Bottleneck vs. Constraint (in an operations setting)
By Tim Sullivan, CIRAS
In my TOC workshops I spend a few minutes clarifying what I believe the distinction between a "bottleneck" and a "constraint" is. In the video version of "The Goal", Jonah defines a bottleneck as 'any resource whose capacity is less than the demand placed on it'. I always ask workshop participants if, using that definition, the company where they work has:
- Just 1 or 2 bottlenecks? or
Invariably they say, 'Many.' I point out that this seems to contradict the Theory of Constraints that claims there is only one, or very few "constraints." This sets the stage for a discussion of the distinction between a bottleneck and a constraint.
I must start with a note about context. In "The Goal", Jonah is talking to the management team of a factory who happens at that point in time to have market demand in excess of the plant's ability to deliver. Jonah issues his definition of bottleneck in the process of identifying the internal resource that is the limiting factor for production. So the following is in the context of an organization who currently has an active internal resource constraint.
Consider a process with 5 steps. "A" can produce 16 pieces/hr, "B" 14/hr, etc. The market demand equals 13/hr.
A ---> B ---> C ---> D ---> E
How many bottlenecks are there? The typical answer using Jonah's definition is 3: C, D, and E.
I point out that in many factories, in order to keep the productivity of "A" high, material is released at the rate of 16 pieces per hour. In such cases "B" would also be a bottleneck because the demand placed on it by "A" will exceed its capacity. So, there may be 4 bottlenecks in many factories. (Please notice that, in order to keep all resources busy/"productive", well intentioned managers create artificial bottlenecks.)
Hopefully the concept of bottleneck is clear and simple.
Next I ask what will happen to the output of the system if process improvement is performed at "C" such that capacity is raised from 12 to 14?
"Nothing," is the response, "because D can still only do 10/hr." In this example, the only point in the system where an increase in local "productivity" results directly to an increase in the output of the system is at "D". Thus D is the "constraint." The constraint is the bottleneck whose performance is directly related to the system performance. (Please note, operations that create artificial bottlenecks by releasing work in excess of the capacity of constraint in order to keep up efficiencies make it much more difficult to identify the true capacity constrained resource.)
Let me say that bottlenecks come and go. A constraint limits system performance over some extended period of time. It has been said that if you suffer constantly from the wandering bottleneck phenomenon, you probably don't have a true internal resource constraint. It should be noted, however, that some manufacturers find themselves at the mercy of a seasonal market. In this case, they often have an internal resource that is "active" as the system constraint for a period of several months, but then becomes "inactive" as the effect of the system constraint becomes visible in the market.
This opens the door for a serious discussion of a "system constraint" -- as opposed to an internal "capacity constrained resource" which is really what has been addressed here (even though it was referred to as the constraint). It has been said that only about 20% of the time is the true system constraint an internal capacity constrained resource. But that is a topic that will have to be addressed in a later paper.
One last tip. When you are considering several bottlenecks and think you know which is the capacity constrained resource ask yourself this question. "If I could wave a magic wand and tomorrow this resource produced 10% more, would we ship 10% more sold product the next day/week?" If the answer is, "No, WIP would just pile up somewhere else in the system", then you've only found a bottleneck! Keep looking for the capacity constrained resource.
Hopefully this clears up the two terms for you. However, beware! Many other TOC practitioners use the terms bottleneck and constraint interchangeably or with exactly the opposite meaning! I strongly recommend that you always ask the person with whom you are trying to carry on a serious TOC discussion that includes these terms EXACTLY what they mean.