Sub Optimization

Definition:
“The result of different departments each attempting to reach a solution that is optimum for that department” (Stevenson, 2015).
Unfortunately, the sub-optimization process does not always adhere to the principle “the whole is more important than the sum of its parts”. Sub optimization occurs when different departments each attempt to reach a solution that is optimal for that department, but that may not be optimum for the organization as a whole. This type of policy can actually do more harm than good. When one department is delivering faster than another department can handle this could cause what is known as a “bottleneck” in the process, which may result in lost profits and customers. “This is a typical effect of sub-optimization. If you only optimize one step in your value creation process it can deliver things faster than the rest of the organization can deal with. Either that part runs dry on input or the output of that part floods subsequent process steps. Make sure that no one department produces more than the department with the least capacity (the bottleneck) can handle” (Marschall, 2011). In the management book “The Goal, Eliyahu Goldratt gives the example of a decision to make machining centers in a factory more efficient by increasing the amount of metal taken off with each pass of the cutting tool. However, Increasing the amount of metal taken off on each pass made the parts brittle, which necessitated heat-treating. The increased load on the furnace gave rise to a serious bottleneck in heat-treating and made the plant significantly less productive and less profitable.
In an effort to prevent sub optimization from occurring each department must work together to understand what the best process is as a whole and to see the bigger picture. Management must ensure that processes are not implemented independently of