Saving time with CCPM

Saving time with CCPMCritical Chain Project Management

Freek de Ruiter

Presentatie nog te geven

xx juni 2013

© Kwantitijd BV 2013 All rights reserved No. 2Saving time with Critical Chain Project Management

Why do we want to save time ?

../../Copie Toshiba laptop Logica op 11 maart 2012/FRUITER/Documents/Filmpjes en muziek/xboxvliegen.asf

../../Copie Toshiba laptop Logica op 11 maart 2012/FRUITER/Documents/Filmpjes en muziek/xboxvliegen.asf

© Kwantitijd BV 2013 All rights reserved

Product life cycles are getting shorter

Improving due date performance and reducing lead time enlarges financial benefits

Finishing a project ASAP means:

• Reduced Time to Market

• Cost reduction

CCPM promises:

• 80% due date performance in a portfolio

• 25% lead time reduction of a project

No. 3Saving time with Critical Chain Project Management

Why saving time (and money!) withCCPM ?


Freek de Ruiter is a member of the NL TOC Network and has become a passionate andambitious expert on Critical Chain Project Management.

Working as Time Management Consultant for his own company, he specializes on the domains planning, scheduling and tracking


Presented to you by Freek de Ruiter


• What is CCPM?

• Improving portfolio performance

• How does CCPM work?

• Plenty of time to save

• CCPM planning and execution

• Multi-project CCPM

• When or why will CCPM not work

• Results


Agenda


• An IT development method like Agile/SCRUM

• An improvement method like Lean and SixSigma

• A project management method like PRINCE 2

• A program management method like MSP

• Just a planning “trick”

• A way to solve all your problems (“Haarlemmer oil” / “Silver Bullit”)


What CCPM is not:


The elaboration of the TOC body of thought on project management:

TOC = Theory of Constraints

Books by Eli Goldratt:

• The goal

• Critical Chain

• Inherent Simplicity The Choice

Books by Robert Newbold

• Project Management in the Fast Lane

• The Billion Dollar Solution


What is CCPM ?

Isaac Newton: “Nature is exceedinglysimple and

harmoniouslywithin itself”


The 5 focussing steps:

0. Define the system

1. Identify the constraint (the resource or policy that prevents the organization fromobtaining more of the goal)

2. Decide how to exploit the constraint (get the most capacity out of the constrainedprocess)

3. Subordinate all other processes to above decision (align the whole system ororganization to support the decision made above)

4. Elevate the constraint (make other major changes needed to break the constraint)

5. If, as a result of these steps, the constraint has moved, return to step 1, don’t let inertia become the constraint)


What is TOC ?


Clear thinking requires these starting points (convictions? beliefs?):

1. Never say I know, it will obstruct you from gaining more knowledge

2. If confronted with something that looks complex, remember that everything is simple

3. If confronted with something that looks a contradiction, remember that it willturn out to be in harmony (a paradox?), if you are willing to think hard and long enough

4. Do not blame someone or something else, if you really feel you need someone to blame, blame yourself


What is TOC ? (continued)


“Doing the right things right”

1) Select the right (order of) projects:

“Front end” PPM: portfolio alignment with company business objectives, is notcovered in this presentation, but probably is the most import factor in improvingportfolio performance

2) Execute the projects as efficiently as possible:

• By providing max. throughput of the system using “Multi-project” CCPM

• This flow is the one and only consideration!

• If you manage to keep projects on time and budget, you do not need to change orstop projects (based on predictions Earned Value Analysis can provide)


Improving portfolio performance


• Plan projects with buffers

• Reducing work in progress (WIP)

• Active execution of projects

• Monitoring the right points of attention

• Unambiguous priority system

“Plan tasks as late as possible to avoid unnessecary work in progress, but monitor the start of planned tasks and the finish of tasks in progress daily, by means of the buffer penetration mechanism.”


How does CCPM work ?

Plenty timeto save


• Safety too high

• Tasks start too late

• Tasks end too late

• Productivity loss of bad multi-tasking

• Waiting on decisions


Time to save


Project member estimates: minimum of 3 days work and tells his team lead: “ready in a week!”

Another project member estimates for a follow up action a week too

Team lead schedules the activities and tells his project manager that he needs 12 days, to prevent that delay of the 1st activity causes delay of the 2nd activity.

