{"id":7459,"date":"2021-02-09T08:27:58","date_gmt":"2021-02-09T08:27:58","guid":{"rendered":"https:\/\/www.mrpeasy.com\/blog\/?p=7459"},"modified":"2023-06-14T07:05:44","modified_gmt":"2023-06-14T07:05:44","slug":"theory-of-constraints","status":"publish","type":"post","link":"https:\/\/www.mrpeasy.com\/blog\/theory-of-constraints\/","title":{"rendered":"How to Use the Theory of Constraints?"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">The Theory of Constraints is a method of process improvement\nthat can be applied to manufacturing, supply chain, marketing, sales, finance,\nor any other area of business. This guide will give you the basic toolkits to\nget started with TOC.<\/p>\n\n\n\n<figure class=\"wp-block-image\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"562\" src=\"https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2021\/02\/theory-of-constraints-1024x562.jpg\" alt=\"theory-of-constraints\" class=\"wp-image-7460\" srcset=\"https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2021\/02\/theory-of-constraints-1024x562.jpg 1024w, https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2021\/02\/theory-of-constraints-300x165.jpg 300w, https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2021\/02\/theory-of-constraints-768x421.jpg 768w, https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2021\/02\/theory-of-constraints.jpg 1502w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<!--more-->\n\n\n\n<p class=\"wp-block-paragraph\"><em>You can also listen to this article:<\/em><\/p>\n\n\n\n<iframe loading=\"lazy\" title=\"How to Use the Theory of Constraints?\" allowtransparency=\"true\" height=\"150\" width=\"100%\" style=\"border: none; min-width: min(100%, 430px);\" scrolling=\"no\" data-name=\"pb-iframe-player\" src=\"https:\/\/www.podbean.com\/player-v2\/?i=3dyuu-fc7d08-pb&amp;from=pb6admin&amp;download=1&amp;share=1&amp;download=1&amp;rtl=0&amp;fonts=Arial&amp;skin=1&amp;btn-skin=3\"><\/iframe>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_84 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #343333;color:#343333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #343333;color:#343333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.mrpeasy.com\/blog\/theory-of-constraints\/#What_is_the_Theory_of_Constraints\" >What is the Theory of Constraints?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.mrpeasy.com\/blog\/theory-of-constraints\/#What_is_a_constraint\" >What is a constraint?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.mrpeasy.com\/blog\/theory-of-constraints\/#The_Five_Focusing_Steps_in_the_Theory_of_Constraints\" >The Five Focusing Steps in the Theory of Constraints<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.mrpeasy.com\/blog\/theory-of-constraints\/#The_Theory_of_Constraints_Thinking_Processes\" >The Theory of Constraints Thinking Processes<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.mrpeasy.com\/blog\/theory-of-constraints\/#1_What_needs_to_change\" >1. What needs to change?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/www.mrpeasy.com\/blog\/theory-of-constraints\/#2_What_it_needs_to_change_to\" >2. What it needs to change to?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/www.mrpeasy.com\/blog\/theory-of-constraints\/#3_How_to_bring_on_the_change\" >3. How to bring on the change?<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/www.mrpeasy.com\/blog\/theory-of-constraints\/#Using_the_Theory_of_Constraints_with_an_ERP_system\" >Using the Theory of Constraints with an ERP system<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/www.mrpeasy.com\/blog\/theory-of-constraints\/#Key_takeaways\" >Key takeaways<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_the_Theory_of_Constraints\"><\/span>What is the Theory of Constraints?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The Theory of Constraints is a management philosophy aimed\nat continually improving business processes and helping organizations meet\ntheir goals.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Eliyahu M. Goldratt, the creator of the theory, has called\nit \u201ca thinking process that enables people to invent simple solutions to\nseemingly complex problems\u201d.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The base stipulation in the Theory of Constraints is that every system or process has a constraint that can be regarded as the most important limiting factor in the system. The Theory of Constraints itself is a method of identifying said constraint and improving it until it is no longer the biggest hindrance in the process.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In simple terms, the TOC concentrates on identifying the weakest link in the process and making it stronger.