The Goal Review

While it is vitally important in today’s economy for a company to remain strategically competitive and innovative, it is near to impossible to accomplish without first maximizing its existing resources to their fullest potential and building a strong foundation in which to build from.

The events described in the book “The Goal” written by Eliyahu M. Goldratt and Jeff Cox are an excellent illustration of how a company called Unico was able to survive by leveraging the skills sets of internal employees and maximizing the efficiencies of processes. Without a strong foundation, they almost went out of business because of management’s inability to understand how to create a continual and consistent inventory and production flow.

Unico also had an identity crisis in that they didn’t have a competitive advantage that was clearly defined. It appeared that their product could be interchangeable with other products in the marketplace based on examples where their customers were going to other suppliers with shorter lead times and better delivery. Their product was not described as innovative and from a cost perspective seems to be comparable to current market rate. Based on the three competitive approaches Unico is left with competing on response in terms of flexibility, reliability and quickness. This is a problematic approach because Unico is in a difficult position because they are losing customers over delayed orders and excess unused inventory.

One of the ways Alex went about exploring the crux of Unico’s issue was to look at the goods and service design of their company Unico’s product. Unico’s product was in a “maturity” stage in a product lifecycle however as a company they weren’t even at the growth phase because of the mismanaged processes. Based on the backorders that the company had, it was quickly apparent that the design of new products wasn’t the issue. The issue was customer satisfaction and Unico’s inability to meet promised delivery dates was pushing the company into the red zone financially. I agree with Alex’s approaches as he tried to diagnose the problems at Unico and felt that without knowing it, he went through the ten strategic OM decisions in order to get resolution.

The first area of the ten OM strategies he explored is quality which can often be misconstrued with referring only to the sound construction and longevity of a product or service. However quality as defined in The Goal is referring to the customer’s quality expectations from a delivery perspective. Unico had several quality assurance checkpoints throughout their production process however there was an overall bottleneck issue causing major delays in customer orders and delaying unused inventory from turning into cash at the point of sale.

Alex was presented with another problem as it relates to process and capacity design that impaired his initial judgment as to the cause of the delayed