Theory of Constraints and its Thinking Processes

Introduction

Today, more than ever, change is essential to satisfying expectations. Customers expect higher product and service quality than the price they’re willing to pay to acquire those products and services. More than ever, employees expect security in their jobs. Shareholders expect that today’s investments will yield a higher rate of return over a shorter timeframe. Yet, “to make ends meet,” Management is constantly pressured to keep costs under control.

In light of today's competitive pressures and a rapidly changing environment, to not change is to give way to one’s competitors. Hence, we should understand that to improve means to change. We know that to improve means we must:

• Provide products and services that solve customers’ problems
• Release products and services consistent with market demand
• Reduce variability in our processes
• Have measurements that indicate success relative to achieving our goal
• Reward people for their contribution to change

Rather than reacting to external change, or being subjected to random internal change, many organizations have concluded that a process of on-going improvement is an absolute necessity. For an organization to have a process of on-going improvement, certain basic questions need to be answered faster and more effectively. Those fundamental questions are:

• “What To Change?”
• “To What To Change?”
• “How To Cause The Change?”

This white paper provides an introduction to the Theory of Constraints and its Thinking Processes.