John Tripp | Goldratt-TOC Ltd

The following is provided to explain the meaning of TOC and related improvement approach terms.
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Ap 

Assumption

Dictionary definition:
a) the act or an instance of accepting without proof.
b) a thing assumed in this way. arrogance.

In TOC we are using the definition in (a) we are constantly searching to ensure that the underlying assumptions are apparent, clearly understood and challenged where necessary.  (Check your basic assumptions).  See some commonly held assumptions that are false.  This is important in the Cloud and Nbr process

Assembly Buffer

The time buffer placed before an assembly operation on non drum parts where Drum components are assembled with non drum components

Bp

Bottleneck (Bn)

This is a resource that has just enough capacity or less capacity than is needed to satisfy the demand placed upon it.  Bottlenecks may need to be taken into account when scheduling.

Buffers

See Time Buffer below...

Buy-in

This term is used to indicate the acceptance and active support for action, proposal, idea by those involved.  There is a specific approach used to use resistance to change to create buy in.

Cp

Capacity Buffer

The time buffer placed between the drums in multiple project.  This buffer protects the later project from the knock on effect of delays in earlier projects.

Cloud (Cld)

This is the thinking process used to precisely define a problem, to surface the underlying assumptions and to enable the identification of the direction of a solution that will remove this problem.

Clouds are used to solve UnDesirable Effect (UDE), Core problems, Daily conflicts, Chronic conflicts, and as an  empowerment process to align resolve misalignments of authority and responsibility .

Example and instructions

Constraint (Cn)

A Constraint is anything significant that is blocking the achievement of the goal.

Core Problem (CP)

The term core problem refers to the constraint of a system where it is not a physical resource, it may be: a policy, or the belief in a false assumption, out dated measures or ineffective behaviours.

Critical Capacity Resource (CCR)

A CCR is a resource that may prevent the system moving closer towards its goal.  A CCR may not be a bottleneck but all CCRs usually need to be taken into account when producing a schedule.

Critical Chain

This is the longest dependent chain of events in a project plan when both resource dependency and task dependency are taken into account.

Critical Path

A Critical Path is the longest path of dependent tasks in a project network not taking resource dependency into account.

Current Reality Tree (CRT)

The TOC Thinking Process diagram that shows through solid logic how the UnDesirable Effects are linked together.  The CRT is used to pin point where improvement actions can have the greatest leverage.

Example and instructions

Dp

Dependency

unable to do without> In TOC it is usually referring to two tasks or actions where one is a prerequisite for the other.  The prerequisite task MUST be complete before the dependent task can begin.

Dependent Event Chain

A series of tasks all linked by either a resource dependency - one task has to wait for the resource to complete another task - and or task dependency.

Desirable Effects

The result that is desired, which replaces some UnDesirable Effects.

Disruption

An event that was not predicted that delays tasks, resources or materials or reveals extra work that was not expected.

Distribution

The term is used to describe an environment where manufactured product has to be produced in advance of demand - to forecast - and then stored ready to meet expected demand.  Usually there is at least one plant with a warehouse feeding a number of warehouses located nearer to the retail demand.

Drum

The Drum refers to the CCR that is used to build the schedule around in an operation. 

Drum Buffer

The time buffer placed before the Drum activities to ensure they arrive before they are needed by the drum.

Ep

Engineering

This term is used to describe the environments where  new products are designed, new plant or project management activities are undertaken.

Entity (Ent)

This is a term sometimes used to describe a thing that exists - a fact of like - that has to be taken into account during an analysis or the development of a solution.

Error Reporting

This term describes a common behavior in projects when a task is completed earlier than expected from the estimated duration.  In many cases the early completion is not reported.  Work either expands to fill the available time or the time won is used on other tasks.

Fp

Feeder Buffer or CCFB

The time buffer that is placed on the end of non critical chains that feed into the critical chain.  The feeder buffer protects the critical chain from the disruptions and uncertainties in the non critical chains.  Sometimes referred to as Critical Chain Feeder Buffer (CCFB)

Finance

In TOC this normally refers to the performance measures (T, I  & OE) monitored and reported on by the finance department - many of which actually damage performance or at best slow improvement processes down. 

Future Reality Tree (FRT)

The TOC Thinking Process diagram that describes how the the agreed direction for a solution unavoidable through solid logic leads to the desired results or benefits.  This process identifies all the injections that need to be put in place to create the desired outcome.

