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The Goal: A Process of Ongoing Improvement, by Eliyahu M. Goldratt, is a book pretty much every business school student is required to read. Below are the key takeaways from this book:

Accounting vs. Operational Measures

• Accounting cost figures misleading for operations purposes
• Productivity per machine is meaningless; bottleneck should drive metrics

Linking Financial – Marketing – Operations Measures

• Often mismatch top-level and lower-level metrics across departments (ROI vs. Sales vs. Productivity on non-bottleneck)

Managing by Bottlenecks

• “An hour lost on the bottleneck is an hour lost for the entire plant”
  • Bottleneck has no “slack capacity”
  • Solution
    • Increase capacity
      • longer hours
      • more machines
      • more workers
      • outsource
    • Larger batches at the bottleneck
• “An hour lost on a non-bottleneck is a mirage”
  • Do not overrun to be efficient: excess WIP chocks up the bottleneck
  • Do not optimize a non bottleneck at the expense of a bottleneck
  • Shorter and smaller batches at non bottleneck
• “Manage the plant by the bottlenecks”
  • “Manage flows not capacity”
  • Quality control before and during the bottleneck
  • Make sure it is always running (have buffers)
  • Make sure most profitable product goes through
  • Throughput is profitable, efficiency is not

Additional Notes on Bottlenecks

• Keep bottleneck running, subject the rest to the bottleneck
• Batch sizes: Long on bottleneck, short elsewhere
• Five steps of bottleneck management
  • Identify the system’s bottlenecks
  • Decide how to exploit the bottlenecks
  • Subordinate everything else to the bottlenecks
  • Remove the system’s bottlenecks
  • Identify the system’s new bottlenecks
• Note: Bottleneck may be external (such as demand)
• Gains from bottleneck management in The Goal
  • Increased revenue from $2 million and 31 orders to $3 million and 57 orders
  • Reduction of WIP by 12%
  • Bucky Burnside was delighted – 5 month order in 5 weeks
  • Order for 10,000 model T’s ensures survival of the plant for one year

Additional Takeaways

• Always challenge the status quo and use a pragmatic approach
• There’s always room for improvement
• Look at overall system, not just the individual parts
• When Operations is effective, you work better, not harder
• Make sure to have the right metrics in place
• Work as a team, foster the sharing of ideas
• Importance of coordinating between Operations and Marketing

The Goal is a management-oriented novel by Eliyahu M. Goldratt, a business consultant known for his theory of constraints, and Jeff Cox, a best selling author and co-author of multiple management-oriented novels.^[1]The Goal was originally published in 1984 and has since been revised and republished. This book can be used for case studies in operations management, with a focus geared towards the theory of constraints, bottlenecks and how to alleviate them, and applications of these concepts in real life.^[2] It is used in management colleges to teach students about the importance of strategic capacity planning and constraint management. Time Magazine listed the book as one of 'The 25 Most Influential Business Management Books.^[3]

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Setting[edit]

Like other books by Goldratt and by Cox, The Goal is written as a piece of fiction. The main character is Alex Rogo, who manages a production plant owned by UniCo Manufacturing, where everything is always behind schedule and things are looking dire.^[4] At the beginning of the book, Bill Peach, a company executive, tells Alex that he has three months to turn operations at his plant around from being unprofitable and unreliable to being successful.^[5] His distant acquaintance, Jonah (a physicist), whom many believe represents Goldratt himself, helps him solve the company's problems through a series of telephone calls and short meetings. A second story line is introduced involving Alex's marital life. Program script for 60th birthday. Perhaps surprisingly, Jonah's concepts are also applied successfully in this alternative story line.

Bottlenecks[edit]

The book goes on to point out the role of bottlenecks (constraints) in a manufacturing process, and how identifying them not only makes it possible to reduce their impact, but also yields a useful tool for measuring and controlling the flow of materials. Alex and his team identify the bottlenecks in their process and immediately begin to implement changes to help increase capacity and speed up production. In response to questions about the logic of using outdated technology in modern manufacturing, Alex's team brought in an old machine they received for free (which had previously been used at their plant in conjunction with two other machines) in order to increase the capacity of the NCX-10 machine, which had been identified as one of the two bottlenecks. Further more, they identified processes at the heat treat, identified as their second bottleneck, that caused massive delays in their getting product through the heat-treat and which had also caused some products to be heat-treated multiple times (to make softer and then harder again) instead of just once or not at all.

Socratic method[edit]

In the book, Jonah teaches Alex Rogo by using the Socratic method. Throughout the book, whenever a meeting or telephone call dialogue happens with Jonah he poses a question to Alex Rogo or a member of his crew which in turn causes them to talk amongst themselves to come up with a solution to their problem. When Alex Rogo is with his wife, he finds the Socratic method to be a way to fix his marriage which he then uses, with his crew, to come up with the five steps they should use to fix problems in the plant which ultimately leads him and Lou to think up the three things every division manager, the position Rogo is promoted to, should be able to do.

Characters[edit]

• Alex Rogo - main character, manufacturing plant manager
• Bill Peach - division vice-president
• Fran - Alex's secretary
• Jonah - advisor, Alex's former physics professor
• Lou - chief accountant / plant controller
• Stacey - inventory manager
• Julie Rogo - Alex Rogo's wife
• Bob Donovan - production manager
• Ralph Nakamura - data processing manager
• Herbie - the bottleneck and the solution
• Dave - Alex Rogo's son
• Sharon - Alex Rogo's daughter
• Mike O'Donnel - union rep
• Ethan Frost - division controller
• Eddie - Second shift supervisor
• Johnny Jons - marketing director / sales manager
• Hilton Smyth - assistant division controller
• Bucky Burnside - President of UniCo's biggest customer

The Goal A Process Of Ongoing Improvement Audiobook Torrent

See also[edit]

References[edit]

1. ^'Jeff Cox'. Simon & Schuster. Retrieved 2017-05-25.
2. ^A summary of The Goal by Gower Publishing
3. ^Rawlings, Nate (2011-08-09). 'The 25 Most Influential Business Management Books'. Time. Retrieved 2016-02-20.
4. ^Stevenson, Seth (2012-06-08). ''Then Why Did We Buy the NCX-10?''. Slate. ISSN1091-2339. Retrieved 2016-02-20.
5. ^A chapter-by-chapter summary of The Goal

• Goldratt, Eliyahu M.; Jeff Cox. The Goal: A Process of Ongoing Improvement. Great Barrington, MA.: North River Press. ISBN0-88427-061-0.

External links[edit]

The Goal A Process Of Ongoing Improvement Torrent