The Goal

143

pacity of a resource in isolation. Its true productive capacity de- pends upon where it is in the plant. And trying to level capacity with demand to minimize expenses has really screwed us up. We shouldn't be trying to do that at all."

"But that's what everybody else does," says Bob.

"Yes, everybody does. Or claims to. As we now can see, it's a stupid thing to try," I say.

"So how do other manufacturers survive?" asks Lou.

I tell him I was wondering that myself. What I suspect is that as a plant comes close to being balanced through the efforts of engineers and managers doing the wrong things, events head toward a crisis and the plant is very quickly un balanced by shift- ing workers or by overtime or by calling back some people from layoff. The survival incentive overrides false beliefs.

"Okay, but again, what are we going to do?" asks Bob. "We can't hire without division approval. And we've even got a policy against overtime."

"Maybe it's time to call Jonah again," says Stacey.

And I say, "I think maybe you're right."

It takes Fran half an hour to locate the area of the world where Jonah happens to be today, and another hour passes be- fore Jonah can get to the phone to talk to us. As soon as he's on the line, I have another secretary round up the staff again and corral them in my office so we can hear him on a speaker phone. While they're coming in, I tell Jonah about the hike with Herbie where I discovered the meaning of what he was telling me, and what we've learned about the effects of the two phenomena in the plant.

"What we know now," I tell him, "is that we shouldn't be looking at each local area and trying to trim it. We should be trying to optimize the whole system. Some resources have to have more capacity than others. The ones at the end of the line should have more than the ones at the beginning-sometimes a lot more. Am I right?"

"You're on the money," says Jonah.

"Good. Glad to hear we're getting somewhere," I say. "Only the reason I called is, we need to know where to go from here."

He says, "What you have to do next, Alex, is distinguish between two types of resources in your plant. One type is what I call a bottleneck resource. The other is, very simply, a non-bottle- neck resource."