Overview of The Goal Book
"The Goal" by Eliyahu Goldratt presents the Theory of Constraints (TOC) - a management paradigm that views any manageable system as being limited by a small number of constraints. Goldratt uses an engaging narrative to show how a struggling factory is turned profitable by employing TOC principles. It highlights that amplifying throughput, not cost optimization, must be the focal point of manufacturing. TOC's principles center around "Five Focusing Steps (Identify, Exploit, Subordinate, Elevate, Iterate)", which help address internal and external constraints of a system. The book also expounds on how TOC affects inventory management, arguing for buffer inventory that solely supports throughput. It propagates "Throughput Accounting" focusing on truly variable costs and advocates balancing flow rather than capacity in a manufacturing system. It also explores the concept of batch sizes, set up times, and the role of bottlenecks, emphasizing effective management of the latter. Overall, "The Goal" breaks down complex managerial concepts into easily understandable nuggets using real-world examples and continually stresses on incremental improvements for optimal productivity.
Dive deeper into these fascinating efficiency-oriented principles by reading "The Goal" in full.