Upon first meeting Alex Rogo, Jonah questioned the productivity as well as the goal of Rogos plant, Uniware.

Jonah makes Rogo aware of the possible implementation of better processes. Alex came to the conclusion that the "goal" is to make money and anything that brings us closer to it is productive and anything that doesnt isnt. Rogo and one of his accountants decided that net profit needs to increase along with simultaneously increasing return on investment and cash flow in order to reach their goal. Once Rogo contacts Jonah, they define the success of any plants production: o 1. Throughout = rate that the system is used to generate money through sales. This measurement would consist of what a product would be worth when sold at market value after deducting operational expense and inventory. o 2. Inventory = all the money invested in purchasing items that will be sold. This could include the remains of their machines after being used toward the investment. o 3. Operational expense = all the money used to turn inventory into throughput (i.e. scraps). Jonah explains to Alex that a plant that is continuously productive is considered inefficient. Continuous production will result in high malingering, poor quality and employee turnover. Rogo would need to reduce operational expense and inventory to improve throughput to demonstrate a balanced line of production. Jonah has Rogo ponder two things: what are the dependent events and statistical fluctuations in his plant. After Alexs hiking trip, the following conclusions can be made: o Final throughput is measured by the rate of the last and slowest operation in the sequence. o Inventory is equal to the length between the leader and the backdoor, which should be minimized. o Operational expense is roughly measured by the energy expended, which must be conserved. o Some resources need to have more capacity than others, especially towards the end of the operating sequence. Jonah bring up the idea of bottleneck and defines is as, "any resource whose capacity is equal to or less than the demand placed upon it." Jonah offers the following guidelines to speed up the bottlenecks: o No idle time: They met with the union to adjust staff break times so that the bottleneck machines are always running. o Only current demand parts: They ensured that only current orders are processed through the bottleneck machines. o No defective parts: They moved the parts inspectors to just before the bottleneck machines, so that they dont do unnecessary work on defective parts, and theyre only working on parts that will actually contribute to finished products.

Now that the new priority system is in place for all parts going through the bottlenecks, inventory is decreasing. But, lower inventory revealed more bottlenecks. This interests Jonah so hes coming to take a look. Mr. Peach agrees to keep the plant open if Alex gives him a fifteen percent improvement next month. Jonah suggests reducing batch sizes by half. Of course, this will take some doing with vendors, but if it can be done, nearly all costs are cut in half. Also, they get quicker response times and less lead times for orders. Based on these few simple steps they significantly increased production by 12% during the first two months and 20% in the third month. They started to engineer big sales with marketing, breaking into the European market. They also turned work around in two weeks (a huge breakthrough) opening dozens of new opportunities for the company.