he following article reviews the Theory of

Constraints (TOC), first published in The

Goal by Eliyahu M. Goldratt and Jeff Cox in
1984, and compares it with Lean Thinking, as
described by James P. Womack and Daniel T.
Jones in Lean Thinking in 1996.

What is the Theory of

Constraints?
The Theory of Constraints is an organizational
change method that is focussed on profit
improvement. The essential concept of TOC is
that every organization must have at least one
constraint. A constraint is any factor that limits
the organization from getting more of whatever
it strives for, which is usually profit. The
Goal focuses on constraints as bottleneck
processes in a job-shop manufacturing
organization. However, many non-
manufacturing constraints exist, such as
market demand, or a sales department’s ability
to translate market demand into orders.
The Theory of Constraints defines a set of
tools that change agents can use to manage
constraints, thereby increasing profits. Most
businesses can be viewed as a linked set of
processes that transform inputs into saleable
outputs. TOC conceptually models this system
as a chain, and advocates the familiar adage
that a “chain is only as strong as its weakest
link.” Goldratt defines a five-step process that
a change agent can use to strengthen the
weakest link, or links. In The Goal, Goldratt
proves that most organizations have very few
true constraints. Since the focus only needs to
be on the constraints, implementing TOC can
result in substantial improvement without tying
up a great deal of resources, with results after
three months of effort.
The Five Steps of the Theory of Constraints
1. Identify the System Constraint. The part of a system that constitutes
its weakest link can be either physical or a policy.
2. Decide How to Exploit the Constraint. Goldratt instructs the change
agent to obtain as much capability as possible from a constraining
component, without undergoing expensive changes or upgrades. An
example is to reduce or eliminate the downtime of bottleneck operations.
3. Subordinate Everything Else. The non-constraint components of the
system must be adjusted to a “setting” that will enable the constraint to
operate at maximum effectiveness. Once this has been done, the overall
system is evaluated to determine if the constraint has shifted to another
component. If the constraint has been eliminated, the change agent
jumps to step five.
4. Elevate the Constraint. “Elevating” the constraint refers to taking
whatever action is necessary to eliminate the constraint. This step is
only considered if steps two and three have not been successful. Major
changes to the existing system are considered at this step.
5. Return to Step One, But Beware of “Inertia”
Goldratt cautions practitioners about becoming
complacent. TOC is an on-going process, and
the inertia that can build up after a change
occurs can actually serve to
prevent continuous improvement.
Goldratt also provides a foundation for
achieving change through TOC by defining a
set of three essential measurements that drive
the change process. He correctly realized that
conventional accounting systems do not
support TOC, or lean-based efforts. Goldratt
proposes replacing all traditional measures
derived from the “product cost” accounting
paradigm. The following measures are the only
way to increase profit through TOC:
 Throughput: The rate at which the entire organization generates money
through sales for a product or service. Throughput represents all the
money coming into an organization.
 Inventory: All the money the organization invests in things it intends to
sell. Inventory represents all the money tied-up inside an organization.
Goldratt’s definition includes facilities, equipment, obsolete items, as well
as raw material, work in process, and finished goods.
 Operating Expense: Operating Expense is all the money an
organization spends turning Inventory into Throughput. It represents the
money going-out of the organization. Examples include direct labour,
utilities, consumable supplies, and depreciation of assets.

All three of these measures are

interdependent. This means that a change in
one will result in a change in one or more of
the other two. Therefore, to improve your
organization using TOC, you as the change
agent would adhere to the following formula:

Maximize Throughput while

Minimizing Inventory and
Operating Expense
These measures are the key to relating local
decisions to the performance of the entire
system. Goldratt advocates that all
improvement opportunities should be
prioritized by their effect on the three
measures, especially Throughput, for which the
only limit on how high it can be increased is
market size.

