Tag: continuous improvement

How Johnstech Reduced Lead Times by 50%
The semiconductor industry is competitive, with efficiency and reliability being paramount for success. Johnstech International has consistently delivered results that surpass industry standards, most notably achieving a remarkable reduction in lead times to just 3-4 weeks, compared to the typical industry standard of 5-8 weeks. This achievement underscores their use of advanced planning, scheduling, and execution technology, setting a new benchmark for operational excellence. As manufacturers face the challenges of complex supply chains and market fluctuations, Johnstech’s approach over the last two decades stands out as a powerful example of how to optimize production and ensure timely delivery.

The Challenge: Navigating a Volatile Market

The semiconductor market is characterized by fluctuating demand and intricate production cycles. The global chip shortage during the pandemic amplified existing pressures, making on-time delivery a critical differentiator in the competition. For Johnstech, maintaining its position as a top-tier provider of test contactor solutions meant addressing several key operational hurdles:
- Meeting Aggressive Deadlines: The industry standard for lead times can stretch from 5 to 8 weeks. Johnstech needed a system to consistently outperform this average.
- Managing Complex Production: The nature of Johnstech products required a dynamic scheduling system capable of handling complex dependencies and priorities in real time.
- Ensuring Visibility: A lack of real-time visibility across the production floor can lead to bottlenecks, delays, and inefficient resource allocation.
To sustain growth and meet customer expectations, Johnstech required a solution that could synchronize its entire manufacturing environment, from the shop floor to the executive level. The goal was to build a resilient, demand-driven operation that could adapt to market shifts without sacrificing quality or speed.

The Solution: Real-Time Visibility and Dynamic Planning and Scheduling

Johnstech partnered with a leading technology provider renowned for its patented synchronization algorithm that revolutionizes manufacturing efficiency. This partnership enabled the implementation of a suite of powerful demand-driven software tools, including SyncManufacturing® and SyncView®. This strategic integration was designed to provide a cohesive, real-time view of the entire manufacturing ecosystem.

Real-Time Planning and Execution with SyncManufacturing^®

SyncManufacturing® provided Johnstech with an advanced planning and scheduling (APS) system that synchronized and prioritized all critical resources. This system moves beyond traditional enterprise resource planning (ERP) RP limitations by offering a dynamic, real-time approach to production management. The software managed constraints and adapted fluidly to drive flow and ensure on-time production. Synchronizing the entire supply chain allowed Johnstech to manage priorities, status, equipment, and alerts with unparalleled precision. This capability was instrumental in optimizing workflows and minimizing idle time.

Unprecedented Visibility with SyncView^®

Complementing the APS system, SyncView® created a real-time visual factory. This tool provided multi-enterprise visibility, keeping every level of the organization synchronized and informed. Decision-makers, planners, and operators gained access to live data on priorities, equipment status, and potential constraints. This level of transparency empowered teams to make proactive, data-driven decisions. Instead of reacting to disruptions, they could anticipate and mitigate them, keeping production schedules on track. The visual interface made complex data accessible and actionable for all stakeholders.

The Results: Setting a New Industry Standard

The implementation of this integrated software suite yielded transformative results for Johnstech, solidifying its reputation for reliability and performance. The data speaks for itself.

Industry-Leading Times

By optimizing every facet of its production process, Johnstech dramatically reduced its lead times. The company now consistently delivers complex, custom solutions in just 3 to 4 weeks, a stark contrast to the industry average of 5 to 8 weeks. This speed provides Johnstech and its customers with a significant competitive advantage, especially in a market struggling with the global chip shortage.

Exceptional On-Time Delivery

Another impressive outcome is Johnstech’s ability to surpass a on-time delivery goal of 95% and maintain a 98-99% on-time delivery rate. This near-perfect record is a direct result of the real-time synchronization and advanced planning capabilities of its new system. For customers in the semiconductor industry, where project timelines are rigid and delays are costly, this level of reliability is invaluable. It demonstrates a mastery of the supply chain and a deep commitment to customer success.

Get the Full Story

The Johnstech story is more than just a case of successful software implementation; it is a testament to the power of demand-driven manufacturing. By embracing real-time data and advanced planning and scheduling, the company has not only weathered the global chip shortage but also thrived. Their ability to deliver faster and more reliably than competitors offers a compelling model for any manufacturing leader aiming to optimize operations.

