Isn't It Obvious? [Paperback]

Once again Dr. Goldratt has a hit with this book! He has moved down the supply chain to the retailer to challenge the status quo and the common business practices of today. Dr. Goldratt exposes the practical common sense solution that can revolutionize every retailer's business. "Isn't It Obvious" is an easy read and short enough to read in a weekend. However, realizing the assumption that high availability can come only with high inventory is fundamentally wrong can take a lifetime for some people. For the retailers that can change how they think will be rewarded with increased sales, increased profits AND reduced inventory. A must read for anyone in the distribution or retailing industry.

First of all, let me say that I am a Theory of Constraints fanatic. The Goal confirmed for me so much of what I had always believed. It's Not Luck changed the way I work and interact with people not just in business. Critical Chain was absolutely priceless in my work as a project manager.

After losing my job, along with dozens of other talented, hard-working people, I found myself returning to retail. It was a very difficult move, not only because I would be making 1/8 what I had been before. Retail business models alone have always frustrated me. The particular chain I went to work for was particularly frustrating to me. But it was work.

When I heard that Goldratt had (co-)written another TOC book, this time about retail, I was very excited to see what I could apply in my situation.

Well, Isn't it Obvious is an excellent start, and could be a wonderful guide for people in the right positions. Small business owners, for instance. Or middle- and upper-level-managers in large chains which employ only completely competent managers who never put their own agenda ahead of the good of the company. For those of us in real-world organizations, however, this is not as helpful as Goldratt's previous works.

The main character, Paul White, is married to Carolina, the corporate purchaser and daughter of Henry Aaronson, the CEO nearing retirement. Paul's good friend is the regional warehouse manager. Is it any wonder that so much could be accomplished in such a cooperative environment?

I have never seen an organization like the one described in this book. The first third was very exciting as roughly 9 out of every 10 problems I have experienced with my employer was specifically mentioned. But the way the problems were resolved is just entirely unrealistic in any organization I've ever witnessed. There is just too much self-preservation and backstabbing. For instance, my current employer is a Frankenstein of an organization, the result of about 20 years of acquisitions, none of which was apparently ever completed because each still tries to operate as a separate entity, with their own internal corporate culture, yet without any autonomy or freedom to make the kind of decisions that are the key solutions in this book.

Further, many of the biggest problems aren't even discussed. It seemed several times that they were going to talk about them, like multiple instances of discussions about some bathmat SKU, but nothing ever came of it. Consider these HUGE problems in retail:

* Product SELECTION (which products the corporate buyer chooses to put on the shelves)
* Location, hours of operation, and other key choices that will greatly influence both the clientele and the experience of the customers
* Workforce vs workload balancing (this is addressed VERY well in The Goal, but try getting a retail VP to read a book about manufacturing and relate it to himself)
* Online vs. brick-and-mortar stores (I know this is vague, but I really had hoped this book would discuss the challenge of competing with online "stores", particularly those who are just drop-shipping website shells)
* Promoting personal agendas instead of serving customers' needs

None of that is discussed in this book. Consider my own current dilemma: We are a chain of stores known for a certain type of product. That product (and related accessories) is specifically identified in our name. We do not carry any products from the largest manufacturer in that industry (a household name to say the least). We do not carry the full lines of any brands. And we completely ignore the existence of the up-and-coming brands. Those we do carry are nearly always out of stock. The accessories for these items are important to their use, yet we only carry a tiny assortment of accessories, none of them of high quality, and all of which are terribly overpriced. So a customer comes in looking for product A, with accessories B, C, and D. But all we have in stock is C, along with alternative product X, which in the most abstract sense does the same thing (but not in any other sense). In other words we don't have what the customers are looking for. I was very excited when this was the dilemma under discussion in the first pages of the book. You see, we have LOTS of other times. More expensive items. Diversified product lines, to the point that any time someone sees these new lines they remark, "Wow, I never would have thought to come here for those." Accessories which we should carry range from $2 to $50, with huge profit markups (100%+), mostly on the extreme low end of that scale. The products we actually have but no one comes to us for because they have no reason to range from $200 to $500, with profit margins measured in pennies.

See what I'm saying? We do not have the basic items which make us a lot of money, but we have lots of the ridiculous items we shouldn't have, but which earn the company just pennies per sale, if the sale didn't take very long. Otherwise we're losing money.

Sticking to our core business, the one in the advertisement, and using the wasted investment money on inventory in stock of the items we should have and that customers actually come to us to buy would make a difference of millions of dollars per year. But we can't buy those because some corporate purchasing agent apparently accepted sexual favors in exchange for the company buying their crappy products.

Don't even get me started on going through bankruptcy protection and reorganization and coming out doing the exact same kinds of bad business as before, but with extended hours so we can do the same bad business for 2 extra hours per day.

Anyway, that's just a small taste of the kinds of crap that go on in the real world, but which aren't even touched on in this book. So, if you're in a company like mine where middle managers serve themselves and throw money away on their own pet projects while simultaneously cutting hours ruthlessly, then skip this book. Just get a copy of The Goal and a copy of It's Not Luck and adapt their approaches to help your organization. On the other hand if you're in a VERY influential role in a VERY cooperative organization then read this and love it. The ideas are excellent for use in such a situation.

Dr. Goldratt, I look forward to reading more of your work, but please don't do anything halfway as this was, and especially with so many glaring typographical errors. The poor quality from the publisher is just inexcusable. :(

This is one of Eli Goldratt's best books. It's a very fast read (the co-authors write for TV and movies)and much thinner than his other books. That doesn't mean it's lightweight though; the story very clearly articulates how to use TOC thinking in retail ... and how to make loads more money. I enjoyed this book.

BTW: if you are a TOC expert then you may already be familiar with the retail solution. This book isn't really written for you. It's written primarily for people working within retail who have maybe heard of TOC but haven't seen the retail/distribution/replenishment solution in Goldratt's other books like INL, NBNS, and The Choice. If you are an expert then search for the interview with Eli Goldratt about this book on the tocthinkers website where he talks about the book's more subtle themes.

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