The Goal : A Process Of Ongoing Improvement-Part 2/3

The Goal : A Process Of Ongoing Improvement

By Eliyahu M. Goldratt and Jeff Cox

Solution

Balancing plant with demand

Jonah says to Alex,

1. Your plant should be balanced with demand not with capacity.
2. Cost accounting is No 1 enemy of productivity. 

Means don’t just consider your optimum because while considering optimums you may mismatch the market demand. Further he say,

     3. A plant in which every one is working all the time is inefficient.

Jonah also proves these statements mathematically.

Hiking (Heribe)

Utilization of bottleneck

Jonah has introduce bottleneck & Non Bottleneck

While considering this concept, the Jonah says,

“The objective is to maintain capacity at slightly less than demand.”

For identifying the bottleneck, Alex takes help from research firm, Ralph Namamura.

They identify two bottlenecks 

1. NCX-10
2. Heat Treating Furnace.

NCX-10:

It is not running at full capacity because six month required to train operators. While operators are leaving the company faster than retain.