Essay About Life Of Alex Rogo And Upset Customer Approaches Alexs Boss

The Goal: A Process of ongoing Improvement
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Jennifer Purifoy
April 30, 2001
Executive Summary for
The Goal: A Process of Ongoing Improvement
by Eliyahu M. Goldratt
The heart of this story is based around the life of Alex Rogo, Plant Manager for
Uniware a division of Unico. After a very upset customer approaches Alexs boss,
Bill Peach, he is given an ultimatum to turn the plant around in three months. Due
to the limited amount of time available, there are not many outside tools available
such as consultants, surveys, etc. With very few hopes, Alex foresees the
inevitable until he remembers his conversation with Jonah, a physicist Alex knew
from a previous job.
The Goal:
It is not until Alexs job is in jeopardy that he decides to devour into his
conversation with Jonah. During the conversation, Jonah asks him several
questions to analyze his companys situation. The conversation leads ultimately
to the question, “What is the goal of any business?” After rethinking his
conversation, Alex realizes that the goal of any business is to make money.
Furthermore, if the goal is to make money any action toward this goal is consider
productive and any action not moving towards the goal is nonproductive. Alex
unsure of such a simple answer decides to contact Jonah to continue the search
for more answers.
Measurements:
Once Alex contacts Jonah they define the following measurements to define the
success of any plants production:
1. Throughout = rate that the system is used to generate money through
sales.
This measurement would consist of what a product would be worth when
sold at market value after deducting operational expense and inventory.
2. Inventory = all the money invested in purchasing items that will be sold.
This could include the remains of their machines after being used toward
the investment.
3. Operational expense = all the money used to turn inventory into
throughput.
This would include such items as depreciation of a machine, lubricating
oil, scraps, etc.
Balancing a Production Line:
Jonah explains to Alex that a plant that is continuously productive in considered
inefficient. He further explains that continuous production will result in high
absenteeism, poor quality and employee turnover. Based on this, he would need
to reduce operational expense and inventory to improve throughput to
Jennifer Purifoy
April 30, 2001
demonstrate a balanced line of production. Jonah leaves him to ponder the
understanding of two things: what are the dependent events and statistical
fluctuations in his plant.
Bottlenecks
During a hiking trip with Alexs son, he produces a game for a few of the kids to
demonstrate an ideal balance line of production. He does this by setting up
dependents and uses a die to measure the statistical fluctuations. At the end of
the game, he concluded that the bottlenecks speed of production is what
determines the speed of the other dependents. Hence, inventory moves very
slow because of statistical fluctuations. This would eventually result in huge
bottlenecks over time. In the end, this is where Alex begins his search inside the
plant.
Upon arriving back at work, him and the crew begin their search for the
bottlenecks. They identify one of the robots, NCX-10, and the heat treatment
area as the source of the bottlenecks. Once identified, they begin their search for
solving them. These are the steps they proceeded with to solve the bottleneck
issue:
NCX-10:
* Have two employees dedicated to the setup of the robot — this will help
ensure that the machine will be continuously running.
* Additionally, these employees take their breaks while the machine is working
since