System bottlenecks explained with water pipes

The most important insight from systems theory is that the total system output is limited by its bottleneck.

Consider this system of pipes of different sizes carrying water from left to right. The total output of this system is limited by the pipe with the smallest diameter. In other words, the smallest section (the bottleneck) limits the flow of the whole system.

If we want to increase the flow of water (system output) changing the size of any pipe before or after the bottleneck doesn’t matter. The total flow is limited by the bottleneck. The only way to increase the total system output is to increase the throughput at the bottleneck.

The fact that this applies to any system is what makes this insight so important.

Picture and idea taken from here.

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