Goal Insight

Five Operational Insights from The Goal by Eliyahu Goldratt

The Goal by Eliyahu Goldratt is a fictional novel about the Theory of Constraints. In this novel, the main character Alex Rogo is the manager of The UniCo Manufacturing plant, where everything is always behind in production. Rogo is given three months to turn the unprofitable and unreliable UniCo into a successful plant or risk the plant shutting down and him losing his job. Using the Theory of Constraints, Rogo eventually turns UniCo around and raises the capacity to fulfill demand to an additional 20 percent. Personally, I gained the following five operational insights from reading The Goal:

1. There is great value in expertise and experience.

2. Final throughput is measured by the

Shorter lead times result in better response times to market demands.

Insight 1: There is great value in expertise and experience. Initially perplexed with how to improve the operational efficiency of UniCo, Rogo runs into his olds physics professor Jonah. Rogo explains different aspects of UniCo’s production process and is surprised to learn from Jonah that his understanding of the concept of productivity is illogical. Jonah teaches Rogo that productivity is accomplishing something in terms of goals.

This insight speaks volumes about the importance of mentorship. In my personal life, I have looked to my mentor for third-party expert advice. When deciding whether to pursue a dual MHA-MBA I looked to my mentor, David, who is a hospital executive. His opinion provided unique insights that I had not thought of and his expert view weighed heavily in my decision to pursue a dual degree. Had I not spoken to him before making the decision, I might have not have realized the inherent value in having a MBA with my MHA when competing against MDs with a MHA for a hospital administration

Jonah teachers Rogo about bottlenecks. According to Jonah, a bottleneck is any resource whose capacity is equal to or less than the demand placed upon it and a non-bottleneck is any resource whose capacity is greater than the demand placed upon it. Rogo then recognizes a bottleneck in the UniCo machine process times, where Jonah then informs him that one can only increase the capacity of a bottleneck to be closer to demand. Thus, Rogo learns that bottlenecks should be optimized by eliminating time wasted through idle bottleneck time, processing defective parts, or producing parts, which do not contribute to