<\/p>\n\n\n<div class=\"banner-v2\">\n    <p class=\"banner-v2__desc\">Improve your manufacturing efficiency with MRPeasy<\/p>\n    <a class=\"banner-v2__link\" href=\"https:\/\/www.mrpeasy.com\/sign-up\/\" target=\"_blank\" data-ga-event=\"blog_signup_banner_blue\">Try for free<\/a>\n<\/div>\t\t<style>.banner-v2 {\n    float: right;\n    display: flex;\n    flex-direction: column;\n    justify-content: center;\n    align-items: center;\n    padding: 40px 32px;\n    gap: 16px;\n    width: 356px;\n    height: 205px;\n    background: linear-gradient(199.68deg, #6084E5 13.17%, #5FA7DD 82.1%);\n    border-radius: 4px;\n    margin-left: 12px;\n    margin-bottom: 12px;\n    margin-top: 15px;\n}\n\n@media (max-width: 767.98px) {\n    .banner-v2 {\n         width: 100%;\n         height: 173px;\n         margin-bottom: 0;\n         margin-left: 0;\n    }\n}\n\n.single__content p.banner-v2__desc {\n    margin: 0 !important;\n}\n\np.banner-v2__desc {\n    width: 292px;\n    font-style: normal;\n    font-weight: 700;\n    font-size: 22px;\n    line-height: 29px !important;\n    text-align: center;\n    color: #FFFFFF;\n    margin: 0 !important;\n    order: 0 !important;\n}\n\n.single__content a.banner-v2__link {\n    color: #FFFFFF !important;\n}\n\n.single__content a.banner-v2__link:hover {\n    color: #003557 !important;\n}\n\na.banner-v2__link {\n    display: flex;\n    justify-content: center;\n    align-items: center;\n    width: 181px;\n    height: 51px;\n    padding: 18px 0;\n    border-radius: 4px;\n    background: #003557;\n    font-weight: 700;\n    font-size: 16px;\n    color: #FFFFFF !important;\n    text-decoration: none !important;\n    order: 1 !important;\n}\n\n.banner-v2__link:hover {\n    background: white;\n    color: #003557 !important;\n}<\/style>\n\t\t\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_a_constraint\"><\/span>What is a constraint?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">A constraint could be anything that impedes a process.\nAccording to the Theory of Constraints, however, there is usually only one (and\nnever more than a few) major constraint in any given system.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In manufacturing, constraints are often referred to as bottlenecks. These may occur in the production process, but also in <a href=\"https:\/\/www.mrpeasy.com\/blog\/procurement-management\/\" target=\"_blank\" rel=\"noreferrer noopener\">procurement<\/a>, sales, marketing, etc.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Constraints can be divided into two:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Internal constraints<\/strong> manifest as an inability to fully respond to market demand, i.e. not being able to produce as much as to meet customers\u2019 needs. Internal constraints can be related to equipment (e.g. when operating practices are sub-par, or when machinery is outdated or ill-maintained); people (lack of skilled people or lack of motivation); or policy (rules in the company that prevent maximum output, e.g. a \u201cno overtime\u201d policy).<\/li><li><strong>External constraints<\/strong> are related to insufficient demand for the produced goods in the marketplace or insufficient supply of the materials required to produce the goods. As such, they can often be alleviated by improving marketing or sales, or by finding better suppliers.<\/li><\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">A company may experience many problems, internal and external, but according to the Theory of Constraints, they should be solved in a highly focused manner, prioritizing constraints one at a time. If the throughput of a constraint is improved up to a point where it is no longer the most pressing one in the system, the constraint has been \u201cbroken\u201d.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><em>Also read about <a href=\"https:\/\/www.mrpeasy.com\/blog\/throughput-time\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"Throughput Time (opens in a new tab)\">Throughput Time<\/a>.<\/em><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"The_Five_Focusing_Steps_in_the_Theory_of_Constraints\"><\/span>The Five Focusing Steps in the Theory of Constraints<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The Five Focusing Steps is the methodology the Theory of\nConstraints provides to identify and improve internal physical constraints. The\nsteps are:<\/p>\n\n\n\n<ol class=\"wp-block-list\"><li><strong>Identify<\/strong> the constraint. Make sure to choose the weakest link in the organization because if you strengthen any other part of your business, the weakest link will negate most progress made elsewhere.<\/li><li><strong>Exploit<\/strong> existing resources to improve upon the constraint. Learn to maximize the utilization and productivity of the constraint. Operate the constraint 24\/7 with a full staff. Perform regular maintenance. Train the constraint operators. Measure the constraint\u2019s <a aria-label=\"Overall Equipment Effectiveness (OEE) (opens in a new tab)\" href=\"https:\/\/www.mrpeasy.com\/blog\/overall-equipment-effectiveness\/\" target=\"_blank\" rel=\"noreferrer noopener\">Overall Equipment Effectiveness (OEE)<\/a> to find out the reasons for inefficiencies if they are not apparent at first. Do not just buy more of the constraint in lieu of trying to make it as efficient as possible.