|HÁJEK Jiří||University of Economics, Prague|
The decision of what amount of a product to produce in a specific time can have a serious impact on the earnings of a company. Various methods have been used to solve this problem, with Theory of Constraints oriented scientific work representing the majority. This theory claims that at least one constraint is present in every system. In a production system the most frequently mentioned constraints is the capacity of machines or workers In times of crisis, demand is one of the constraints, especially for metallurgical companies. Therefore solving product mix related problems is crucial in metallurgy. This paper focuses on product mix decision making with respect to the Theory of Constraints (TOC) and Activity Based Costing (ABC). Much research was done on application of TOC and solving the product mix problem with the use of Dr. Goldratt’s originally introduced solution, but the solution does not lead to the optimal product mix in specific cases. The ABC emphasizes the causality of costs, activities and the final outcome. The mothod is based on the principle of processes which consume resources and outcomes which consume processes. This paper presents the more developed solutions of the TOC solution and the ABC approach to this problem. The critical evaluation of the methods is performed and optimal procedure for the metallurgical industry is chosen, with recommendations for its use.