Improving Production at Little Cost
Increasing the capacity of constraint C to 165/hour will increase the system throughput by 10%, probably at no cost. C would still be the constraint. Since excess WIP was removed in Step 0, the increased throughput will appear very quickly. A 10% increase in Throughput probably for free! See Figure 5.
Figure 5: System with element C throughput increased by 10%
Increasing C from 165 to 210/hour will move the constraint to D as shown in Figure 6. D's capacity is 170 versus C's 210. That is only a 3% throughput gain for the system, even though A's capacity increased 27% (45/hour). That is not much benefit provided by the increase in C. A smaller increase in C may be more cost effective.
Figure 6: Effect of increasing element C to 210 pc/hour
The system is now limited to 170/hour, the rate of D, the new constraint. Increasing the capacity of D to 185/hour will move the constraint to B, 180/hour as shown in Figure 7. At some point, an improvement will require purchasing additional constraint capacity to increase throughput further. Up until that point, the improvements have been essentially free. No new resources were purchased and probably less overtime required.
Figure 7: Effect of now increasing capacity of D
Always watch the constraint. Don't let it starve or get buried in unneeded work. It's the heartbeat of the system. If the constraint breaks down, it is the highest priority to be repaired.
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Five-Step Process
