Institute of Management Technology, Nagpur

PGDM 2010-12

The Goal-Book Review

Submitted to: Submitted by:

Dr. Jitendra Sharma Aditya Agarwal

Roll No. 2010016
Section A
This book is a required reading for one of the courses I'm taking now (Operations
Management-2), and despite the assurances of few of the classmates who already read it,
who said it was highly readable, novel-type book, I was skeptical. But they were so right!
The Goal is an amazing book on process improvement which caters the real life examples
to explain the all-important Theory of Constraints but in a very interesting way. There are
several books available in this category but it’s very difficult to relate with them as their
approach is unrealistic, but this one manages to keep the reader engaged, which is
important for a guiding novel like this.

The book revisits what the goal of a business should be and what is important to measure
and control to achieve that goal. Through examples in the main character's personal life
and work life, the author Eliyahu Goldratt explains the weaknesses of traditional cost
accounting systems and what's important to track. In short, to optimize money earned,
increase throughput, decrease operating expense and decrease inventory. It demonstrates
why many traditional measurements and common intuition is wrong.

The main character of the book is Alex Rogo; he is a plant manager working in the
manufacturing industry who was continually fighting to meet the output requirements of
his business. Alex has three months to get the plant running according to Bill Peach's
standards or he is out of a job. Alex is faced with a real dilemma, and has 3 months to
turn things around before his plant is closed due to poor performance. There are ongoing
conflicts between marketing, accounting and production in the organization. Throughout
the book the goal is to make money for the plant by reducing the bottlenecks. Rogo
identifies production bottlenecks that are the critical points determining the rate of
production of the operation. Then he develops strategies for overcoming or living with
the bottlenecks. Alex changed procedures to put quality control directly in front of the
bottlenecks.

This book introduces the Theory of Constraints via this entertaining novel. I think this
book is excellent if you are new to Operations. And I think the approach of telling a story
rather reading a traditional text book is a good format and it’s very useful for those who
are involved in distribution, manufacturing, services, Inventory management, Bottlenecks
and Capacity Planning. All industrial and systems engineers need to read this book, as do
all managers of processes. Actually, this book is an eye opener for anyone interested in
management to the fundamentals of running a business.