A must read book - The Goal beautifully narrates the way a set of people- Plant Manager, Production Manager, Plant Controller, Data Analyst, Material Manager make a turn around in a manufacturing plant which is in the verge of shut down.
The book starts with narrating pathetic situation in the badly managed manufacturing plant where in the managers are surrounded by typical challenges of any modern day manufacturing plant like ever demanding management that works with unquestionable belief in their bad procedures, ill measurements and over confidence in advanced tools as a means to increased efficiency; unhappy customers because of too much delay in product delivey; unprecedented employee attrition or lay-offs; plan working with lacking system thinking and missing team synergy etc. Their jobs are in danger and their family life is miserable and full of tension.
Under such a situation a plant manager with a timely tips of a industrial consulatnt decides to bring in a major change by involving Production Manager, Plant Controller, Data Analyst, Material Manager.
By oberving and analysing current procedures in the plant, they identify events and dependencies. They identify bottle-necks and non-bottle necks. Then they challenge existing bad assumtpions and make new assumtions which include- Balancing the flow with demand but not the capacity; Profit of the system is determined by dependency and constraints on the resource but not by the individual potential of the resource; Bottle necks govern both the throughput (money we make through sales) and inventory (the money that the system has invested in purchasing things which t intends to sell). With these in mind, they identify goals and very simple measurements. At Organization level they identify goal as "Making Money" and list out corresponding measurements- Net Profit, Return on Investment (RoI), Cash Flow. In day to day operation at plan level, the goal they identify is "Operational Effectiveness" and list out corresponding measurements- Throughput, Inventory, Operational Excellence.
Following this, Plant Manager, Production Manager, Plant Controller, Data Analyst, Material Manager accept orders that many times seems to be impossible to fulfill at macroscopic level. By successful brainstorming to evaluate alternative solutions and pick the best one, keep continuous watch on statistical fluctuations, perform root cause analysis, make pragmatic timely decisions, bench mark practices from daily life and fine tune implement these practices to achieve a goal. As a result, happiness fills the air: happy management because increased sales, delighted customers because timely products, benefited employees and happiness in their families because of secured jobs, working place as a fun place because of continuous learning.
In brief, The Goal is a must read book that summarizes the way in which one can make a impact full change in work place by combining leadership and functional skills by building team synergy with the help of simple assumptions and measurements by focusing on bottle necks and understanding constraints to achieve goal of making money by increased sales.
A must read book and a worthy to have in personal library with a pride.