Customer Reviews

Theory of Constraints and Its Implications for Management Accounting

5 star:		(1)
4 star:		(2)
3 star:		(1)
2 star:		(1)
1 star:		(0)

 

 

This book was the best summary of the Thinking Process I have yet read, but it's title suggests an accounting focus. The accounting focus lasted just for the first section. The real value of this book was the case studies where they discussed some of the benefits and pitfalls experienced by some companies that implemented TOC ideals.

...this is an excellent book that summarizes Goldratt's theory explained in the Goal and the Haystack Syndrome (preferably, read these two first). The point of this book is not to change the "accounting" for IRS purpose or whatever, the purpose is to give "real world" experience applying TOC in management decision making. This theory is the theory of common sense, nothing more, but yet, we easily forget about it. One of the biggest insights of the theory is that Cost Accounting recognizes no constraint in a system (i.e. company) at all, making it obsolescent for decision making. So, if you are ready to forget about everything you know about cost allocation and believe that you can arrive to better decision making without the need of a "product cost" go ahead with this book and be surprised!...again this is a change of paradigm and, because of that, for some people will be difficult to digest, specially accountants and ABC advocates.

In the first 2 chapters the authors do a good job of explaining why variable costing is better than full absorption costing. Thereafter the book fails to add much more than that. I learned in university that variable costing is better than full absorption costing, so this is nothing new - what would be more useful would be ways to use both systems simultaneously, seeing as full absorption costing will be with us for SEC and IRS reporting purposes.
Great start, but left with a feeling that I hadn't really learned much in the end.

I certainly like Goldratt's writings, however this book adds a new and supportive dimension to the Theory of Constraints. Where many other TOC books insist on using the novel structure to enhance readibility this book gives much needed information and depth without long winded characterisations and subplots.

Read in conjunction with Eli's books it makes the whole theory more punchy and useful. Therefore the book is timely and certainly recommended. Eric Noreen and his fellow authors have done a good job.

item as described - good conditions.
Had to pay additional VAT - as value declared 55$ for a used book :-(