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Theory of constraints -SIOM

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Power point presentation on Theory of Constraints by students of Symbiosis Institute of Operations Management (SIOM), to give you insights to find out bottlenecks and continuous improvements of the process.

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Theory of constraints -SIOM

  1. 1. THEORY OF CONSTRAINTS Sourabh Joshi Sriyans Patwa Sugyan Panda SIOM | Symbiosis Institute Of Operations Management
  2. 2.  Definition  History  Assumption  Steps Involved  Types of Constraints  Applications  Drum Buffer Rope  Pros & Cons SIOM | Symbiosis Institute Of Operations Management
  3. 3. DEFINITIONS:  A constraint is anything that prevents the system from achieving more of its goal.  The theory of constraints (TOC) is a management philosophy that views any manageable system as being limited in achieving more of its goals by a very small number of Constraints. SIOM | Symbiosis Institute Of Operations Management
  4. 4.  Introduced by Eliyahu M. Goldratt in 1984 in his book titled The Goal.  Mr. Goldratt adopted the concept with his book Critical Chain, published in1997.  The concept was extended to TOC with respectively titled publication in 1999.  Also known as Theory of Bottlenecks. SIOM | Symbiosis Institute Of Operations Management
  5. 5. THEORY OF CONSTRAINTS Strengthening Your "Weakest Link"  Significance of bottlenecks  Speed  Improvements wasted SIOM | Symbiosis Institute Of Operations Management
  6. 6. ASSUMPTIONS Organizations can be measured and controlled by variations on three measures: 1. Throughput 2. Operational expense 3. Inventory SIOM | Symbiosis Institute Of Operations Management
  7. 7. STEPS INVOLVED  Identify  Exploit  Subordinate  Elevate  Repeat SIOM | Symbiosis Institute Of Operations Management
  8. 8. Steps involved SIOM | Symbiosis Institute Of Operations Management
  9. 9. TYPES OF CONSTRAINTS: o External constraints.  Material  Market o Internal constraints.  Equipment  People  Policy SIOM | Symbiosis Institute Of Operations Management
  10. 10. SIOM | Symbiosis Institute Of Operations Management
  11. 11. APPLICATIONS IN DIFFERENT AREAS  Finance & Accounting  Throughput Accounting  Throughput = sales – variable cost  Project Management  Critical Chain Project Management(CCPM)  all activities converge to a final deliverable  Marketing and Sales  Sales Process Engineering SIOM | Symbiosis Institute Of Operations Management
  12. 12. DRUM-BUFFER-ROPE SIOM | Symbiosis Institute Of Operations Management
  13. 13. CASE STUDY ON OREGON(OFD)  Problem faced:  High Inventory  High lead time  Make to stock  Solutions:  Find out the constraint  Limited Freezing Space  Exploit the constraint  VFD-variable frequency drives  Subordinate the rest of the organization  Control the flow of Cooked/Dry food Make to stock + make to order SIOM | Symbiosis Institute Of Operations Management
  14. 14. PROS   Increases in productivity with minimal changes to operations  Reduce cycle time  Time from receipt of customer order to shipment  Optimizes inventory  Improves communication between departments  Dramatically reduces the damages caused when the flow of goods is interrupted by shortages and surpluses. SIOM | Symbiosis Institute Of Operations Management
  15. 15. CONS   Variation  Identification  Time Frame SIOM | Symbiosis Institute Of Operations Management
  16. 16. REFERENCES:  Book “The GOAL”  www.google.com  en.wikipedia.org  www.toc.tv  www.mindtools.com  www.isixsigma.com SIOM | Symbiosis Institute Of Operations Management
  17. 17. ANY QUERIES?? SIOM | Symbiosis Institute Of Operations Management

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