The Goal takes place in the life Mr. Alex Rogo, an industrial engineer and an MBA graduate and the manager of a plant called the UniCo Manufacturing Corporation which is performing badly and has three months to fix it or be shut down. His old physics professor, Jonah, is his mentor through the story as Alex and his team learn to create the Theory of Constraints to keep the plant running and earn him a promotion.
The story starts out with the overlay of problems Alex faces working at the plant as it is always late with shipments taking all its resources to ship one order. Alex meets the division Vice President Mr. Bill Peach who is very agitated and complains about the plant’s situation.He gives Alex 3 months to make ends meet or the plant would shut down. Alex later reflects upon the situation of the plant, the deadlines and discrepancies between the company’s accounts and actual profits.
Alex runs into his old Physics professor, Mr. Jonah, and told him about his company and the problems that they are facing. Jonah leaves a ‘food for thought’ question what was his company’s ultimate goal?” He keeps pondering over Johan’s suggestions until he understood what the companys goal is, to make money. He realizes that the main goal of the plant and the specific terms of accounting that could reach that goal. He finds the need to increasing the cash flow into the plant, return on investments, and the net profit. He was going to need long days to work but doesnt have much more knowledge on how to do so.
Jonah explains three significant things for measuring the company’s account, ‘throughput’ that gave the rate of sales, ‘inventory’ was the money invested in their products, and ‘operational expenses’ were the costs associated with converting inventory into throughput. After finding the components and categorizing them based on these three concepts, Alex tells him what problems at the plant where and the limitations of having them changed. Jonah guarantees the changes would be possible but rejects Alex’s concept of a balanced plant and tells him to reconsider the possibilities through ‘dependent events’ and ‘statistical fluctuations’.
During an overnight boy scout trip with his son, he watched the scouts movement and the effect on the entire line during the hike and came to understand the concept of ‘dependent events’ and ‘statistical fluctuations’. Alex plays a game with the boys and realizes the importance of dependent growth and the effect of a bottleneck in a system and that a balanced plant was not solution because ‘dependent events’ and ‘statistical fluctuations’ would pull down the throughput for each day, and the operational expenses as well the cost of inventory increased.