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A review by aishaayoosh
The Goal: A Process of Ongoing Improvement by Eliyahu M. Goldratt
5.0
Who is this book for? Anyone sitting the PM or APM modules for ACCA, CIMA students, production managers, and CEO’s.
It’s a book that is very easy to read at all levels because it is written in the style of a thriller novel. The book contextualises the theory of constraints (TOC) into a real-world scenario.
TOC uses a Socratic method of approach by identifying the systematic problem behind an observed cause/issue. It challenges common business practices and conventional ways of thinking. The book clears the confusion around performance measurements, efficiencies, productivity and company goals.
The three most important areas of focus:
• Throughput: the rate the system generates money through sales. Money coming in.
• Inventory: all the money invested in things it intends to sell. Money in the system.
• Operational Expense: The money spent to turn inventory into throughput. The money you pay to make throughput happen.
The Goal: Increase throughput while simultaneously reducing both inventory and operating expense.
A system only moves as fast as the slowest moving person (the bottleneck). TOC is a process involving five fundamental steps to help identify and alleviate these limitations.
• Step 1: Identify the system’s constraint.
• Step 2: Decide how to exploit the system’s constraint.
• Step 3: Subordinate everything else to the decisions of Step 2.
• Step 4: Elevate the system’s constraint.
• Step 5: If a constraint is broken in Step 4, go back to Step 1.
The bottom line is that the goal of any business is to ‘make money'.
Keeping people working and making money isn’t the same thing. Just because you’re paying for someone doesn’t mean they should be busy all the time, it could cause more harm than benefit.
Three simple questions: What to change, what to change to, and how to cause the change?
The book did touch on other themes that I felt were noteworthy:
• The importance of team buy-in
• Work/life balance and taking time out for reflection
• Cultural difficulties and transformation of mindsets
I loved that this book was written by a Scientist applying his empirical way of thinking into the business world. It really hits back to when I initially trained to be one, this method of troubleshooting can actually be applied in the business world. Eliyahu has paved the way :)
It’s a book that is very easy to read at all levels because it is written in the style of a thriller novel. The book contextualises the theory of constraints (TOC) into a real-world scenario.
TOC uses a Socratic method of approach by identifying the systematic problem behind an observed cause/issue. It challenges common business practices and conventional ways of thinking. The book clears the confusion around performance measurements, efficiencies, productivity and company goals.
The three most important areas of focus:
• Throughput: the rate the system generates money through sales. Money coming in.
• Inventory: all the money invested in things it intends to sell. Money in the system.
• Operational Expense: The money spent to turn inventory into throughput. The money you pay to make throughput happen.
The Goal: Increase throughput while simultaneously reducing both inventory and operating expense.
A system only moves as fast as the slowest moving person (the bottleneck). TOC is a process involving five fundamental steps to help identify and alleviate these limitations.
• Step 1: Identify the system’s constraint.
• Step 2: Decide how to exploit the system’s constraint.
• Step 3: Subordinate everything else to the decisions of Step 2.
• Step 4: Elevate the system’s constraint.
• Step 5: If a constraint is broken in Step 4, go back to Step 1.
The bottom line is that the goal of any business is to ‘make money'.
Keeping people working and making money isn’t the same thing. Just because you’re paying for someone doesn’t mean they should be busy all the time, it could cause more harm than benefit.
Three simple questions: What to change, what to change to, and how to cause the change?
The book did touch on other themes that I felt were noteworthy:
• The importance of team buy-in
• Work/life balance and taking time out for reflection
• Cultural difficulties and transformation of mindsets
I loved that this book was written by a Scientist applying his empirical way of thinking into the business world. It really hits back to when I initially trained to be one, this method of troubleshooting can actually be applied in the business world. Eliyahu has paved the way :)