To get the complete details of how Johnstech achieved these remarkable outcomes, download the full case study. Discover the specific strategies and technologies that enabled them to redefine performance in semiconductor testing.

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January 27, 2026
Strategic Prioritization: The Manufacturing Leader’s Guide to Operational Excellence
Manufacturing organizations face an uncomfortable truth: having the capacity to produce something doesn’t mean you should. Every resource allocation decision—from accepting sales orders to scheduling production runs—directly impacts your bottom line. Without strategic prioritization driving these decisions, even the most sophisticated manufacturing operations can spiral into inefficiency, missed deadlines, and diminished profitability.

Strategic prioritization extends far beyond simple task management or reactive firefighting. It represents a fundamental shift toward aligning every organizational function with your company’s core objectives. When implemented effectively, strategic prioritization becomes the driving force of your manufacturing operation, ensuring that sales, engineering, procurement, production, and logistics work as a cohesive team.

The stakes couldn’t be higher. Discrete manufacturers operating in today’s competitive landscape cannot afford misaligned priorities. Resource constraints and material availability limitations mean that every decision carries significant consequences. Organizations that master strategic prioritization gain sustainable competitive advantages, while those relying on ad hoc approaches face mounting operational challenges.

Understanding Strategic Prioritization in Manufacturing

Strategic prioritization means every person in your organization works toward the same objectives—objectives that directly align with your company’s vision and goals. This alignment creates a powerful multiplier effect where individual efforts combine to drive exceptional organizational performance.

The foundation begins with executive leadership establishing a clear vision and objectives based on core values. However, translating high-level strategy into daily operational decisions requires a systematic approach. Strategic prioritization serves as this critical translation mechanism, filtering every function and process through your strategic lens.

Manufacturing environments demand particular attention to this alignment. Sales teams must understand which products generate the highest strategic value, not just the highest commissions. Production managers need clear guidance on which orders deserve priority when capacity constraints force difficult choices. Purchasing departments require strategic direction to optimize supplier relationships and inventory investments.

The Hidden Costs of Manual and Ad Hoc Prioritization

When manufacturing operations operate without a clear, systematic framework for prioritization, they inevitably fall back on manual and ad hoc decision-making processes. This isn’t a conscious strategy, but rather a default stat where critical choices are made without understanding the cascading inefficiencies they can have that compound throughout the operation. “

Local Optimization Challenges

Manual prioritization typically occurs at the local level, where decisions are based on limited visibility rather than comprehensive data. Manufacturing managers responsible for specific production areas make priority decisions that optimize their local metrics while potentially suboptimizing the entire system.

Imagine a manufacturing manager overseeing an operation ten levels deep in a complex product structure. Their ad hoc priority decisions directly impact downstream production capabilities. While they may achieve excellent utilization metrics in their area, their decisions might create bottlenecks and delays at points downstream operations that compromise overall system performance.

Expert knowledge within specific areas doesn’t translate to understanding complex organizational interdependencies. The more sophisticated your manufacturing processes, the more these local optimization decisions can undermine strategic objectives.

Systemic Consequences

Organizations relying on manual prioritization processes experience predictable negative outcomes. Resource misalignment becomes endemic as different departments pursue conflicting priorities. Lead times extend as work flows inefficiently through production systems. Critical deadlines slip when urgent tasks overwhelm the company’s ability to respond.

Perhaps most damaging, these organizations lose competitive advantage as more strategically aligned competitors capture market opportunities. Without structured prioritization frameworks, manufacturers lack the synchronization necessary for continuous improvement and sustainable growth. These challenges highlight the urgent need for a structured prioritization framework that can address inefficiencies and align operations with strategic objectives.

Framework for Structured Prioritization

Implementing effective prioritization requires a systematic framework addressing five critical components.

1. Understanding Organizational Relationships

Document relationships between activities required to complete orders. Manufacturing organizations use value stream mapping, process mapping, SIPOC diagrams, swim lane diagrams, and dependency structure matrices to capture these relationships.

These documented relationships must be entered into systems that both humans and computers can understand and process. Product structures in ERP systems, planning and scheduling systems, and manufacturing execution systems provide examples of this requirement.

Understanding precedent relationships enables accurate propagation of order due dates throughout all related activities. Without this understanding, synchronization becomes impossible.

