1. SE503 Advanced Project Management
Dr. Ahmed Sameh, Ph.D.
Professor, CS & IS
Theory of Constraints

2. Background “The Goal” – 1992 Synchronous Manufacturing (techniques)
Theory of Constraints (philosophy)
Many books, seminars, etc.
“Critical Chain”

3. TOC Measurements Throughput (maximize quantity shipped)
Inventory (minimize WIP and finished goods)
Operating Expense ( minimize material, labor, overhead)

4. Process Characteristics
Statistical Fluctuations
Dependent Events
Direct flow (A to B)
Common destination (A to C, B to C)
Common source (B from A, C from A) B B A B C A A C

5. TOC Principles Balance flow (synchronize)
Optimize globally, not locally
Dynamically identify bottlenecks
Bottlenecks limit throughput

6. Bottlenecks Bottleneck hour = System hour
Inventories should protect bottlenecks
Let lead time and batch size be variable

7. Identify the Constraint
Capacity or throughput
Percent loading
Queue sizes
Expensive equipment
Could be dynamic

8. Exploit the Constraint
Load to 100%
Large lot sizes
Run through breaks, overtime
High maintenance priority

9. Subordinate the Other Processes
Schedule based on the constraint
Synchronize production to constraint
Small lots
Smooth flow
Inventory only to support constraint

10. Elevate the Constraint
Improve equipment
Reduce statistical variations
Reduce dependencies

11. Repeat the Process New constraint emerges Constraints become external
Suppliers
Customers/sales
Constraints become behavioral/cultural
Padding estimates
Student’s syndrome
Parkinson’s law

12. Example