What is TOC?

TOC is the Theory of Constraints. It is a theory to describe how to manage organizations to achieve the goal. The theory asserts that the throughput of an organization is limited by a constraint. A slightly modified version of an evolving definition put forth by the TOC ICO is:

A management philosophy, developed by Dr. Eliyahu M. Goldratt, based on the principle that complex systems exhibit inherent simplicity, i.e., even a very complex system made up of thousands of people and pieces of equipment can have any given time only a very, very small number of variables – perhaps only one (know as a constraint) – that actually limits the ability to generate more of the system’s goal.

Although identified with this name by Dr. Eliyahu Goldratt, the theory has foundations leading back to at least the 14th century as Occam's Razor, "Entities should not be multiplied beyond necessity".

Leonardo da Vinci stated it thus, "Simplicity is the ultimate sophistication."

Isaac Newton made a similar statement, "We are to admit no more causes of natural things than such as are both true and sufficient to explain their appearances."

The basic approach of TOC is to figure out how to maximize the organization goal, usually served by increasing throughput, by deciding:

1. What to change?
2. What to change to?
3. How to cause the change?

Dr. Eliyahu Goldratt proposed five focusing steps as the most basic implementation of TOC:

1. Identify the constraint.
2. Exploit the constraint.
3. Subordinate to the constraint.
4. Elevate the constraint, and
5. Do not let INERTIA prevent you from doing it again.

Thus, TOC provides a strategy for ongoing improvement.