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TOCICO
2015 TOCICO International Conference

Transforming Industries Track


Amir Schragenheim
AMIR SCHRAGENHEIM
Founder and CEO
Inherent Simplicity

Virtual Buffers – What Are They and What Are They Good For?
September 9, 2015

The virtual buffer concept was developed by me during 2004. It was accepted by the late Dr. Eli Goldratt as the right way to manage MTS environments as it solved the conflict of whether to use stocks or time in order to properly manage stocks. It also enabled managing a hybrid manufacturing environment of MTO & MTS (nowadays referred to as MTA).

The virtual buffer allows more than one view of the same buffer and by that serves the decision making of different managers. For instance, a stock buffer protecting the availability of a specific SKU at a remote warehouse. The manager of the warehouse would see the penetration into the physical available stock of that SKU at the warehouse. At the same time at the feeding warehouse the dispatch manager has to look at the same buffer from a different viewpoint. That manager needs to evaluate whether there is an urgent need to send new supply of that SKU. That decision depends not only on the stock at the remote warehouse, but also on the stock currently in transport to the remote warehouse. Thus, while the buffer at the remote warehouse is Red, the virtual buffer, including the stock in transport, could be Yellow or even Green.

This different view of what is "in the buffer” and what is missing from the buffer, has wider ramifications in the production floor - expanding this concept we can give a different priority to different work orders for the same SKU, each one at a different phase in the production process, thereby enabling for the buffer management to reflect the real priority of each independent work order, allowing in turn for the operators to make the right decisions every time. The same concept can be applied to long transportation lead time environments, in which most of the stock is on the way to the warehouse/consumption point.

This concept can also be applied to high-touch time manufacturing environments, where the physical location of the order in the process has an impact of how the buffer status is calculated, even when based on actual stocks and not on time.


AMIR SCHRAGENHEIM, founder and CEO of Inherent Simplicity - a TOC software company which is part of the Goldratt Group, is active in the TOC community for over 15 years.

Amir has been involved deeply in knowledge developments in TOC and is considered to be one of the world experts in Production, Distribution & Retail for TOC implementations and has been recognized as such by the late Dr. Eli Goldratt himself.

Amir developed several computerized TOC educational and simulation tools along with Eli Schragenheim. Amir participated in analyzing the solution and developed the software for TOC implementations in the healthcare industry including A&E and Operation Theatres. Amir holds an MBA from Tel-Aviv University Magna Cum Laude.

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