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Operating above capacity can undermine overall performance from "summary" of The Goal by Eliyahu M. Goldratt,Jeff Cox
Every organization has a limit to its resources, whether it’s machines, manpower, or materials. When a system operates beyond these limits, it creates a ripple effect that disrupts the flow of production. This situation often leads to increased lead times, higher levels of work-in-progress inventory, and a greater likelihood of defects or errors. Imagine a manufacturing plant pushing its machines to run at full throttle. Initially, this might seem beneficial, but as the demand for output exceeds the capability of the equipment, complications arise. Workers become overwhelmed, leading to mistakes and accidents. Machines begin to break down more frequently, as they are not designed to function continuously at such high levels. Repair times increase, further exacerbating delays. The focus shifts from quality to quantity. Everyone is racing to meet targets, and the attention to detail diminishes. As defects rise, rework becomes necessary, consuming time and resources that could be better spent on new production. The bottleneck shifts across the system, causing fluctuations that make it impossible to predict delivery times or maintain customer satisfaction.- The system's overall throughput decreases despite the illusion of increased output. It becomes a vicious cycle; the harder everyone works to push beyond capacity, the more the system falters. The true goal of any organization is not merely to increase output but to do so in a way that maximizes efficiency, maintains quality, and ultimately satisfies customer demands. Balancing capacity with demand becomes crucial for sustainable performance, ensuring that each component of the system operates harmoniously.
