What on earth took me so long to read “The Goal” by Eliyahu M. Goldratt and Jeff Cox? The first edition came out in 1984.
Several years ago a close friend, Max Krug, introduced the book “The Goal” as well as the Theory of Constraints. Consequently, Max is a Theory of Constraints (TOC) expert and consultant. Max preaches maximizing efficiency and throughput. He is an operational excellence guru and thank goodness he recommended this outstanding resource. To learn more about Max, click here.
Anyway, “The Goal” is the rare business book that demonstrates a game-changing philosophy and strategy described in a fictional story. A story that flows as a well written & page-turning novel.
This business classic is truly a must read for any entrepreneur or business manager. Especially for those in manufacturing. Minimizing constraints while maximizing efficiency and profits is the name of the game.
The Goal: A Process of Ongoing Improvement
Instead of a book just based on theories with boring calculations and models, the authors tell a fictional story of a plant manager who is obsessed with his work.
The book opens with the protagonist, Alex Rogo, plant manager of UniCo pulling into the company parking lot. Only to find his parking space occupied by a crimson Mercedes. Even though the parking lot is nearly empty.
The Mercedes occupying his parking space belongs Bill Peach, division vice president. Bill Peach visits Alex’s plant to address order #41427 that is not only 7 weeks late but also belongs to UniCo’s largest customer.
Needless to say, this large customer is not pleased. The division vice president then informs Alex that he has three months to turn the plant around. Otherwise, Peach plans to go to the management committee with a recommendation to close the plant.
90 days. That’s it!
Combined with rumors flying around that the entire division will be sold if a turnaround doesn’t come soon.
So the journey begins with Alex trying to become a hero and save the day. Save the plant. In addition, save his job as well as his career.
Advancing efficiencies. Vastly improving cash flow and profit margins. Preventing the damage that a plant closure causes a small community. Saving hundreds of jobs as well as all of the families that would be negatively impacted.
Furthermore, the book describes the challenges that a manager faces not only with job security and the threat of his plant being closed, but also his own personal struggles at home. Work-life balance is a hot topic commonly discussed today. Marital problems. Raising kids. That is all here.
Jonah to the Rescue
While waiting in an airline lounge for a connection at O’Hare, Alex runs into Jonah. Jonah was a physicist professor that Alex knew from college. Alex received a grant to study the mathematical models that Jonah was working on at the time.
Alex updates Jonah on his career and shares exciting information on UniCo. Jonah immediately sees through Alex’s exaggeration of optimism (aka B.S.) and starts questioning Alex about the inefficiencies at his plant. Alex is dumbfounded and questions how could an academic understand his business and manufacturing?
“I am a scientist”, Jonah says “And right now you could say I’m doing work in the science of organizations in particular.”
Jonah continues, “productivity is the act of bringing a company closer to its goal. Every action that brings a company closer to its goal is productive. Every action that does not bring a company closer to its goal is not productive.”
Alex tries to explain how his plant measures efficiencies through benchmarks and formulas. Jonah explains, “You think you’re running an efficient plant….but your thinking is wrong”.
What is “The Goal”?
As Jonah boards his plane, he leaves Alex with the burning thought, “Alex, you cannot understand the meaning of productivity unless you know what the goal is. Until then, you’re just playing a lot of games with numbers and words.”
That meeting kicks off Alex’s quest to discover “The Goal”.
Alex finally discovers the goal of his plant. Actually, the goal of any organization for that matter: Make money and maintain sustainability.
Most importantly, create profits and positive cash flow.
Once Alex finally discovers “The Goal”, then his adventure truly begins.
How to actually obtain “The Goal”?
- Identify constraints
- Maximize throughput
- Increase profits
- Lower expenses
- Decrease inventory
- Improve inventory turnover
- Reduce lead times
- Hit delivery times
To discover if Alex saves the plant along with the hundreds of jobs, grab yourself a copy of “The Goal” today!
Wrapping It Up
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