The author of this book, Dr. Goldrat, was originally an Israeli physicist, and later became a master of business management and the creator of TOC restriction law. His first work, Goal, boldly borrowed the brushwork of the novel to explain how to solve complex management problems through logical reasoning close to common sense, and the result was an instant hit.
When Goldrat was 20 years old, he was determined to teach others the way of thinking, that is, the so-called Socratic way of thinking, which means not telling you the answer directly, but guiding you to think for yourself, allowing students to explore and understand by asking questions, and finally finding the answer suddenly (although this method is not used to it). He has great enthusiasm for spreading ideas, and he can travel around the world and give speeches only by sleeping for three hours every day. He also founded the "Golden Mouse Organization", set up branches all over the world, trained TOC talents, promoted TOC restriction law, and tutored many well-known enterprises including General Motors and Boeing aircraft, as well as people from various industries including teachers and US Air Force generals. After Pursuing the Goal, Goldrat successively published three business management novels, Never Lucky, Critical Chain and Still Not Enough, as well as several theoretical monographs on TOC restriction law, which aroused strong repercussions around the world. TOC constraint theory is somewhat similar to Kaneking's law, and the bottleneck can also be regarded as a short board.
What's more, the management novel "Goal" was actually made into a TOC method for film communication. So after watching the movie Goal, you can also enjoy the feeling after watching it.
Uni factory: the factory of Uni company.
Rocco: Director.
Zhong Na: Rogge's high school physics teacher.
Pique: President of Uni Business Department
Donafan: Production Manager
Warehouse supervisor.
Liu Wu: Financial Manager.
What do we say is the goal of the enterprise? Why is the name of Godrath's first novel "Goal"? This book is to explain Dr. Godrat's "TOC Restriction Law". This book tells the story of Rogge, the director of Uni Factory. "Uni Factory" is poorly managed. The factory has many shareholders, one of which is the American retirement pension. The investment strategy of "American retirement pension" is steady investment, but due to the poor management of "Uni Factory", the original investment of more than 900 million US dollars was only more than 200 million US dollars after re-evaluation, which caused serious losses. Several executive directors demanded a stop loss and prepared to sell the Uni factory to "cut meat". But before cutting the meat, we decided to give the enterprise a grace period or an ultimatum, that is, if the enterprise can turn losses into profits within three months, we can stop cutting the meat and not sell the Uni factory.
Like a "dreamer", the author constructs an environmental scene and a "story summary": how did Rogge find a way to turn the "Uni Factory" into a profit within three months when an order could not be delivered to the factory on time? Moreover, at this time, because the husband and wife who worked overtime every day turned against each other, Rogge's wife left home with two children, and the family was also facing a breakdown. Rogge, the hero, resisted the pressure, found Zhong Na, a middle school physics teacher (meaning "prophet"), and pointed out the maze. Finally, the "Youni Factory" was brought back to life, and the husband and wife got back together and reached the peak of their lives.
The author also constructs several hypothetical environments of the novel, namely: any resource can be divided into "bottleneck resources" and "non-bottleneck resources"; There is a dependence in the production of the factory: one process can be completed before the next process can be carried out; There is "statistical fluctuation" in the productivity of each resource (it is a variable, but not an extraordinary quantity): for example, workers are sick, machines are out of order, and so on.
In the novel, Zhong Na asks Rogge what problems he has encountered. Rogge said we would close in three months. Now the board of directors asked me to solve the problem, gave me a three-month deadline and introduced me to a number of robots. Labor productivity has really improved. Zhong Na asked: "Is the inventory reduced?" Rogge said: "There is no decrease, but an increase." Next, Rogge expressed the following status quo: the unit cost decreased, but the total inventory increased, which did not solve the problem. And the factory is as busy as a bee, everyone is busy and everyone is complaining. Sometimes the bottleneck lies in the production line: the factory inventory is full, but by the delivery deadline, the production line has not produced anything, all the necessary parts are ready and piled up for standby, but the assembly has not started because the parts in a certain component are out of stock. And if you are in a hurry, you need to pay extra overtime. Sometimes the bottleneck lies in the purchasing end: when arranging production, I found that there were no materials in the warehouse, and I found the purchasing department and said that the supplier did not promise to supply. This situation often exists in enterprises.
