In today’s world we are always looking for ways to improve what we do. But many time we have improved a step of one of our business processes to find no real gains. Yes that step is more efficient but over all we did not improve the bottom line. Why does this happen? Because we have been improving areas that are not the over all bottlenecks of your company. The bottleneck or constraint paces the whole process and if you are improving any other step but the constraint you will find not improvement in the overall process. You need to work the constraint. A constraint is any resource with less throughput than the demand placed on it. The constraint usually regulate the output of the process. It is the “Beat” of the process.
What we need to do is manage our constraints. If we manage them then we will be making improvements to the critical parts of our processes and thus we will see improvement in the output. Constraint Management helps recognize and manage constraints that are impacting our performance. It provides:
- Increased capacity without needing to make capital investments.
- Flexibility to changing customer demands
- Reduce or eliminate need for buffers/ Work in process (WIP)
- Reduces cost through increased output and improved global efficiency.
- Reduces throughput variability
- It creates global optimization , not local sub-optimization.
There are five basic steps to Constraint Management. They are:
- Identify the constraint – Look at every step of the process and evaluate it’s capacity and throughput in regards to the demand or Takt Time. Look around at the steps of your process, do you see a lot of inventory or a large stack in an inbox, people charging a lot of over time, working late or long hours, taking work home to get it done. This usually indicate a constraint.
- Exploit the constraint – Looking at the required throughput (Demand or Takt Time) adjust buffers (in baskets) and equipment at the constraint to allow maximum throughput. Then rebalance the process to feed just what the constraint needs no more no less.
- Subordinate the constraint – This means reduce production so that all operations only produce the quantity that the constraint can handle. This reduction many times frees up equipment and personnel that can help work the constraint step of the process. Make sure everyone know what the constraint is and what that step can handle.
- Elevate the constraint - Here we do everything possible to keep the constraint step working. This is like making sure the step is running 24 hours a day 7 days a week. Adjust employees breaks and lunch to insure this step is always running. Remove or have someone else do tasks that do not create value but need to be done at this step. Treat the employee at this step like a heart surgeon; everything is close by easy to get and ready for use.. No delays.
- Go back to 1. – You need to go back to step one because if you did you job right on the constraint then you now have a new one to work..
You keep doing this until you have no constraints in the process. How can that be? We can reach that point when the (customer) demand is less than the throughput. You will still have steps that are the slowest but as long as you meet the demand you are ok. By the way those steps still set the pace of the whole process. If you remember that you will help keep cost ( of storing inventory) down. One way to do that is with a “Pull System” which is a good topic for another article.
As always if you have questions or comments please feel free to contact me by leaving a comment below, emailing me, calling me, or leaving a comment on my website.
Bersbach Consulting
Peter Bersbach
Six Sigma Master Black Belt
http://sixsigmatrainingconsulting.com
peter@bersbach.com
1.520.829.0090
I’ve been wondering about the identical factor personally recently. Glad to see another person on the same wavelength! Nice article.
;`. I am really thankful to this topic because it really gives great information *”;