| Investment (I) |
Investment (I) – all the money the system invests in purchasing things it intends to sell. Investment includes Inventories that are recorded at the purchasing prices (at RM prices, price of components or goods for resale), without added value due to internal processes and without overhead absorption. Return on Investment ( ROI) the TOC Way […] |
| Job Shop |
Job-Shop Production can be looked at as a special case of the I-Flow. It is usually a machine shop that is producing parts for assembly as an internal supplier, or as outsourcing services for assembly plants. The parts are produced according to their own routings (process sheets) and they move around from one machine to […] |
| Logic, checking |
Categories of Legitimate Reservations, CLR In logical reasoning it is important to check each causality connection between two entities to ensure that it is clear and irrefutable. When communicating logic, people tend to check the statements that are made against their internal logic. Many times things just “Do not make sense to us”. TOC suggests […] |
| Logical Diagram U-shape |
A concept of organizing the TOC knowledge in a comprehensive logical diagram of TOC entities that participate in the analysis of the current reality and the construction or usage of the solution to create an improved future reality. The U-shape was established to organize, store and easily retrieve the TOC knowledge. The U-shape is used […] |
| Logical reasoning |
In logical reasoning it is important to check each causality connection between two entities to ensure that it is clear and irrefutable. When communicating logic, people tend to check the statements that are made against their internal logic. Many times things just “Do not make sense to us”. TOC suggests a protocol how to discuss […] |
| Mafia Offer (also Value Offer/Unrefusable Offer) |
It is an exceptionally attractive and hard-to-copy offer a company gives to its potential clients with the view of increasing sales through capitalizing on the operational or any other excellence the company has built. The mafia/value/unrefulsable offer should satisfy the following criteria: It is based on significant improvements in company’s logistical performance; It brings exceptional […] |
| Managerial flows within a system |
Process Flow – the flow of materials or documents that generates the Throughput of the system. Information flow – contains all the relevant data that is flowing from the Process (Throughput) flow to the workforce and to the management the and gives indication about the progress or difficulties of the Process Flow. Decision Flow – […] |
| Market constraint |
Market Constraint – the amount of customers’ orders is not sufficient to sustain the required growth of the system. Constraints are the factors or elements that determine how much the system can accomplish. Types of Constraints: Capacity Constraint Market Constraint Time Constraint Source: Oded Cohen and Jelena Fedurko, Theory of Constraints Fundamentals, 2012 |
| Market Segmentation [the TOC way] |
The market is segmented according to problems and needs of certain groups of clients. The more ‘painful’ the problem and stronger the need, the higher is clients’ perception of the value of the offer that removes the problem and meets the need. The job of Marketing is to raise the perception of the value by […] |
| Marketing [the TOC way] |
The job of Marketing is to raise the perception of the value by the market at lest to the level of the supplier’s perception of the value.The market is segmented according to problems and needs of certain groups of clients. The more ‘painful’ the problem and stronger the need, the higher is clients’ perception of […] |
| MTA – Make-to-Availability |
MTA – make-to-availability is to produce to replenish previously calculated and monitored buffers. This is a TOC solution to handle certain types of MTS. Source: Oded Cohen and Jelena Fedurko, Theory of Constraints Fundamentals, 2012 |
| MTO – Make-to-Order |
A system based on customers’ orders (specific) while accepting response time that includes the production time. Customers place orders for products with quantities and delivery dates. Usually the delivery dates are fixed by policy or by agreement with customer service department. Source: Oded Cohen and Jelena Fedurko, Theory of Constraints Fundamentals, 2012 |
| MTS – Make-to-Stock |
MTS – make-to-stock is to produce just in case, mostly based on forecast of selling most demanded products. It happens when the market is not willing to wait until the order is manufactured and expects to buy “from stock”, hence the production starts without a firm order from a specific customer. There are also situations […] |
| NBR – Negative Branch Reservation |
A logical structure that presents cause and effect relationships explaining how the Injection can lead to a possible negative outcome. The NBR is a tool to check a suggested solution (an Injection) for risks and to find a Supporting Injection that will trim the perceived negative outcome. Source: Oded Cohen and Jelena Fedurko, Theory of […] |
| Negative Branch Reservation – NBR |
A logical structure that presents cause and effect relationships explaining how the Injection can lead to a possible negative outcome. The NBR is a tool to check a suggested solution (an Injection) for risks and to find a Supporting Injection that will trim the perceived negative outcome. Source: Oded Cohen and Jelena Fedurko, Theory of […] |
| No resistance to Change – Basic Assumption no.3 |
There is no resistance to change – people do not embrace change because we have not brought them to see the win for them. People should be handled with respect. Source: Oded Cohen and Jelena Fedurko, Theory of Constraints Fundamentals, 2012 |
| Non-CCR |
There are 3 categories of resources from the point of view of capacity: Bottleneck CCR – Capacity Constraint Resourse Non-CCR Source: Oded Cohen and Jelena Fedurko, Theory of Constraints Fundamentals, 2012 |
| Obstacle |
Something that can significantly hinder or completely block the ability to implement the Injection. Difference between an Obstacle and a Negative Branch Reservation (NBR): Obstacle BLOCKS OUR WAY to implement an Injection, and NBR may appear as a SIDE RESULT of implementing the Injection. Source: Oded Cohen and Jelena Fedurko, Theory of Constraints Fundamentals, 2012 |
| Operating Expenses (OE) |
All the money that the system spends in turning Investment in Throughput. OE are the periodical amount of expenses spent by the organization. These are the expenses that do not vary with a single sale. OE includes all the money that is paid out and cannot be directly associated with a specific product or specific […] |
| Pivot [TOC Pivot] |
TOC Pivot provides the core change from the conventional management to management the TOC way Solutions of Managing the TOC Way stem from the Pivot and bring new elements to reality – Injections and Desired Effects. Source: Oded Cohen and Jelena Fedurko, Theory of Constraints Fundamentals, 2012 |