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2015 TOCICO International Conference

Transforming Industries Track


Luna Magpili
LUNA MAGPILI
Associate Professor of
Engineering Management
Washington State University

How the TOC Approach Protects Systems from Harm and Creates Opportunities
September 9, 2015

Summary: TOC has been proven successful in the management of systems, particularly in production, supply chain, and project management. A key element in the success of any of these systems is how it deals with risk. The goal of this paper is to explore the conceptual risk management features of Theory of Constraints (TOC). The paper seeks to examine the key characteristics of TOC that are linked directly to the effective management of risk.

Risk management is the process of understanding and addressing risks to maximize the chances of objectives being achieved. Risk Management follows three basic guiding questions-

  1. What can go wrong and what are their causes and consequences? – In particular, we discuss the application of the TOC Thinking Process in identifying root causes and constraints.
  2. What are the likelihood or chances of occurrence? – Here, we discuss the TOC value of being prepared and paranoid but not be hysterical.
  3. What can be done to detect, control, and manage them? – Examples include TOC buffers and Buffer Management with strong early detection capabilities.

Our approach is to identify the unique processes and mechanisms of the TOC methodologies that directly address these basic questions. Further analysis is done to distinguish the effectiveness and robustness of the TOC method in dealing with risks as compared to other more traditional methods in production, supply chain, and project management. This effort will also highlight the way TOC creates opportunities, or what is known as positive risks, to illustrate the anti-fragile nature of TOC.


LUNA MAGPILI has extensive experience as an industrial engineer and consultant tasked to improve the quality and productivity of various manufacturing and export enterprises. She also served as program officer for International Relief and Development and managed the supply chain and knowledge management involved in relief work across the globe. While at the University of Virginia, her research focused on service systems planning and risk management. She developed methods and tools to aid decision makers plan for infrastructure and capital investments. Dr. Magpili currently serves as panel reviewer to various programs at NSF, NASA, and DoD. She also serves as referee to various journals, such as Risk Analysis, Environmental Science and Technology, and Environmental Monitoring and Assessment. She is currently a member of ASEE, ASEM, INCOSE, and TOCICO.

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