Optimum production schedule and profit maximisation using the concept: Theory of constraints

R. Sivasubramanian, V. Selladurai, A. Gunasekaran

Research output: Contribution to journalArticlepeer-review

8 Scopus citations

Abstract

The Theory of Constraints (TOC) is an example of a management philosophy built upon a limited number of assumptions and designed to provide a process of continuous ongoing improvement [1]. The assumption forming one foundation of TOC is that a system's outputs are determined by its constraints. The assumptions forming another foundation are new definitions for throughput, inventory and operating expense [2]. These definitions are designed to support the goal of the organisation, which, according to Goldratt, is to make money [3], TOC, previously referred to as Optimized Production Technology (OPT), is a production control methodology that maximises profits in a plant with a demonstrated bottleneck [4]. The process used by TOC to determine product mix that will maximise profitability is a very simple series of steps [5], In this article, a case study from an industry is considered to demonstrate how the application of concepts of TOC will maximise profit for an organisation. This paper further explains how TOC plays a vital role in increasing performance through a limited number of assumptions designed to provide a continuous process of improvement, as emphasised in Total Quality Management (TQM). This paper also shows the steps involved in solving a typical TOC problem along with optimisation of resources for increased demand conditions. This work has been carried out on an IBM/PC compatible system.

Original languageEnglish (US)
Pages (from-to)325-337
Number of pages13
JournalInternational Journal of Manufacturing Technology and Management
Volume5
Issue number4
DOIs
StatePublished - 2003

All Science Journal Classification (ASJC) codes

  • Computer Science Applications
  • Strategy and Management
  • Industrial and Manufacturing Engineering
  • Information Systems and Management
  • Electrical and Electronic Engineering

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