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John Spacey, October 24, 2015 updated on March 05, 2023
The theory of constraints is a management approach that examines the limiting factors that are preventing an organization from achieving its goals. This is based on the idea that a chain is only as strong as its weakest link. As such, the theory of constraints is focused on identify and clearing bottlenecks in processes, policies and procedures.
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Function | Management | Definition | A theory of management that states that bottlenecks are often the cause of process and project inefficiency. | Example | A telecom company takes an average of 7 days to deliver an order to business customers. Of that time, 3 days is consumed by internal approval processes that represent an administrative bottleneck. | Value | Improving efficiency | Related Techniques | Debottlenecking |
Management Accounting
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