2. Preface
• Systems dynamic models originated at MIT
• Jay Forrester developed the concept
• Richard Bennett created the first software
• John Sterman wrote the business text
Stock
Flow
3. The Model Before ToC
16,800 once per week
Randnorm(200, 5) per hour
Randnorm(500, 50) per 8-hour shift
10 workers @ 50 units per shiftRandnorm(99, 5) per hour
Randnorm(1, 5) per hour
Randnorm(80, 10) per hour
Randnorm(150, 5) per hour
2,400 once per day
50% of failures per 4 hours
10. The Model After ToC
16,800 once per week
Randnorm(200, 5) per hour
Randnorm(800, 80) per 8-hour shift
16 workers @ 50 units per shiftRandnorm(99, 5) per hour
Randnorm(1, 5) per hour
Randnorm(80, 10) per hour
Randnorm(150, 5) per hour
2,400 once per day
50% of failures per 4 hours
17. In Conclusion
• The Theory of Constraints is as real as 3.1415926535…
• Bottlenecks constrain throughput like a stomach stapling.
• Bottlenecks require a tradeoff.
• Operating Expense for Inventory and Revenue
• Bottlenecks migrate like a moose in rut.
• Keeping tight control over production requires special
tactics and people (Jet Li Six Sigma Black Belt Sensei).