This is an individual chapter of Theory of Constraints Handbook. The purpose of this chapter is to suggest ways that TOC can be used to address problems of complex organizations. We start by providing a definition of complexity and then describe the core conflict of complex organizations, which we believe results from the need for both continual growth and organizational stability.
The problem complex organizations face is coordination of many independent units that are all trying to maximize local measures. We propose a key injection "Everyone in the organization who has a significant impact on Throughput is measured by Throughput Dollar Days (TDD)" and show how TDD and other TOC Supply Chain measures can be used in complex organizations to create an effective method of coordination between independent units and give senior management new insight and greater ability to manage such organizations.
James F. Cox III, Ph.D, CFPIM, CIRM, holds TOCICO certifications in all disciplines. He is a Jonah's Jonah, Professor Emeritus, and was the Robert O. Arnold Professor of Business in the Terry College of Business at the University of Georgia. Dr. Cox has written three books on TOC.
John Schleier holds TOCICO certifications in all disciplines. He was President and Chief Operating Officer of the Mortgage Services Division of Alltel, Inc., Executive Vice President of Computer Power, Inc., and Director of Office Systems and Data Delivery for IBM.
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