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Glossary Supply Chain / Term

theory of constraints (TOC)

Originally developed by Dr. Eliyahu Goldratt and published in his book The Goal, and based on the theory that a system has a single goal, and that systems are composed of multiple linked activities, one of which acts as a constraint on the whole system. It places emphasis on methods to achieve the primary business goal of making money through increasing throughput and reducing inventory and operating expenses, ways to synchronize the production pace of linked activities and ensure continued operation of the system constraint, and the use of thinking processes to identify problems and propose alternatives.

Permanent link theory of constraints (TOC) - Creation date 2021-11-03


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