Throughput Accounting and the Theory of Constraints

THROUGHPUT ACCOUNTING AND THE THEORY OF CONSTRAINTS A Summary of Goldratt's Argument During the 1970's Eli Goldratt developed a new approach to production management which he called Optimised Production Technology (OPT). This approach provided a logical analysis of manufacturing issues and argued that in order to increase the throughput (defined as sales less material costs) of a plant, production managers needed to identify and focus attention upon the ultimate constraint of a plant's output. This …

…Accounting: A Comparative Analysis of ABC and TOC", Interdisciplinary Perspectives on Accounting Conference, July 2000 Ramsay M L, Brown S and Tabibzadeh K "Push, Pull and Squeeze Shop Floor Control with Computer Simulation", Industrial Engineering, February 1990, pp. 39-45 Goldratt, E M, "The Haystack Syndrome: Sifting Information out of the Data Ocean", New York, North River Press, 1990 Fox, Robert E "The Theory of Constraints - Fad or Future?", http://www.tocc.com/Articles/FadFuture.PDF cited 7 December 2003