Tuesday, August 05, 2008

innie or outie

Internal or External Constraint?

Internal or External Constraint?

That is the $64,000 question. If your throughput (read as "money in your pocket") is not sufficient, the first order of business is determining which side of the line in the sand needs your attention first.

Recall that "internal" means that you cannot ship to meet existing demand, or cannot quickly scale to ship more goods or services in the here and now. "External" constraints mean that you have too few sales, and therefore, you have excess capacity.

It is important to determine which challenge you are facing. Why? Each type of constraint requires a different approach and often a different throughput guru.

The illustration paints a great picture: there are businesses making obscene amounts of money (the Purple Curve). But the companies on the green curve (or even worse, the red curve) cannot tell from this simple tool where the biggest breakthrough lies... it takes a little more insight.

Eli Goldratt gave us the "bitch & moan" session. I give you the Purple Curve.

Need help? Call me.


P.S. The first step is to buy my book. The PDF is even free. Once we are "on the same page" so to speak, you will be amazed how quickly results can be achieved. Usually in less than 90 days. Often in just 30 days. Need Proof? Call me.

Jeff 'SKI' Kinsey, Jonah
+1 330.432.3533

©2008 Throughput.us LLC. All rights reserved.

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