How Does Lean Thinking

Compare to the Theory of
Constraints?
Lean thinking is an organizational change
method that is also implemented with the
objective of increasing profit. Lean thinking
originated in Japan, and is best exemplified by
the Toyota Production System. Constraints
placed on the Japanese manufacturing
industry after the second world war lead Taiichi
Ohno of Toyota to pioneer a new type of
production system that was so different, and so
much better, than mass production, as to
warrant a new type manufacturing. Lean
production is a method of organizing
production using half the effort, space,
inventory, and product development time
compared with mass production. It also
achieves fewer defects, and larger product
variety. These improvements should result in
increased sales, which is the key to re-
deploying freed-up resources. Lean
thinking codified and expanded upon the
Toyota Production System to include non-
manufacturing organizations, as well as
product development efforts.
The objective of lean thinking, as with TOC, is
to increase profit. This is achieved by focusing
on reducing costs using the following simple
equation:
Profit = Selling Price – Cost
Toyota realized that selling price is dictated by
the market and cannot be increased.
Therefore, the only way to increase profit is to
decrease cost. Note that although Goldratt
attempts to move away from cost reduction by
focussing on throughput improvement, the net
effect is the same: profit increases because
cost decreases.
Lean thinking achieves the objective of cost
reduction by employing a system-view of an
organization that is centered on the notion of
customer-defined value. Lean efforts are aimed
at eliminating all the steps in the production of
a good or service that do not add value to the
final customer.
The Five Steps of Lean Thinking
1. Specify Value from the Perspective of the Customer
2. Identify the Value Streams
3. Flow
4. Pull
5. Perfection

Where TOC starts by identifying constraints,

Lean thinking instructs the change agent to
rethink the notion of value first. By walking
the value stream, from finished goods to raw
materials and repeatedly asking: “Are my
customers willing to pay for this?”, the lean
change agent identifies opportunities for
eliminating waste from the system.
Further, value stream mapping is a very useful
tool for determining which areas of the system
to improve first. As well, the future state map
keeps the organization focused on moving
towards a common goal.
Both Lean Thinking and TOC agree that the
organization must first find the change, then
determine if a sensei is required. The
Goal relies on a sensei-like individual named
Jonah who provides assistance at key points in
the book. However, Goldratt warns against
relying on a sensei, and advocates that the
change agent should learn enough to become
a sensei. In parallel, successful lean
implementation efforts have relied on learning
through trial and error, and the resulting
creation of in-house lean “experts.” However,
the caveat to this approach is that it will
invariably take longer to achieve results. A
good sensei will catalyze the change effort and
keep the momentum building. TOC advertises
a three-month improvement lead-time, which
may be next to impossible without assistance
from a sensei. It would be interesting to hear
how long it took TOC change agents to
become “Jonahs.”
The following table summarizes the
comparison between Lean Thinking and the
Theory of Constraints.
Box Summary: Theory of Constraints
versus Lean Thinking
Theory of Constraints Lean Thinking
Goal Increase Profit by increasing Throughput Increase Profit by adding value
from customers’ perspective
Measures • Throughput • Inventory • Operating Expense • Cost • Lead Time • Value-Added
Percentage
What to Change? Constraints: the “weakest links” in the system Eliminate Waste and Add Value
considering the entire system
How to Five-Step, Continuous Process Five-Step, Continuous Process
Implement the emphasizing acting locally emphasizing thinking globally
Change:
Time Both can achieve immediate results, but require
a long term (about five year) effort to sustain
the results

Combining Lean Thinking with

the Theory of Constraints
Can the Theory of Constraints be used as a
catalyst for lean implementation?
This author says yes! TOC methods fit nicely
into the lean thinking five-step change
framework, between steps two and three.
Using TOC can help lean change agents to
improve performance in processes where it is
infeasible to eliminate bottlenecks. Specifically,
after creating the ideal future value stream
map, how do you achieve it? As you divide
your value stream into loops and determine
improvement objectives for each, as described
in Learning to See, incorporating TOC methods
can give the following benefits:

Determining Where to Begin

TOC advocates beginning with the constraint
that most limits Throughput. This should create
substantial improvements to the value stream
in a short time, which is beneficial for igniting
the required employee momentum and
support.

Sustaining Momentum
Achieving your future state may require
designing new equipment that has not currently
been developed. Until these processes can be
eliminated, and if they are constraints, TOC
can be used to continue the implementation
momentum. Then, you can develop continuous
flow that operates based on Takt, a pull system
to control production, and implement
production leveling.

Performance measures that

support lean implementation
Replacing traditional financial metrics of asset
utilization and burden absorption with
Goldratt’s Throughput, Inventory, and
Operating Expense measures will help
management see the benefits of Lean
Thinking.
That’s it for an introduction to the Theory of
Constraints and its comparison to Lean
Thinking. We will summarize helpful insights
and append them to this essay.

Bibliography

Dettmer, William H. Goldratt’s Theory of Constraints A Systems Approach

to Continuous Improvement. Milwaukee, Wisc.: ASQ Quality Press, 1997.