Then Zhong Na asked a question, "What is the company's goal?" And said that we should know this premise first, and then talk about other things. Zhong Na didn't tell Rocco the answer directly, but let Rocco think for himself. The article uses a chapter "Chapter 5: What is the goal" to describe the process that "making money" is the company's goal.
After defining the goal, we will further refine "making money" and give the goal an accurate "expression", which is based on a precise definition. In other words, "goal" leads to three concepts or definitions. A few simple definitions are as follows:
Throughput: the speed at which the whole system obtains money through sales;
Inventory: the money invested by the whole system in purchasing (purchasing things ready for sale);
OperatingExpense: the money spent by the system to convert inventory into effective output can be understood as cost.
After clarifying these three concepts, the goal of the whole company (system) can be expressed as: reducing inventory and operating expenses while increasing effective output (decomposing the goal of "making money" into three is more operational). If the following story can be summarized in one sentence, it is that Zhong Na told Rogge to shift her attention from reducing costs to improving effective output (equivalent to increasing productivity).
Therefore, on the surface, improving efficiency through robots is to reduce costs, but this is an "illusion" because the cost of robots is still a lot. The most fundamental problem is the bottleneck in the company's operation. This is the problem encountered.
There are generally two phenomena in factories, namely "dependence" and "statistical fluctuation", and each department is a kind of dependence. "Statistical fluctuation" is just like the water capacity of a wooden barrel does not depend on the longest board, but on the shortest board. The combination of "dependence" and "statistical fluctuation" is a situation we have to face every day, and the purpose of facing this situation is to improve the effective output. To improve the effective output, it is necessary to find out the resources that hinder the effective output, that is, the so-called bottleneck resources.
Any resource of the company, as long as its production capacity is equal to or less than the demand, is the bottleneck. If you find the bottleneck, you must work hard on it. First of all, pay attention to the use of effective resources, use effective resources to the bottleneck, and use resources to push the system to the goal. Secondly, to improve the product quality of bottleneck output, the loss of bottleneck production time caused by quality influence is equivalent to the loss of effective output time, and bottleneck output is equivalent to effective output, so bottleneck time must not be wasted. Finally, we should reduce the time waste of the whole system. According to statistics, among the time consumed by any part, the operation and processing time only account for a small part, while the waiting time consumes most of the time.
In the novel, Rogge cited three examples to illustrate this principle: "Boy Scout hiking", "Competition mobile game" and a specific production example. Not only that, Rogge also deduced that "the utilization efficiency of non-bottleneck resources is not determined by its production potential, but by the bottleneck resources in the system". This looks like nonsense. But a direct inference from this is: Is it the most "efficient" for factory workers to stay busy forever? On the surface, if workers are not allowed to keep their jobs, there will be idle manpower, thus reducing the average output of workers (reducing efficiency). However, if 100% is used to make workers work at full capacity, the semi-finished products cannot be used for subsequent processes, thus forming semi-finished products inventory?
The common phenomenon in the factory is that all departments are very busy, and everyone is very busy, which will only lead to an increase in inventory and operating expenses. How much can non-bottleneck resources earn for the system? It is not determined by its own potential, but by the restrictive factors within the system, so it is necessary to maintain the balance between flow and demand, not the balance between capacity and demand.
This is TOC theory. In an abstract way, I think the methodology of TOC can be summarized as: by finding the "local optimization" of the bottleneck, the "global optimization" of the whole system can be realized.
This method includes three levels. First, it generally recognizes the importance of bottlenecks and should not strive to achieve "local optimization" in each link on average; The second is to clarify which are the real bottlenecks; Third, efforts should be made to optimize the bottleneck.
I think the second point is particularly critical. As a novel, in fact, two-thirds of the protagonist of the book is out of the predicament, and the last third is basically to sum up experience and raise the methodology of "TOC" to the height of universal application.