2. Constraint Analysis Implementation

Organizational relationships create networks of activities and interdependencies. Understanding these networks enables the identification of resources and processes constraining productivity. Focusing improvement efforts on these constraints delivers sustainable growth and enhanced profitability.

Theory of Constraints (TOC) provides an excellent framework for constraint analysis and management. While most commonly associated with manufacturing, TOC applications extend successfully to project management, supply chain management, marketing, and engineering operations.

The TOC process follows five steps:
1. Identify system constraints
2. Exploit constraint capabilities fully
3. Subordinate all other activities to support constraints
4. Elevate constraints through capacity improvements
5. Repeat the process for continuous improvement
Step two, exploit the constraints, directly relates to strategic prioritization. Constraints represent critical resources where time invested in non-strategic activities represents permanent losses. Constraints must work in strict priority order aligned with organizational objectives.

Step three, subordinate all other activities to support constraints, is about bringing all other activities within the company in alignment with strict priority established at the constraints.

3. Tie-Breaker Mechanisms

Due date prioritization inevitably creates conflicts when multiple orders require the same critical resources simultaneously. Organizations typically establish customer, program, or product priorities using classification systems. Government contractors may receive mandatory priority designations for specific programs.

Regardless of your tie-breaker methodology, two requirements must be met:
- Methods must align with strategic organizational priorities
- Planning and scheduling systems must incorporate priority information into scheduling logic
Priority doesn’t mean production sequence. Higher priority orders receive preference for on-time performance when resource conflicts occur. Planning and scheduling systems unable to incorporate non-date priority information will be bypassed, creating disconnected manual and ad hoc systems.

4. Systems Integration Strategy

Activities required to complete orders often occur in disparate systems. These systems require tight real-time integration to accurately propagate priority throughout all activities. Every system should reflect identical priorities.

Systems difficult to integrate represent candidates for replacement, especially considering AI capabilities requiring access to comprehensive, timely information. Modern manufacturing environments demand seamless information flow between all operational systems.

5. Organizational Visibility

From executive boardrooms to production floors, all employees must work toward identical goals. Regardless of the systems employees use, priorities must be highly visible and easily understood.

Systems failing to accurately synchronize activities with organizational priorities should be replaced. Interactive dashboards can sometimes overcome system limitations by embedding priority logic into visual displays. However, tightly integrated systems remain necessary for comprehensive implementation.

Implementation Strategy for Manufacturing Leaders

Strategic prioritization implementation requires systematic change management addressing both technological and cultural dimensions.

Executive Commitment: Leadership teams must demonstrate unwavering commitment to strategic prioritization principles. This commitment includes making difficult decisions that prioritize long-term strategic value over short-term local optimization.

Technology Infrastructure: Evaluate existing systems for integration capabilities and real-time information sharing. Identify systems requiring replacement or significant upgrading to support organization-wide prioritization requirements.

Training and Development: Employees at every level need training on strategic prioritization principles and their role in organizational alignment. This training must extend beyond manufacturing to include sales, engineering, and support functions.

Measurement and Continuous Improvement: Establish metrics measuring prioritization effectiveness. These metrics should track alignment between activities and strategic objectives and achievement of organizational goals.

Driving Sustainable Manufacturing Excellence

Strategic prioritization transforms manufacturing organizations from reactive firefighting operations into proactive, strategically aligned enterprises. When every decision aligns with organizational objectives, the cumulative impact drives exceptional performance improvements.

Manufacturing leaders implementing strategic prioritization frameworks position their organizations for sustained competitive advantage. Resource constraints become optimization opportunities and leverage points rather than limiting factors. Complex manufacturing processes operate in harmony rather than creating internal conflicts.

The time for implementation is now. Manufacturing becomes more competitive each day, and organizations that gain strategic prioritization advantages will be increasingly difficult to match. Begin by assessing your current prioritization approaches, identifying improvement opportunities, and developing systematic frameworks for organizational alignment.

Your manufacturing operation’s future depends on strategic prioritization excellence. The question isn’t whether you can afford to implement it, it’s whether you can afford not to.

See how SyncManufacturing® incorporates business priority information into planning and scheduling by requesting a demo.

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January 6, 2026
Solving Wood Products Planning and Scheduling Challenges with Master Item Planner 
Table of Contents
Manufacturing wood products is not for the faint of heart. As if seasonal and economy-based demand variability weren’t enough, working with organic raw materials such as wood inherently leads to manufacturing process variability. Skilled workers and robust processes are needed to ensure sustainable operations despite thin margins in this highly competitive market.  