<\/li><li><strong>Subordinate<\/strong> all other processes to support the constraint. This means avoiding overloading the constraint, slowing down other processes if necessary. If other processes produce more than what the constraint can handle, the results can be excess <a href=\"https:\/\/www.mrpeasy.com\/blog\/work-in-process-inventory-accounting\/\" target=\"_blank\" rel=\"noreferrer noopener\">WIP inventory<\/a>, longer than usual lead times, and frequent firefighting. In addition, you will have to make sure to never deprive the constraint of activity. Maintain a certain level of <a aria-label=\"safety stock (opens in a new tab)\" href=\"https:\/\/www.mrpeasy.com\/blog\/safety-stock\/\" target=\"_blank\" rel=\"noreferrer noopener\">safety stock<\/a> to make sure that the constraint gets quality inputs at all times. It is also very important to train your employees according to the new focus on eliminating the constraint.<\/li><li><strong>Elevate<\/strong> the constraint by bringing in more resources to support it. If you have maximized the capacity of the constraint, you can start investing in additional support \u2013 equipment, human resources, space, etc. This step should never be taken as a first measure unless you find that the cause of the constraint is related to insufficient resources allocated to the process.<\/li><li><strong>Repeat<\/strong> the process to ensure continuous improvement in your processes. If you elevate a constraint up to a point where it is no longer the weakest link, move back to the first step and find a new constraint to improve.<\/li><\/ol>\n\n\n\n<p class=\"wp-block-paragraph\">If you follow these five steps, you are bound to find and\nalleviate your constraints. You do not have to worry about identifying a wrong\nconstraint as the Five Focusing Steps auto-correct the errors quite quickly.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"The_Theory_of_Constraints_Thinking_Processes\"><\/span>The Theory of Constraints Thinking Processes<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The TOC Thinking Processes, also called TP Tools, are\nprocess improvement devices used mostly in the case of non-physical constraints.\nThese tools can be applied, for example, to sales, marketing, and finance \u2013 but\nthey can also be used as a personal growth toolkit.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">You can also use the Thinking Processes to resolve internal policy constraints and to motivate the workforce, or bring it in as a supplement to The Five Focusing Steps when resolving issues related to production, inventory, or supply chain processes.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The essential questions the Thinking Processes aim to give\nanswers to are:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>What needs to change?<\/li><li>What it needs to change to?<\/li><li>How to bring on the change?<\/li><\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">The central premise of the Thinking Processes is that all\nissues arise from a core problem. That means issues are often merely symptoms\nof a larger, more deeply rooted problem.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">To effectively utilize the Thinking Processes, they are implemented in a group. This prevents any one person from imposing their personal view of what the constraint or the UDEs are and allows the organization as a whole to work through the individual \u201clayers of resistance\u201d, and get the bigger, more objective picture of the problem.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The questions are approached by creating a <a href=\"https:\/\/asq.org\/quality-resources\/tree-diagram\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"\u201ctree diagram\u201d (opens in a new tab)\">\u201ctree diagram\u201d<\/a> out of the symptoms (Undesirable Effects or UDEs), desired effects, new ideas (also called Injections in the TOC literature) concerns, conditions, tactics, and strategies. These trees are related to the essential questions mentioned above.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"1_What_needs_to_change\"><\/span>1. What needs to change?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>The Current Reality\nTree (CRT)<\/strong> maps out all the cause-effect relations between the Undesirable\nEffects (UDEs) and helps identify the core problem.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"2_What_it_needs_to_change_to\"><\/span>2. What it needs to change to?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">The following additions to the tree diagram deal with\nprojecting the Desirable Effects, Injections, possible outcomes, and conditions\nthat need to be met.