Using the Theory of Constraints as a Tool to Lean Inventory - A Case Study in Diyala State Company

Abstract

The research aims to adapt techniques of lean inventory through the use of Theory of Constraints in Iraqi companies. The research adopted the case study approach to determine objectively the research problem, which is to determine the best size of product inventory, for the products of the Electronic Standards Laboratory in Diyala State Company, in light of the bottlenecks experienced by workstations or restrictions that limit production capacity. The results of the research showed the ability to apply the Restrictions Theory to determine the best mix that achieves the highest profit according to priority, as well as its contribution in addressing bottlenecks of production schedule in the light of available energy in each workstation per month. Results also showed the ability slimming inventory and that the current research method is better than the company’s method by adopting cost criteria. The research also introduced a set of recommendations, the most prominent of which is the adoption of scientific methods in determining the size of storage and the application of the theory of restrictions and training workers to use these techniques to achieve the company’s ability to reduce its costs and thus increase its profits.