The Goal

This is a book on operations management. The message of the book is that an organisation resembles a chain and is only as strong as its weakest link. The book rightly concludes that an organisation is more than the sum of its parts.

The author demonstrates using both logic and analogy that local optimisation without identifying the weakest link is a losing strategy. “A system of local optimums is not an optimum system at all; it is a very inefficient system.” For example, keeping people busy for the sake of keeping people busy is an example of local optimisation.

There are couple of management adage on measurement - 'If you cannot measure it, you can't manage it' and 'You get what you measure.' The book highlights the negatives of choosing wrong (suboptimal) measures. Hint: Most traditional measures of efficiency and productivity are flawed. 

Author claims that the universal goal is to make money - by increasing net profit, while simultaneously increasing return on investment, and simultaneously increasing cash flow. In other words, the goal is to increase throughput while simultaneously reducing both inventory and operating expense.

I am not convinced if that is the goal. The goal in my opinion is to deliver value through one or more means. Seeking operational excellence in whatever means an organisation chooses to deliver value is an absolute must. No doubt about it. I am not sure, though, if that is the end all and be all.

The best part about the book is the explanation on the interaction between dependant events and statistical fluctuations. In summary, the theory suggests that statistical fluctuations don't average out because dependency limits the opportunities for higher fluctuations. Thereby, accumulating slowness (excess inventory).

The author elaborately explains the havoc dependant events and statistical fluctuations cause on operational expense when they happen to be together using hike and match stick examples. 

Using these examples author concludes that whoever is moving the slowest in the troop is the one who will govern throughput. This is precisely how bottlenecks or constraints are identified.

The rest of the book goes about how to effectively deal with constraints. The author proposed a five step process as outlined below
  • IDENTIFY the system’s constraint. 
  • Decide how to EXPLOIT the system’s constraint. 
  • SUBORDINATE everything else to the above decisions. 
  • ELEVATE the system’s constraint. 
  • If in the previous steps a constraint has been broken Go back to step 1, but do not allow inertia to cause a system constraint.
In his fictional story, author points to other issues that start to show up when the organisation starts managing the bottlenecks in line with the five step process.

This is where the disappointing part starts. From this point onwards, author reverse engineers/retro-fits the concepts usually associated with that of Toyota Production System or Lean manufacturing like balancing flow, pull, takt time etc. into his theory of constraints.

The last part of the book focuses on environments where it makes sense to implement lean vs lighter, time based constraints to restrict over production citing Hitachi Tool Engineering Ltd. as a case study. I found this discussion quite valuable.

Overall, I would still recommend this book. But I would vastly prefer The Toyota Way over The Goal.

On a side note, at one point in the book author draws an analogy from periodic table (chemistry). In doing so, author provides an amazing introduction to periodic table. Had I been introduced to the concept of periodic table in this manner, I might have done better in chemistry during school days.

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