The Theory of Constraints (TOC) is a management philosophy that focuses on identifying and managing the most critical limiting factor (constraint) that stands in the way of achieving a goal and then systematically improving that constraint until it is no longer the limiting factor.
Throughput accounting is an approach to short-term decision-making in manufacturing that treats all conversion costs as fixed and ranks products based on a throughput accounting ratio (TAR), particularly useful when a constraint or scarce resource exists.
