the goal

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					The Goal is a well known book written by Eliyahu M. Goldratt , the originator of the Theory
of Constraints and emphasizes on the concept of Strategic Cost Management in a
manufacturing firm and the challenges in the life of a manager. It’s a fictional story about
the life of a production plant manager struggling to turn around his plant to become
profitable again and having problems in his personal life further raising questions on the
work-life balance of a manager.

Alex, the plant manager had been appointed to make the plant profitable in 3 months. The
top management has done little to provide direction and has only been communicating
‘Fear’ of loss of jobs if profitability is not achieved.
Alex is having problem in understanding why the plant is losing money.

Luckily he comes across his old physics professor, Jonah who is now a consultant. He advises
Alex to clearly define his goal and get 3 measurements that would help him achieve that
goal. Alex identifies them as ROI, Net profits and Cash flow. Alex does extensive research on
the functioning of the plant and takes concrete steps to identify bottlenecks and thereafter
eventually eliminate them. He communicates his new vision to the plant employees and
works in coordination with them to reduce inventory.

In the end, the plant dramatically improves efficiency, increases net profits and also attracts
new clients.

This book is a great for budding managers and it emphasizes the importance of inventory,
bottlenecks, communication, etc. It gives a good account of manager’s personal and
professional life and the emphasis given to performance and clarity of thought at all times.

 The details within the book are presented in such a simple and clear way, the context of
them are transparent to other lines of business and not limited to the operations of a
manufacturing plant, which the story is based on.

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