The Goal Case Study

Now moving into chapter 21 of The Goal, Alex has identified the problems/bottlenecks in his factory. His goal now is to identify the back log of orders and get them through the bottlenecks, get them assembled, and shipped out to the buyers as soon as possible. Alex and his team determines that one of the underlying causes of their present parts pile-up at the bottlenecks is because the operator cannot tell the difference between a bottleneck-destined part and an ordinary one. The operator, in an attempt to keep busy, processes batch after batch of non-bottleneck parts when what they really need to do is work on bottleneck parts. They attempt a solution for this by placing red and green tags on the parts which are destined for a bottleneck

The goal of a manufacturing organization is to make money. Jonah poses this as a question: "What is the goal?" and Rogo actually struggles with it for a day or two, but any manager or executive that can't answer that question without hesitation should be fired without hesitation.

Alex comes up with the consensus that the “Goal” of his business and many others is to increase net profit while simultaneously increasing return on investment and their cash flow at the plant. This basically means to make money. These three measurements can be achieved by looking closer into his second set of measurements. Alex specifically must find a way to increase throughput while at the same time decreasing it inventory and operational expenses. All three of these measurements must be cautiously monitored since they all rely on each other to be obtained in balance. Factors that cause throughput, inventory, and operational expenses to become unbalanced are excess manpower and balance capacity of the demand of resources in the market.

One of the issues Target could face if it continues to only focus on private label store brands and do not promote national brands is losing a percentage of its customers. Although Target’s innovative amount of store brands on its aisles has proven successfully for the retailer and consumers have shown a positive reception to the products, there are still a number of customers who are accustomed to

Alex comes up with the consensus that the “Goal” of his business and many others is to increase net profit while simultaneously increasing return on investment and their cash flow at the plant. This basically means to make money. These three measurements can be achieved by looking closer into his second set of measurements. Alex specifically must find a way to increase throughput while at the same time decreasing it inventory and operational expenses. All three of these measurements must be cautiously monitored since they all rely on each other to be obtained in balance. Factors that cause throughput, inventory, and operational expenses to become unbalanced are excess manpower and balance capacity of the demand of resources in the market.

The novel, “The Goal: A Process of Ongoing Improvement”, by Eliyahu Goldratt focuses on a production plant that has a failing system which can potentially shut down if the system that it operates under does not right itself and show improvements. The book is structured like a business textbook but is written as a novel. “The Goal” uses a scenario in the production world that can occur to any production manager. Eliyahu Goldratt uses the main character, Alex Rogo a plant manager with UniCo Company for the past 15 years, puts him in the students seat. It helps business students learn with Alex and makes it very relative.

He decides he needs to find Jonah once again to get some more mentoring. Jonah shares three terms that will help him run his plant: throughput, inventory and operational expense. Everything can be classified under one of these terms. While in the midst of all of this turmoil, the plant had robots that were taking over some of the production jobs. Alex realizes, after his talk with Jonah, that these robots did not help to save money, but in fact increased costs, operational expenses, and were less productive. The robots were implemented, which increased costs to do so, however they did not reduce other costs like direct labor. They shifted labor to other parts of the plant. Now the challenge is how they are going to take care of the robots issue without lowering efficiencies? Alex decides to visit Jonah again. Jonah tells him he has got it all wrong.

The first way throughput can be increased is by making sure that the bottleneck’s time is not wasted. According to the text, this means that a bottleneck should never be sitting idle or working on defective parts. When a bottleneck is down for an hour, it is not only the cost of the bottleneck that is lost, but the cost of the entire system. This is because the bottleneck’s capacity is equal to the entire system’s capacity, and whatever a bottleneck produces in one hour is what the corporation produces in one hour. In addition, if a bottleneck works on defective parts or parts that are not needed, it is a waste of time that the bottleneck could be spending on good parts that are needed. Without good parts from a bottleneck, you can’t sell a product or generate throughput.

One more time, Jonah explained Alex another concept. Jonah explained, “A bottleneck is any resource whose capacity is equal to or less than the demand placed upon it. A non-bottleneck is any resource whose capacity is greater than the demand placed on it”. Alex with the help of his team could identify the bottleneck in the plant and organized the

In the article Aims, Goals and Objectives, Nel Noddings states that “Aims are used not only to derive goals and objectives but also to evaluate them.” (Noddings, Aims, Goals and Objectives, 2007). She also believes that educational aims should be directed towards making the lives of everyone full and satisfying as opposed to changing all people into members of the educational elite (Noddings, Aims, Goals and Objectives, 2007). Reflecting on these points has brought up a facet of the aims argument that I had not previously considered and has helped me identify areas for improvement in my teaching career. In the paragraphs that follow, I will first provide a summary of the article that details the author’s main ideas and key points and then I

The Goal a Process of Ongoing Improvements was Dr.Eliyahu M Goldratt first book. It is a fiction business management novel that primarily focuses on the theory of constraints. The author Goldratt is a critical acclaimed Israeli business manager, physicist professor, and author. He is thought of as the guru of business operation. Goldratt is the creator of optimized production technique and the theory of constraints. He also is the author of the following books: Production the TOC way, IT’S Not LUCK, Critical Chain, Necessary but not sufficient, ISNT It Obvious, The Choice, The Race, What is This Thing Called: theory of constraints, and The Haystack Syndrome.

It takes a day out with the Boy Scots for Alex to discover one of his biggest problems at the plant – bottlenecks. A bottleneck is any resource whose capacity is less than the demand placed upon it and thus limiting the throughput. A nonbottleneck is a resource whose capacity is greater than the demand paced upon it and thus will contain idle time. A capacity constrained resource (CCR) is one whose utilization is close to capacity and could be a bottleneck if not scheduled carefully.

The one and only goal for any company should be to make money. Under the theory of constraints, everything that goes towards achieving that particular goal is productive and everything that doesn’t is unproductive. The first bit of advice Jonah gives to Alex involves the big picture view of what is wrong with the plant. Jonah mentions high inventories and failure to achieve shipping dates as most likely the main problems being faced, and asks Alex multiple questions, without giving answers. This back and forth between Alex and Jonah can be described as the socratic method. This method allows a series of questions to be asked but left up to interpretation, so there is no answer given, but critical thinking is required to find a solution. After this method works to perfection and Alex figures out the answer to these questions, he immediately sets up a meeting with an accountant and they outline what is needed such as increasing net profit, return on investment and cash flow.

The bottlenecks are the areas (machines) in the plant that are constantly holding back the production of the finished product. The philosophy behind this will become clear in a moment.

This journal article on the path-goal approach theory is a study that carefully examines the rapport and connection amongst leaders and followers job expectancies. This model designed by House (1974) addresses the directive, supportive, participative and achievement –oriented components of leadership and subordinates. Additionally, it studies the conduct and character of leaders while investigating situational contingences that transform those behaviors. Therefore, the leader’s role in this model is to ensure that they provide guidance and support while demonstrating behavior that is motivational by inspiring followers to work diligently to achieve organizational goals that were carefully outlined to facilitate success. Hence, the purpose of this study was to test the validity of the path-goal theory with reference to expectancy theory. Conversely, it revealed that cellular companies gives adequate powers to its managers to offer incentives to individuals performing at high levels. However, a weaker relationship between the leader conduct and the followers’ job expectancy was the outcome. One exception noted was that of supportive leader behavior which was revealed at the conclusion of the study. Subsequently, the behavior of the leader had a tremendous impact on outcome. Leaders must assist subordinates throughout the path by eliminating road blocks along the way. The primary function of the leader in this research was to motivate subordinates and increase payoffs