Cost Accounting 101 Practice Test: Balanced Scorecard - Quality, Time, and the Theory of Constraints — Flashcards

Balanced scorecard: Quality, Time, and the Theory of Constraints is a topic that describes quality as a competitive tool, the four perspectives of a balanced scorecard, and the Theory of Constraints (TOC). 

Quality is the total characteristics of a service or product that is made or performed according to specifications to satisfy customers. 
The four perspectives of a balanced scorecard are: Financial, Customer, Internal Process, and Learning and Growth. 

The TOC is a management philosophy that identifies and manages organizational bottlenecks that impede efficiency and productivity. It's designed to optimize the flow of resources and identify areas for improvement to achieve maximum output and profitability. 
The TOC process has five steps: Identify the constraint, Exploit the constraint, Pace every other process to the speed of the constraint, Invest in the constraint, and Repeat until you get the desired result. 
The TOC calls for continuous process improvement. It uses the common idiom "a chain is no stronger than its weakest link". This means that organizations and processes are vulnerable because the weakest person or part can always damage or break them, or at least adversely affect the outcome.