This post explores the manufacturing challenges faced by wood products manufacturers and shows how SyncManufacturing® and the Master Item Planner module address these issues. 

Wood Products Manufacturing Challenges

If you’re a production scheduler in the wood products industry, you know how challenging your role can be. No matter what the Master Production Schedule produced by your ERP system says, you no doubt spend hours adjusting schedules to real-world constraints, such as the quantity and quality of raw materials available, current workforce skills and availability, and the inevitable supply chain delays. Despite all your efforts, your production schedule can become instantly obsolete when things change, such as discovering that one of your raw materials shipments wasn’t up to the promised quality standards.

But the wood products production planner’s challenges do not stop there. As an example, take the challenge of manufacturing engineered wood products such as an LVL beam. LVL, short for laminated veneer lumber, is manufactured as a large panel often referred to as a “billet.” This panel is then cut lengthwise to achieve the desired height of the final product before being trimmed crosswise to the required length. Twenty or more finished products can be cut from one billet. The production planner’s challenge becomes how best to fulfill customer orders while minimizing material waste and maximizing plant capacity.  

4 Steps to Minimizing Waste and Maximizing Resource Utilization

To help our wood products customers address this challenge, we added a feature called the Master Item Planner to SyncManufacturing. The Master Item Planner evaluates countless production scenarios against customer demand and identifies the most effective approach. From this optimized solution, SyncManufacturing generates a detailed plan, complete with electronic work orders.

Since most manufacturers we work with love details, let me dig a bit deeper into that process, providing more specifics on each of the steps:

Step #1 – Based on customer demand, SyncManufacturing generates order suggestions based on desired inventory levels and minimum order quantities. This step is not unique to wood manufacturers. Aggregating customer demand into order suggestions is a fundamental function of SyncManufacturing Advanced Planning and Scheduling (APS).

Step #2 – Here’s where the Master Item Planner addresses the unique needs of wood product manufacturers. SyncManufacturing determines the optimal billet size as well as rip (lengthwise) and cut (crosswise) operations needed to produce the finished products most efficiently. 

Step #3 – While SyncManufacturing automatically generates optimized production schedules, no one knows their business like production planners and schedulers do. Once they’re happy with the production plan, they tell SyncManufacturing to generate the electronic work orders necessary to execute it.

Step #4 – Lastly, SyncManufacturing schedules the electronic work orders, optimizing changeovers, batching, and material flow through the plant. 

“SyncManufacturing’s Master Item Planner has enabled us to schedule our plant operations more effectively, reducing changeovers and minimizing waste.  We appreciate Synchrono’s efforts in building this tool.”
Ryan West, Scheduling and Optimization Manager, SIOP at Roseburg Forest Products

4 Benefits of Master Item Planner

Master Item Planner helps wood products manufacturers optimize their operations and achieve greater productivity and production efficiency. Let’s dig a bit deeper into these key benefits.

Minimize material waste – By evaluating all possible options, the Master Item Planner creates a low-waste plan that ensures materials are used most effectively. The Master Item Planner can also be configured to meet the needs of individual facilities, such as prioritizing filler products based on historical demand, preferring certain billet lengths, or focusing on full bundle or unit sizes of finished products. 

Maximize plant productivity – Because the Master Item Planner creates electronic work orders and aggregates customer demand into stock order suggestions, plant productivity can be calculated and forecasted. Instead of booking to approximations of capacity, like linear or cubic feet, SyncManufacturing can direct the sales team to book new orders directly against machine hours. 

Increase production efficiency and agility – Instead of manually determining plans using spreadsheets and institutional knowledge, the Master Item Planner can calculate a plan in seconds. The time difference between tweaking a pre-made plan and manually creating a plan from scratch is significant. Automated production scheduling software also allows the business to be more responsive to last-minute rush orders from customers. 

Improve workforce utilization and retention – Hiring and retention issues frequently come up in our discussions with customers. Production schedulers and planners are often seasoned employees with a lot riding on how well they perform their role. Standardized, automated production scheduling processes reduce burnout by making the planning and scheduling roles less stressful and making it easier for others to fill in. Standardized processes can also make it easier to onboard new people when current staff members retire.

