ABSTRACT

The authors, practitioners in the Theory of Constraints (TOC) frame the importance of the supply chain concept and its effect on company performance. They maintain that the concept of supply chains and supply chain management—a decidedly whole system perspective—has achieved wide acceptance for modeling a variety of businesses. This is because of the recognition that any link in the chain prospers over the long term only when a customer buys an end product. Why this is such a recent phenomenon might be challenged, but its global acceptance is undeniable.The authors maintain that the appropriate starting point for implementing the TOC concepts may be anywhere in the chain, but because they are so close to the market, the distribution links are excellent places to start. Implementing these concepts in distribution companies would impose pressure on suppliers to “do the right thing” by providing vendor‐managed inventory using make‐to‐availability (MTA) procedures, a TOC concept. Supply chain market success requires speed in introducing new products and offering wide variety with assured availability at every point of sale. Success to supply chain participants requires the lowest possible supply chain inventory, fast replenishment, and availability of materials and products all along the chain.