Business Operations Essay

Submitted By seunmaduka

Words: 419

Pages: 2

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To: James Bight
From: Samantha Edew
Date: January 16, 2009
Subject: Discussion Question 2

The Theory of Constraints was pioneered over 20 years ago by Eliyahu Goldratt. The theory of constraint uses the cause and effect thinking process to understand the systems (Goldratt, 2004). In the book, Goldratt stress the importance of the role of bottlenecks in a manufacturing process. He highlights that bottlenecks or constraints plays a key role in measuring and controlling process flows. Goldratt proposes “the five-step process of ongoing improvements. “The steps are listed below

1. Identify 2. Exploit 3. Subordinate 4. Elevate, and 5. Go back to Step 1” (Sullivan, 1998).
I strongly believe that efficiency and utilization can be misguided and misused in the production process. . Utilization and efficiency have the tendency to sometimes create unnecessary waste. To avoid it, Goldratt suggests the “three key performance measurements to evaluate: throughput, inventory and operating expense (Goldratt, 2012). Theory of Constraint places emphasis on the use of the three mentioned global operational measures instead of local measures such as efficiency and utilization.
Bottlenecks can be used to support market demand. As an operational consultant to the owner of a factory, I would ensure that bottlenecks are used to support market demands. A process is either bottleneck or non-bottleneck. Bottleneck flow should equal the market demand. To avoid a surplus of good, bottlenecks are necessary. Therefore bottleneck should be used at all times. I will ensure that no hour is lost because bottleneck equals the plant’s throughput so if an hour is lost, it will be lost to the whole system. To increase bottleneck throughput, I will recommend that the organization keeps the machine continuously manned. I will

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