Apr 11, 2008

The goal

As part of the prescribed readings of our "Operations Management" course, I came across this interesting and insightful book "The goal" by Eliyahu Goldratt and Jeff Fox. It's definitely an eye opener in terms of breaking some of the traditional mindsets in manufacturing processes.

The story revolves around Alex Rogo, a plant manager who is facing the challenge of improving the performance of his loss-making plant in 90 days. If he fails, his plant will be shut down and many workers will lose their jobs. There has been huge delays in delivering the orders. There are issues with throughput and inventory. Priorities keep changing and expeditors are always on their toes. Overtimes or robots don't help either. Although Alex has been putting long hours at work trying to fix issues, there is no improvement whatsoever. On the other hand, his personal life is affected and so is his marriage.

An accidental meeting with one of his professors Jonah opens up a new window of thinking and Alex starts to analyze the processes in his plant from scratch. Jonah's pointers on throughput, operational expense and inventory helps Alex to unravel more pitfalls in the current operations of his plant. He gets to learn more on bottlenecks when he goes on a hiking trip with his son. Many revelations that he experiences in this journey of three months are common sensical in nature. Yet in the name of so-called common practices, we tend to not think beyond and question the many principles that we follow blindly.

There are many valuable insights throughout this book in terms of productivity and utilization aspects, dependent events and statistical fluctuations. The author also hits at some of the common accounting practices that can prove to be detrimental in the effective operations of a firm. Towards the end, the concept of "theory of constraints" fits so beautifully with the learnings that Alex experiences in his journey.

I found this book to be very interesting. I plan to read "Goal II" during my weekend vacations in May :-)

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