What is Theory of Constraints and how does it help improve product development processes?

Author of the article: Dmitry Kurdyumov

Participated in Agile transformations in the largest companies in Russia (Alfa Bank, MTS, X5 retail group), with international experience in startups abroad

Theory of Constraints (TOC) is a management methodology proposed by Eliyahu Goldratt in 1984 in his book “Target”. It is based on a simple but powerful principle: any system, be it a production, business process or development team, is always limited by one or more bottlenecks. These limitations, or bottlenecks, limit the overall effectiveness of the system and are the key elements that must be identified and addressed for significant improvements.

In a product development environment where speed of delivery, quality, and customer satisfaction are critical, applying the theory of constraints can lead to significant improvements in processes and results. Let's look at how TOC works in practice and how it can help development teams.

The essence of the theory of constraints

The theory of constraints is based on the idea that in any system there is always at least one bottleneck – a process or resource that limits the entire value chain. In product development, this could be anything: a highly specialized employee who is the only one with the necessary skills to perform a certain task, ineffective testing processes, slow feedback from users, or even a lack of coordination between teams.

TOC suggests focusing on this limitation and improving the system by concentrating resources and attention on eliminating the bottleneck. This is a key approach to achieving significant improvements at minimal cost.

Five Steps of Theory of Constraints

Goldratt proposed five steps for working with constraints in any system that can be adapted to development processes:

1. Identify the constraint
   Determine what bottleneck is holding the system back. This could be a specialist who is overloaded with tasks, a process with long testing cycles, or ineffective feedback. It is important to find the element that complicates or slows down the entire process.
   Example: In a mobile application development team, for example, this could be the integration testing process, which takes a lot of time and becomes a blocker to the release of the product.

2. Maximize work on the constraint
   Once a bottleneck has been identified, performance at that bottleneck needs to be optimized. This could be redistributing tasks, automating, improving processes, or increasing the time to solve a problem.
   Example: If the main bottleneck is a test person, you can implement automated tests to reduce the workload on that person or bring in additional people to help complete tasks.

3. Subject the rest of the system to constraint
   At this stage, it is important to ensure that all other processes in the system are adjusted to the restriction. This means that the team's work should be organized in such a way as to avoid the accumulation of tasks on the constraint.
   Example: If testing is a bottleneck, the team should organize the process so that there is no extra queue of tasks for testing, and tasks get into tests gradually and evenly. In some cases, it is necessary to stop development before testing is completed. At the moment, we also involved developers in testing in order to open up the bottleneck, and then we solved the problem systematically.

4. Increase your bandwidth limitation
   This stage involves eliminating or weakening the constraint itself. You can bring in additional resources, improve processes, or increase the number of people working on the bottleneck.
   Example: Training developers to perform basic testing or implementing automated CI/CD pipelines that speed up testing and release the product faster.

5. Re-search for a new constraint
   Once the constraint is removed, it is worth revisiting the system and identifying a new bottleneck. After each improvement, it is important to look for weak links again so that the process improves continuously.
   Example: After optimizing the testing process, it may turn out that the new limitation is that it takes too long to coordinate tasks with the business. Then the optimization process continues at this stage.

Application of Theory of Constraints to Product Development

TOC is especially useful in product development, where processes are complex and multi-layered, and each team or individual process can be a potential bottleneck. Limitations often manifest themselves in insufficient process flexibility, long-term release of functionality, or overload of specialists.

How does Theory of Constraints help improve processes?

1. Time-to-market acceleration:
   When development teams experience slowdowns in product delivery, TOC helps identify key processes that are creating bottlenecks. For example, there may be a long cycle of coordinating requirements with customers. By optimizing this process, you can significantly speed up the release of new features.

2. Improved product quality:
   CBT helps identify problems that limit the quality of work. For example, if testing is a bottleneck, it can negatively impact the final quality of the product. Optimizing the testing process allows you to improve quality and avoid bugs at earlier stages of development.

3. Reducing command overload:
   Operational bottlenecks can not only slow down work, but also overload individual team members. TOC helps to distribute tasks more evenly and organize work in such a way as to avoid overload and burnout of employees.

4. Process optimization:
   CBT helps to see systemic problems and fix them. For example, if the bottleneck is the long time it takes to coordinate tasks between different departments, it is worth optimizing communication between teams and introducing transparent processes.

An example of using TOC in product development

Let's take the example of a SaaS product development team. The team was faced with a long development cycle for new features – about 3 months from idea to implementation. The reason was that each release was blocked by a long process of manual testing.

By applying TOC, the team was able to identify that testing was the bottleneck. The solution was to implement automated tests and CI/CD infrastructure, which reduced testing time from 2 weeks to several days.

Conclusion

The Theory of Constraints is a powerful tool for teams seeking continuous improvement and optimization. In a product development environment where speed and quality are critical, TOC allows you to identify weaknesses, increase efficiency and significantly improve processes. By adopting TOC approaches, teams can not only improve their performance, but also create better products for customers.

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