The Goal: A Process of Ongoing Improvement, Third Revised Edition
Page 10
about it," he says. "Just remember we are always talking about
the organization as a whole—not about the manufacturing de-
partment, or about one plant, or about one department within
the plant. We are not concerned with local optimums."
"Local optimums?" I repeat.
Jonah sighs. "I'll have to explain it to you some other time."
"But, Jonah, this isn't enough," I say. "Even if I can define E.M. Goldratt
The Goal: A Process of Ongoing Improvement
Captured by Plamen T.
68
the goal with these measurements, how do I go about deriving
operational rules for running my plant?"
"Give me a phone number where you can be reached," he
says.
I give him my office number.
"Okay, Alex, I really do have to go now," he says.
"Right," I say. "Thanks for—"
I hear the click from far away.
"—talking to me."
I sit there on the steps for some time staring at the three
definitions. At some point, I close my eyes. When I open them
again, I see beams of sunlight below me on the living room rug. I
haul myself upstairs to my old room and the bed I had when I
was a kid. I sleep the rest of the morning with my torso and limbs
painstakingly arranged around the lumps in the mattress.
Five hours later, I wake up feeling like a waffle.
E.M. Goldratt
The Goal: A Process of Ongoing Improvement
Captured by Plamen T.
69
9
It's eleven o'clock when I wake up. Startled by what time it is,
I fall onto my feet and head for the phone to call Fran, so she can
let everyone know I haven't gone AWOL.
"Mr. Rogo's office," Fran answers.
"Hi, it's me," I say.
"Well, hello stranger," she says. "We were just about ready to start checking the hospitals for you. Think you'll make it in today?"
"Uh, yeah, I just had something unexpected come up with
my mother, kind of an emergency," I say.
"Oh, well, I hope everything's all right."
"Yeah, it's, ah, taken care of now. More or less. Anything
going on that I should know about?"
"Well . . . let's see," she says, checking (I suppose) my mes-
sage slips. "Two of the testing machines in G-aisle are down, and
Bob Donovan wants to know if we can ship without testing."
"Tell him absolutely not," I say.
"Okay," says Fran. "And somebody from marketing is calling
about a late shipment."
My eyes roll over.
"And there was a fist fight last night on second shift . . .
Lou still needs to talk to you about some numbers for Bill Peach
... a reporter called this morning asking when the plant was
going to close; I told him he'd have to talk to you . . . and a
woman from corporate communications called about shooting a
video tape here about productivity and robots with Mr. Granby,"
says Fran.
"With G ranby?"
"That's what she said," says Fran.
"What's the name and number?"
She reads it to me.
"Okay, thanks. See you later," I tell Fran.
I call the woman at corporate right away. I can hardly believe
the chairman of the board is going to come to the plant. There
E.M. Goldratt
The Goal: A Process of Ongoing Improvement
Captured by Plamen T.
70
must be some mistake. I mean, by the time Granby's limo pulls
up to the gate, the whole plant might be closed.
But the woman confirms it; they want to shoot Granby here
sometime in the middle of next month.
"We need a robot as a suitable background for Mr. Granby's
remarks," says the woman.
"So why did you pick Bearington?" I ask her.
"The director saw a slide of one of yours and he likes the
color. He thinks Mr. Granby will look good standing in front of
it," she says.
"Oh, I see," I tell her. "Have you talked to Bill Peach about this?"
"No, I didn't think there was any need for that," she says.
"Why? Is there a problem?"
"You might want to run this past Bill in case he has any other
suggestions," I tell her. "But it's up to you. Just let me know when you have an exact date so I can notify the union and have
the area cleaned up."
"Fine. I'll be in touch," she says.
I hang up and sit there on the steps muttering, "So ... he
likes the color."
"What was that all about on the phone just now?" my mother
asks. We're sitting together at the table. She's obliged me to have
something to eat before I leave.
I tell her about Granby coming.
"Well that sounds like a feather in your cap, the head man—
what's his name again?" asks my mother.
"Granby."
"Here he's coming all the way to your factory to see you,"
she says. "It must be an honor."
"Yeah, it is in a way," I tell her. "But actually he's just coming to have his picture taken with one of my robots."
My mother's eyes blink.
"Robots? Like from out-of-space?" she asks.
"No, not from outer space. These are industrial robots.
They're not like the ones on television."
"Oh." Her eyes blink again. "Do they have faces?"
"No, not yet. They mostly have arms . . . which do things
like welding, stacking materials, spray painting, and so on.
E.M. Goldratt
The Goal: A Process of Ongoing Improvement
Captured by Plamen T.