See Master Item Planner in Action

We’re excited to introduce the Master Item Planner module within SyncManufacturing® and would like to thank Roseburg Forest Products for their support throughout the development process. Based on their input, Master Item Planner continues to maximize the value, such as reducing waste and maximizing manufacturing efficiency and productivity. For more information and to see the Master Item Planner in action, schedule a demo with one of our specialists. 

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October 2, 2025
The Best Time to Kick Off a Continuous Improvement Initiative

Prosperity is perhaps one of the greatest obstacles to continuous improvement in manufacturing. When things are going well, we don’t feel the need to make improvements quite as keenly. For example, instead of focusing on removing waste in our factories to become more cost competitive, we might opt to add capacity so we can keep up with demand.

There really is no better time to make improvements than when things are going well. In this post, we’ll take a quick look at what the research says about the short-term outlook for manufacturers. Then, I will explain why now is the best time to kick your continuous improvement efforts into high gear.

Things Are Looking Up

After nearly a decade of belt-tightening, many sectors are returning to a renewed sense of optimism. This is especially true in manufacturing. An amazing 93.5% of respondents to NAM’s 1st Quarter 2018 Manufacturer’s Outlook Survey registered a positive outlook, the second highest level recorded in the survey’s 20-year history.

Of course, because NAM is reporting on human sentiment, there’s always the chance that their results aren’t indicative of what’s actually happening in the market. Humans are not always the most objective source of “data.”

MAPI (Manufacturer’s Alliance for Productivity and Innovation) looks at a number of variables to project growth rates for the manufacturing sector. In March of this year, they nearly doubled their projected average growth for the U.S. manufacturing sector for the 2018-2021 period from 1.5% to 2.8%.

It’s not that you can’t find anyone who thinks things are not as rosy as they seem, but much of the negativity stems from a concern that the economy will grow too fast. That sounds to me like what an old colleague of mine in the manufacturing sector used to call “a happiness problem.” For now, most manufacturers I know are just trying to make the most of the opportunity presented to them.

Optimistic Workers Make the Best Change Agents

As anyone who has ever tried to implement a continuous improvement effort knows, the more secure your shop floor workers feel, the more likely they are to support change. While neither the NAM survey or the MAPI analysis look at worker sentiments, there’s no doubt that the optimism at the top has a way of filtering down.

Consider these two very different scenarios:

Scenario A: The Mandate to Cut Costs

A machinist has just stepped out of a company-wide meeting in which executives issued a cost-cutting mandate due to a slowdown in orders. With support from the COO, production managers decide the best way to cut costs is to lower inventory levels by implementing constraints management.

Now they need to explain it to the machinist and other team members in similar roles.

What the operations manager says: “We’ve identified the painting station as the constraint in our operations, so we’re going to set the pace of production to maximize capacity at that station. We don’t want you working on anything other than what the system tells you to. This may mean you have more downtime, but that’s OK. We’re not measuring utilization rates right now.”

What the machinist hears: “We need to cut costs, so we’re going to cut back on production. We know you’ve been making more than you needed to anyway. You’ll probably have more idle time because we won’t always have enough work to keep you busy.”

During one of those idle times, the machinist starts to wonder how long it will be before the cost-cutting measures include his job.

Scenario B: Let’s Pick Up the Pace!

This time, the company meeting is about increasing the pace of manufacturing. The sales pipeline is fuller than it’s been in a long time, and sales believes that if the company can decrease lead times they’ll be able to have a banner year and increase market share.

Once again, the operations managers decide to implement constraints management. This time the focus is on increasing velocity.

What the operations manager says: “We’ve identified the painting station as the constraint in our operations, so we’re going to set the pace of production to maximize capacity at that station. We don’t want you working on anything other than what the system tells you to. This may mean you have more downtime, but that’s OK. We’re not measuring utilization rates right now.”

What the machinist hears: “Business is good, but we need to determine how to step up our pace. We’re going to try this thing called constraints management. It will seem a little strange at first, but it’s all part of the process.”

In this scenario, the machinist does some reading on Lean and attends a few workshops during his downtime. Instead of worrying about his future, he starts to think about how he might contribute to the initiative. Maybe he’ll even work to become a green belt and advance in his career.

Making Hay While the Sun Shines

Nothing lasts forever, and that includes a great economy. The continuous improvements you implement now can set you up to weather the hard times ahead with both better processes and better people. The sun is shining on much of the manufacturing sector. Now is the time to take advantage of it.

