People have been telling me for years how good a book The Goal is and now I’ve finally read it.
Format of the book
The Goal is a management book explaining the Theory of Constraints and how it can be applied to a manufacturing plant. Rather than just explaining the concept, the book is a novel following a stressed out manager trying to save his plant from closing.
What is the goal?
One of the important lessons that I took away from the book was to remember what the goal of an organisation is. For many organisations this is to make money and if the actions aren’t helping towards the goal then they probably aren’t the right actions.
For example reducing costs in itself is not the goal, especially if it comes at the cost of sales.
The goal puts forward a simplified method of measuring yourself against your goal. It consists of three measures; throughput, inventory and operational expense. An organisation will want to raise throughput (revenue) while reducing inventory (money in work in progress) and operational expenses.
Theory of constraints
The book explains how the plant manager can help the plant by looking at where the bottlenecks or constraints are in the plant and work to maximise their efficiencies. Many people in the company were looking at the wrong performance indicators. For example they were focusing on cost per part and ensuring that all staff were busy all of the time.
However, its important to identify the system’s constraints. As the book explains, an hour lost on a bottleneck resource is an hour lost to the whole system due to its impact on throughput. It is much more important to have an optimised system rather than locally optimised parts of the system.
The approach to a problem
A system’s constraint isn’t always going to be a physical resource. It could be external, personal or a process so its useful to have a process of how to deal with different bottlenecks. The process that the plant manager comes up with is 5 steps to deal with a constraint.
- Identify the constraint
- Decide how to exploit the constraint
- Subordinate everything else to the constraint
- Elevate the contraint
- If the constraint is no longer a constraint then go back to step 1
Once changes have been put into place to help the bottleneck it is important to not let inertia stop further improvements. If an action helps to improve throughput it doesn’t mean that the action will always be the right action. Circumstances change and fighting the inertia of processes can be difficult. Its important to be able to respond to new challenges and opportunities.
How I found the book
When I first started the book I didn’t enjoy that the book was written as a fiction novel. It seemed that the information could be given in a much more succint way. I also didn’t enjoy reading about the main character’s marital problems.
However after finishing the book I do think that the style did help the lessons learned to stick. I do think that there is a lot to be learned from this book but I think the main thing I learned was to look after my wife, work is important but some things are more important.