Capacity Constraints: How Knowing Your Limitations Can Save Your Life (And Your Business)

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There’s a scene towards the end of the classic movie The Outlaw Josey Wales when a bounty hunter saunters in looking for Clint Eastwood’s titular character. When Wales asks him if he’s a bounty hunter, the man says, “A man’s got to do something for a living these days.” To which Wales responds, “Dying ain’t much of a livin’, boy.”

The bounty hunter considers this “advice” and saunters off only to return moments later to, well, let’s just say he wasn’t very good at making a living.

This would have been the perfect moment for Clint to growl “A man’s got to know his limitations.”

Of course, he used that line in the role of Harry Callahan in the movie Magnum Force released three years earlier. Still, it would have been a nice call back the audience would have instantly appreciated.

Knowing your limitations is more than a quaint philosophy from some bygone era of make believe. It’s a real-life phenomenon that can make a difference between thriving and merely surviving.

In strict practical terms, it refers to capacity constraints.

A capacity constraint usually applies to a physical limitation. For example, you can’t pour two gallons of water into a one gallon pail. Well, you could, but only if you’re willing to lose one gallon of water that spills out of the full pail.

Because of its physical nature, operations managers at manufacturing firms use this concept when analyzing logistics. In fact, the “Theory of Constraints” was first introduced by Eliyahu M. Goldratt in his 1984 book The Goal. “TOC” has since become a popular management philosophy.

You don’t need to be a math major to understand the importance of capacity constraints in business. In the broadest sense, you’ve heard the old adage “There are only 24 hours in a day,” right? That’s an example of a capacity constraint. You only have so much time. That puts a cap on what you can do.

As Clint Eastwood might say, “A business has got to know its limitations.”

But it’s just not about business.

It’s about you.

You’ve got to understand (and accept) your own capacity constraints.

And I’m not talking about the emotional kind. That’s the kind of capacity constraint that has Josey Wales give up his cozy life as a farmer and become a man whose vengeance has no limits.

Hmm, I suppose that means he has unlimited capacity.

OK, a better example of strained emotional capacity would be the character played by Peter Finch in the movie Network. His portrayal of embattled newsman Howard Beale reaches a climax when he repeatedly shouts, “I’m mad as [H-E-double-toothpicks] and I’m not gonna take it anymore!”

Of course, he didn’t actually say “H-E-double-toothpicks.” He said the real word. That’s how mad he was. He had reached the breaking point and he just wasn’t going to take it anymore.

But that’s emotional capacity. Even, and especially, if you have that under control, the more important capacity constraint to understand is your capacity for action.

Your capacity for action deals with your ability to take on projects, whether they be at work, at home, or at any organization or group you belong to.

The same basic rule of businesses applies to you: there are only 24 hours in a day. If you take on too much, your output suffers, you’ll get frazzled, and, overall, well, it just “ain’t much of a livin’.”

Let’s examine the most likely places where these activity bottlenecks occur.

First and foremost, among these is work. You don’t have to own the business to become a workaholic. In fact, you don’t have to be a workaholic to push up against your capacity constraint. You might just want to impress your boss, so you take on more than you should. Conversely, your boss might just want to squeeze every bit of juice out of you and piles tasks on you like there’s no tomorrow. In either case, you’ve reached your limit and the value you can add slowly ebbs.

Home is a trap for ignoring your capacity constraint. Whether it’s spending money you don’t have or taking on one too many do-it-yourself projects, you hit a wall you don’t see or feel. Bills pile up. Projects don’t get done. But you still buy things. And you still start another project.

Finally, everyone likes to be liked. So, you do things for people. Actively participating in community organizations represent the easiest way to accomplish this. As a result, you join a church, a civic association, or a volunteer group. To show you’re committed, you take on one job after another. Pretty soon, every night of your week and every day of your weekend is spent on one of these groups or another.

Again, there are only 24 hours in a day. You can’t do it all.

Now, here’s the real annoying part of capacity constraints. Like it or not, different people have different capacity constraints. Simply put, some people can do more than other people. As a result, some people earn more money than other people. This upsets the folks who believe all outcomes (as opposed to opportunities) must be equal.

But don’t worry about that right now. That’s for other people. Worry about yourself. Understand what you can do and what you cannot do. Sure, push the envelope, but keep alert. Be mindful that there is a breaking point. Step back before you get there.

And don’t let anyone (be they boss or competitor) push you past that breaking point.

Don’t be a Howard Beale.

Be a Josey Wales.

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