In this post, I focused on constraints management, but there are many other types of continuous improvement initiatives. If you’re still defining your approach, we have plenty of resources you can mine for ideas. Here are just a few.

Paper: 4 Ways SyncKanban eKanban Technology Drives Continuous Improvement

Paper: Get Lean on Scrap

Post: How the Internet of Things Can Shorten Lead Times

Post: How the Internet of Things Can Help Lower Inventory Levels

Video: How Orbital ATK is Leveraging the IIoT and Visual Factory Technology to Drive Continuous Improvements

Post: Turn Your Gemba Walk Into a Power Walk

For additional ideas, visit our Resources page on our website.

July 23, 2018
Three Ways Leaders Create Lean
Three Ways Leaders Create Lean

“Relentless” leadership and team empowerment drive lean change

For those of you who have heard this before, it bears repeating. For those of you who have not, this is important – leadership is the single most important component to lean success.

It is exciting to talk about bottom-up change and expect that a ground swell of individuals in virtually every level of the organizational chart can succeed with lean—in spite of those in the C-suite that just don’t get it. But in practice, this has to happen early on or there is little-to-no chance of success.

Who’s driving this thing?

I am not saying that lean changes cannot start from the bottom-up; but the situation needs to flip quickly to leadership driving the bus. That’s because at some point early on in your lean journey, your methods will start to conflict with some long-standing processes and metrics. These formerly sacrosanct topics need to be addressed by leadership (those with the power to change them) before your journey can continue.

Once leadership is on board, the leader(s) can come from anywhere in the company. But to prevent stagnation at a higher level, leaders must carry the torch of continuous improvement tirelessly and relentlessly.

80/20 rule

They can start out leading the kaizen events but they need to mentor and train those doing the work in order to keep continuous improvement alive and well. Mature lean organizations expect 80% of their improvements to come directly from those closest to the work. This is the only way to fully utilize the talents and capabilities of your human assets. Give the people closest to the work the tools and the support necessary to astound you with their creativity and innovation.

Out on the floor

Gone are the days where leaders sit in their offices sending out directives to the rest of the organization and lead mainly by pounding on the rest of us when those directives are not met. Today, leaders are responsible for training and mentoring their people. They equip them with the tools of continuous improvement and empower them to remove the obstacles that block their way. Here are some ways I have seen manufacturing leadership create a more demand-driven culture:
- Of machines and men (or women) – Leaders who think of their production staff as extensions of their equipment are making a fatal error. Empowered people who feel their bosses care about keeping them on staff by growing their skills and offering development opportunities are the people who will drive the changes needed to make your business excel.
- “Scaffolding” support – It is a huge mistake to treat your people like their only role is to follow the standard operating procedures (SOPs) handed down from above and that the only way they drive value is when their direct labor hours are being absorbed into products. You are under-utilizing the most valuable assets in your organization. It doesn’t happen overnight and without any effort, but you must build the scaffolding needed to support your people by giving them the tools, confidence, and authority to make changes. It is the people closest to the work – and who know the most about the process – that can provide the greatest innovation if you build the foundation on which they can innovate.
- Training rolls on- Training should never stop. I hear the complaints and the unending list of obstacles – no time, no budget, where to begin, no senior-level support, and so on. But every moment spent training your people yields ongoing hours saved in fixing mistakes, putting out fires and trying to explain your poor results to the powers that be. Equip them with the tools, confidence, and abilities to speak up when something’s wrong; show them how to look for solutions and take ownership of results, and you are tuning up the “true improvement machine” on your shop floor and beyond.
I have been working with supply chain professionals and manufacturing leaders my entire career. If there is one thing I can say about the successful ones, it’s this: Effective change agents in manufacturing environments invariably spring from a leadership culture that supports the people not just the change — every step of the way.

– John Maher

John’s passion for demand-driven manufacturing is equal to his interest in how this method improves the lives of employees within these environments. “I’m here to help, not to judge” comments John whose posts reflect why demand-driven matters and are based on his experience working in manufacturing environments and expertise in ERP, MRP, APS, supply chain, manufacturing planning and scheduling systems and constraints management.
May 21, 2018
Fast Results Using TOC for Demand-Driven Manufacturing – Part Two
Manufacturers use constraints management first to gain the most demand-driven change

Last time, we talked about focusing on enterprise improvements rather than local efficiencies using constraints management (TOC). We discussed that continuous improvement tools such as TOC, Lean and Six Sigma work like “sandpaper” on an organization’s processes, smoothing various stages of their demand-driven journey.

