The Goal

The Goal, originally published in 1984 by North River Press, is part of a subset of business writing intended for managerial training. In the tradition of Who Moved My Cheese? and Surviving Your Serengeti: 7 Skills to Master Business and Life, The Goal is a fictional fable directed at executives to help them improve organizational culture and productivity. The Goal was one of the first such publications and introduced the idea of the Theory of Constraints and Critical Chain Project Management. It also proliferated the idea of bottlenecks in business. The book has since been republished many times, the most recent in 2014, and was named one of Time Magazine’s top “25 Most Influential Business Management Books.”

Plot Summary

Alex Rogo, a young plant manager for UniCo, a manufacturing firm, walks into his plant to find a scene of chaos. Bill Peach, the division vice president and Alex’s boss, has stormed into the plant furious about a late order. After disrupting the whole work process, he tells Alex that he has three months to show significant improvement, or Bill will recommend that the plant be closed. Things at home are no better for Alex. Julie, his wife, is bored by life in sleepy, small-town Bearington and frustrated by Alex’s inability to come home for dinner or spend any time with his two young children, Davey and Sharon.

While at a division meeting in which Bill lays out just how badly the UniCo plants are doing, Alex remembers a conversation he had two weeks ago. He had a chance meeting in an airport with Jonah, his former physics professor, who now works as a business consultant. Though Alex thought his plant was doing fine, Jonah was able to ascertain, through only a few questions, that the plant was inefficient and hemorrhaging money. He asked Alex what the “goal” of a business was. Alex offered several incorrect guesses before Jonah had to catch his plane.

Disturbed by how useless the division meeting is, Alex leaves and goes to think about Jonah’s question. He eventually determines that the goal of a business is to make money and is shocked by how simple the answer was. Alex tracks Jonah down and presents his answer, along with his current predicament. Jonah agrees to help. He gives Alex a new system of measurements: inventory, operational expense, and throughput.

Alex gathers an advisory team of his top managers and presents these new measurements to them. They are initially skeptical but agree to try it out. Alex goes with his son on a Boy Scout hiking trip and begins to see his plant in a different light. He discovers that it is the slowest person (or machine) that determines a group’s output, and so finds the “bottlenecks” in his plant. Once these have been identified, he and the advisory team discover ways to combat the problem. They meet with resistance from workers and from UniCo executives, but they persevere and quickly see a dramatic difference in terms of their cash flow and inventory. Through a series of calls and visits with Jonah, Alex and his team identify and solve each problem at the plant as it arises. Meanwhile, Julie leaves Alex and the children and moves back in with her parents. Alex begins to devote more time to their relationship, taking Julie on dates and talking honestly about their lives.

Hilton Smyth, the division productivity manager, catches wind of the changes Alex has made and brings him in front of UniCo division heads for a performance review. Hilton sees Alex’s new system as nothing more than a mirage and advises Bill and the others to shut the plant down. Alex delivers a presentation explaining his new methods, and the UniCo executives respond positively. Bill declares that not only will Alex’s plant stay open, but he has chosen Alex to replace him as division vice president, when he moves up the corporate food chain. Julie and Alex reaffirm their love for one another, and Julie moves back in.

Alex’s new task is to figure out how to be an effective manager, as he will soon be taking over Bill’s job as vice president. He asks Jonah for help, but Jonah responds that this is something Alex will have to do for himself. Alex gathers his advisory team once again, and they devise a process for how to effectively lead and understand an organization. Alex realizes that in order to be a good manager, he will have to embody Jonah’s best qualities—his ability to ask the right questions, his patience, and his ability to inspire. He will have to become his own Jonah.