Goldratt, Eliyahu M. and Cox, Jeff. The Goal. Great Barrington, Mass.: The
North River Press, 1992.

Goldratt, Eliyahu M. What is this thing called Theory of Constraints and

how should it be implemented? Great Barrington, Mass.: The North River
Press, 1990.

Noreen, Eric, Debra Smith, and James T. Mackey. The Theory of

Constraints and its Implications for Management Accounting. Great
Barrington, Mass.: The North River Press, 1995.

Rother, Mike and John Shook. Learning to See. Brookline, Mass.:

The Lean Enterprise Institute, 1998.

Womack, James P. and Daniel T. Jones. Lean Thinking. New York: Simon
and Schuster, 1996.
Community
Responses
Time. TOC, and Lean
While both TOC and lean manufacturing focus
on reduction of cost (lean manufacturing
emphasizes reduction of waste), there could be
an alternate perspective in terms of time (time-
to-market) – reducing lead times (improving
responsiveness of the organization to changes
in the environment). The inherent assumption
here is that the market is not really the
constraint (since a company can profit more by
reducing time to market and also selling more
products – increasing throughput).
The origins of time-based competition’ (Stalk,
George Jr., Time: The Next Source of
Competitive Advantage,” Harvard Business
Review, Jul-Aug 1998) can be seen in
the JIT system developed by Japanese
automobile manufacturers in response to the
post-war markets (need for multiple models
with varying demands). From a TOC
perspective, the objective of increasing
throughput can be realized through reducing
manufacturing lead times.
In the recent times, companies have tried to
make their entire value chains more
responsive, starting from faster product
development lifecycles (examples include
Toyota’s multiple-project management for
designing new cars faster), faster procurement
and better logistics tracking (through the
efficient use of IT), efficient delivery/distribution
systems, and also prompt service. (Firms
realize that the responsiveness in upstream
activities such as manufacturing can be
partially obscured by sluggish downstream
activities.)
The advantages of using time as a weapon of
competitive advantage (as exhibited by the
apparel industry in the US) are:
 Reduced costs by reducing inventory and operating expenses
 Reduced risk of product failure by shortening product lifecycles
 Better customer satisfaction by responding quickly to changing customer
preferences

–Venkat Sreeram, Associate, High

Technology Practice, Triniti Corporation,
India.

TOC and Lean Thinking

The first step to understanding world class
business concepts is to recognize where the
varied philosophies agree and where they
differ from traditional mass production
concepts. Lean and TOC are the best
examples, but many others are out there
(Demand Flow Technology, Velocity, etc.,) To
engage in sustainable real world
implementations it eventually becomes
beneficial to embrace one specific philosophy,
but it does not require rejecting the others. The
real breakthrough is teaching others to reject
the concepts of traditional mass production
which have become intuitive to us all. To
undermine one or the other undermines the
potential for a revolutionary breakthrough
toward either.
A key to fully understanding TOC is that it is
not just a system of eliminating constraints
(bottlenecks) but more a system of managing
constraints. A truly enlightened organization
will know exactly where it wants the constraints
to be. Constraints are a reality, the question is
whether you want them to be internal, where
you can control them or external (i.e. the
market). A company that is in control of its own
destiny can use its constraints like a valve to
control and continually promote the flow of
value.
John L. Werling, Business Developer,
Institute for Economic Transformation,
Duquesne University.

The problem is the VARIATION!

In my opinion the two theories are completely
complementary: only when you eliminate
bottlenecks you will be able to build a really
pull system, but what to do immediately to
reduce your cost (or inventory and operating
expense… it’s the same!) without penalizing
your Customers and Shareholders (increasing
throughput or optimizing value stream …it’s
again the same!). To do that, today, you need
some right storage because your variation is
not zero! So your buffers are more than 1
(TOC) and it seems to you that lean is
different…. one piece flow!!
When you will standardize all the processes
and, using every Continuous Improvement tool
you want, you will have variation = 0, then all
your buffers will can be equal to 1 (one piece
flow) and so lean and TOC will be the same!
In my opinion TOC must be the way of facing
the problems one by one, lean is the vision of
what your firm would be, the tools you use are
not so important if the way of thinking and the
objective are clear!
Fulvio Fratamico, Lean Promotion Officer,
TRW Italy.

