Bragg.steven@gmail.com Stevebragg.com
Not for manufacturing only and based on TOC
Identify bottleneck :
stock pile, too often maintenance, somebody not going vacations or late to all meetings, phisicaly not bottleneck but expensive equipment or highly paid employee
Run the bottleneck all the time :
keep a buffer before it, have quality check before it, stagger lunch breaks, bring next shift earlier to save shift change lost times, identify back up operator in case of absence, schedule maintenance at break times, do not let assigned employee deal with NONESSENTIAL things such as cleaning, meeting,..., keep wages remarkably high, cross train alternative employees, try partly efficient part time assisstants for bottleneck operation, identify bypass routes even they have way low poor efficiencies, place all equipments close by, try outsourcing as long as throughput exceeds outsource cost, try transfer batches before bottleneck operation, if necessary pay extra for rush delivery of a material, go for overtime at bottleneck, if necessary invest for sprint capacity in upstream. If you are spending most of your time for nonessential operations review your prioroties.
Capital Budgeting :
Show the relevancy (effect on throughput) of any capital expenditure request.
Compare incremental increase of throughput vs incremental increase of operating expenses and vs investment.
Prefer multiple low tech machines rather than a fully automated one machine considering in case of breakdown, maintenance, etc.
If necessary consider any investment in upper stream for sprint capacity.
There may be some other requests not related with throughput but you need to rethink about them. For example mitigating risk, legislative regulations, quality improvement,...
Review requests whenever necessary, do not lose time.
Organize a request form with three sections:
relevancy- effect of request on throughput, operating expenses and ROI, requires smaller no of approvals-easy approval
Mitigation- address exact risk explicitly, requires a risk assesment approval
Non bottleneck- state comprehensive explanation, requires max no of approvals-hard approval
Financial Analysis :
In case of short capacity go for max amount of product which has max throughput per bottleneck min.
Compare alternative decisions based on incremental changes of throughput, investment and operating expenses.
Do not include indirect costs as in traditional accounting to cancel products.
Controls :
In traditional accounting usual control points are where there is a potential loss risk. Focused on expenses.
In throughput accounting usual control point is bottleneck. Focused on throughput.
Chart efficiency of bottleneck on a board, downtimes, reasons of stoppage, conformance to plan, scrapping in downstream, bottleneck buffer status, monitor sprint capacity in upstream, WIP work orders, in/out times of key materials.
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