Book review the goal

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booke review on the goal

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Book review the goal

  1. 1. • “Genius” , “Guru to industry” • Management- a Science not an Art • Introduced the concept of ongoing improvement.
  2. 2. • Net Profit • Return On Investment • Cash Flow
  3. 3. •On being called by Alex, Jonah gave him the 3 money measurements: Increase Throughput Decrease Inventory Decrease Operational Expense
  4. 4. •Gathers focus group for operational solutions •Several concepts which are polar opposites from general business operations.
  5. 5. •Jonah reveals that a balanced plant is where the capacity of every resource is balanced exactly with demand from the market.
  6. 6. •A series of events •Predictive information that cannot be determined precisely. •Interlinked.
  7. 7. •Alex takes his son, David, on a hike with his Boy Scout troop. •Uses this hike to understand the two phenomena. •Used to understand theory of bottlenecks later.
  8. 8. •Final throughput-measured by rate of slowest operation. •Inventory should be minimized. •Operational expense must be conserved.
  9. 9. •Bottleneck - Capacity = or < than the demand placed upon it •Non-bottleneck - Capacity is > than the demand placed upon it.
  10. 10. •Maximum speed = speed of the slowest operation •Bottlenecks must be identified and improved if the process is to be improved.
  11. 11. •Allows management to take action to alleviate the constraint in the future •Reduce cycle time •Improve manufacturing cycle efficiency (MCE)
  12. 12. •Make sure bottleneck time is not wasted •Take the load off the bottlenecks •Quality controls
  13. 13. Types of elapsed time Setup time Process time Queue time Wait time
  14. 14. • 15% increase on sales promised • Cutting the batch sizes to half. • Gets his plants improvement marketed
  15. 15. • Manages a huge contract • Accomplishes an increase of about 17% • Promoted to the division head.
  16. 16. Define Goal Cut batch sizes in half Define Measurements Increase Sales Reduce lead times Determine Bottlenecks Relieve stress from bottlenecks and increase productivity of bottlenecks
  17. 17. • Minimum one constraint at a time in a system • Over time constraints may change • The 5 focusing steps of theory of constraints are:
  18. 18. If a constraint is broken in Step 4, go back to Step 1. Subordinate everything else to the decisions of Step 2. Elevate the system’s constraints Decide how to exploit the system’s constraints. Identify the system’s constraints.
  19. 19. • Improves capacity decisions in the short-run • Avoids build up of inventory • Improves communication between departments
  20. 20. •Negative impact on nonconstrained areas •Ignores long-run considerations •Not a substitute for other accounting methods
  21. 21. • Global principles of manufacturing •Helps to bring order and avoid chaos •Not only applicable to manufacturing world
  22. 22. • Each concept and theory elongated •Extremely technical •Lots of thinking required. Difficult to read at one go

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