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Book Report: The Goal Novel

The Goal novel is a management-oriented fictional book written by Eliyahu Goldratt and

Jeff Cox. The book was initially published in 1984 but has since undergone several revisions and

publications in different editions. The primary focus of the novel is the theory of constraints

which provides insight into the causes, effects and how to manage several operational

management issues in day to day running of the firm. While the novel follows the personal life of

the main character Alex Rogo, it provides reliable techniques on the identification of constraints

and improvements necessary to manage them. Similarly, the book offers insight on

measurements used in the analysis of business performance among other concepts. This article

analyzes three central concepts learned from the goal that can enable managers to improve

performance while increasing profits.

The key take away from the book gets illustrated in its title “The Goal” which shows that

every activity an individual or a business entity partakes has an underlying objective. In many

businesses, the targets get connected to increasing sales and their subsequent profits. Moreover,

the book insists on the importance of measurements in the determination of whether a business

entity is working towards their goals or not. The measurement strategies a business employs

must be precise and accurate to provide a clear picture of the actions and policies that are

productive for particular objectives and which ones are slowing down a company’s purpose.

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Various industries require different tactics regarding measurement in efforts to achieve

accurate and efficient results. Eliyahu Goldratt criticized critical fundamental principles in

manufacturing plants including cost accounting, performance incentives and economic order

quantities (EOQ). Goldratt presented three ways of analyzing whether a business entity is

achieving their goal of maximizing profit. The three measurements techniques are interrelated

and include throughput, inventory, and operating expense. Throughput describes the rate at

which the plant generates income through sales; inventory showcases the cost of all the input

used while operating expense illustrates all the money the system uses to transform inputs into

outputs. These measuring techniques are crucial for not only profit maximization but also quality

inputs that facilitate quality products.

Goldratt also presents a business model that relates to dependent events and statistical

fluctuations regarding the manufacturing process. Dependent events show a concept of activities

that must first take place before others can start while statistical volatility occurs when an

individual is incapable of predicting the business events or the quantities related to those

particular operations. According to Goldratt, both dependent events and statistical fluctuation

have a significant impact on the output of the business. The book provides a practical example

when Alex and his adviser Jonah sit in a restaurant and John illustrates while they can predict the

capacity of the restaurant by counting the available seats, they are incapable of predicting the

time required by a waiter to fulfill their orders (Goldratt and Cox 78). The model illustrates

relying on forecasting and efficiency as the avenues to reduce the cost of production while

maximizing efficiency. Goldratt demonstrates the importance of focusing on specific areas rather

than the whole system. As such, limiting systems to traditional measurements of efficiency may

work to increase the constraints.

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Another essential aspect presented in the Goal is the concept of bottlenecks which

illustrates the idea of productivity. In the book, constraints get depicted as barriers that limit the

production process. For instance, the author presents a practical example in a hiking group where

a chubby boy slows down the whole expedition (Goldratt and Cox 33). It describes the

complexity of constraints as broken chains that affect the business as a whole rather than a single

section. In this case, the chain is as strong as its weakest link. Therefore, the improvement of the

constraints increases the performance of the business. The book provides five focusing steps

including the identification of restriction, exploitation of the specifics related to the bottleneck

and aligning and management of the systems around the constraint. The two other measures

include elevating the performance of the limitation and repetition of the process to ensure

efficiency. Indeed, many businesses in the current globalized market face different types of

obstacles whether in the supply, marketing or the production process. The steps provided in

mitigating and managing constraints are essential in improving business performance and profits.

The improvements involve subordinating other production processes to bottlenecks and elevating

bottleneck’s throughput through outsourcing some of the constraint’s work to external suppliers.

In the event a constraint is identified again, repetition is essential to find the new bottleneck.

The Goal provides knowledge on that uncovers the principles of the theory of constraints

that can be easily applied not only in manufacturing but also other industries. It gives insight on

measurements used that differ from traditional efficiency methods. Obstacles are the key to

unlocking the performance of a firm. The theory of constraints provides practical solutions in

managing business barriers through their identification and application of best solutions.

Effective management of constraints and measurement tactics results to improved performance

through rapid response culture, reduced cycle time, free cash flows, and higher net profit among

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others. The concepts presented in “The Goal” emphasis on improvement of general performance

through micro-level analysis which applies in various industries.

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Work Cited

Goldratt, Eliyahu M and Jeff Cox. The Goal. The North River Press, 2004.

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