The Theory of Constraints

This is another brilliant blog series by Tiago Forte (of “future of productivity” fame), this time on the topic of the “theory of constraints” – a powerful organizational productivity theory developed in the 1980s by Eliyahu Goldratt. While the original application was developed in an industrial context, it was recently adapted to a knowledge work context in the Phoenix Project – a business parable that I would highly recommend reading.

Tiago’s series is another adaptation of it, in a knowledge work context, putting some more historical context around it and hitting all the major implications. The first 8 parts of the series a publicly available:

  1. Introduction to the series
  2. The illusion of local optima
  3. The four fundamental principles of flow
  4. Balance flow, not capacity
  5. Drum-Buffer-Rope at Microsoft
  6. The five focusing steps
  7. Identifying the constraint
  8. Optimizing the constraint

This series is a joy to read on its own merit, but have certainly raised 3 super-interesting questions for me, considering its implications in a broader context:

  1. Resolving organizational constraints is exactly the type of “complex coordination problem” that’s often used to justify the need for managerial hierarchies. It’s interesting to follow the “role of management” in the solution that’s outlined in the series and ask ourselves: What would a more self-organizing/self-managing solution to an organizational constraint problem might look like?
  2. At least in the American work culture, the busy=valuable equation goes deeper than management’s view of employees into employees’ own sense of self-worth. Under the old paradigm, it’s management’s job to solve this principle-agent / self-interest problem. How would it get solved under a more egalitarian paradigm in which the distinction between “management” and “employees” does not exist?
  3. With the expanding use of OKRs and “goal setting” methodologies more broadly, the notion of “stretch goals” is considered a best practice (see my own post on this topic here). However, the Theory of Constraints casts a pretty big shadow over this practice, being a good example of a “local optima” or a situation in which “optimizing the part (individual performance) does not optimize the whole (organizational performance)”. Is this a polarity to be managed? and if so, what are some of the tools to do so?

End-note: sadly, Tiago decided to put a pay-wall around his future posts, which means that I’m less likely to showcase any of them here. You can pay and subscribe to his publication here

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The Theory of Constraints

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