71
They're run by computer and you can program them to do dif-
ferent jobs," I explain.
Mom nods, still trying to picture what these robots are.
"So why's this Granby guy want to have his picture taken
with a bunch of robots who don't even have faces?" she asks.
"I guess because they're the latest thing, and he wants to tell
everybody in the corporation that we ought to be using more of
them so that—"
I stop and glance away for a second, and see Jonah sitting
there smoking his cigar.
"So that what?" asks my mother.
"Uh ... so that we can increase productivity," I mumble,
waving my hand in the air.
And Jonah says, have they really increased productivity at
our plant? Sure they have, I say. We had—what?—a thirty-six
percent improvement in one area. Jonah puffs his cigar.
"Is something the matter?" my mother asks.
"I just remembered something, that's all."
"What? Something bad?" she asks.
"No, an earlier conversation I had with the man I talked to
last night," I say.
My mother puts her hand on my shoulder.
"Alex, what's wrong?" she's asking. "Come on, you can tell
me. I know something's wrong. You show up out of the blue on
my doorstep, you're calling people all over the place in the mid-
dle of the night. What is it?"
"See, Mom, the plant isn't doing so well . . . and, ah ...
well, we're not making any money."
My mother's brow darkens.
"Your big plant not making any money?" she asks. "But
you're telling me about this fancy guy Granby coming, and these
robot things, whatever t
hey are. And you're not making any
money?"
"That's what I said, Mom."
"Don't these robot things work?"
"Mom—"
"If they don't work, maybe the store will take them back."
"Mom, will you forget about the robots!"
She shrugs. "I was just trying to help."
I reach over and pat her hand.
"Yes, I know you were," I say. "Thanks. Really, thanks for
E.M. Goldratt
The Goal: A Process of Ongoing Improvement
Captured by Plamen T.
72
everything. Okay? I've got to get going now. I've really got a lot
of work to do."
I stand up and go to get my briefcase. My mother follows.
Did I get enough to eat? Would I like a snack to take with me for
later in the day? Finally, she takes my sleeve and holds me in one
place.
"Listen to me, Al. Maybe you've got some problems. I know
you do, but this running all over the place, staying up all night
isn't good for you. You've got to stop worrying. It's not going to
help you. Look what worrying did to your father," she says. "It
killed him."
"But, Mom, he was run over by a bus."
"So if he hadn't been so busy worrying he would have looked
before he crossed the street."
I sigh. "Yeah, well, Mom, you may have a point. But it's more
complicated than you think."
"I mean it! No worrying!" she says. "And this Granby fellow, if he's making trouble for you, you let me know. I'll call him and
tell him what a worker you are. And who should know better than
a mother? You leave him to me. I'll straighten him out."
I smile. I put my arm around her shoulders.
"I bet you would, Mom."
"You know I would."
I tell Mom to call me as soon as her phone bill arrives in the
mail, and I'll come over and pay it. I give her a hug and a kiss
good-bye, and I'm out of there. I walk out into the daylight and
get into the Mazda. For a moment, I consider going straight to the
office. But a glance at the wrinkles in my suit and a rub of the
stubble on my chin convinces me to go home and clean up first.
Once I'm on my way, I keep hearing Jonah's voice saying to
me: "So your company is making thirty-six percent more money
from your plant just by installing some robots? Incredible." And I
remember that I was the one who was smiling. I was the one who
thought he didn't understand the realities of manufacturing. Now I feel like an idiot.
Yes, the goal is to make money. I know that now. And, yes,
Jonah, you're right; productivity did not go up thirty-six percent
just because we installed some robots. For that matter, did it go
up at all? Are we making any more money because of the robots?
And the truth is, I don't know. I find myself shaking my head.
E.M. Goldratt
The Goal: A Process of Ongoing Improvement
Captured by Plamen T.
73
But I wonder how Jonah knew? He seemed to know right
away that productivity hadn't increased. There were those ques-
tions he asked.
One of them, I remember as I'm driving, was whether we
had been able to sell any more products as a result of having the
robots. Another one was whether we had reduced the number of
people on the payroll. Then he had wanted to know if inventories
had gone down. Three basic questions.
When I get home, Julie's car is gone. She's out some place,
which is just as well. She's probably furious at me. And I simply
do not have time to explain right now.
After I'm inside, I open my briefcase to make a note of those
questions, and I see the list of measurements Jonah gave me last
night. From the second I glance at those definitions again, it's
obvious. The questions match the measurements.
