The Goal Effects of New Tools on the Operation Management Practices Research Paper

The Goal Effects of New Tools on the Operation Management Practices - Research Paper Example Alex is given a time constraint of three months in which he has to save his plant from collapsing. In the course of saving that plant, Alex meets an old colleague named Jonah (a physicist). Jonah helps Alex save the plant by guiding him to the right path (Goldratt & Cox, 1992). The concept applied in The Goal was from the new practices applied in today’s world. There was a theory named the six-sigma theory which focused on the concept of continuously improving the quality of production and eliminating the waste products just like the lean production concept. Both the concepts were merged and applied in the book (Jacob, Bergland, & Jeff, 2010). However, in the recent years new tools and practices have been introduced based on the use of the Internet as web based business applications. E-commerce is also known as buying and selling of goods or services through the Internet technology. This new trend has increasingly gained popularity, thus changing dynamics of businesses by providing high satisfaction (Gunasekaran, Marri, McGaughey, & Nebhwani, 2002). Now businesses interact by making transactions around the globe in minutes, reducing their operational costs and eventually leading to generation of high revenues. Presently, the orders placed are high in volume as the market is demand driven and the orders are placed more on the basis of Customization category using just-in-time (JIT) rather than batch process system. The business to business (B2B) transactions are gradually changing as the trend is shifting towards business to customers (B2C). The cost of Internet technologies and databases is often high because of which the cost of inventory is increased (Gunasekaran, Marri, McGaughey, & Nebhwani, 2002). The new tools play a vital role in determining what steps Alex would have taken if they were taken into consideration after defining the goal of increasing net profits, return on investment, and the positive cash flow. Alex would have looked at the market conditions for ascertaining the demand for the product and subsequent estimation of orders (sales) at a given period of time. Based on this concept, the inventory costs would be calculated (Gunasekaran, Marri, McGaughey, & Nebhwani, 2002). Based on new tools systems of today, Alex would have a different goal overall. Based on the prior information about Alex’s goals on increasing profits, Alex would focus on the marketing of the company and providing high customer satisfaction. High customer satisfaction involves customization of the product. The Clientele approa ch would be taken into consideration at this point, i.e., having more clients to satisfy and relatively less orders to take. However, in case of Alex orders were high from one client with price remaining the same but the operations of business processes and costs were managed through altering manufacturing process. The marketing approach would lead to focusing on creating awareness of the service which the company has to offer and the cheapest form of marketing would be used that is the internet to save costs (Goldratt & Cox, 1992). In this book, it has been said that anything invested into the business including assets used in the system to make sales are considered as inventories of the business. In order to