Management Essays – Operations Management

Operations Management

This paper will argue the analysis of the book “The Goal” by Eliyahu M. Goldratt and Jeff Cox. It will stress the positive and negative aspects of the book, and will discuss the criticism and which areas of the book were least interesting. The paper will also emphasize the areas of interest. The Goal is a riveting, fast-paced business novel about overcoming the barriers to making money. It has helped me better understand the fundamentals of identifying and solving problems created by constraints. After finishing the book one will be able to start successfully addressing productivity and quality problems. The authors feature some important aspects of business management; they have explained the theories in simple terms that make it appealing and logical for the readers.

In this captivating business novel, which illustrates modern economic theory, Alex Rogo is a UniCo plant manager whose factory and marriage are failing. Alex Rogo manages a failing manufacturing plant, and because he dedicates most of himself to his work his marriage is difficult. When he learns from his district manager that profits must increase or the plant will be closed, Alex realizes he needs assistance. He turns to a former professor, Jonah, whom Alex discovers is now a management consultant. With his help and the help of the plant staff, Alex turns the plant around.

However, in the process he also abandons many management principles that he previously thought were ironclad. To regenerate the plant, he follows advice from a vague former college professor who teaches that reduction in the efficiency of some plant operations may make the entire operation more productive. Alex’s attempts to find the road to profitability and to keep his employees in the struggle involve the reader. Thankfully the authors’ economic models including a game with match sticks and bowls are easy to understand.

Although some characters are as mysterious as the goods manufactured in the factory, others ring true. Also, the story of Alex and his wife’s separation and reunion makes a touching contrast to the rest of the book. The reading is recommended for anyone with an interest in the state of America’s economy. It is energetic and interesting and offers food for thought for managers in any field of work. The performances are natural, with sound effects to enhance a picture of reality. Although it is a novel, its title is more attractive for business collections.

Anyone who considers himself a manager should buy and consume this book immediately. If you are the only one in your work place to have read it, your progress to success may suddenly increase as this is one of the most exceptional business books I have ever encountered. After reading The Goal I was very impressed with the way it was written. Reading a business book in a narrative format was something I was not expecting. The narrative format caught and kept my attention throughout the entire book. That explains why it has sold over a million copies. I have since recommended this book to both my family, who manages their own business, and to my friends. It is not just as a book about business but it can help one in every aspect of life. Some of my manager friends who have started the book say that the approach to keep it away from the traditional, boring business books is wonderful and interesting. I enjoyed the fact that the authors allowed the reader figure out what Jonah (an oracle like figure) meant before Alex got it. I felt it did take Alex a long time to understand; and it seemed as though there were some basic changes in his plant that the amateur eye could see but over all, I have nothing but praise for this book. If it was not for Jonah arriving at the plant one could have assumed that Jonah was the subconscious of Alex Rogo and that he had the answers the whole time. I felt that The Goal did an excellent job leaving an open ended question and showing that life is indeed a process of ongoing improvement.

Let me explain some of the many levels on which this novel is important. First, the book shows how to view businesses as systems better then any other business book on the market. It compares important works as a guide to constraints and well defines them in everyday life. The metaphor of how to speed up a slow-moving group of boy scouts will be beneficial to anyone who has done any hiking with a group. Second, the book helps you learn how to progress the performance of an organization by providing you with a replicable process that you can apply to analyzing any human or engineering system. The main metaphor is improving a manufacturing process but the same principles apply more broadly to other circumstances. Third, you will experience the power of the Socratic Method as a way to encourage your mind to learn and to use Socratic questions to stimulate the minds of others to become better thinkers. Fourth, the authors use problem simulation as a realistic way to help you experience the learning process they are advocating. And last, the book is good in bringing home the consequences of allowing your business processes to run in a cycle.

Eli Goldratt truly has a modern approach not only to management but also in teaching his theory. The Goal is about the ongoing struggle of a manufacturing plant manger as he searches for a way to save his plant from being shut down. With the leadership of an old high school physics professor Jonah, he develops a tactic to make his factory run more efficiently and become more beneficial. The theory of constraints is a simple theory that is usually the most effective and unnoticed. Goldratt understood that no matter how simple the theory is to comprehend, it would not be as successful unless it was deeply understood. If he were to simply set rules in a textbook style format as to how to approach a constraint, the chances of long-run improvement would be slim. Since business is in a steady stage of change, the constraints within them must also change. Unless the manager has a true comprehension of the theory they will be unable to adjust the environment to the changes to remain successful.

This book was enormously effective in delivering its message and educating readers on management and accounting theories. Through the text, author Eli M. Goldratt introduces and explains the Theory of Constraints. His main character, Alex Rogo, and Rogo’s team of plant executives must save a declining production plant by increasing throughput and cutting operational costs. He uses the characters to guide readers through the thought process behind the theory as the characters ask questions and search for answers. Readers are given time to consider these questions and form ideas before the answers to the theory are given. Students can carefully consider all the information and weigh all possibilities to form their own opinions at times his theories become too complex and conflicting.

Goldratt has been an especially productive author in recent years. Goldratt has written a novel in which he provides an analysis of those concepts as applied in a imaginary company. He has a cast of characters, a plot, and a context. He relies greatly on conversation to advance the narrative. At times these advanced narratives can be confusing for a new reader, but he tries to explain the theories in an easy and understandable manner. As in any other well-written novel, The Goal examines issues in dispute that create conflicts. Ultimately they are resolved, even if somewhat too neatly.

