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"I never walk out of a CEBI meeting without something I can use."

Tom Lingvai
President
Lingvai Excavating, LLC

 

Chief Executive Book Review # 9

 

THE GOAL

A Process of Ongoing Improvement, Revised Edition

Eliyahu M. Goldratt and Jeff Fox, North River Press ISBN 0-88427-061-0

COMMENTS

This book is one of the most important management books written in decades and has significantly changed the thinking and actions of many chief executives.  It is also available in an excellent audio tape version.

THE MOST IMPORTANT IDEA

This book is the basis for the Theory of Constraints as espoused by Eli Goldratt.  Producing a product or delivering a service involves a series of contingent events.  The completion of certain events is contingent upon the completion of preceding events.  The completion of the series is constrained by the speed of the slowest event.

The principle is best explained by considering the events that take place when taking a group of boys on a hike in the woods.

The goal is to have the group hike to a spot 10 miles into the woods.  Since the average boy can walk two miles per hour, it would seem reasonable that the hike would take five hours to complete.  In reality, it will take the group considerably more than five hours to make the 10 mile hike.

The boys are lined up on the trail, equal distance from each other.  As they begin their hike, the distances between the boys start to vary and the line starts to spread out.

One slightly overweight boy named Herbie has the longest distance between himself and the boy in front of him, but yet has several boys close behind him.

In order to keep the group together, the boys in front of Herbie are asked to stop and wait for Herbie and the other boys to catch up.

Herbie is placed in various positions in the line, but it becomes apparent that the speed of the group is determined by Herbie, regardless of where he is in the line.

The point of the story is that every company has a Herbie and that Herbie determines the speed of the process of contingent events.

Chief executives who insist on being involved in many daily operational issues usually end up being the Herbie in their company.  They are the one person in their company who impedes growth more than any other person.

Chief Executive Boards International provides CEOs and business owners with peer advisory boards
 
           
 
               
 
 
 
 
 

"I never walk out of a CEBI meeting without something I can use."

Tom Lingvai
President
Lingvai Excavating, LLC