"The Goal" written by Eliyahu M. Goldratt is an interesting business novel published in 1984. It tells us a story about how Rogo, the plant manager, saves the plant with the efforts of both his staffs and the consultant Johan. The plant keeps shipping order overdue and losing money, so the supervisor comes to Rogo and tells him to solve the problem within three months by increase the productivity and efficiency. Otherwise, the plant would be shut down. Rogo quickly finds out that the problem of the plant is the excessive material purchasing and producing decisions. Based on these wrong decisions, the plant’s inventory and operating expense keep at a high level, which constrains the plant’s cash flow. In order to change this situation,
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The concept of TOC is that every organization must have at least one constraint, which limits the organization from making money (Rattner). Gorldratt gives a three-step thinking process in the last chapter of the book to tell new manager how to implement the theory of constraint: step one – What to change?"; step two – "To what to change to?"; and step three – "How to cause the change? (Gorldratt) Finding the bottleneck, or as called constraint, can speed up manufacturing and increase throughput (Markgraf). Each part of the process in manufacturing cannot be perfectly identical, which means that there is always one part slower than the others, this slower part may affect the production schedule. An independent study has found that implementing the TOC theory can extremely improve the company’s performance, such as a 60 percent increase in on-time delivery, 50 percent decrease in inventory (Balderstone and Mabin). Rogo finds the bottleneck in his plant and decides to increase the throughput of the bottleneck by following this …show more content…
Before Rogo and his staffs find the reason, they work over time to try to solve this problem. However, the reason why the plant cannot ship out the orders on time is due to the low throughput of the bottleneck. If one part of the production chain has not been processed in time or even out of stock, the next part would have to wait till it been done. Reducing the batch size is another critic mentions in the goal. The batch size is the amount of product a machine can produce after setup. In general, reducing batch size is one of the most powerful techniques available for improving the flow of products (Jez Humble). The reduction in batch size can not only effectively improve the throughput of the product, but also reduce the time spends on work in progress. Once the bottleneck’s capacity becomes greater or larger than the demand, the plant can ship out the orders on
The concept of TOC is that every organization must have at least one constraint, which limits the organization from making money (Rattner). Gorldratt gives a three-step thinking process in the last chapter of the book to tell new manager how to implement the theory of constraint: step one – What to change?"; step two – "To what to change to?"; and step three – "How to cause the change? (Gorldratt) Finding the bottleneck, or as called constraint, can speed up manufacturing and increase throughput (Markgraf). Each part of the process in manufacturing cannot be perfectly identical, which means that there is always one part slower than the others, this slower part may affect the production schedule. An independent study has found that implementing the TOC theory can extremely improve the company’s performance, such as a 60 percent increase in on-time delivery, 50 percent decrease in inventory (Balderstone and Mabin). Rogo finds the bottleneck in his plant and decides to increase the throughput of the bottleneck by following this …show more content…
Before Rogo and his staffs find the reason, they work over time to try to solve this problem. However, the reason why the plant cannot ship out the orders on time is due to the low throughput of the bottleneck. If one part of the production chain has not been processed in time or even out of stock, the next part would have to wait till it been done. Reducing the batch size is another critic mentions in the goal. The batch size is the amount of product a machine can produce after setup. In general, reducing batch size is one of the most powerful techniques available for improving the flow of products (Jez Humble). The reduction in batch size can not only effectively improve the throughput of the product, but also reduce the time spends on work in progress. Once the bottleneck’s capacity becomes greater or larger than the demand, the plant can ship out the orders on