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2015 TOCICO International Conference

Transforming Industries Track

Philip Marris
Marris Consulting

How to Identify Constraints in Production and Projects 
September 9, 2015 

In today’s factories and research and development departments, 8 times out of 10, the capacity bottleneck is in the wrong place. And, to make matters worse, the company, often surrendering to wishful thinking, mistakenly believes that it is elsewhere. This is our experience based on the last 10 years of our 30 years experience of TOC in production and projects. 

Many years ago, let’s say prior to 2000, organizations that had accepted the precept of the Theory Of Constraints that their system contained a constraint, tended to have correctly identified them. In our experience this is no longer true of the majority of companies. 

We argue that there are several reasons for this: 

  • The environment is changing faster and faster: new technology, new products … Companies will therefore have a tendency to have an obsolete view of the location of their constraints. Their analysis is out of date. The constraint that they believe they have was the constraint 2 or 3 years ago, but it has moved since then. 
  • Production systems have more and more operations that are considered as "indirect” and therefore are not managed (in the ERP’s routings) as an operation with a predefined time per part using an identified resources with a quantified capacity. This is for instance true of quality control or quality documentation operations that are now significant in work load and widespread in contemporary industry (aeronautical, food, pharmacy, steel, etc.). Unfortunately when the constraint concerns indirect labor the overload on the resources and the accumulation of Work In Progress are likely to go unnoticed. The ERP system will not see them. Unfortunately the performance – the "productivity” – of these operations is rarely monitored correctly by management. So the constraint does not receive the appropriate management attention. 
  • In project environments such as New Product Development (NDP) the data regarding task durations and workloads are necessarily difficult to estimate. In practice they are either very erroneous or simply non-existent; the organization does not even attempt to calculate workloads apart from a very approximate annual budget. This has always been the case but the increasingly significant changes in NPD portfolios are destroying the historical equilibrium. Companies are trying to develop today’s product portfolio with yesterday’s resource pool. Typically in New Product Development we have very regularly found that the new competencies, or the areas in which the amount of work per product has increased very significantly, are understaffed: electronics, regulatory, software development, quality management… 

So, in our experience of over 100 TOC implementations in production and projects these past 10 years, what we find is that management often no longer knows where their real constraints are, and therefore will focus on the wrong resources. So they over utilize their non-bottleneck resources thereby increasing WIP and lead times and they under exploit their bottlenecks which results in limited Throughput. 

We will review several cases to support our point of view: 

  • A case in aeronautical production where quality control was the unrecognized bottleneck.
  • An animal health pharmaceutical company that had not realized the impact of their decision, 3 years previously, to subcontract 50% of their production. As a result all their new product development was blocked just before getting to the market. 
  • A leading steel manufacturer that had not realized that their manual quality control that was repeatedly used all over their plant was their invisible and elusive bottleneck. 
  • The case of a leading automotive equipment manufacturer that disrupted an entire division of its organization by implementing a purchasing decision regarding rare earth metals. 

This situation can be viewed as regrettable. Some may think that these companies were badly managed, but we think that they are in fact the new normal. As we have said, we think this is the case of 8 companies out of 10 today. 

But in our opinion, it means that it is an extraordinary opportunity for 8 companies out of 10. It implies that the majority of organizations can increase their performance very easily and very quickly in both their production and their new product development. All they have to do is correctly implement the first 3 steps of TOC’s 5 focusing steps: identify the constraint, exploit it and subordinate the system to its real constraints. 

PHILIP MARRIS is CEO of Marris Consulting. Marris Consulting is a management consultancy focused on industrial operations. Over 80% of the firm’s projects are based on TOC. He is the author of the French reference book « Le Management Par les Contraintes en gestion industrielle ». He is involved in the "TOC + Lean” movement and founder of the LinkedIn "TLS - TOC Lean & Six Sigma” group. He has designed, sold and executed over 150 transformation projects. He is a member of the board of the TOCICO French regional group and is active in increasing the awareness of TOC in Europe.

He started his TOC journey in 1986 when he joined Creative Output France and had the honor and pleasure of working with Eli Goldratt and Issi Pazgal.

Philip Marris was in charge of Manufacturing Operations in large consulting firms.

He has over 29 years of experience in industry and in consulting. Philip Marris started his career as a production engineer in the steel industry. He is English and is bilingual and bi-cultural. He lives in Paris, France.

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