Theory of Constraints (TOC) - Application for Distribution
Last updated on 2016-05-13
About the Book
This eBook discusses the problems faced by Distribution system in most companies and shows the causes that are responsible for these problems.
It explains in detail, TOC’s application for Distribution system.
The eBook contains several Figures, Tables, Diagrams, Pictures, Charts, Graphs, examples, Quotes, Exercises and Games as appropriate. Most chapters are summarized in “Points to Ponder” at the end of certain chapters.
The eBook has some Multiple Choice Self-assessment questions. These questions help you to assess yourself the knowledge gained by you by reading this eBook.
This eBooks series is an excellent guide for those who want to learn TOC and its applications.
Copyright Information 3
This book is dedicated to 4
I am thankful to… 7
The Vicious Cycle 8
How to reverse the vicious cycle – The Solution9
Characteristics of a Distribution System12
Another Scenario 14
The Problem 16
Replenishment Time 19
The Conflict 21
The Bullwhip Effect 24
What is Bullwhip Effect? 24
Example of the bullwhip effect 24
What contributes to Bullwhip Effect? 25
Shortages and Surpluses 27
Quantifying Impact 29
Shortages, Surpluses and Lost Sales 29
Impact of increase in sales 29
Impact of increase in average sales price 30
Impact of decrease in OE 30
Quantifying Lost Sales 32
Quantifying Surpluses 33
Quantifying the Impact of Reduced Replenishment Time 35
Batching and its Ramifications 38
Batching at Retail Stores 38
Batching at Central / Regional Distribution Centers 38
Batching at Manufacturing Unit38
Structure and Functioning of Distribution Network 42
Dealing with Forecast 43
Determine Target Level Inventory for Each Product 46
Minimizing Replenishment Time 48
Buffer Zones 51
Buffer Management 54
How to Make the Solution Work? 57
Setting Good Criteria for Variety Decisions 59
Managing Variety 61
What is the impact of the TOC Replenishment System?63
Do the Basic Rules of Manufacturing also apply to Distribution? 65
Improving Flow in a Distribution System 65
Preventing over-production in a Distribution system 66
Taking care of possible negative outcomes of the solution 67
The New Mantras 69
Operational Measurements 70
Advantages of TOC’s Distribution Solution 72
A simple Example 74
Reversing the Vicious Cycle 74
Expected results 75
Self-Assessment Questions 76
eBooks published by Rajeev Athavale 80
Learner’s Guides 80
Article Repository 81
TOC Applications: Implementation Guidance for Small and Medium Size Enterprises 82
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