APPLYING THE THEORY OF CONSTRAINTS TO INCREASE ECONOMIC VALUE ADDED: PART 1—THEORY
<p>ENGLISH ABSTRACT: This article, presented in two parts, explains how to apply the Theory of Constraints (TOC) in a business to increase Economic Value Added (EVA). The first part deals with the theory, while the second part deals with the implementation. The goal of a business, the...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
| Published: |
Stellenbosch University
2012-01-01
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| Series: | South African Journal of Industrial Engineering |
| Online Access: | http://sajie.journals.ac.za/pub/article/view/319 |
| _version_ | 1819293998123057152 |
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| author | Malan Smith Pieter Pretorius |
| author_facet | Malan Smith Pieter Pretorius |
| author_sort | Malan Smith |
| collection | DOAJ |
| description | <p>ENGLISH ABSTRACT: This article, presented in two parts, explains how to apply the Theory of Constraints (TOC) in a business to increase Economic Value Added (EVA). The first part deals with the theory, while the second part deals with the implementation. The goal of a business, the measurements of the goal and the priority of the measurements are discussed. The future reality of a company which implements TOC principles is shown through cause and effect to lead to an increase in EVA. The increase in EVA is caused by an increase in return on investment and a reduction in the cost of capital. The actions the company must take to increase EVA is presented.</p><p>AFRIKAANSE OPSOMMING: Hierdie artikel, aangebied in twee dele, verduidelik hoe om die Teorie van Beperkinge (TVB) in a besigheid toe te pas om Ekonomiese Toegevoegde Waarde (ETW) te vermeerder. Die eerste gedeelte verduidelik die teorie, terwyl die tweede gedeelte die toepassing hanteer. Die doel van ’n besigheid, die maatstawwe van die doel en die prioriteit van die maatstawwe word bespreek. Deur middel van oorsaak en effek word gewys dat die toekomstige werklikheid van ’n besigheid wat TVB beginsels toepas lei tot ’n toename in ETW. Die toename in ETW word veroorsaak deur ’n toename in opbrengs op belegging en ’n afname in die koste van kapitaal. Die aksies wat ’n besigheid moet neem om ETW te vermeerder, word genoem.</p> |
| first_indexed | 2024-12-24T04:19:19Z |
| format | Article |
| id | doaj.art-34f47b398b5041b5bcabca6d7f831585 |
| institution | Directory Open Access Journal |
| issn | 1012-277X 2224-7890 |
| language | English |
| last_indexed | 2024-12-24T04:19:19Z |
| publishDate | 2012-01-01 |
| publisher | Stellenbosch University |
| record_format | Article |
| series | South African Journal of Industrial Engineering |
| spelling | doaj.art-34f47b398b5041b5bcabca6d7f8315852022-12-21T17:15:51ZengStellenbosch UniversitySouth African Journal of Industrial Engineering1012-277X2224-78902012-01-01131APPLYING THE THEORY OF CONSTRAINTS TO INCREASE ECONOMIC VALUE ADDED: PART 1—THEORYMalan SmithPieter Pretorius<p>ENGLISH ABSTRACT: This article, presented in two parts, explains how to apply the Theory of Constraints (TOC) in a business to increase Economic Value Added (EVA). The first part deals with the theory, while the second part deals with the implementation. The goal of a business, the measurements of the goal and the priority of the measurements are discussed. The future reality of a company which implements TOC principles is shown through cause and effect to lead to an increase in EVA. The increase in EVA is caused by an increase in return on investment and a reduction in the cost of capital. The actions the company must take to increase EVA is presented.</p><p>AFRIKAANSE OPSOMMING: Hierdie artikel, aangebied in twee dele, verduidelik hoe om die Teorie van Beperkinge (TVB) in a besigheid toe te pas om Ekonomiese Toegevoegde Waarde (ETW) te vermeerder. Die eerste gedeelte verduidelik die teorie, terwyl die tweede gedeelte die toepassing hanteer. Die doel van ’n besigheid, die maatstawwe van die doel en die prioriteit van die maatstawwe word bespreek. Deur middel van oorsaak en effek word gewys dat die toekomstige werklikheid van ’n besigheid wat TVB beginsels toepas lei tot ’n toename in ETW. Die toename in ETW word veroorsaak deur ’n toename in opbrengs op belegging en ’n afname in die koste van kapitaal. Die aksies wat ’n besigheid moet neem om ETW te vermeerder, word genoem.</p>http://sajie.journals.ac.za/pub/article/view/319 |
| spellingShingle | Malan Smith Pieter Pretorius APPLYING THE THEORY OF CONSTRAINTS TO INCREASE ECONOMIC VALUE ADDED: PART 1—THEORY South African Journal of Industrial Engineering |
| title | APPLYING THE THEORY OF CONSTRAINTS TO INCREASE ECONOMIC VALUE ADDED: PART 1—THEORY |
| title_full | APPLYING THE THEORY OF CONSTRAINTS TO INCREASE ECONOMIC VALUE ADDED: PART 1—THEORY |
| title_fullStr | APPLYING THE THEORY OF CONSTRAINTS TO INCREASE ECONOMIC VALUE ADDED: PART 1—THEORY |
| title_full_unstemmed | APPLYING THE THEORY OF CONSTRAINTS TO INCREASE ECONOMIC VALUE ADDED: PART 1—THEORY |
| title_short | APPLYING THE THEORY OF CONSTRAINTS TO INCREASE ECONOMIC VALUE ADDED: PART 1—THEORY |
| title_sort | applying the theory of constraints to increase economic value added part 1 theory |
| url | http://sajie.journals.ac.za/pub/article/view/319 |
| work_keys_str_mv | AT malansmith applyingthetheoryofconstraintstoincreaseeconomicvalueaddedpart1theory AT pieterpretorius applyingthetheoryofconstraintstoincreaseeconomicvalueaddedpart1theory |