Example and instructions

Ip

Injection (Inj)

This word is used as a label for the new things (usually non trivial) that need to be injected into the environment to create the solution.

Integration Point

Common term in a project to describe where two or more tasks join together.  Usually a number of task have to be completed before the integration task can start.

Intermediate Objective (IO)

The thing that must be reached in order to overcome an obstacle to an ambitious target or injection.

Inventory (I)

Inventory is all the money invested in buying things that will at some time be sold - turned into Throughput

Mp

Marketing

The acts of bringing the market to desire the product or service being offered to it.  Bring the ducks with sticky feet to make it easy for sales to shoot.

Multi Tasking

A major cause for projects overrunning both on time and budget.  Multi tasking refers to the breaking into one activity before it is complete to move onto at least one other task before returning complete the original task.  This activity can be responsible to a large degree for excessive rework, wasted time in intellectual set up, and poorly designed solutions or products.

Np

Negative Branch (Nbr)

Most ideas or solutions are greeted with negative responses or concerns these we call negative branches.  Usually it is not the whole solution that leads to the concern but some aspect of it.  The negative branch identifies which aspect of the solution is causing the concern and analyses the logical links form the solution to the predicted negative outcome (the concern).  Often the Nbr can be removed by surfacing the underlying assumptions.

Op

Obstacle (Obs)

Any significant thing that will block the achievement of an ambitious target or an injection.

Operating Expense (OE)

All the money spent on turning Inventory (I) into Throughput (T).

Operations

The term used to describe any production environment - an insurance office,  a bank or a factory.  The TOC solution here is called Drum Buffer Rope

Pp

Path

Any series of linked (dependent) tasks in a project plan.

People management

Used to describe a set of TOC thinking processes that help improve the relationships and productivity between peers, and managers and their reports.

PERT

Project Resource Evaluation Technique

Prerequisite Tree (PrT)

The TOC thinking process used to break the injections needed in the solution down into smaller logical steps.  The process identifies all the significant obstacles and the things (Intermediate Objectives (IO)) that need  to be achieved to overcome the obstacles.

Example and instructions

Project Buffer (CCCB)

The time buffer placed at the end of the critical chain to protect the customer from the fluctuations and disruptions that occur in the Critical Chain.  Sometimes called Critical Chain Completion Buffer (CCCB)

Protective Capacity

Protective capacity describes the amount of installed capacity that is necessary to overcome disruptions.  Protective capacity and time buffers enable reliable predictions where uncertainty exists.

Rp

Resistance to change

There are six levels of resistance to change:

1. There is not agreement on the problem.
2. There is not agreement on the direction of the solution.
3. There is not agreement on the solution.
4. People point to new negatives or raise concerns with the solution.
5. People point to obstacles that will block the solution.
6. There is fear of making the change or there is a lack of leadership.

Sp

Sales

The process of turning a prospect that is interested in ones product or service into an actual paying customer. 

Shipping Buffer

The time buffer that is placed before the customer to protect them from disruptions.

Statistical Fluctuation

The variations that occur in around a nominal task time.

Strategy

A plan that moves the organisation closer to its goal.  See Eli Goldratt Strategy programme.

Student Syndrome

One of the common behaviours in a project that lead to tasks being later than they need be.  Tasks are often not started when they can be but left closer to the deadline much like students revision for an exam.

Synchronization

The bringing together of materials information and anything else needed in a coordinated manner such that no part is waiting long for another - usually needed in projects at integration points or in assembly tasks or to facilitate effective on time release of materials into a production process.

Tp

Tactics

The components that make up the strategic plan.  i.e. have a flexible supply chain, have a flexible responsive factory.

Throughput (T)

The rate at which the system produces goal units - commonly - the rate at which the system generates money (sales value minus direct expenses - money that just flows per product to a vendor etc.,) 

Time Buffer

A key part of the TOC applications that protects against disruptions - although applied and used in slightly different forms in each solution a time buffer is a period of time built into schedules, which has the effect of releasing tasks a predetermined amount of time earlier than they are strictly needed.  The amount of time is judged such that most things reach the critical locations just early.  The constraints do not wait for the non constraints customers get their service product when they were promised it.

Transition Tree (TrT)

A TOC process used to construct the actions needed to achieve an intermediate objective.  This process describes the change that will take place in reality and identifies the minimum necessary actions needed. 

Example and instructions

Up

UnDesirable Effect (UDE)

These are the negative things the problems that are visible and caused by the thing (Core Problem) that must be changed. 

Example