TOC favors increasing volume over

decreasing cost, and TOC’s drum-buffer-
rope is really a pull system
I would like to clarify two points:
1. The article states that the net effect of both
systems is the same: “Profit increases because
cost decreases.” While it’s hard to argue with
the arithmetic, TOC favors increasing volume
over reducing cost. Its focus is to help people
find the leverage points (policies as well as
physical constraints) to continually improve
Throughput.
2. In an e-mail attached to the article, Stephen
Corbett asserts that “TOC is based on a PUSH
system.” In reality, while TOC’s mechanisms
differ from TPS, TOC is really a slightly
disguised PULL system. Because the
constraint, or “drum,” is scheduled based on
demand and “roped” to the release point, work
is PULLed through the system at a rate that is
synchronized with demand. The constant
tuning of strategic buffers allows inventories to
be kept at minimum levels.
Al Posnack, President, Productivity
Partners.

Both TOC and Lean Thinking Focus on the

Entire Organization
1. I like Goldratt’s definition of a value-add
activity as being one that takes the plant
towards “the goal.” When we first started doing
value stream mapping in BT we found it difficult
to decide which activities were adding value
and which weren’t, particularly in areas where
employees are interacting directly with
customers. We found that spending some time
up-front defining exactly what “the goal” is for
the process makes it much easier to designate
activities as value-added or non-value-added.

2. For me, one of the common themes of “Lean

Thinking” and “The Goal” is the importance of
optimizing the organization as a whole, rather
than local optimization. This is brought out in
“The Goal” through the concept of maximizing
throughput while minimizing inventory and
operating expense. In other words, you must
tackle all three measures simultaneously, not
optimize one whilst having a negative impact
on the others. It’s all too easy to reduce visible
costs by introducing hidden costs!

3. Another common theme is that non-

bottlenecks do not have to work continuously,
and that people can be freed up from non-
bottleneck parts of the process. In “It’s Not
Luck,” the sequel to “The Goal,” Goldratt says
that these people should not be made
redundant but used for improvement activities.
Again, this is very much in line with lean
thinking.
Carole Jones, Advanced Operational
Solutions Unit, BT Laboratories.

TOC is Not a Local Optimization Method

I appreciate the effort to put TOC and Lean on
the table to compare notes. I would like to offer
a few insights on this comparison based on my
experience over a number of years involved in
TOC and Lean including the Toyota Production
System (TPS) as practiced at Toyota. I believe
there are some very fundamental
misunderstandings of elements of both
systems that need to be clarified. Without
clarification on these points, implementers of
either Lean or TOC, or both of these
approaches will have problems sooner or later.
First of all. Contrary to the paper conclusion on
the web site (e.g., summary box) TOC is
absolutely not, never has been and never will
be (at least in a proper implementation) a
“local” focus.
Bob Elder, Chesapeake Consulting, Inc

TOC Reconciles Local Action with Global

Optimization, and is Compatible with Pull
Systems
I would like to thank you for posting such a
useful article. I agree with the conclusion that
TOC and Lean have many similarities and that
these similarities are much more important
than their differences. I would like to point out
however, two points where I disagree.

First, in the article, the author defines TOC as

focused on local action, it should be pointed
out that the core question TOC grapples with is
how to reconcile local action with global
optimization. TOC contends that by focusing
on the constraint is the only way you can be
sure that your local action will have the positive
impact on global performance. I believe this
point gets lost in the table in the article.
My second disagreement is with one of the
written comments after the article. Stephen
Corbett refers to TOC as a PUSH system. I
find TOC more of a PULL system than a PUSH
system. True, TOC does advocate buffers
(inventory) at selected points to ensure that
neither the constraint nor the customer is left
waiting. But, new orders PULL additional
production through the Constraint which in turn
PULLS material into the system to feed it. I
agree that this is more complex than a
lean kanban approach but it is still basically a
PULL. In my experience, PUSH systems
require a large quantity of information about
estimated demand (seasonally adjusted, of
course)down to the SKU level and many
meetings focused on improving demand
forecasts, inventory record accuracy and
implementing hugh data bases to contain all
this information. Perhaps this is all semantics,
but I do not see the mutual incompatibility Mr.
Corbett asserts
Mark C. Szpila, Asset Management Group,
Rohm and Haas. (Opinions expressed are
mine and not those of Rohm and Haas
Company.)

