“In isolation yes, in combination no” is a key concept in Theory of Constraints.
Consider the ten machine manufacturing process in the schematic below. Each machine had a team of manufacturing engineers managing their design and development. All ten teams hit their performance target: 50 units per hour and 98% availability. A separate team of plant engineers developed the plant layout. Their objective was to minimize work-in-process inventory. By carefully arranging the ten machines, they achieved perfect single-piece flow.
Before the new manufacturing process went into production, the teams briefed senior management on the status of the project. Everyone had met or exceeded their objectives. Waste had been minimized. All the lean metrics looked great. Optimism for a successful launch was very high, and why not?
When the new manufacturing process was launched, production was only 42 units per hour not the 49 units per hour that was expected. If everyone met or exceeded their objectives, what went wrong?
The interactions between the machines were not considered. When Machine #6 is down, Machines #1 through #5 are immediately blocked and Machines #7 through #10 are immediately starved. In isolation, each machine could produce 49 units per hour. In combination, they could not.
Theory of Constraints
This manufacturing puzzle can be solved by inspection. Now replace the ten machines with manufacturing departments and functional organizations (marketing, sales, scheduling, purchasing, manufacturing, distribution, customer support, etc). No longer are interactions (blocks and starves) easily observed. In fact, they are likely going unnoticed as the multiple activities work hard to improve their local metrics. This is the first lesson in Theory of Constraints: In isolation yes, in combination no.
And that’s the Theory of Constraints opportunity. Think of your business not as individual silos but as a dependent system…the connections matter!
Availability = percentage of time ready to work
Blocked = waiting with nowhere for completed work to go
Starved = waiting for work from the previous activity
Seven Wastes =
- Over-production (making more than customer demand)
- Motion (human or machine)
- Waiting (human or machine)
- Over-processing (making features not valued by the customer)
- Inventory (raw materials or finished goods)
- Correction (scrap and rework)