At the beginning, the author clearly summarized the five-step method of "finding the bottleneck-tapping the bottleneck potential-determining the priority of other matters-loosening the bottleneck-cycling" in Section 36. In the last section, the focus of finding problems and bottlenecks falls on "breaking the inertia of thinking and bravely challenging traditional assumptions".
But it's easier said than done. It is not easy to challenge the hypothesis and break the inertia, especially for enterprises that are accustomed to nature under the "constitution" of state-owned enterprises, such as "more things and less things, information islands, small departmental culture and more resources, which are easy to complete".
"Activation" is not equal to "utilization". Some of the output dragged away by the market does not make money, and some take the job first regardless of difficulty and cost. Although TOC method is accepted by many enterprises, sometimes, the premise is not effective output, not TOC method, but whether the product is competitive in the market, homogeneous product or differentiated product.
Quote a few words in the article that you think are inspiring:
-"What determines the strength of a chain (such as a bicycle chain)?" He asked Donovan. "the weakest link"
-"If you want to improve the strength of the chain, what should you do first?" "Find the weakest link and point out the bottleneck!"
-"I dare not actively fight for orders anymore, because we are afraid that extra sales will create more bottlenecks and let us fall into the nightmare of catching up with work again. On the other hand, I can't ask the company to let me hire more people or buy machines, because the current financial situation shows that we are unable to do so. "
We can't solve the problem by changing priorities and working overtime. We have tried many times, which may save several orders, but it has thrown the whole factory into chaos and caused more orders to go wrong. "
Enlightenment 1: The output of the factory is determined by the output of the bottleneck process, that is, the bottleneck loss of 1 hour equals the output loss of the factory of 1 hour.
Enlightenment 2: The improvement of non-bottleneck process links has no effect on output. That is to say, the efficiency of bottleneck process A has not been improved, and it is useless to spend money to improve or improve the production efficiency of non-bottleneck normal process B. As the saying goes, the right method is useless, and good steel is useless on the blade.
Revelation 3: The correct weight should be the first effective output; Inventory ranks second; Cost or operating expenses ranked third. I used to think that cost was the most important thing. When I meet with improvement, I only know how to reduce the cost. In fact, the biggest "cost reduction" is the optimization of process, the improvement of efficiency and the streamlining of organization. To reduce costs, one is thankless, and the other is long-term inefficiency, which is called "thankless" and "easy to offend people". Therefore, from the actual situation, the overall optimization and improvement of effective output and inventory is often great, and can even contribute dozens of percentage points of profits; The contribution of reducing costs to profits is only 2 or 3 percentage points.
How to understand the improvement of effective output? Personally, the focus of the production link is to stabilize the whole process control of production and working procedure, and the improvement of efficiency equals to the reduction of cost; For example, speed up the inventory turnover rate, optimize the inventory structure, prompt the safety inventory risk through information means, and "seamlessly link inventory use". These are all effective output increases, which are equivalent to reducing costs; Stable production can reduce switching cost to the greatest extent, realize scale reduction, improve yield and reduce "quality cost"; It is necessary for the manufacturing department to find ways to reduce the "tossing cost", that is, to mass-produce products with the same specifications and performance according to the user's orders as much as possible, and further increase the "production and sales coordination" between the marketing department and the production department.
There is a synergistic effect between production and sales. If the enterprise has formulated the cost orientation of the strategic premise of "seizing the market theme", the sales order need not consider the difficulty of production too much. Therefore, it is necessary to improve the assessment and incentive orientation of the sales department and the production department, increase the incentive weight for products that are difficult to produce, and reduce the assessment weight. However, if it is the cost orientation of the strategic premise of "sound management theme", sales should consider the difficulty of production links and reduce switching costs, accident costs and toss costs. The sales department and the manufacturing department need to find ways to reduce the "tossing cost", that is, to mass-produce products with the same specifications and performance as much as possible according to the user's orders. To put it bluntly, it is how the marketing department and the production department realize barrier-free "production and marketing coordination".