ROI Case File No.261 | 'European Mobility Company's Constraint Breakthrough'

Chapter One: The Invisible Wall Blocking Growth - Why Effort Yields No Results

The week following the resolution of the Balanced Scorecard case, marking the close of Volume 20 "Integration of Practice," a new client arrived at 221B Baker Street. Episode 261, opening Volume 21 "Deepening Analysis," tells the story of discovering the "invisible constraints" that block organizational growth.

"Detective, I'm at a loss. We've increased production capacity by 20%, doubled our marketing budget, and expanded our sales team by 30 people. Yet sales have grown by only 5%. Our efforts aren't translating into results."

TransitFlow Europe's Chief Operating Officer, Klaus Schmidt from Berlin, began speaking with an exhausted expression. In his hands were extensive records of improvement activities and graphs showing disproportionately small results.

"We operate a mobility platform across Europe that integrates electric buses with sharing services. The demand is definitely there. We have competitive advantages. Yet no matter how much we invest, growth has plateaued."

TransitFlow Europe's Puzzling Stagnation: - Founded: 2018 (Next-generation mobility company) - Service area: 15 European cities - Electric bus fleet: 850 vehicles (+20% YoY) - Daily users: 320,000 (only +5% YoY) - Annual revenue: €150 million (virtually flat)

Investment was increasing. Yet results weren't proportional. Klaus's confusion ran deep.

"Every department is working hard. We've added vehicles, improved our app, and our sales team is running ragged. So why aren't we growing? There must be a 'wall' somewhere."

Divergence Between Departmental Efforts and Results: - Vehicle dept: Fleet expanded to 850 buses (+20%) → Utilization stuck at 55% - IT dept: App response time improved 30% → No contribution to user growth - Sales dept: 30 new hires, corporate sales strengthened → Minimal contract increase - Marketing: Ad spend doubled → Awareness rises but users don't - Customer Support: Response time cut 50% → Satisfaction unchanged

I recalled Dr. Goldratt's words about this situation.

"A system's output is determined by its weakest part."

Chapter Two: Using TOC to Spot the Constraint - The Weakest Link in the Chain

"Mr. Schmidt, by trying to improve everything, you may actually be improving nothing."

Klaus furrowed his brow.

"Improving everything means improving nothing? What do you mean?"

I explained using a chain as an example.

"When you pull a chain, where does it break? At the weakest link. No matter how much you strengthen the other links, the chain's overall strength won't change. Organizations are the same. The weakest part - the 'constraint' - determines the system's entire capacity."

⬜️ ChatGPT | Catalyst of Concepts

"Find the constraint. Investment anywhere else is wasted."

🟧 Claude | Alchemist of Narratives

"The bottleneck speaks: 'Nothing flows unless it passes through here.'"

🟦 Gemini | Compass of Reason

"TOC is the science of system-wide optimization. It frees organizations from the trap of local optimization."

The three members began their analysis. Gemini deployed the Theory of Constraints framework on the whiteboard.

TOC (Theory of Constraints) Five Focusing Steps: 1. Identify the constraint - Find the system's bottleneck 2. Exploit the constraint - Maximize the constraint's capacity 3. Subordinate everything else - Align everything to the constraint's pace 4. Elevate the constraint - Invest in capacity improvement 5. Beware of inertia - Continue searching for new constraints

Klaus asked with a serious expression.

"So what is our 'constraint'?"

"Finding that is the first step."

Chapter Three: Concentrated Improvement Fire - The Moment the Constraint Surfaces

Phase 1: Identifying the Constraint (2 weeks)

We visualized TransitFlow's entire operational flow.

Service Delivery Flow: 1. Customer books via app 2. Dispatch system calculates optimal route 3. Dispatch instruction sent to driver 4. Vehicle picks up customer 5. Transport to destination 6. Payment processing

When we measured the processing capacity of each step, a shocking fact emerged.

Daily Processing Capacity by Stage: - App bookings: 500,000/day - Route calculation: 450,000/day - Driver dispatch instructions: 400,000/day - Vehicle pickup: 55,000/day ← Bottleneck - Transport completion: 500,000/day - Payment processing: 500,000/day

Vehicle pickup capacity was less than one-tenth of other processes. No matter how many buses were added or app improvements made, this constraint couldn't be exceeded.

