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LearnLesson 5 of 8

Rules are constraints too

Most constraints are policies and beliefs. They cost nothing to change and are the hardest to see.

A rule limiting a resourceDemand flows from the left toward a resource on the right. Between them sits a highlighted box labelled rule, which blocks most of the flow before it reaches the resource.demandthe rule“only I can quote”the resource(mostly idle)The resource has capacity. The rule decides how much of it gets used.

When owners hear "constraint" they picture something physical. A person who is fully booked. A machine. A delivery van. Those exist. But the most common constraint in a small business is not a thing. It is a rule.

"We do not sell on the first call." "Only I quote jobs over five thousand." "We ship on the first of the month." "No refunds." "Everyone has to be busy." Some of these were good decisions once. Some were never decided at all; they just became how things are done.

A policy constraint limits output more than any physical resource does, and it is the hardest kind to see, because it looks like common sense. Signals that you have one: "we have always done it this way", measures that reward keeping people busy, an approval that everything waits on, a batch size nobody questions.

Beliefs work the same way. "My clients will not pay more." "I am the only one who can sell this." A belief in the owner's head can hold a whole business at its current size.

The good news is that rules cost nothing to change. No hiring, no spending. The hard part is that every rule exists to protect something. Drop it carelessly and the thing it protected gets hurt. That is why this method uses an : find what the rule protects, find the assumption that says you need the rule to protect it, and replace the rule with something that protects the need without limiting the business.

Check yourself

Two questions. Pick one answer each; you will see why straight away.

  1. 1.Which of these is most likely a policy constraint?

     

  2. 2.Why not just delete a limiting rule as soon as you find it?