I always love having a guest writer for my weekly letter, and this week I am honored to have Vinny Monteiro, director of the Goldratt Group.
Goldratt Consulting was founded by Dr. Eliyahu Goldratt, and his son, Rami Goldratt, serves as the CEO. Eliyahu Goldratt was an Israeli physicist-turned-management-thinker who wrote the classic business novel “The Goal.” If you’ve never read it, the book follows a plant manager who has 90 days to save his factory from being shut down. Goldratt uses it to teach a powerful idea on the Theory of Constraints.
Goldratt’s core message is simple: every organization has one key constraint that limits its performance. Improve that constraint, and the entire system improves. Ignore it, and no amount of effort elsewhere will make a meaningful difference.
“The Goal” was one of the first books I read when I started in manufacturing, and it stayed with me throughout my career. I know those of us who have read the book have used the “Herbie” analogy more than once. You will have to read the book to understand that.
What I appreciate most about Goldratt’s work is understanding where our true bottlenecks are and aligning our efforts around them. It’s a mindset that applies far beyond manufacturing. Teams, projects and even personal goals all have constraints that quietly shape our results. When we identify and address them, progress accelerates.
Goldratt partners with AME to deliver TOC flow solutions workshops. This week, Vinny Monteiro shares a unique perspective on efficiency.
What if efficiency is the problem?
Written by: Vinny Monteiro, director of Goldratt Group
I know this may sound odd, especially coming from an industrial engineer, but let me ask you something: What if some of your best efficiency gains are actually hurting throughput?
I know. That sounds backwards. We’ve been trained to believe that high efficiency (high OEE) is always good. That keeping machines running, people busy and maximizing utilization are the paths to getting more done.
But here’s what I’ve seen in dozens of manufacturing environments: companies that obsess over local efficiencies often struggle with on-time delivery, excessive overtime and frustrated customers. Everything is “busy.” What is missing is proper flow.
This paradox is at the heart of Theory of Constraints (TOC), a management methodology developed by physicist Dr. Eliyahu Goldratt (some of you may have read “The Goal”). TOC starts with a claim that, when you stop and think about it, is quite bold: it states that any system, no matter how seemingly complex, can only have one constraint that determines overall performance. Optimizing anything other than those constraints doesn’t improve the system — it often makes things worse.
Think about it. If you speed up a process that feeds into a bottleneck, you don’t get more output. You get more stuff piled up in the bottleneck. More chaos.
The TOC approach changes the paradigm from “How do we make every resource more efficient?” to “How do we increase the flow of value through the entire system?”
This shift in thinking has helped organizations double output without adding resources, cut lead times in half and finally escape the end-of-month firefighting that exhausts their teams.
For those of us committed to continuous improvement, TOC isn’t a competing philosophy. It’s a focusing mechanism, a way to ensure our process improvement efforts actually move the needle where it matters most.
The question isn’t “How do we get more efficient?” It’s “What’s actually constraining our flow, and what would happen if we focused there first?”
Flow is the force.
May the flow be with you.
Thank you, Vinny, and the entire Goldratt community. We appreciate your partnership and invite our membership to attend one of our upcoming AME Goldratt events offered around the country. If you don’t see your area on the list, reach out to bclayton@ame.org to schedule an event.
As always, please stay safe and keep looking for one another.
