Improving the product mix heuristic in the theory of constraints

Fredendall, Lawrence D.; Lea, Bih‐Ru

doi:10.1080/002075497195100

Cited by 88 publications

(71 citation statements)

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“…Table 2 shows different implementation of TOC. Fenbert & Fleener, 2002;Wei et al, 2002√ Dettmer, 1995Ehie & Sheu, 2005;Moore & Scheinkopf, 1998;Nave, 2002;Raimona Zadry & Mohd Yusof, 2006;Siha, 1999;Stein, 1997√ Coman & Ronen, 2000Hilmola 2001√ Aryanezhad & Komijan, 2004Bhattacharya et al, 2008;Fawcett & Pearson, 1991;Fredendall & Lea 1997;Gupta et al, 2008;Lea & Min, 2003;Patterson, 1992;Souren et al, 2005;Umble et al, 2006√ Balakrishnan & Cheng, 2005√ Bhimani et al, 2002Cooper & Slagmulder, 1999;Fritzsch, 2011;Kee, 1995;Kirche et al, 2005;Ioannou & Papadoyiannis, 2004;Jones & Dugdale, 1998Louderback & Patterson, 1996;Schniederjans & Garvin, 1997;Spencer, 1994;Watson & Patti, 2008;Zimmerman & Yahya-Zadeh, 2011√ Bramorski et al, 1996√ Breen et al, 2002Motwani et al, 1996 √…”

Section: Resultsmentioning

confidence: 99%

“…Their proposed model helped managers determine which products to produce and which one has to be outsourced. Fredendall and Lea (1997) proposed a revised TOC product mix heuristic to determine the optimal product mix under conditions where the traditional TOC heuristic fails. Lockamy III and Spencer (1998) examined the application of a TOC-based performance measurement system in an operating environment.…”

Section: Tablementioning

confidence: 99%

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Theory of constraints: A state-of-art review

Orouji¹

2016

10.5267/j.ac

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The theory of constraints (TOC) is a management tool, which considers any manageable system as being limited in reaching more of its objectives by some constraints. According to TOC, there is always, at least, one single constraint, and TOC implements a concentrating process to detect the constraint and restructure the remaining of the organization around it. This paper presents an overview of different perspectives of TOC and its implementation in different industries such as project management, quality management, outsourcing, product mix, maketo-buy, accounting, banking and health care, etc. The results indicate that the method has been extensively implemented in different areas of accounting.

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Section: Resultsmentioning

confidence: 99%

Section: Tablementioning

confidence: 99%

Theory of constraints: A state-of-art review

Orouji¹

2016

10.5267/j.ac

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“…In fact, Fredendall and Lea (1997) suggested that TOC also applies to multiple constraints and can similarly obtain the optimal solution by repeated solution searches [12]. Aryanezhad and Komijan (2004) argued that the algorithm for repeated solution findings, as proposed by Fredendall and Lea (1997), requires more time; therefore, they proposed an algorithm similar to multi-objective decision-making in order to improve the single objective algorithm for repeated solution finding [36]. Kirche and Srivastava (2005) used ABC and MIP to find solutions to problems and suggested that ABC can increase profits and reduce inventory levels more effectively than TOC [7].…”

Section: Applying Toc and Abc To Product MIX Decision-makingmentioning

confidence: 99%

“…Finally, the obtained product mix is not the optimal product mix, and such a limit can be overcome by integer linear programming (ILP) [10]. In fact, Fredendall and Lea (1997) suggested that TOC also applies to multiple constraints and can similarly obtain the optimal solution by repeated solution searches [12]. Aryanezhad and Komijan (2004) argued that the algorithm for repeated solution findings, as proposed by Fredendall and Lea (1997), requires more time; therefore, they proposed an algorithm similar to multi-objective decision-making in order to improve the single objective algorithm for repeated solution finding [36].…”

Section: Applying Toc and Abc To Product MIX Decision-makingmentioning

confidence: 99%

“…In addition, when there are multiple constraints and integer solution assumptions in TOC, there may not be an optimal solution [10,11]. Although Fredendall and Lea [12] suggested that the optimal solution can be obtained by repeated solution-finding iterations, such an approach will become more complex in the face of added constraints; thus, enterprises will gradually pay more than the exact cost in order to obtain more accurate cost information for consideration.…”

Section: Introductionmentioning

confidence: 99%

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Sustainability Concept in Decision-Making: Carbon Tax Consideration for Joint Product Mix Decision

et al. 2016

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Carbon emissions are receiving greater scrutiny in many countries due to international forces to reduce anthropogenic global climate change. Carbon taxation is one of the most common carbon emission regulation policies, and companies must incorporate it into their production and pricing decisions. Activity-based costing (ABC) and the theory of constraints (TOC) have been applied to solve product mix problems; however, a challenging aspect of the product mix problem involves evaluating joint manufactured products, while reducing carbon emissions and environmental pollution to fulfill social responsibility. The aim of this paper is to apply ABC and TOC to analyze green product mix decision-making for joint products using a mathematical programming model and the joint production data of pharmaceutical industry companies for the processing of active pharmaceutical ingredients (APIs) in drugs for medical use. This paper illustrates that the time-driven ABC model leads to optimal joint product mix decisions and performs sensitivity analysis to study how the optimal solution will change with the carbon tax. Our findings provide insight into 'sustainability decisions' and are beneficial in terms of environmental management in a competitive pharmaceutical industry.

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Complexity and workload considerations in product mix decisions under the theory of constraints

Golmohammadi

Mansouri

2015

Naval Research Logistics

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The literature on the product mix decision (or master production scheduling) under the Theory of Constraints (TOC), which was developed in the past two decades, has addressed this problem as a static operational decision. Consequently, the developed solution techniques do not consider the system's dynamism and the associated challenges arising from the complexity of operations during the implementation of master production schedules. This paper aims to address this gap by developing a new heuristic approach for master production scheduling under the TOC philosophy that considers the main operational factors that influence actual throughput after implementation of the detailed schedule. We examine the validity of the proposed heuristic by comparison to Integer Linear Programming and two heuristics in a wide range of scenarios using simulation modelling. Statistical analyses indicate that the new algorithm leads to significantly enhanced performance during implementation for problems with setup times. The findings show that the bottleneck identification approach in current methods in the TOC literature is not effective and accurate for complex operations in real‐world job shop systems. This study contributes to the literature on master production scheduling and product mix decisions by enhancing the likelihood of achieving anticipated throughput during the implementation of the detailed schedule. © 2015 Wiley Periodicals, Inc. Naval Research Logistics 62: 357–369, 2015

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Improving the product mix heuristic in the theory of constraints

Cited by 88 publications

References 0 publications

Theory of constraints: A state-of-art review

Theory of constraints: A state-of-art review

Sustainability Concept in Decision-Making: Carbon Tax Consideration for Joint Product Mix Decision

Complexity and workload considerations in product mix decisions under the theory of constraints

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