Too busy to read?

"A bottleneck," Jonah continues, "is any resource whose capacity is equal to or less than the demand placed upon it. And a non-bottleneck is any resource whose capacity is greater than the demand placed on it.

"I mean anything that isn't within the current demand," he says. "Because what happens when you build inventory now that you won't sell for months in the future? You are sacrificing present money for future money; the question is, can your cash flow sustain it? In your case, absolutely not." "He's right," admits Lou. "Then make the bottlenecks work only on what will contribute to throughput today . . . not nine months from now," says Jonah. "That's one way to increase the capacity of the bottlenecks. The other way you increase bottleneck capacity is to take some of the load off the bottlenecks and give it to non-bottlenecks.

the level of utilization of a non-bottleneck is not determined by its own potential, but by some other constraint in the system."

He points to the NCX-10 and says, "You have on this machine only so many hours available for production--what is it. . . 600, 700 hours?" "It's around 585 hours a month," says Ralph. "Whatever is available, the demand is even greater," says Jonah. "If you lose one of those hours, or even half of it, you have lost it forever. You cannot recover it someplace else in the system. Your throughput for the entire plant will be lower by whatever amount the bottleneck produces in that time. And that makes an enormously expensive lunch break."

"What you have learned is that the capacity of the plant is equal to the capacity of its bottlenecks," says Jonah. "Whatever the bottlenecks produce in an hour is the equivalent of what the plant produces in an hour. So . . . an hour lost at a bottleneck is an hour lost for the entire system."