SM5.0 Theory of Constraint (TOC) Find Remove Bottleneck

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The Theory of Constraints (TOC) is an important optimising technique that focuses on improving the throughput of work at the (usually) single bottleneck or constraint in the workflow.  

This Skills Module draws together a number of the 12Faces articles on the subject.  One research project demonstrated that 89% of improvement in a manufacturing business came from the application of TOC. Yellow Belt.  button LMS subscribe

Business Training

The 12Faces business training resources are focused on how to grow a small business.  They cover the particular issues arising for each growth stage from startup to 20 staff.  Also includes our systems for actually getting the work done via a rapid, lower stress, framework.  The Business training also expands on some of the important […]

SM4.1 Eight Types of Waste

The well-known Toyota car company identified seven types of waste that had an impact on Productivity and Profit.  An eighth has been added more recently.  By gradually reducing these wastes, you can improve the Productivity and Profit of your business.  In Japanese, this is referred to as reducing “muda” (pronounced Moo-da).  This article discusses how these types of waste might show up in your business; and what to do about them.  Waste reduction is an ongoing and probably never ending process.  This article gives lots of examples of waste in each of the categories.   To be most effective, you should tackle the largest waste items first so as to make the largest gains first. Waste reduction is a team effort ideally as those on the front-line probably already know what is wasteful; they are just not empowered and trained to combat waste.

Read this if: you are working on making your business operate more efficiently

Relates to: 80/20 Rule for finding the biggest issues, Kaizen for incremental improvement, Constraints and bottlenecks.  Our Profit Acceleration optimization toolkits; Double Profit in 100 Days and Double Growth and Profit in 365 Days.

Audio/visual Materials: none

Degree of Difficulty: Yellow (entry level) .  Not hard to do but requires perseverance.  It is the first article in a series on managing waste to improve your profit

SM5.2 Benefit from Theory of Constraints in Retail

The Theory of Constraints (TOC) argues that good growth can be achieved by focusing on the one or two limiting factors or “Constraints” in a production system. This article applies TOC to the Wholesale/Retail sector.

SM1.1 Rapid Profit Increase from Price Increase

As was outlined in the introduction to our Pricing Module, the extra profit from even small changes in the prices of your product goes 100% to your bottom line Profit (assuming demand doesn’t change).  Consider a business turning over $500,000 per year. Let us further assume that it makes a 5% profit on that, which gives it a Profit of $25,000.  If it increased its price by 1%, and assuming demand remained constant, that would lead to an extra $5,000 in Income. This extra $5,000 profit, over the original $25,000 profit, is an 11% improvement.  In keeping with our 80/20 philosophy this article discusses a rapid change to your pricing system that can flow virtually 100% to your bottom line Profit. It is a rapid, and not very subtle, change that you can later adapt to make it more focused and more successful.  This is a yellow belt article

SM4.4 How to Reduce Waste in Offices and Service Industries

Most improvement is an incremental process. “Kaizen” is a Japanese word for incremental improvement. Most people think of the removal of waste occurring only on the factory floor.

Waste can also occur in Office Operations; administration, human resources, sales & marketing. Experts report that Office Operations waste is at a higher level than waste on the factory floor.

The principle reason: operations on the factory floor are very visible. People optimise things on the factory floor. As previously discussed, experts have categorised waste into 8 types. Yellow &  Blue Belt

SM2.0 80/20 Principle – Double Sales, Triple Profits

Introducing the 80/20 Principal The 80/20 Principle asserts that a minority of causes, inputs or effort usually lead to a majority of the results, outputs or rewards. Taken literally, this means that 80 percent of what you achieve in your job comes from 20 percent of the time spent. This implies that: 80% of your […]

SM4.2 Capturing Waste in the Wild

Once you get on the trail of waste out in the wilds of your production system (service, retail or manufacturing), you are going to find literally hundreds of examples of waste.  It’s too much to hold in your head so you need a simple way to find, measure it and record it for later prioritised removal.  This is a yellow belt approach to these tasks. It is the second article in this series on waste.

SM4.3 Prioritising Waste Removal

Any waste removal project will identify literally hundreds of instances of waste. There is a serious risk that such a vast quantity of information will overwhelm the business operator’s ability to manage it in the best interests of the business. We need to discuss ways to identify the most important wastes to remove first. 

This is a Yellow Belt article.

SM6.4 Profit Autopilot Business Model Video 2

Profit Autopilot is our simple and quick to use method for configuring your business to give you the profit and the salary that you want.

By starting out from these two goals and working backwards, you can quickly see if your business already meets those goals.

If not, you will have a clear demonstration of what needs to be done to achieve them.

Our two part video series is a quick introduction to tuning your business once Part 1 has indicated what you need to work on.

Watch Profit Autopilot Video 2 here – 15 minutes

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