The Theory of Constraints is a process improvement methodology aimed at discovering and improving the least productive stage (constraint) as a way of evolving the entire system.

While a chain will never be stronger than its weakest link, a system of sequential processes will never produce more per unit of time than its least productive step. In other words, just as the weakest link limits the strength of the chain, the least productive process limits the output of the entire value chain.

The Carpentry Example

To illustrate, let's imagine a carpentry shop with a 4-step manufacturing process:

a. the cutting stage can generate enough pieces for 5 tables per day;;

b. the finishing stage results in pieces for 2 tables in the same period;

c. at the assembly stage, 4 tables can be produced daily;

d. and finally, the painting manages to finish 3 tables.

The daily production of this carpentry shop is conditioned by the flow of the most restricted stage, in this case, the finishing of the pieces. Even if the following stages manage to produce 4 and 3 tables respectively, there would be no finished pieces for this (unless accumulated for more than one day).

Following this logic, the Theory of Constraints states that, just like a chain, a system will have one, and only one, weakest stage (link) (the one where the chain breaks). Thinking about carpentry, we have stages that are less productive than others, but only one is less productive than all. And this, as it is the limiting factor of the entire process, is the one that should receive attention first.

If we try to increase the capacity of processes prior to finishing, we will have a greater accumulation of parts. If we act after, we will have more idle capacity. Therefore, neither of the two options improves the situation of the system, and it will be a waste of time to focus on them.

The 5 Steps to Solve Bottlenecks

The Theory of Constraints teaches us how to deal with this in 5 steps:

1. Identify the bottleneck, the limiting step in the process. After all, as we have seen, changing the other steps does not help us at the moment.

2. Exploit the constraint: the bottleneck stage is often not at its maximum possible efficiency. Therefore, we can take actions to increase its performance without extreme actions, with automation or waste reduction, for example.

3. Subject the other stages to the constraint: equalize the production of the other processes to the maximum production of the bottleneck found, thus avoiding congestion and idle capacity. After all, if I have the capacity to produce 5 in a phase, but there are only 2 bottlenecks, then the capacity of the first will be idle at some point, and this is a waste.

4. Raise the bottleneck: if, even so, this stage continues to be the least productive, now we can think about investments such as hiring people or machinery.

5. Prevent inertia from becoming the constraint: once a stage is no longer the bottleneck, another one will be. Time to apply the 5 steps to it.