Although of greatest relevance to manufacturing companies, Goldratt’s Theory of Constraints with suitable modifications can also be of extensive value to other companies with bottlenecks that also delay and often disrupt a process of some kind. The Theory of Constraints portion was a bit put down and the romance line was a little tedious, but all in all it was a decent read. The Goal is a business management book which tries to explain the theory of constrain in a manner that hasn’t been done before. The author’s way of explanation is different and does not feel like a business book, instead gives the feeling of a novel. This new way of narration can at times feel complicated, as it makes a person loss touch with the business and management, and make them involved with the interpersonal conflicts of the book.

The Goal introduces the Theory of Constraints, is changing how America does business. The Goal is a fascinating, business novel about overcoming the barriers to making money. It helps to learn the basics of identifying and solving the problems created by constraints. From the moment you finish the book you will be able to start successfully addressing chronic productivity and quality problems. This theory provided a persuasive solution for factories struggling with production delays and low revenues. Theory of Constraints is strange but can be the best resource for organizations that have established improvement.

The simplicity of the ideas Goldratt places on constraints helps him teach his ideas. He helps us define our organizational goals and the concepts of productivity throughput, inventory, and operational cost. Jonah the teacher makes Alex and his staff the students discover the questions and answers they have been searching for to save their factory. This work is incredible for any new business manager. It is also a very common sense and basic approach to describing some of the major problems of the manufacturing organization. These problems are easily overlooked when dissecting financial reports.

An extraordinarily effective novel for learning management, this novel succeeds in being exceptional at so many levels that it could receive a multiple of five stars. It is difficult to picture a management book in novel form ever approaching this one in usefulness. Most people will learn more that they can apply from this book about management than many learn to apply from an M.B.A. The central story is built around the dilemmas facing Alex Rogo, a newly appointed plant manager. The plant can not seem to ship, it’s losing money, and bad things can happen to good people if all this does not change soon. Alex is at a loss for what to do until he pulls out a cigar that Jonah had recently given him. That cigar reminds him to contact Jonah for help. From there, the path to revival begins.

Unlike many books that take complex ideas and oversimplify them so the ideas lose their meaning, this book simplifies ideas in ways that boost their meaning. They do this by making the ideas easier to view and employ. If you do not understand about typical factory accounting, you may get a little lost from time to time; but that is not a problem. The accounting just alters common awareness of what needs to be done. Companies that do not put an asset charge on operational assets could make the mistake from this book of seeking too little earnings. Companies need to earn on-going returns that surpass the cost of capital, too. The greatest success from this book is The Fifth Discipline following it. The discussion of the beer game simulation in The Fifth Discipline will add to the comprehension of system dynamics. Eli’s character as a slaughterer of sacred cows began in 1979 when the beginning of his computerized scheduling system disproved the legend that fixed scheduling does not work. This work led to the awareness that the present measurements used on the shop floor are a major stumbling block to improvement and led to the almost unavoidable next development step. But when he attacked “Cost Accounting as enemy number one of productivity,” he should have produced great conflict. Instead, Eli was sincerely welcomed by both manufacturing and financial people.

Many companies are now discarding efficiencies and questioning other uses of cost accounting for making decisions. Today Eli’s process of ongoing improvement is increasingly accepted as a powerful, practical holistic approach in which other methods — such as MRP, Just in Time, Statistical Process Control are synergistically matched. It seems suitable that a man characterized as unconventional but also full of common sense should mask The Goal, a manufacturing textbook, as a novel or, as some say, a love story. It is also appropriate that it should become an underground best seller in boardrooms, universities and on the factory floor.

Eli Goldratt demonstrates his intellect both as a scholar and as a teacher with The Goal. The operational ideas that he presents are innovative in their practicality and common-sense approach. These concepts, jointly described as Theory of Constraints have closed the loop for prepared thinking and problem solving. This has lead to a change in this thinking that connected the departments into chains and emphasized up-stream suppliers and down-stream consumers. Where these short falls were in looking at the productivity of the entire chain and providing a problem solving method for continuously improving that productivity, Theory of Constraints provides a problem solving method as well as an executive approach that drives ongoing improvement in any business.

The business novel approach is very attractive as a delivery and teaching method. Most of us struggle through the yearly crop of dry business texts that are commonly uninspiring. This book is presented with a storyteller’s obsession for detail, while still driving the key points of the theory. Every organization can gain from the concepts presented in The Goal. Implementation is not costly, unlike other improvement “fads.” Theory Of Constraints shows you, the manager, how to hub on what is really important in your operation, in spite of your daily fire drills.

In conclusion, “The Goal” by Eliyahu M. Goldratt and Jeff Cox is a business text camouflaged as a novel. It is a remarkable cast of actors that dramatizes a charming tale of discovery and freedom. In the story the manager of a troubled plant learns from a mathematician turned consultant that many of his management practices and financial assumptions are faulty. After he retools his thinking, he convinces everyone at the factory to get with the new program. The story’s flow is slowed by irrelevant dialogue and subplots, but it is still a good story and a appealing format for serving up the author’s message–that businesses weighed down by archaic habits can be wildly beneficial when fresh mathematical methods are used courageously.

References

• Mathematics books, last viewed: 20th May’04
• http://mathematicsbooks.org/Business_Economics_Finance_Theory.html