Page 45 - PM Integrated Workbook 2018-19
P. 45
Advanced Costing Methods
6.3 Theory of constraints
Goldratt and Cox describe the process of identifying and taking steps to remove the
constraints that restrict output as the Theory Of Constraints
1 Step 1: Identify the system’s bottlenecks.
2 Step 2: Identify how to exploit the bottlenecks.
3 Step 3: Subordinate everything else to the decision in Step 2.
Step 4: Elevate the system’s bottlenecks.
4
5 Step 5: If, in previous steps, a bottleneck has been broken, go back to
Step 1.
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