How to Handle Bottlenecks in Operations Management

How to Handle Bottlenecks in Operations Management

What is a Bottleneck?

The term bottleneck refers to the physical shape of a bottle. The narrowest point is at the neck and the most likely place for congestion to occur. Bottlenecks occur when work arrives at a given point more quickly than that particular point can handle it. Bottlenecks are inefficiencies that manifest themselves for a variety of reasons in a host of industries.

 

Identifying and Managing Bottlenecks

Bert Markgraf, writer for Demand Media, explains in his article, How to Identify Bottlenecks in Manufacturing, that if companies can quickly identify the bottlenecks slowing down the production line, they can rectify them, speed up the production line, and increase productivity.

There are different types of bottlenecks. Some bottlenecks can be eliminated by critical thinking skills and quick problem solving but there are others that are much more difficult to identify. Markgraf explains that finding and rectifying these four types of bottlenecks are essential to major performance improvement:

1. Accumulation

If a production line has a long queue, you are likely to see a bottleneck. Sometimes it is easy to identify where the bottleneck is occurring and then develop a simple solution but there are other times when it is far more complicated to determine what is going on and find a remedy. Simple solutions include fixing a machine or providing operators with more training.

2. Throughput

Think of throughput as the amount of product produced over a specified time period. If you have machines timed to send a product out over a specific time period, it may be possible to change the throughputs one machine at a time until you find the optimal interval and prevent a bottleneck. That could involve one machine or several.

3. Full Capacity

If all your machines are producing at their very top level for a given time period, you may have a bottleneck. The only effective way to deal with this type of bottleneck is to find a machine with increased capacity.

4. Wait Times

Wait times are almost self-explanatory. If there is a hold-up on a machine, you may need to review the machine that is the step just prior to the one with the wait time to determine what needs to be done. Wait-times are bottlenecks and lost time for everyone in production.

 

Applying Theory of Constraints to Manage Bottlenecks

Those skilled in Operations Management understand that the best-practice for improving process flow is to rely on the theory of constraints. Made famous by Eliyahu M. Goldratt in his book The Goal, the implications of the theory are “far reaching in terms of understanding bottlenecks to a process and better managing these bottlenecks to create an efficient process flow.” Simply put, the theory states, “the throughput of any system is determined by one constraint (bottleneck).” Thus to increase the throughput, one must focus on identifying and improving the bottleneck or constraint. Goldratt in another book, Theory of Constraints, outlines a five-step process to applying the theory:

  1. Identify the process constraints
  2. Decide how best to exploit the process constraints
  3. Subordinate everything else to the above decisions
  4. Evaluate the process constraint
  5. Remove the constraint and re-evaluate the process

Once managers of operations have a conceptual understanding of the theory of constraints, they can apply the theory and begin working to identify the particular bottlenecks hampering their process flow. Once theses bottlenecks are identified, corrective action can occur resulting in a company regaining control of not only their production schedules but their competitive edge.