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Theory of Constraints

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As my first post, I would like to start on a topic which is of immense interest to me. This is the Theory of Constraints (TOC) which was originated by E. M. Goldratt. TOC is in simple terms, the focused or lazy man's style of doing operations.

When I mean lazy, I borrow from the quote, "Whenever there is a hard job to be done I assign it to a lazy man; he is sure to find an easy way of doing it."

It helps us to answer many questions such as the one below.

When 100 people are doing some work process in 1 day, how will we be able to increase the work done to twice the amount in a day?

Now, what is the first thing that comes to mind?

We use the old math problem we solved in 5th standard to say that it will take twice (i.e. 200 people) the amount of people to do the work.

If that were the case always, Infosys or any other company will never be able to achieve the non-linear growth model.

To answer the above question better, let's take another example of 10 people going for lunch. What is the speed of the entire group in reaching the lunch place? If we think it is the average speed of the whole group, it is a common but wrong assumption. It is the speed of the slowest member of the group. (i.e.) Everyone reduces their speed to match the slowest member of the group. In other words, a chain is only as strong as its weakest link.
This weakest link or the slowest member is known as a constraint.

Hence in order to speed up the whole process or to increase the work done in the same amount of time, there is absolutely no use of making everyone to work faster.

Many people in the process do not work simply because they do not have any work! This may be surprising to many managers because they can see a lot of work pending and if one says that there is no work, the manager will simply laugh it off.

To explain this, I have put in a simple process flow. The below figure shows the capabilities (Shown as number of work units performed in some time) of the people (Marked as circles) in a process.

 

ToC1.pngHere, it is seen that the first person can do 10 units of work in the time that the second person can do 5 units of work and so on (15 for third person and 20 for the fourth person)

But when the work starts, the manager sees only the following happening below.

ToC2.png

As seen here, the third and the fourth person inspite of being able to do much more, work only for 5 units of work and (depending on the manager) start idling or act as if they are busy.

Not only that, as the first person is sending 10 units of work to the second person, the work gets piled up in the middle leading to delays and worse, work units getting misplaced.

There are many ways of increasing the speed of the flow of work (No...This does not include firing the person in the middle) such as reducing the load of the person who is the constraint (2nd circle), increasing the number of people doing that one piece of work (thus enhancing the flow of work for the entire line) or even changing the form of work itself.

Hence coming back to the first question on how to increase the amount of work performed by 100 people, often there is no requirement of a proportional increase of personnel. A rearrangement of people can work wonders in increasing the output even to 50 - 100% of the current output.

This is only one part of the vast topic of TOC. More parts on the same topic should come soon.

Comments

Good Job !!! Interesting read.

Excellent insight. Keep blogging.

Hi Varghese..very simple yet effectively written content related. Every industry faces this issue - capacity balancing and output management - whether in services or manufacturing or others. Drum rope buffer approach helps as underlying principle within TOC. Keep writing more man.

wonderful post

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