Question

What are the parallels between concepts learned in “ Introduction Management Science” of Frederick S. Hillier and Mark S. Hillier and those that are covered in “ The Goal” of Eliyahu M. Goldratt. Specially describe, the relevance of each chapter in the Introduction to Management Science text to the key concepts in the book “ The Goal”

Answer 1

Answers:

Key concept of Book:

The book is about the theory of constrain. some of the key points are

Productivity is act of bringing a closer to its goal.every action that brings a company closer to its goal is productive.every action that doesn't bring a company closer to its goal is not productivity.Productivity is meaningless unless you know what your goal.Producing products is also not the goal.Quality? If quality were truly the goal,then how company like rolls Royce very nearly went bankrupt?Producing quality product efficiently that must be goal., Market share, customer satisfaction all these are essential to satisfy goal.

Action that moves us toward making money is productive.An action that takes away from Making money is non productive.

There are three operations rules Throughput, inventory, operation expenses.Throughput:is the rate at which the system generates money through sales.Inventory: inventory is all the money that the system has invested in purchasing things which it intends to sell.Operational expenses:is all the money the system spends in order to turn inventory into throughput.These are the goal in terms of measurement.So goal is to increase throughput while simultaneously reducing both inventory and operating expenses.

concentrate on two types of resource Bottleneck resource & Non bottleneck resource

Capacity of plant equals to capacity of bottleneck.whatever bottleneck produce in an hr is the equivalent of what the plant produces in an hr

To increase capacity of plant is to increase the capacity of only the bottleneck.