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Theory of Constraints (TOC)
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Theory of Constraints (TOC) is an overall management philosophy introduced by Dr. Eliyahu M. Goldratt in his 1984 book titled The Goal. This book is geared to help organizations continually achieve their goals. The title comes from the contention that any manageable system is limited in achieving more of its goals by a very small number of constraints, and that there is always at least one constraint. The TOC process seeks to identify the constraint and restructure the rest of the organization around it, through the use of Five Focusing Steps. According to TOC principles, an operation is a chain of inter-dependent resources, in which only a few elements - called constraints - control the output of the entire operation. In a study, it was found that companies that followed this theory reduced lead times by 69%, reduced cycle times by 66%, improved due date performance by 60%, reduced inventory levels by 50%, and increased revenue by 68%.

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