Theory of constraints
The theory of constraints focuses improvement on the factor currently restricting the organisation’s goal. A common sequence is identify the constraint, exploit it, subordinate other activities, elevate its capacity and repeat because the constraint can move. It emphasises system-wide flow rather than local efficiency. Resource costs, demand and quality still matter; removing a physical bottleneck is worthwhile only if the resulting benefits justify the change and align with the organisation’s objective.
Worked example
A finishing bottleneck loses an hour each day waiting for material. Ensuring priority supply may improve throughput before buying a second finishing machine.
Common mistake
Do not optimise every department independently or assume producing more at a non-bottleneck creates more saleable output.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | APM | Supporting | September 2026–June 2027 |
| ACCA | PM | Direct | September 2026–June 2027 |