TOC and Lean Thinking are Mutually

Exclusive
I just read your comparison of TOC and TPS
and think that the author missed a very
important consideration. TOC and Lean have a
common foundation, the identification and
elimination of waste. Lean focuses its efforts
on using pull and flow to identify problems for
elimination, while TOC uses extensive
analysis, which is not a major difference. When
they are compared in theory there are no major
problems between them. It is in the area of
problem resolution where they differ.
The two approaches vary in their approach to
problem resolution: the fundamental
differences come in their focus. TOC uses the
bottleneck process to drive the entire process,
while lean focuses on pull. The material flow in
a TOC facility is much more complicated than
in a lean facility. TOC is based upon a PUSH
system. TOC uses a hybrid MRP process to
release materials at the rate the constraint
process can handle, which is pushing the
material through the system. TPS on the other
hand is a pull system that cascades that
customer demand through the system,
replenishing what the customer has withdrawn.
These two approaches are mutually exclusive,
and as such the two manufacturing
philosophies cannot be combined.
Stephen Corbett

Organizational Barriers to Change: Another

Difference Between TOC and Lean Thinking
Bravo! This essay represents a thorough
analysis of a controversy within many
companies. I concur with the author’s
conclusion that TOC can actually be used as a
tool in the lean tool box. I would like to add one
additional thought. TOC is a very logical, even
mathematical approach to managing the
production flow. Herein lies its allure to many. I
would submit the following hypothesis. TOC
applied to a limited area can be implemented
with minimal involvement of the workforce, i.e.
buffers are calculated, implemented and
communicated to the affected area workers. An
organization does not require a significant level
of buy-in on their part.
Conversely a truly Toyota Production System
approach to lean is built on employee
involvement. Culture change from a traditional
Western way of thinking to a lean thought
process MUST occur. I would submit to you
that this fact is another fundamental difference
between TOC and TPS.
Gary McGregor, Manager, Assembly
Strategy, CASE Corporation.

Goldratt Communicates Synergy between

TOC and Lean Thinking
What follows is a reference to a March 24,
1999 satellite broadcast in which Eli Goldratt
commented on the compatibility between Lean
Thinking and the Theory of Constraints.
Goldratt explained that TOC tells you where to
look and what to change, while lean tells you
how to change; both TOC & lean provide
insight about how to cause the change.
In practice, both bodies of knowledge have
unique and synergistic teachings…TOC
provides a theory base (scientific thinking) and
process tools (cloud/trees) that help gain
perspective on the evolved practice of lean by
hands-on approaches. That’s what we’ve found
ourselves doing in our business situation; it
was terrific to hear Eli himself dispel the
“inferior/superior” debates that seems to have
diverted us a bit over the past several years.
Theory of Constraints Examples

Implementation Examples

Over 5,000 organizations around the world have achieved breakthrough results with
the Theory of Constraints, including SMEs, regional corporates and even large multinational
such as:

What is the Impact of the Theory of Constraints?

This academic research study by Steven J. Balderstone and Victoria J. Mabin from the
School of Business and Public Management at Victoria University of Wellington outlines the
background of the Theory of Constraints based on a literature review of 310 items, including
32 books and 83 different journals and magazines articles.

It goes on to critically analyze a sample of over 100 companies that implemented TOC. Not
a single failure or disappointing results was observed. The mean improvement in operational
and financial performance, post implementation of the TOC, are summarized below:

Lead-Times 69% Mean Reduction

Cycle-Times 66% Mean Reduction
Due-Date-Performance 60% Mean Improvement
Inventory Levels 50% Mean Reduction
Revenue / Throughput 68% Mean Increase
Combined Financial Variable 82% Mean Increase

Download the full report below:

TOC_Impact_Analysis.p
df

Download File
TOC Case Studies from Around the World

Poles Apart

The Construction Index, UK, May 25, 2019

Michael Krajewski started Steelo with £12,000 after failing to get into the Polish army. A
decade on, his UK-based business is turning over nearly £4m and pioneering 3D printing for
structural steel fabrication.

Today Steelo’s semi-automated plant turns over nearly £4m and employs 30 people,
supplying small projects mainly in the south-east of the UK, and mostly in the residential
market. This bread-and-butter work funds Steelo’s research into more exciting areas such as
3D printing, but Krajewski – who in some circles has acquired the sobriquet “the Steel Guy”
– has been innovative from the start. You can see this in Steelo’s responsiveness to client
requests. Lead times between placing an order and delivery to site can be as short as one
day, with the parts reliably arriving within a two-hour time slot.

