The Goal Summary

The Goal: A Process of Ongoing Improvement by Eliyahu M. Goldratt and Jeff Cox, is a management-oriented business novel. Goldratt is an Israeli physicist who became a business management guru. He is a business consultant known for his Theory of Constraints. The purpose of the novel is to teach the importance of strategic capacity planning and constraint management. The Goal tells the story of Alex Rogo, a 38-year-old executive plant manager working at a factory owned by UniCo Corporation Manufacturing Plant in the small city of Bearington. The story starts out depicting how the plant is spiraling out of control. Alex has a large amount of late customer orders, long lead times, low efficiencies consequently making the plant lose money. The division vice president, his boss, Bill Peach gives him a deadline of three months to save the plant or the plant will close down and all the employees will lose their jobs. On top of his work life, his marriage is also crumbling.
On a recent business trip, Alex reconnected with a former physics teacher named Jonah who happens to be an internationally
Alex stated, "I am running an efficient plant." Jonah replied, "You are running an inefficient plant." This conflict left the question by Jonah of what is “the goal”? The "goal" is to make money and be productive and profitable. Jonah states that there is only one goal for all companies. Every action that brings you closer to achieving it is productive and all other things are not productive therefore do not get caught up on the side issues. It is done by following three concepts; increasing throughput, reduce inventory, and reduce operating expense. "Throughput is the rate at which the system generates money through sales." "Inventory is all the money that the system has invested in purchasing things which it intends to sell." "Operational expense is all the money the system spends in order to turn inventory into