Theory of Constraints

Theory of constraints is used as a tool or a method to find the most important constraint that is acting as a limiting factor while achieving the goals and objectives of a business or an individual. In pretext of accounting the theory of constraints is often applied to the manufacturing constraints that result in affecting the manufacturing process of a business. The theory of constraints works on the factor that manufacturing consists of the series of activities and one of these activity is the weakest link of the chain and is acting as a constraint on the other activities as well that results in poor manufacturing performance. The throughput of the entire process is affected by the poor performance of the constraint and the overall performance of the process could be made better if constraint is removed.

There are five steps involved in implementing theory of constraint on a given process. These steps can be explained as follows:-

Identifying the given constraint

Analyzing and fixing the constraint

Synchronizing the constraint with the overall system

Elevating the performance of constraint and entire system

Repeating the entire process

Theory of constraints can be applied to each and every industry and every business in order to boost the performance and to remove the weak links from the overall process. The industries where theory of constraints can be implemented are Health, Manufacturing, Distribution, Education, Defense, Government and Social Services. However the most common use of the theory is in manufacturing unit of a given business.



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