Theory of Constraints: How to Strengthen Your Weakest Link

Management accounting serves the purpose of aiding decision making and performance management within an organization.

As professionals in the field of accounting, it is crucial for us to possess a diverse set of tools and techniques that can effectively cater to the requirements of our respective organizations. In this regard, two methodologies that stand out are Throughput Accounting and Lean Accounting, both of which fall under the umbrella of flow accounting. These methodologies are particularly suitable for organizations that have adopted a process-oriented approach.

Throughput Accounting is specifically designed to bolster management accounting in organizations that embrace the principles of the Theory of Constraints. By focusing on identifying and optimizing the constraints that limit a company's overall performance, Throughput Accounting helps organizations achieve higher levels of efficiency and profitability.

Similarly, Lean Accounting also places a strong emphasis on enhancing the workflow within a business process. It provides a range of adaptable tools that enable organizations to assess, oversee, and improve their performance. By eliminating waste and streamlining operations, Lean Accounting helps organizations achieve greater productivity and cost-effectiveness.

This comprehensive course covers not only the Theory of Constraints but also Throughput Accounting and Lean Accounting. By delving into these key concepts and principles, learners will gain a thorough understanding of how these methodologies can be applied in real-world scenarios to drive organizational success.

Course Overview

In this course, we will cover the following topics in a clear and accessible manner:

1. Theory of Constraints
2. Throughput Accounting
   • Performance Measures
3. Lean Accounting
   • Seven Aims
   • Performance Measures and Managerial Decision making
   • Accounting Transactions
4. Integration of Throughput Accounting and Lean Accounting with Financial Statements

No pre-requisites are required for this course other than an interest in business finance and performance management. I hope you find this course enjoyable.

1. Accounting students
2. Accountants and financial managers in business
3. Management accountants
4. Business managers with an interest in financial performance management
5. Learners with an interest in process management and costing
6. Anyone interested in business management and improvement

1. The course was very good. I learned much and the information was presented concisely ~ M Dillard
2. A really good course on throughput accounting, highlighting the concept of TOC and lean accounting ~ V Sankar

1. The Basics of the Theory of Constraints
2. Key Principles in Throughput Accounting
3. Why "flow" is important in the Theory of Constraints, Throughput Accounting and Lean Accounting
4. The Performance Measures and KPIs of Throughput Accounting
5. What Lean Accounting is and how it works
6. A definition of Lean
7. The Five Principles of Lean
8. A brief history of Cost Accounting
9. The Seven aims of Lean Accounting
10. The Principles of Lean Performance Measures
11. The Three levels of Performance Measure
12. A starter set of Lean Performance Measures
13. Performance improvement in Lean Accounting
14. What is Value Stream Management?
15. Kinds of Value Stream
16. Key Lean Accounting tools
17. Lean Accounting and accounting transactions
18. Quantifying the benefits of improvement
19. Lean Accounting and Customer Value
20. Why plan by Value Stream?
21. Throughput Accounting and Lean Accounting versus Financial Accounting

1. An understanding of the basic principles of accounting will help learners but is not essential
2. An understanding of the accounting terms "marginal costing" and "contribution" will be beneficial