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>The Future Reality\nTree <\/strong>shows the ideal state of the processes. It takes the Current Reality\nTree and adds Injections (or new ideas to be implemented) that should lead to\nbetter outcomes (Desirable Effects).<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>The Negative Branch\nReservations <\/strong>map out concerns anyone might have regarding the outcomes of\nthe Injections. This phase basically deals with the question \u201cWhat could be the\nlarger implications of a change?\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Evaporating Cloud\nTree <\/strong>is used to iron out conflicts that may arise due to making changes. It\ndiagrams the logic behind them in the following basic way:<\/p>\n\n\n\n<figure class=\"wp-block-image\"><a href=\"https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2021\/02\/theory-of-constraints-evaporating-cloud.png\" target=\"_blank\" rel=\"noreferrer noopener\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"484\" src=\"https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2021\/02\/theory-of-constraints-evaporating-cloud-e1612857374856-1024x484.png\" alt=\"theory-of-constraints-evaporating-cloud\" class=\"wp-image-7471\" srcset=\"https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2021\/02\/theory-of-constraints-evaporating-cloud-e1612857374856-1024x484.png 1024w, https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2021\/02\/theory-of-constraints-evaporating-cloud-e1612857374856-300x142.png 300w, https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2021\/02\/theory-of-constraints-evaporating-cloud-e1612857374856-768x363.png 768w, https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2021\/02\/theory-of-constraints-evaporating-cloud-e1612857374856.png 1920w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/a><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">The A in the diagram represents a common objective, the blue B and C boxes are requirements for achieving the objective, and the D and D\u2019 represent opposing prerequisites. So the basic formula says that in order to achieve A, either B or C is necessary, but B cannot be achieved with D\u2019, and C cannot be achieved with D.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"3_How_to_bring_on_the_change\"><\/span>3. How to bring on the change?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>The Strategy and\nTactics Tree <\/strong>maps out all the smaller objectives needed to be achieved\nbefore the larger goal can be reached. It gives a detailed description of the\naction plan that needs to be followed and sets up metrics that allow the team\nto measure their progress.<\/p>\n\n\n<div class=\"banner-v1\">\n    <div class=\"banner__text\">\n        <div class=\"banner-v1__title\">Easily identify and eliminate constraints<\/div>\n        <div class=\"banner-v1__desc\">MRPeasy users report a 54% average improvement in the overall performance of their manufacturing company.<\/div>\n        <div><a class=\"banner-v1__link\" href=\"https:\/\/www.mrpeasy.com\/sign-up\/\" target=\"_blank\" data-ga-event=\"blog_signup_banner_white\">Try for free<\/a><\/div>\n    <\/div>\n    <div class=\"banner__img\">\n        <img decoding=\"async\" src=\"https:\/\/www.mrpeasy.com\/blog\/wp-content\/themes\/mrpeasy\/assets\/images\/banner.svg\" alt=\"banner\">\n    <\/div>\n<\/div>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Using_the_Theory_of_Constraints_with_an_ERP_system\"><\/span>Using the Theory of Constraints with an ERP system<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Even though the two have been seen as alternatives to one another, using the Theory of Constraints in conjunction with an <a href=\"https:\/\/www.mrpeasy.com\/enterprise-resource-planning\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"ERP system (opens in a new tab)\">ERP system<\/a> has some great advantages:<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">1. An ERP system provides you with information about how\nyour resources are performing, making identifying a constraint a much easier\nprocess.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">By using shop-floor reporting data, the system can\nautomatically calculate OEE and TEEP (Total Effective Equipment Performance)\nand other metrics.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">2. In the process of lifting the constraint, the real-time\ndata collecting capability of an ERP system can be used to get an accurate\nindication of how well the system works after making changes.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">You do not need to wait for the end of a week or month to get\nreports, as soon as data comes in from the shop-floor, reports are updated and\nhistorical trends can be observed.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">3. But most importantly, an ERP software provides both a\nhigh-level overview of the business in general, but also makes the current\nsituation more transparent, which already helps a user to notice, communicate,\nand remove many of the constraints naturally.