TOC course · Lesson 5 of 6

Connect flow decisions to money

Use throughput economics to choose what deserves scarce constraint time—without mistaking revenue, utilization, or allocated margin for the system goal.

Time: 15 minutes Previous: elevate and reassess Reference: field guide

The three operational measures

Measure	Working definition	Service-business caution
Throughput (T)	Sales revenue minus costs that vary directly with the sale.	Do not subtract allocated fixed salaries merely because time was booked to a project.
Investment (I)	Money tied up in things the system intends to turn into throughput.	Includes cash tied up in unfinished work or required assets; define the boundary explicitly.
Operating expense (OE)	Money spent to turn investment into throughput.	Most regular payroll and operating capacity remain OE in the short-run decision horizon.

Net profit = T − OE
Return on investment = (T − OE) ÷ I

These definitions come from TOC's Throughput Accounting decision framework, introduced alongside the Five Focusing Steps by Goldratt Research Labs.

Prioritize the constrained minute

When the constraint is a scarce specialist or decision function, compare throughput per unit of constraint consumed, while respecting due dates, commitments, SLA guardrails, and strategic necessary conditions.

Illustrative RFC	Price	Truly variable cost	Constraint hours	T per constraint hour
A	UAH 30,000	UAH 6,000	8	UAH 3,000
B	UAH 42,000	UAH 12,000	15	UAH 2,000
C	UAH 18,000	UAH 3,000	3	UAH 5,000

RFC B has the highest revenue; RFC C generates the most throughput per constrained hour. This is an illustration, not a recommendation: promised dates, customer impact, risk, and service obligations can override a purely economic sequence.

Match the financial signal to the question

The updated IT-Premium source establishes an authoritative accounting split: recurring subscription income is posted to Абонплата. The production feed is approximately UAH 1.3m per month across the observed quarter. Separating recurring from project revenue no longer depends on invoice-level tags.

Question	Right source	Remaining work
Recurring versus project income?	`Абонплата` account attribution.	Use the accounting split directly.
True MRR?	Recurring postings plus contract schedule.	Normalize prepayments, catch-up, and non-monthly postings.
Customer/service/project margin?	Invoice/service classification, Change/RFC time logs, and variable-cost data.	Match project labour recorded on Changes as well as RFCs; ticket-only effort understates project work.
Churn?	Customer contract and status history.	Measure starts, expansions, contractions, and exits—not revenue totals alone.

Time logs are now the source of truth for touch time, capacity mix, and labour-cost analysis. They support loaded-labour calculations, but they do not replace phase-transition timestamps for elapsed lead time or wait time.

Cash context is not automatic priority: a paid customer or overdue receivable can inform a commercial decision, but it must not silently advance an unapproved or unready RFC.

Practice: calculate from the example

RFC A: UAH 30,000 price minus UAH 6,000 variable cost. Throughput?

Which RFC has the highest throughput per constraint hour?

Regular short-run payroll is usually classified as what?

Your decision card

Candidate work:
Expected throughput:
Constraint units consumed:
Throughput per constraint unit:
Commitment / SLA / strategic guardrails:
What data is uncertain?

Ask follow-up questions: Bring two anonymized work candidates to the agent. We can test whether their costs and constraint units are classified consistently.

Primary reading

Goldratt Research Labs: Introduction to TOC — the relationship between the Five Focusing Steps and Throughput Accounting.
North River Press: Throughput Accounting and other Goldratt titles — continue with the dedicated text if pricing and mix decisions become important.