This seems extraordinary for a company the size of Steelo, but Krajewski says that it’s all
down to automotive-influenced lean manufacturing principles, supported by a bespoke IT
system. Also, he adds, “we’ve adopted the theory of constraints”. Krajewski originally
thought his production bottleneck would be in the welding bays. But when he started
studying Goldratt’s theory in earnest, he realised that the company’s most vulnerable point
was its delivery. Read the full article
We plan to grow by 20-25 per cent in 2019: Raja Mukherjee, Bajaj
Electricals

The Economic Times, India, 26 April, 2019

While the financial results for Q4 FY19 are yet to come, in December 2018, Bajaj Electrical
had said that its order book stood at Rs 5,787 crore out of which Rs 126 crore was from
illumination projects.

"This year, we want to focus on smart lighting and executing more smart cities projects," said
Mukherjee. In Q1 2019, the company executed six smart cities projects. The smart cities
projects attributes to about 15-20 per cent of overall revenue of the segment.

The company went through several changes internally. "We implemented theory of
constraints within our business unit and now we are witnessing good results. Read the full
article

How TOC helped Dr. Reddy’s Win Best Supplier Award in the US

Corporate Dossier, India, 17 Oct, 2014

Five years ago, Dr. Reddy’s Laboratories faced high backorders and low supplier ratings in
the US. The company started implementing Theory of Constraints, and managed to win the
best supplier award last year.

Dr. Reddy’s not only tightened the supply chain with a focus on better inventory
management in Russia and the US, but also tightened their finance and project
management. They moved to a throughput based system where they track operating
expenses, significantly simplifying management accounting and reporting.

An increasing number of companies are implementing TOC to stay ahead in the game. The
key here is to do away with constraints that are limiting the business from doing more. Read
more
Small appliances brand Morphy Richards challenged standard
industry practices by adopting Theory of Constraints

The Hindu Business Line, India, Dec 12, 2013

Consumer Durables brand, Morphy Richards, has seen dramatic improvement in stock outs
and excess inventory at the distributor end. They have been able to optimize working capital
by as much as 40%. All this has been achieved after the company decided to implement
Theory of Constraints – within the company and extending the principles to include its
distributors too.

The company had grown from Rs. 2 Cr. in 2003 to Rs. 185 Cr. in 2013. However, the
company was looking at an ever flourishing upward growth curve. That is when the top
executives attended a seminar on Theory of Constraints, and decided to implement it. Many
undesirable practices in a sales led setup had to be rejigged – 60% of the sales happening
in the last week of the month, most stock replenishments happening on the value of goods
sold and not the actual product sold (hence apples could be replaced by oranges), high
spares inventory and a host of other issues. Read more

Dramatic improvements seen after implementing Theory of

Constraints for the country of Lithuania!

www.itbusiness.net, Germany, 5 June, 2013

Lithuania has embarked on a countrywide implementation of Theory of Constraints to

increase its GDP from 1.434 to 10.900 per capita GDP. The goal is an increase of 664%
over a 17 year period. In 2009-10 Theory of Constraints was applied to the Guarantee Fund
application process in Lithuania. The result was a dramatic lead time reduction from 388
days for the applicant to receive payments to 63 days. Theory of constraints education was
then expanded to training for 200 healthcare managers and 2,500 teachers. Several
conferences have supported the spread of theory of constraints within Lithuania.
Mazda Executive Credits Theory of Constraints for Company
Turnaround

PR.com, Germany, June 3, 2013

At the 11th annual conference for theory of constraints professionals, Mr. Mitsuo Hitomi
described the crisis faced by Mazda to offer creative and innovative exhilarating driving to
those people who still hold dear the love of motion experienced as a child while surviving
four straight years of significant financial losses. Mr. Hitomi described the last chance for
Mazda to survive by developing technology that would achieve low fuel consumption from an
internal combustion engine that would rival a hybrid engine, no compromise in the driving
pleasure, and affordable for all customers. The product development cycle had to be cut in
half for Mazda to survive. Starting with Critical Chain Project management education in
2007, the momentum grew within the company for holistic project management until the
development project duration was cut by half. Mr. Hitomi then described how this new
technology was applied in a multi-project environment with all projects delivered with full
scope on time.

Rami Goldratt, CEO of Goldratt Consulting, said, "Mazda gives the world another great
example of the power of TOC to generate results previously thought not possible -
financially, operationally, and at least as importantly, in the growth and harmony of the
people themselves." Read the full article

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