<\/p>\n\n\n\n<figure class=\"wp-block-image\"><a href=\"https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2021\/02\/theory-of-constraints-oee.png\" target=\"_blank\" rel=\"noreferrer noopener\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"479\" src=\"https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2021\/02\/theory-of-constraints-oee-1024x479.png\" alt=\"theory-of-constraints-oee\" class=\"wp-image-7467\" srcset=\"https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2021\/02\/theory-of-constraints-oee-1024x479.png 1024w, https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2021\/02\/theory-of-constraints-oee-300x140.png 300w, https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2021\/02\/theory-of-constraints-oee-768x359.png 768w, https:\/\/www.mrpeasy.com\/blog\/wp-content\/uploads\/2021\/02\/theory-of-constraints-oee.png 1355w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/a><figcaption><strong>An ERP system calculates the Overall Equipment Effectiveness automatically, allowing you to identify constraints more easily.<\/strong><\/figcaption><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">The system provides means to communicate\nwith co-workers, leave important notes, document procedures, provide updated\ninstructions at all times, and guide processes in a better way. All in all,\nthis makes the organization more nimble when it comes to change management.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Key_takeaways\"><\/span>Key takeaways<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul class=\"wp-block-list\"><li>The Theory of Constraints is a collection of\nmethods that is used to eliminate obstructions from systems and processes. Even\nthough it was originally developed for the manufacturing industry, the TOC has\nbeen applied to everything from inventory management to finances to personal\ngrowth.<\/li><li>A constraint can be anything that impedes a\nprocess, but according to the TOC, only one constraint exists at any given time\n\u2013 this is the weakest link in the system. In manufacturing, constraints are\ncalled bottlenecks. These can be found in the production process, but also\nanywhere else in the business.<\/li><li>Constraints can be eliminated by using the Five\nFocusing Steps and the Thinking Processes methodologies. While the Five\nFocusing Steps is mostly used in order to eliminate internal physical\nconstraints, and the Thinking Processes is used to alleviate non-physical\nconstraints, the two approaches can also be used together.<\/li><li>The beneficial effects of implementing the TOC\ncan be incrementally expanded when used in conjunction with an ERP system.<\/li><\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Sources: <\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Eliyahu M. Goldratt and Jeff\nCox.&nbsp;<em>The Goal: A Process of Ongoing Improvement<\/em>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Eliyahu M. Goldratt.&nbsp;<em>What Is This Thing Called Theory of Constraints and How Should It Be Implemented<\/em>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><em>You may also like: <\/em><a rel=\"noreferrer noopener\" aria-label=\"Statistical Process Control - A Manufacturer's Guide (opens in a new tab)\" href=\"https:\/\/www.mrpeasy.com\/blog\/statistical-process-control\/\" target=\"_blank\"><em>Statistical Process Control &#8211; A Manufacturer&#8217;s Guide<\/em><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Theory of Constraints is a method of process improvement that can be applied to manufacturing, supply chain, marketing, sales, finance, or any other area of business. This guide will give you the basic toolkits to get started with TOC.<\/p>\n","protected":false},"author":7,"featured_media":7460,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[44,94],"tags":[253,210,317,66,254,490,5,488,498,499],"class_list":["post-7459","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-erp","category-tips","tag-business-process-management","tag-internal-processes","tag-managing-quality","tag-mrpeasy","tag-process-management","tag-process-monitoring","tag-production-process","tag-quality-assurance","tag-theory-of-constraints","tag-throughput"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.8 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>How to Use the Theory of Constraints? - MRPeasy<\/title>\n<meta name=\"description\" content=\"The Theory of Constraints is a method of process improvement that can be applied to manufacturing, supply chain, sales, or any other area of business.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.mrpeasy.com\/blog\/theory-of-constraints\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"How to Use the Theory of Constraints? 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