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By:- Ankit Khator15
Mahesh Chavda
Nelson Rodgrieus Pratik Makhija19
Ritu Singh-
Shonali Shenai
Urvi Mehta - 23
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About the Author
An educator, author, scientist, philosopher & businessleader.
Obtained bachelors & masters degree in the field ofscience and doctrate of philosophy.
He holds a number of patents in the areas frommedical devices to drip irrigation to temperaturesensors.
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He has authored several business novels and nonfiction works such as:
1. Production The Toc Way
2. Its Not Luck
3. Critical Chain4. The Race
5. What Is This Thing Called TOC ?
6. The Haystack Syndrome
7. Necessary But Not Sufficient8. The Choice and many more
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Introduction To The Book THE
GOAL
Its a different type of management book.
It has reached a sale of eight million copies.
This book is in the form of a novel assuspenseful as a thriller and equally fast-paced.
The book is also about global principles ofmanufacturing.
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Introduction
Story about a young executiveAlex Rogo.
Done his engineering under graduation and an
MBA. Started career in UniCo as project manager and
now works under Bill Peach as plant manager inBearington, his hometown.
Factory produces machined assemblies. Well trained staff led by highly experienced
managers.
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Current scenario
Orders bordering 2 months behind scheduled
delivery date.
20 $ million unsold finished goods inventorylying in ware house.
Facing an increasing cash shortage.
Efficiency heading downward. If no improvement- shutdown.
Deadline- 3 months
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New hope
Running into old physics professor Jonah.
Key identifiers of productivity- decreasing
inventory, reducing expenses and selling moreproduct.
Jonah leaves Alex to ponder upon the concept of
productivity.
What is the GOAL?
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Question left by Jonah: What is the
Goal ? Make product
Increase market share
Produce quality products
Produce efficiently
Hire workers
Support the city, state and national economy Increase stockholder value
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measurements of productivity
The 3 basic measurements of productivity:
Throughput (TP)
Rate at which system generates money through sales.Sales Revenue - Raw material Expense
Inventory (I)
All the money that the system has invested in
purchasing things which it intends to sell Operational Expense (OE)
All the money that the system spends in order to turninventory into throughput
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Hiking with son
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ALEXS OBSERVATION..
Final throughput is measured by the rate of thelast and slowest operation in the sequence.
Inventory is equal to the length between theleader and the backdoor, which should beminimized.
Operational expense is roughly measured by the
energy expended, which must be conserved. Some resources need to have more capacity than
others, especially towards the end of theoperating sequence.
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Towards improvement
Returns to plant to confirm information.
Introduces bottlenecks and non-bottle necks.
Objective- maintain capacity slightly less thandemand.
6 months lead time to train NCX-10 operators.
Trained operators are leaving the company. Hidden excess capacity.
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Considering alternate processes.
Quality control.
Zero defect. Total plant capacity = Bottleneck capacity
Bottleneck defines plant throughput.
Bottleneck per unit cost =Total plant operating cost
Total production bottleneck hours
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Activating a resource and utilizing a resource arenon- synonymous.
Activatingsimply turning it on. Utilizing - making use and moving towards the
goal.
Material release system.
Reduce batch sizes. Four primary time components include: setup
time, process time, queue time.
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Potential to respond better to demand markets.
Solid profits and decreasing operating costs.
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Alex announces his promotion.
Bob - plant manager
Stacyproduction manager. Removal of tags.
Further market expansion.
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Three fundamental decision
issues Alex and Lou identify three fundamental
decision issues as critical to the success of any
manager:1. Knowing what to change.
2. What to change to.
3. How to cause the change.
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Conclusion Dr. Eliyahu Goldratt states,
Production is the heart of industry.
Industry is the heart of a nationswealth and concluding he hopes that
his book and theories help in
strengthening it.
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