That's how Jonah knew. He was using the measurements in
the crude form of simple questions to see if his hunch about the
robots was correct: did we sell any more products (i.e., did our
throughput go up?); did we lay off anybody (did our operational
expense go down?); and the last, exactly what he said: did our
inventories go down?
With that observation, it doesn't take me long to see how to
express the goal through Jonah's measurements. I'm still a little
puzzled by the way he worded the definitions. But aside from
that, it's clear that every company would want to have its
throughput go up. Every company would also want the other
two, inventory and operational expense, to go down, if at all pos-
sible. And certainly it's best if they all occur simultaneously—just
as with the trio that Lou and I found.
So the way to express the goal is this?
Increase throughput while simultaneously reducing both in-
ventory and operating expense.
That means if the robots have made throughput go up and
the other two go down, they've made money for the system. But
what's really happened since they started working?
I don't know what effect, if any, they've had on throughput.
But off the top of my head, I know inventories have generally
increased over the past six or seven months, although I can't say
for sure if the robots are to blame. The robots have increased our depreciation, because they're new equipment, but they haven't
directly taken away any jobs from the plant; we simply shifted
E.M. Goldratt
The Goal: A Process of Ongoing Improvement
Captured by Plamen T.
74
people around. Which means the robots had to increase opera-
tional expense.
Okay, but efficiencies have gone up because of the robots. So
maybe that's been our salvation. When efficiencies go up, the
cost-per-part has to come down.
But did the cost really come down? How could the cost-per-
part go down if operational expense went up?
By the time I make it to the plant, it's one o'clock, and I still
haven't thought of a satisfactory answer. I'm still thinking about it
as I walk through the office doors. The first thing I do is stop by
Lou's office.
"Have you got a couple minutes?" I ask.
"Are you kidding?" he says. "I've been looking for you all
morning."
He reaches for a pile of paper on the corner of his desk. I
know it's got to be the report he has to send up to division.
"No, I don't want to talk about that right now," I tell him.
"I've got something more important on my mind."
I watch his eyebrows go up.
"More important than this report for Peach?"
"Infinitely more important than that," I tell him.
Lou shakes his head as he leans back in his swivel chair and
gestures for me to have a seat.
"What can I do for you?"
"After those robots out on the floor came on line, and we got
most of the bugs out and all that," I say, "what happened to our sales?"
Lou's eyebrows come back down again; he's leaning forward
and squinting at me over his bifocals.
"What kind of question is that?" he asks.
"A smart one, I hope," I say. "I need to know if the robots had any impact on our
sales. And specifically if there was any
increase after they came on line."
"Increase? Just about all of our sales have been level or in a
downhill slide since last year."
I'm a little irritated.
"Well, would you mind just checking?" I ask.
He holds up his hands in surrender.
"Not at all. Got all the time in the world."
Lou turns to his computer, and after looking through some
E.M. Goldratt
The Goal: A Process of Ongoing Improvement
Captured by Plamen T.
75
files, starts printing out handfuls of reports, charts, and graphs.
We both start leafing through. But we find that in every case
where a robot came on line, there was no increase in sales for any
product for which they made parts, not even the slightest blip in
the curve. For the heck of it, we also check the shipments made
from the plant, but there was no increase there either. In fact, the
only increase is in overdue shipments—they've grown rapidly
over the last nine months.
Lou looks up at me from the graphs.
"Al, I don't know what you're trying to prove," he says. "But if you want to broadcast some success story on how the robots are
going to save the plant with increased sales, the evidence just
doesn't exist. The data practically say the opposite."
"That's exactly what I was afraid of," I say.
"What do you mean?"
"I'll explain it in a minute. Let's look at inventories," I tell him. "I want to find out what happened to our work-in-process
on parts produced by the robots."
Lou gives up.
"I can't help you there," he says. "I don't have anything on inventories by part number."
"Okay, let's get Stacey in on this."
Stacey Potazenik manages inventory control for the plant.
Lou makes a call and pulls her out of another meeting.
Stacey is a woman in her early 40's. She's tall, thin, and brisk
in her manner. Her hair is black with strands of gray and she
wears big, round glasses. She is always dressed in jackets and
skirts; never have I seen her in a blouse with any kind of lace,
ribbon or frill. I know almost nothing about her personal life. She
wears a ring, but she's never mentioned a husband. She rarely
mentions anything about her life outside the plant. I do know she
works hard.
When she comes in to see us, I ask her about work-in-process
on those parts passing through the robot areas.
"Do you want exact numbers?" she asks.
"No, we just need to know the trends," I say.