IIA-CIA-PART2 · Question #427
According to the theory of constraints, which of the following is most influenced by various bottlenecks the organization encounters?
The correct answer is B. Profitability. According to the theory of constraints, the performance of any system is constrained by a few bottlenecks or limiting factors. These bottlenecks directly impact the organization's profitability because they limit the system's output, leading to reduced efficiency and…
Question
According to the theory of constraints, which of the following is most influenced by various bottlenecks the organization encounters?
Options
- AManufacturing.
- BProfitability.
- COverheads.
- DQuality.
How the community answered
(25 responses)- A8% (2)
- B88% (22)
- C4% (1)
Explanation
According to the theory of constraints, the performance of any system is constrained by a few bottlenecks or limiting factors. These bottlenecks directly impact the organization's profitability because they limit the system's output, leading to reduced efficiency and effectiveness. Addressing these bottlenecks can lead to significant improvements in throughput, which in turn enhances profitability.
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