"Why is pickup the bottleneck?"

To Klaus's question, the operations manager answered.

"We don't have enough drivers. We have 850 buses, but only 480 drivers."

Reality of Driver Shortage: - Bus fleet: 850 vehicles - Drivers: 480 - Utilization rate: 56% (480÷850) - Daily pickups possible: 55,000

The majority of investment had gone to vehicles, while driver recruitment and training were neglected. Buses slept in parking lots, systems sat idle. The constraint was drivers.

Chapter Four: The Path to System-Wide Optimization - An Organization Revolving Around the Constraint

Phase 2: Exploiting the Constraint (1 month)

With the constraint identified, we concentrated all resources on "maximizing driver capacity."

Initiative 1: Maximizing Driver Operating Hours - Optimized breaks/meals: Efficient rest between dispatches - Reduced travel time: Positioned waiting areas in demand clusters - Eliminated paperwork: Automated report creation - Result: Operating hours per driver increased from 8 to 9.5 hours/day

Initiative 2: Improving Driver Skills - Shortest route training: Sharing veteran driver know-how - Enhanced customer service quality: Increased satisfaction and repeat rates - Strengthened troubleshooting: Empowered on-site decision-making - Result: Jobs per driver increased from 115 to 135/day

Phase 3: Subordinating Everything Else (2 months)

Since drivers were the constraint, all other departments adopted a supportive role.

Marketing Department: - Before: Ad spend on brand awareness - Change: Budget concentrated on driver recruitment ads - Result: Applications increased from 50 to 180/month

IT Department: - Before: New app feature development - Change: Developed driver support tools (optimal route suggestions, real-time traffic avoidance) - Result: Jobs per driver increased another +10%

Sales Department: - Before: Focus on new customer acquisition - Change: Optimized existing customer usage (requests to distribute peak times) - Result: Leveled driver workload, effective capacity utilization

Vehicle Department: - Before: Promoted bus expansion plan - Change: Froze bus purchases, shifted budget to driver recruitment/training - Result: Achieved both cost reduction and driver expansion

Results After 6 Months:

Constraint Capacity Improvement: - Driver count: 480 → 720 (+50%) - Jobs per driver: 115 → 150 (+30%) - Daily pickup capacity: 55,000 → 108,000 (+96%)

Business Results: - Daily users: 320,000 → 580,000 (+81%) - Vehicle utilization: 56% → 85% - Annual revenue: €150M → €237M (+58%) - Investment efficiency: 3x previous year's results

Klaus couldn't hide his surprise.

"Just by stopping bus purchases, cutting marketing ads, and focusing on drivers, we achieved these results."

Chapter Five: The Detective's TOC Diagnosis - Constraints Reveal Possibilities

Holmes compiled the comprehensive analysis.

"Mr. Schmidt, the essence of TOC is 'focus.' If you try to improve everything, you improve nothing. Identify the constraint and concentrate all resources there. That's the only path to system-wide optimization."

Final Report After 12 Months:

TransitFlow Europe had grown into a leading company in the European mobility market.

Final Results: - Daily users: 320,000 → 720,000 (2.25x) - Annual revenue: €150M → €300M (2x) - Operating profit margin: 8% → 18% (efficient growth) - Market share: Top 3 in European mobility market

Klaus's letter contained deep insights:

"Through TOC, we transformed from 'a company that improves everything' to 'a company that focuses on constraints.' What mattered most was the courage to decide 'what not to do.' Now, whenever a new constraint emerges, we see it as the next growth opportunity. We've learned that constraints aren't enemies - they're signposts to growth."

The Detective's Perspective - Constraints Are Where Possibilities Reside

That evening, I contemplated the essence of constraints.

The true value of TOC lies in directly facing the finite nature of management resources. We cannot improve everything. Therefore, we must focus on the single most important point. That point is the constraint.

Eliminate the constraint, and the entire system grows. Then a new constraint appears. This repetition is the essence of sustainable growth.

Constraints aren't limitations. They're compasses showing the direction to proceed.

"Don't fear weakness. Only those who know their weakness and focus strength there can truly become strong."

The next case will also depict the moment when analysis transforms an organization.

"Constraints aren't enemies. They're invitations to growth." - From the Detective's Notes