After completing this section of the course, you will be able to: Identify common assumptions of a traditional management system Determine what is likely to happen when all resources are optimized List items necessary to calculate throughput Name an example of local optimization Identify the presence of a constraint and how it can be designated List ways to deal with employee turnover as a constraint Define the expedite zone and its purpose Identify why adding staff may not increase sales and what hiring practices can help List a key problem that causes delays in projects Specify where the time buffer of a project should be located Cite the result of a culture of cost reduction Specify why direct labor is not a variable expense Identify why scrap is more expensive if discovered after the constraint Identify how the SEC issues accounting guidance List similarities in guidance on manufactured goods between GAAP and IFRS Cite an example of variable overhead List measurements used to measure relationships between throughput and constraints Define the term for the amount of inventory buffer in use at any time Cite problems with the traditional inventory turnover calculation Name a harmful measure that is sometimes used to make business decisions Identify costs to be excluded from product cost analysis List a cost unique to the sales channel Define the cost object associated with returned goods and early payment Name an event that might trigger a controls review List reasons for using controls and which controls are most useful List problems with top-down and bottom-up approached to revenue estimation Calculate direct labor using the crewing method Identify where support for the constraint concept comes from Define rolling forecast Specify the basis for bonus compensation Identify where increases to throughput occur Identify the key limiting factor in a constraint Cite ways that a business's financial results can be enhanced Classify the type of pricing that absorption pricing is Identify the type of customers that are desirable in a constraint-based pricing environment Cite a solution for lengthy setup times at a constraint Specify the effect of having a constraint in the marketplace Cite which factor should be used to determine which investments to make Specify constraint management tactics for volatile industries Cite when competition is likely to cut prices in response to your own reduction Identify when a speed of delivery strategy is most useful Cite situations when constraint management is effective in the acquisition process Specify when organizations in financial distress may choose to implement constraint management

Types of Constraints Constraint Operational Terminology The Inventory Buffer Production Scheduling Sales Department and Engineering Department Constraints Executive and Project Management Constraints Cost Analysis Reporting GAAP and IFRS frameworks Difference between Constraint Management and the Accounting Frameworks Constraint Utilization/Effectiveness Constraint Maintenance Constraint Controls Budgeting Policies that help Constraint Management Analysis Analysis Issues Pricing Constraint Management Decisions Strategies