The Goal Discussion Questions to be written and handed in: 1. What is the goal of the company?

The goal of the company is to increase net profit while simultaneously increasing return on investment and cash flow, or basically to make money. 2. What are the manufacturing plant measures? The manufacturing plant measures throughput, inventory and operational expense. Throughput-the rate at which the system generates money through sales. Inventory-the money that the system has invested in purchasing things which it intends to sell. Operational expense-the money the system spends in order to turn inventory into throughput. 3. What is the relationship between manufacturing plant measures? Operationally, a business must increase throughput, while simultaneously reducing inventory and operational expenses. 4. How do these measures relate to money? Throughput is defined as the rate of sales. Inventory incorporates the money invested in things intended to be sold. Operational expenses include all money spent to convert inventory into throughput. 5. What's wrong with setting your sights on high plant efficiencies? You are not working towards your goal-to reduce operational expense and reduce inventory while simultaneously increasing throughput. The idea that the less idle time you have causes you to become more effective is not entirely true. In fact, you may end up with a surplus of inventory instead. This also increases operational expenses. Because of this thinking, you may end up occupying a resource or workers that could be used in other areas of the plant. 6. What is the concept of dependent events in a factory? Dependent events are a series of events that must take place prior to another one beginning, or in other words, the subsequent event depends on the ones prior to it. For example, if we have a bottleneck then throughput of the entire system would be equal to throughput of the bottleneck. 7. What is meant by statistical fluctuations?

Statistical fluctuations are the result of certain types of predictive information that cannot be determined precisely. These fluctuations influence prediction of error percentages, market demand estimates, and attempts to measure productivity. For example, in a plant, when human operates we cannot always predict same throughput so it varies from time to time. 8. How do we influence a change in capacity of bottlenecks? Do bottlenecks necessarily remain the same? A bottleneck is any resource whose capacity is equal to or less than the demand placed upon it. We influence a change in capacity of bottlenecks by only allowing the amount of inventory to be processed at the time it is needed. This causes the bottleneck to no longer be an issue because it is not jammed with too many products to process without enough resources to do so. We can also try to use the bottlenecks to produce fictitious orders in an effort to keep the bottlenecks busy. That will free up capacity, which translates into market share. Bottlenecks can remain the same when we increase capacity but it is still visible and determines the entire systems throughput. Why do we want to cut batch sizes? We want to cut batch sizes to reduce the total capital commitment used during production. Reduction in batch sizes also reduces the total time spent in work-inprocess. Less time spent in production increases the speed of throughput as well as a faster turn-around on customer orders. Shorter lead times result in better response to the market demands. How do you reach the goal after you gain extra capacity at the bottlenecks? Capacity gained at the bottlenecks determines the entire systems throughput. The plant can produce more finished goods which increases the plants throughput and generate revenue. Then you reach the goal of making money. 9. What are the 5 steps of the process that they followed to solve their problems? Explain each step in great detail. 1. Identify the system constraints (the bottlenecks that prevents the plant from obtaining more of the goal) Identifying the systems constraints is the key to determining the plants throughput. All other processes are dependent on the bottleneck. 2. Decide how to exploit the systems constraints (get the most capacity out of the constrained process)

Increase the capacity of the constraint and make sure it is better utilized. Plan flow according to this constraint capacity. If the output of the system is constrained by the output of the bottleneck, you must try to increase the output of the bottleneck. Any idle time of the bottleneck reduces output of the system. 3. Subordinate everything else to the above decision (align the whole system to support the decision made above) Prioritize accordingly to make sure constraints are better utilized and release materials as needed. As explained by green and red tags used in the system. All the resources that arent bottlenecks have some slack so use that slack to support the bottleneck. You can do so by letting the non-bottlenecks help the bottleneck. Everyone should work at the pace of the bottleneck, no faster no slower, to avoid overloading the bottleneck with work in progress. 4. Elevate the systems constraints (make other major changes needed to break the constraint) Identify the other possible bottlenecks by going back to old methods. If still want higher levels of performance you must have more of whatever is limiting performance such as adding more people or machines. 5. If in the previous steps, a constraint has been broken, return to Step 1, but do not allow inertia to cause a systems constraint. Make sure your solution will not cause any new constraints and ask yourself if your goal is still valid or is your measurement of throughput still correct. If it is not, go through the steps all over again. 10. Describe how work life can affect home life. What improvements can be made to strike a better work/life balance? Work life can affect home life because it impacts ones ability to spend time with their family. Some people get too easily caught up at work that they neglect their personal life. In the case of Alex, the extra workload caused his marriage to strained because of the devotion he needs to give to the plant. Due to Alex dedication to solving the plants problems, his wife, Julie, decided to resolve her problems by leaving him. In order to avoid this problem, one can set physical boundaries such as leaving work at the office and not bringing it home. That will allow you to spend more time with those important in your life without thinking about work. You can also impose limits and let clients know you only worked set hours. Also it is important to set aside some me time. Having a hobby will help you rejuvenate.

This will counteract the stress you have from work and allow you to have time purely to relax. In the case of Alex and Julie, communicating and letting each other know of what you do at work can help to ease the stress. If the people in your life have an understanding of your situation at work, they will more than likely understand your dedication to solving problems at work rather assuming you are avoiding or neglecting them. Julie was able to give her inputs and help Alex out. They were able to reconcile their marriage because they made the effort to spend time together and expressed their feelings to one another.