Theory of Constraints (TOC) is the result of Eli Goldratt's work introduced in his book The Goal. TOC is used to help companies identify and overcome barriers to maximizing profits, whether these barriers are production bottlenecks, company policies, business strategy, ineffective marketing, supply chain issues, labor shortages, cash flow restrictions, etc. As Goldratt states in the above book, the goal of any for-profit organization is to generate more profits, now and in the future. An overriding philosophy behind TOC is the focus on increasing revenues instead of reducing costs in order to increase profits. There is a finite limit to how much a company can reduce costs, but there is no real limit to how much revenue a company can earn. From a practical standpoint, it's not realistic to attempt to reduce costs (labor, material, or overhead) by more than about 20% without impacting the ability to generate revenue. MEP will help you identify those constraints limiting your ability to generate revenues (and profits) and develop a strategy to eliminate them. One significant benefit of using TOC methodologies is that the elimination of constraints generates both incremental and breakthrough improvements. Another significant benefit is that much of the improvement can be realized with little or no capital expenditures.