blog




  • Essay / The Goal by Eliyahu M. Goldratt and Jeff Cox - 1264

    While reading The Goal, by Eliyahu M. Goldratt and Jeff Cox, I learned that there is great importance for a productive organization when management of a business. The book is an investigation into the life of a redemptive factory that was heading into a downward spiral that would have shut it down. The book is an investigation into the life of a factory that is in a downward spiral until new management ideas begin to arise and shake up the company and put it back on track to making money. The book describes how scientific and systematic thinking processes helped this factory transform its functions into a more positive business, increasing its cash flow through reorganization within the factory. The first positive step toward a comeback occurs when Alex Rogo, the factory manager, recognizes the true Purpose of his company: to make money. The purpose of each business is often lost in statistical, production and efficiency data. In order to make money, a customer must have a want or need for the company's product(s). A customer will appreciate the satisfaction he gets from the product. Customers want to find the best deal for the product they are purchasing. Usually, customers look at prices, quality and reliability. In this book, we discover how important it is for the factory's customers to receive their deliveries on time. Fast delivery proves to be a key factor in gaining customers for the factory. When Alex realizes how well his factory is doing with shipping dates, he decides to go even further by cutting the batch size in half. This not only benefits customers, but also the factory by reducing the time parts sit in the factory and increasing the flow rate of parts. This gives Alex's factory an advantage in the market because customers come to her for faster delivery. Before the new system, the factory was not giving its customers what they wanted. Jonah helped the factory understand that what was really needed was for orders to be sent to their customers on time. The factory was having trouble getting deliveries out on time, creating a backlog of orders. When there was demand for a certain order, additional expenses were added to focus all efforts on a single sale. This caused a negative chain effect throughout the factory due to their flawed cost management system..