Business Problems And Mistakes

The full title of this book by H William Dettmer is

The Logical Thinking Process: A Systems Approach to Complex Problem Solving“.

In my review at Amazon.co.uk, I rate the book at the FIVE Stars level, this means that I consider it to be excellent.

Here is what I posted.

A clear explanation of TOC Thinking Processes

On the one hand, the Theory of Constraints Thinking Processes can be powerful tools for investigating the current situation and identifying vital ways to improve the system in ways to meet the goal. On the other hand, they can be daunting to prepare and/or to understand because of the acronyms, unusual terminology and complexity of both the diagrams and their underlying rules. [continue reading…]

in 2 – Your Inner Game, Best Business Books, Business Problems And Mistakes

The Theory Of Constraints For Small Businesses

The Theory of Constraints (TOC), as originally developed by Eliyahu Goldratt and introduced to the world in the business novel “The Goal“, has produced some remarkable successes in big companies, showing huge improvements in the three main measurements:

  1. More Throughput (T) – this is effectively increasing sales less the direct cost of sales without any questionable apportionment of shared costs.
  2. Lower Operating Expenses (OE) – reducing the other costs of the business.
  3. Lower Inventory and Investments (I) – reducing the money tied up in the business whilst also improving due date performance and cutting lead times.

This has been achieved by focusing improvement efforts on the main constraint or the weakest link in the chain. Quite simply, this is where you can get the biggest bang for your buck.

Just to be clear, a constraint is something that stops you from reaching your goal. For example, consistent customer service problems may stop a business from reaching its goal to increase profit. [continue reading…]

in Business Problems And Mistakes

There isn’t an extended title with this book, it’s just

The Choice

written by Eli Goldratt and his daughter.

In my review at Amazon.co.uk, I rated this as a FIVE stars book, which means I think it is excellent.

Here is what I posted.

The most important Goldratt book? A look at the importance of inherent simplicity

I was reading the transcript of an interview with Eli Goldratt, the main author behind the Theory of Constraints and he described this as his most important book.

More important that The Goal?Before I read The Choice, I was sceptical but now I have read it, I can understand why Goldratt said it. [continue reading…]

in 2 – Your Inner Game, Best Business Books

In my review of

Late Night Discussions on the Theory of Constraints

by Eliyahu Goldratt posted on Amazon.co.uk, I gave the book Three Stars, meaning Worthwhile.

Here is my book review.

Not The Place To Start Your Theory Of Constraints Experience

This is a series of conversations between two of the stars of The Goal, Alex, the plant manager and Jonah, the mysterious business guru. [continue reading…]

in Other Business Books

Isn’t It Obvious? By Eliyahu Goldratt

The full title of the book written by Eliyahu Goldratt and with Ilan Eshkoli and Joe Brownleer is

Isn’t It Obvious?: A Business Novel on Retailing Using the Theory of Constraints“.

In my review at Amazon.co.uk, I rated the book at the FOUR Stars level which means I think it is good to very good.

Here is what I wrote.

TOC in a retail setting with wider lessons

This is another business novel explaining the ideas behind the Theory Of Constraints. To make it a snappier read, Eli Goldratt worked with screenwriters who were well used to regularly revising their work.

It is based on a retail business in home textiles in the US. I can’t remember the exact numbers but there are about 100 stores organised into about 10 regions. [continue reading…]

in Best Business Books

Six Lessons by Clarke Ching

The full title of this book by Clarke Ching is

Six Lessons: My Sixty-Minute Masterclass with Eli Goldratt

In my review posted on Amazon.co.uk, I gave the book Three Stars, meaning Worthwhile.

Here is my book review.

Interesting interview

This is a transcript of an interview with Eliyahu Goldratt, drawing out lessons from “Isn’t It Obvious” which looked at retailing.

Inevitably given the format, it is a bit of a clunky read in places. People don’t tend to talk in as structured a way as they write. It starts by highlighting three lessons from the book and then goes on to find another three. [continue reading…]

in Other Business Books