I likened TOC to the “coarse” grit of sandpaper—the one to use first to get the best results–faster. Before discussing the other tools (which I’ll address in future articles), I wanted to share how the TOC principles we discussed last time have brought real results to two manufacturers.

Constraints management improves throughput, on-time delivery, more

My first example, a discrete manufacturer of test equipment for semi-conductors, decided that they could do better and that TOC was going to be the philosophy they utilized to do it. They had a lot of difficulty in production and in meeting their client requirements. They began by implementing drum buffer rope (DBR) scheduling. As part of this, they identified a drum for the organization and began managing it as the constraint. It is important to note that TOC people do not regard constraints as bad things per se, instead, they look at them as leverage or control points that allow you to simplify management of your system. There are many people that I come across who think TOC is about identifying and eliminating constraints. However, Goldratt viewed constraints as a positive item in that in an interconnected environment, the constraints provided the leverage points that greatly simplified management of the system. Goldratt once told me that the constraint within an organization should not move any more than once every two to three years.

Once the drum was identified, the next steps were to exploit the constraint and subordinate all other resources to the constraint. As part of this, the company identified a number of policy and process changes. First, they changed what they did when a constraint resource needed a first-article inspection before continuing to run. They began moving the parts requiring inspection to the front of the queue and, in some cases, removing parts from the test equipment in the middle of the test, in order to service the constraint faster. Soon, the team carried this first-in-line mentality throughout the organization with a laser-like focus on clearing anything that got in the way of the constraint producing to current customer demand. Here are their results:
- Increased constraint throughput by 120%.
- Increased on-time delivery from low 70% to 95%+.
- Cut cycle time and lead-time in half.
Before this change, the company was outsourcing 50% of the work for the constraint. They have since brought it all in house where the yields were much higher, plus, they added another 20% of throughput.

All of this was accomplished within four months and without making one physical alteration to production. No 5S, no kaizen events, no SMED, no value-stream maps, no re-laying out of the production process, no Six-Sigma projects. Also, no additional people or capital equipment were needed. The tools of Lean and Six-Sigma were critical to continuous improvement and refinement of the process, but Constraints Management (harkening back to the sandpaper analogy) served as the coarse sandpaper, taking a rough board and making the dramatic change of smoothing it out.

60% on-time delivery to 90+

Another example – During my work with a discrete manufacturer of capital equipment, with hundreds of parts needed to move through a spaghetti-type flow and meet up in final assembly. Chaos and stress reigned throughout this organization, with the head of final assembly serving as chief expediter. Our aim was to increase their on-time delivery rate which was in the low 60% range and their replacement part fill rate which was less than 50%.

We turned it around by focusing on synchronization and the pacemakers of production. We began by “choking work” into production at the rate the system could handle and subordinated all other resources to the constraints and to final assembly. Soon parts were delivered on time to final assembly, and, ultimately the customer. The results?
- On-time delivery up to 95%+
- Increased fill rate to the upper 90% range
- Returned profitability to the organization for first time in four years
- The head of assembly spent time managing assembly rather than expediting parts.
All of this happened in less than six months. Again, not a resource was added, not a single resource was moved; the physical flow of material was unaltered– yet these were the results.

In both of these cases, it was still critical to employ the tools of Lean and Six Sigma to continue the path of continuous improvement, and we’ll talk about that the next time I write to you. However, these cases prove that nothing gets results as fast as the use of Constraints Management. The board will never get as smooth as when Lean and Six Sigma are used after TOC– but to take a really coarse board and make it relatively smooth quickly and efficiently, you need the coarse sandpaper (TOC) –and then the medium (Lean) –and then the fine (Six Sigma)– to make it as smooth as glass.

This is part two of a three-part series. Here are the links to the entire series.
- Part 1, What Sandpaper Will You Use?
- Part 2, Fast Results Using TOC for Demand-Driven Manufacturing
- Coming soon
-John Maher

John’s passion for demand-driven manufacturing is equal to his interest in how this method improves the lives of employees within these environments. “I’m here to help, not to judge” comments John whose posts reflect why demand-driven matters and are based on his experience working in manufacturing environments and expertise in ERP, MRP, APS, supply chain, manufacturing planning and scheduling systems and constraints management.
April 23, 2018

“test”