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With all measures that are applied in management contexts I find that the mistake people tend to make is that there is a linear relationship between the measure
by kcexn 4y ago
With all measures that are applied in management contexts I find that the mistake people tend to make is that there is a linear relationship between the measure of work and the financial measures (revenue, profit, margin, etc.)
Velocity seems like a simpler measure than a Network Queue, and both seem like they are valid measures since neither will have a linear relationship with the bottom line of the company.
The goal of the entire business is to tune all the parts of the business and seek out an efficient solution.
The theory of constraints as it is quoted in this article isn't advocating for rate matching everywhere in the business specifically. Rather it is making the statement that some inputs and processes in the business have a disproportionately large effect on the business outcomes. And you should weight management priority to the processes that affect your outcomes the most.
If you have a process (say deploys to production), that dramatically affects your business outcomes, in the sense that small changes to this process lead to large changes or even most of the changes in outcomes (e.g. revenue). Then most of the resources should be allocated to optimising that part of the business, since resources allocated anywhere else will be wasted, since the magnitude of the effects (even assuming they'll still be positive), will be dwarfed by your most sensitive inputs.
The theory of constraints preaches that after you have chosen your most important business outcomes (a strategic decision), you should measure how much the different inputs to your business affect the outputs of the business, and allocate resources to the most sensitive inputs.
Most big businesses do this very well. It's why you can find yourself in a team where doing more work or less work doesn't seem to matter, even though your direct manager is up your ass all the time.