Application Research on Theory of Constraints in Distribution System

Theory of constraints is a management method aimed at enhancing revenue of the entire system. This thesis analyses the entire distribution system from the overall angle, uses appropriate technology tools to identify and resolves the root problem hidden behind the surface in order to enhance revenue of the entire distribution system. Theory of constraints (TOC) is a management method aimed at enhancing revenue of entire system. It believes that the maximum output of a system is the weakest link and also bottleneck in it. Only by continuously enlarging and eliminating these bottlenecks, revenue of the system can be enhanced. The optimization of non-bottleneck resources will only result in excessive inventory or waste of resources, but not contribute to improvement of the entire revenue. This article leads TOC into the research of status quo and development of distribution system, which can find the key factors obstructing the development of China's distribution industry and then improve it, in order to promote the rapid development of logistics enterprise and the operational efficiency of supply chain.