TOC3 Australia

This simple theory from an Israeli genius will revolutionize the way you think about business

Front Page: The Week: By Pascal-Emmanuel Gobry | November 6, 2014

Bezos instructs all of his senior execs to read The Goal by Dr Eli Goldratt. (Spencer Platt/Getty Images)

Voted best CEO 2014, Jeff Bezos is a big fan of Theory of Constraints

Two years in business school and stints as an entrepreneur and business consultant had mostly convinced me that all management theories are basically a crock. The technical tools I learned in business school, such as accounting and financial analysis, were quite useful in the real world. But the abstract theories I was taught were rarely superior to good old-fashioned commonsense.

But there was one exception, which no one in business school told me about, but which I discovered through a friend who advises entrepreneurs on their business strategy: the theory of constraints (TOC)....

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Testimonials

Bambach Wires and Cables

“We have lowest ever late orders in our entire history. From 70% late 6 months ago to just 2 orders late last week." “We now have the platform to take off like a fighter from an aircraft carrier and not lumbering off down an interminable runway like the Spruce Goose”, Bill Gale, Director Bambach Wires and Cables, Sydney

Electrolux Testimonial

"Over the period of 2008 thru 2009, during supposedly the worst economic conditions since the Great Depression, we have used TOC to unlock the hidden capacity in our business and sell it into the market place. The result of this has been to shift our Operating margin from 5.1% to 13.1%, our profit increased by $19.88m, and our volume went up by 6.5...

Paul Winterflood

We have had some dramatic changes to the business in recent years including new ownership. However, we are still running the same system you helped install - it just works!" Paul Winterflood, Manager Production Operations, Mackies Group of Companies

Gigangit

We got enough space now to play cricket”, "Rework has virtually been eliminated" Gigangit, Production Manager, Best Bar Reinforcements, Melbourne

Terry

“We have to wait a while before we can say we are making more throughput but I can say we are making the same as before but so much more easily”. Terry, Finance Director, Best Bar Reinforcements Perth

Dragi

“We were averaging 74 tonnes per day now that has jumped to 87 tonnes per day after only 8 days”. (+18%) Dragi; Production Manager, Best Bar Reinforcements, Melbourne

Rick

“I can load four trucks now in the same time as one before” Rick: ecstatic Day Shift Truck Loader

Jessie

"My team no longer need to come to me to know wh at to do, the boards show them”. “Loading trucks and meeting delivery is now just so easy” Jessie: Afternoon Shift Foreman, Best Bar Melbourne

Brad Johnston

“I’m very pleased with that” commenting on the consistent and increased flow of product trough the plant (known for his understatements) Brad Johnston: Operations Director, Best Bar Reinforcements, Perth

Grant Johnston

"That’s truly amazing” Commenting on >75% reduction of WIP in less than 3 weeks and total elimination of back orders. Grant Johnston: Managing Director, Best Bar Reinforcements, Melbourne

Bruce Drummond

“We are more confident in ourselves when responding to the market. Now we can quote dates and know we can deliver.” Bruce Drummond, Owner and MD, Millbrook Furniture, New Zealand

Aiden Kavanagh

“I have to spend less and less time on the factory floor trouble shooting and getting production to flow” “We have lots more capacity now that we are better organised and can schedule properly.” “We have a true pull system: The schedule comes from the customer. We do whatever they ask and resource accordingly”. Aiden Kavanagh, Owner Kavanag...

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