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The Goal by Eliyahu Goldratt
Pages 3 (753 words)
Today we have access to lots of data, let it be in business or in science. But how to convert data into useful information is a big challenge. Since we see lot of data, it is very important to know what is required or expected in the given the job to lead to real success in the task…
the goal is to make money. I feel the way we follow to make money shouldn't be violating the business ethics. In my opinion, the money generated by business is essential for firm's survival, growth, social responsibility.
As mentioned in the novel, the plant manager character in the novel Alex Rogo, and his division was facing financial crisis. His supervisor Bill Peach had warned him to shut-down the plant if they don't show improvement of the plant in three months time. Alex took this as a challenge to prove himself and his plant to prove in three months. Surprisingly, Alex remembers his physics professor Jonah, who finally helped Alex with practical suggestions in a Socratic way.
The measurements of expressing the goal of making money are namely: throughput, inventory and operational expense. The rate at which the system generates money through sales is throughput. This is the money coming in the system. The money invested in purchasing things is called inventory (Goldratt 66). Inventory is the money currently inside the system. The money spent to turn inventory into throughput is called operational expense (Goldratt 67). All these definitions are related to money, the goal of any business firm. If we increase throughput, and reduce both inventory as well as operating expense, this leads to profit. So the goal can be understood in terms of relation of these terms. ...
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