The Race

After reading most books of the TOC series from Goldratt, it was time to convert knowledge into wisdom. The content of this book and the way the teaching was done didn't grab me though.

Because the previous books (The Goal, It's not Luck, etc.) were written like novels, this book seems a bit like that math addendum you may have gotten at school. First size you up with compelling stories and then throw some cold-hearted sums in your face. However, if you want to learn more about TOC and how to apply it this book will help you.

If you like sudoku you may like this one. If you've read the other books from the serie you need to read this one as well, but you may not like it.

2 parts-First, the book was in perfect condition, arrived before the promised time, and cost less than the cover asks. I don't think it gets any better, unless they sent a Lay-Z-Boy chair to read it in!

Second, this book should be required reading for everyone in business that is team leader/supervisor level and above. Fortunately, since it isn't, those of us who have read it have a significant professional advantage over those who don't.

Bob Fox doesn't get enough credit here. He and Eli should get together for another.

This is basically the "powerpoint" version of TOC. It is not a how-to guide or a novel like most TOC material. I would recommend buying one copy for any group starting a TOC implementation or needing to present TOC concepts (great slide ideas). It doesn't deserve a place on everyone's desk like some of the other TOC books, but has value for those who have read or seen The Goal and now need to participate in an implementation.

Business is back to usual. Tough days are here again. Organizations need to excel to be competitive in whatever they do in the race to retain customers and profits. The last decade of the last century was perhaps an exception to this rule. Now it makes sense to revisit books that show us the means to achieve excellence in operations; books written by Eliyahu Goldratt.

This is a book with a difference from Goldratt. The focus is on getting the concepts straight through illustrations and not in the form of a novel.

The goal of all businesses is to make money in the present as well as in the future. We have measurements like Net Profits, ROI, and Cash Flow to assess bottom line performance. We use the cost concept as a bridge to arrive at these measures. The book challenges the cost concept and looks at using Throughput, Inventory and Operating Expenses as the bridges that will lead us in the right direction. These terms or 'Global Operational Measures" are defined in a way that is different from conventional.

-Throughput - The rate at which the system generates money through sales.
-Inventory- All the money the system invests in purchasing things the system intends to sell.
-Operating Expense- All the money the system spends in turning inventory into throughput.

In order to succeed in the market place, six competitive edge issues are identified - Product (Quality and Engineering), Price (Higher Margins and Lower Investment per unit), Responsiveness (Due-date Performance and Shorter quoted lead-time).

Having defined these measures, the book looks at the critical role of inventory (at all stages). The high inventory syndrome leads to a lower performance in all the competitive edges. The manufacturing system then should get into the mode of "Synchronized Manufacturing". This is a unique combination of concepts like JIT, zero-defect and Drum-Buffer-Rope (DBR) approach. In fact I found that this is the best among all of Goldratt's books to understand the DBR concept. It helps in identifying the Capacity Constraint Resources (CCRs) and balances the entire manufacturing system to towards the globally optimal solution that can achieve our overall goal.

The book contains some interesting exercises at the end to ensue that the concepts are well understood.

A must read for all managers to achieve break through improvements in operations - manufacturing and service. The race is on and is getting hotter than ever. We need to keep pace to remain in this race. The second best may not survive to have another chance.