Eliyahu M. Goldratt
Eliyahu M. Goldratt was an educator, author, physicist, philosopher and business leader, but first and foremost, he was a thinker who provoked others to think. Often characterized as unconventional, stimulating, and “a slayer of sacred cows,” he urged his audience to examine and reassess their business practices with a fresh, new vision.
Dr. Goldratt is best known as the father of the Theory of Constraints (TOC), a process of ongoing improvement that identifies and leverages a system’s constraints in order to achieve the system’s goals. He introduced TOC’s underlying concepts in his business novel, The Goal: A Process of Ongoing Improvement, which has been recognized as one of the best-selling business books of all time. First published in 1984, The Goal has been updated three times and sold more than 7 million copies worldwide. It has been translated into 35 languages.
Heralded as a “guru to industry” by Fortune magazine and “a genius” by Business Week, Dr. Goldratt continued to advance the TOC body of knowledge throughout his life, building on the Five Focusing Steps (the process of ongoing improvement, known as POOGI) with TOC-derived tools such as Drum-Buffer-Rope, Critical Chain Project Management (CCPM) and the Thinking Processes. He authored ten other TOC-related books, including four business novels: It’s Not Luck (the sequel to The Goal), Critical Chain, Necessary but Not Sufficient and Isn’t It Obvious? His last book, The Choice, was co-authored by his daughter Efrat Ashlang-Goldratt.
Born in Israel on March 31, 1947, Dr. Goldratt earned a Bachelor of Science degree from Tel Aviv University and a Master of Science and Doctor of Philosophy from Bar-Ilan University. He is the founder of TOC for Education, a nonprofit organization dedicated to bringing TOC Thinking and TOC tools to teachers and their students, and Goldratt Consulting. In addition to his pioneering work in business management and education, Dr. Goldratt holds patents in a number of areas ranging from medical devices to drip irrigation to temperature sensors. He died on June 11, 2011, at the age of 64.
“While they go get the others, I figure out the details. The system I’ve set up is intended to "process’’ matches. It does this by moving a quantity of match sticks out of their box, and through each of the bowls in succession. The dice determine how many matches can be moved from one bowl to the next. The dice represent the capacity of each resource, each bowl; the set of bowls are my dependent events, my stages of production. Each has exactly the same capacity as the others, but its actual yield will fluctuate somewhat.”
“So this is the goal: To make money by increasing net profit, while simultaneously increasing return on investment, and simultaneously increasing cash flow.”
“I write down the three measurements which Lou and I agreed are central to knowing if the company is making money: net profit, ROI and cash flow.”
“Well, I don’t. Not absolutely. But adopting "making money’’ as the goal of a manufacturing organization looks like a pretty good assumption. Because, for one thing, there isn’t one item on that list that’s worth a damn if the company isn’t making money.”
“More importantly, our software worked. I don't just mean that it didn't bump, or that it performed according to the written specifications, or that it was efficient in producing reports. It really worked”