📚 node [[theory of constraints]]
- [[Throughput]]: rate at which the [[system]] generates [[money]] through [[sales]].
- [[Inventory]]: all the [[money]] the [[system]] has invested in purchasing things which it intends to sell.
- Operational expense: all the money the system spends in order to turn [[inventory]] into [[throughput]].
- [[Inventory]] is sellable, [[expense]] is not.
- The goal is not to reduce operational expense by itself. The goal is not to improve one measurement in [[isolation]]. The goal is to reduce operational expense and reduce inventory while increasing throughput.
- Accumulation of [[diversity]]. [[Dependency]] limits the [[opportunities]] for higher [[variance]].
- Whoever is [[moving]] slowest in a ruck governs throughput. "You're only as fast as your slowest Joe".
- Look at the [[system]] as a whole, don't try to maximize [[local]]ly.
- [[Bottleneck]] resource: any resource whose [[capacity]] is equal to or less than the [[demand]] placed on it.
- Non-bottleneck [[resourceful]] : Any resource whose capacity is greater than the demand placed on it.
- Activating a resource is not the same as utilizing a resource. A resource is utilized when its activation advances toward the Goal.
- A [[system]] of [[local]] optima is not an optimal system. (Do not attempt to optimize every resource.)
- Anchor inventory to bottlenecks.
📖 stoas
- public document at doc.anagora.org/theory-of-constraints
- video call at meet.jit.si/theory-of-constraints
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