Constraints Mgt.

	*The Remington Group* TOC Services *Manufacturing In The New Millennium* The Remington Group, LLC 475 Wall Street Princeton, New Jersey 08540 (609) 497-6400

Last update:

08/21/2001

CONSTRAINT MANAGEMENT

The "Theory of Constraints" enumerated by the noted author of "The Goal" has slowly been entering the consciousness of manufacturing executives. While clearly a controversial subject, it is providing a new perspective on operations management as well as on accounting.

All factories have constraints (aka bottlenecks). The Theory of Constraints focuses managers' attention on successive management of constraints by an unique process beginning with identification and following through to elimination. By successively going through the identification to elimination process, throughput is enhanced through lower inventories and sales and profitability grow through decreased lead-time and better customer service.

A new financial analysis - "Throughput Accounting" - accompanies the implementation of constraints management with a focus on maximizing contribution margins through identification and exploitation of constraints.

Constraints Management is controversial to be sure,
but we think certainly appropriate for companies with
the desire to push the envelope of manufacturing economics.

We can help in constraints management by:

Providing conceptual training in constraints management;
Developing constraints management practices;
Setting up a Throughput Accounting analysis scheme; and
Assisting in actual walk-through implementation of the Theory of Constraints and Throughput Accounting processes.

Constraints management as a guiding philosophy of manufacturing is on the leading edge requiring an individualized approach. We treat each company as a unique entity in the adoption of this new approach.

The Remington Group, LLC 475 Wall Street Princeton, New Jersey 08540 (609) 497-6400