The Role of the Theory of Constraint (TOC) in Developing Systems for Managing Expenses to Develop and Enhance Production Operations and its Profits An Applied Study in Industrial Companies Whose Shares are Listed in Amman Stock Exchange Market

Abstract

The Study is aimed at recognizing the needs and measures for applying the Theory of Constraint (TOC) in the Jordanian industrial companies and the role it plays in developing and enhancing the operations applied in production with the aim of  increasing production and profit sought after.  The population of this study included companies whose shares are listed in Amman Stock Exchange totaling (92) companies.  The researcher applied random selection process from within the population of the study to chose sample companies that included (65) companies representing different sectors at an average of (65%) of the constituency.

The Study reached: A comprehensive group of clients and suppliers who have different, variable and volatile tastes and requirements that play an important role in the definition and design of the products and in the life cycle of the product and its management as well as defining the active input in its design and development. The application of the Theory of Constraint leads to the definition  of the cost of the product and in turn affects the development and improvement of the cost management system and accrue due benefits.

The study recommended that due importance should given to allowing sufficient flexibility in the companies to meet the specifications that characterize the products and those that correspond to the wishes and requirements of users  in order to maintain the cost of the targeted products, In addition to above, it is quite important to remove activities that do not add value to the product and bottlenecks during the production process with the aim of developing and improving costs management systems to increase  profitability, sought after by the application of the Theory of Constraint in industrial companies.

Keywords: Theory of Constraint (TOC), Cost Management Systems , Development and Improvement of Production Processes , increase profitability .