THE GOAL

1. Productivity:

Before reading the book, productivity for me meant efficient work in a factory, adhering to the
work plan without idle time, and minimal revision processes. However, after reading the book,
as Goldratt claims, productivity should not be narrowly focused on reducing costs or increasing
output, as commonly misunderstood. Instead, it should be seen in terms of how much it
contributes to achieving the organization's main purpose or goal. Shedding light on productivity,
the book emphasizes the need for businesses to shift their focus away from individual task
efficiency towards a greater emphasis on overall output, i.e., the speed at which a system
generates money through sales, as extensively discussed in the book.

Nevertheless, in some processes, no matter how productive we are, our capacity will be limited
by the capacity of our bottlenecks, a concept known as the theory of constraints. In other words,
productivity is independent of machine capacity but dependent on bottleneck capacity. Indeed,
when Goldratt examined the machine capacity and working hours of our company, Uni Co.,
everything seemed fine. However, this situation, in addition to inefficiency, had also affected
costs due to high inventory. Recognizing that idle workers are not efficient, they increased
inventory, which created a cost. After realizing this, inventory levels were inevitably reduced,
and with an increase in orders, costs began to drop below 15%.

In summary, any action that leads a company to its goal is productive, while any action that
deviates it from its goal is unproductive.

2. The Goal of a Company:

As Goldratt proposed, the ultimate goal of any business should be to increase profit. As
expressed on page 64 of the Turkish edition published by Optimist Publications in 2014, the
goal was to make money by simultaneously increasing both return on investment (ROI) and
cash flow, thereby raising net profit. However, "The Goal" cleverly demonstrates that the goal
is not only about profit but also about increasing net profit and cash flow while intelligently
boosting return on investment (ROI). The essence of this position lies in understanding three
critical metrics (Throughput, Inventory, and Operational Expense) that continue to be the
backbone of a company. Consequently, while aiming for profit, the focus should be on
increasing efficiency while reducing both inventory and operational expenses.

3. Automation's Benefit for a Company:

In the realm of business operations, automation is often unquestionably seen as a panacea for
increasing output and reducing costs. However, Goldratt, with profound insights, advises
careful consideration, arguing that automation is not always beneficial. The author's contrarian
view suggests that while automation can reduce labor costs, it does not guarantee an increase
in Production, or a decrease in Inventory or Operational Expenses. The examples in "The Goal"
illustrate that poorly implemented automation can lead to an increase in Inventory or
Operational Expenses, ultimately harming the goal (net profit, ROI, and cash flow). Therefore,
automation should be strategically applied to assist in reaching the overall goal rather than being
a standalone solution.

In conclusion, reflecting on Goldratt's fundamental tendencies in "The Goal," a holistic

perspective emerges as crucial for success. Increasing efficiency is not just about achieving
individual tasks narrowly; it is about aligning efforts with the ultimate business goal. This
reference framework teaches us that a company's primary objective should be towards
increasing profit, not in isolation, but by maintaining a good balance among key metrics.
Finally, while automation is a powerful tool, it should be approached with nuance; appreciating
where it complements the overall system, avoiding exaggeration of its benefits, or overlooking
potential pitfalls.