Project manager reports to the steering committy to count on 3 weeks for thatcluster, because before the activities can start first another cluster……


Safety too high (addition to Eli’s heritage)


A deadline influences in a negative way

3 days work? 5 days available?

I can postpone working on this task, which I do not like to start, to the day aftertomorrow!

On day 4 Murphy strikes: 2 days extra needed!

Possibly increasing the lead time of the project


Tasks start too late (student syndrome)


Time planned will always be filled with work

3 days work? 5 days available?

I immediately start working on this task that I like to work on

Ready after 3 days, no reward for being ready, adding all kinds of “nice to haves” for2 days

Loss of productivity and possibly waisting an opportunity to reduce the lead time of the project


Tasks end too late (Parkinsons lawNo. 1)


Productivity loss of bad multi-tasking

Task A

Task B

Task C

Tasks assigned to person

3 days

3 days

3 days

Ideally: Task A Task B Task C

3 days 3 days 3 days

OK? B BA AC C

6 days

6 days

6 days

In reality minimally

BBA AC C

7 days

7 days

7 days

Productivityloss

Shift of end date task A

Shift of end date task B


• Not much space in management agendas

• Disagreement on priorities

But on top of that:

• Menzo de Muinck Keizer: Managers miss information because the decision making process is not enough known to the non-decisionmakers

Consequences:

• More waiting on decisions

• More loss of productivity

• More increase of the project lead time

• More loss of motivation

Looking back in retrospective, any decision, always based on the knowledge at a certain time, could possibly better have been replaced by another, unfortunately never enabling a 100% certain analysis of the consequences of that replacement


Waiting on decisions (addition to Eli’s heritage)

CCPM planningSingle project

No. 20© Kwantitijd BV 2013 All rights reserved

Start with basic planning on skill level

Saving time with Critical Chain Project Management


Critical Path



Resource allocation of individuals



Overallocation!



Also overallocation in the skill based planning



Overallocation solved, but multitasking means more work!



Resource leveling can cause switching more than once



Multi-tasking eliminated, resource contention removed, ready to apply CCPM planning



Critical Chain is not Critical Path




• Reducing WIP






How does CCPM work ? (repeated)


• Only with buffers and daily monitoring setbacks can be compensated by pleasantsurprises

• Where protection needed?

• How much?


Plan projects with buffers


Step 1:Remove 50% safety from the individual tasks



Step 2:Add buffers with 50% of the removed safety



Step 3:Start non-critical tasks ALAP




• Reducing WIP








Result of the 3 CCPM planning steps



Cautious?Result of removing only 25% safety from tasks



Very cautious?Result of not removing any safety at all



50% - 50% 50% approach is proven best CCPM practice in a multiproject arena!


CCPM executionSingle project



• Reducing WIP








• Resource allocation of individuals

• Buffer management

• The following scenario is an example of possible events


Execution


Start of project on 9/11/09



Monday 16/11: Analist 1 reports status finished with 4 hoursextra work done, Designer 1 reports 4 hours extra work to do.


Progress in week 1


Analyst 2 and Designer 2 report work finish conform schedule, Developer reports having started 1 day later because of sickness.


Progress in week 1


Feedbuffer consumption 50% with branche 80% complete, Projectbuffer consumption 13% with Critical Chain 30% complete.


Progress in week 1


Monday 23/11: Designer 1 reports work finished conform new schedule, Developer reports finished product 2 with 8 hours extra work done and 16

extra hours to be done on product 1.


Progress in week 2


Feedbuffer consumption 50% with branch 100% complete, Projectbuffer consumption 50% with Critical Chain 50% complete


Progress in week 2



• Reducing WIP








Developer reports 1 day later “probably ready middle next week”, whichmeans projectbuffer consumption 75% with Critical Chain 50% complete.


Progress in week 2 + 1 day


Projectmanager helps Developer with problem and skippingsuperfluous work , project buffer consumption back on 50%


Progress in week 2 + 1 day


Monday 30/11: Developer reports progress according to new schedule, project buffer consumption 50% with Critical Chain 75% complete


Progress in week 3


Monday 7/12, integration test finished with 8 hours extra work, acceptance test starting today.


Progress in week 4


Wednesday 9/12: Acceptance test finished after 2 days, project buffer consumption of 66,67%


Progress in week 5


Project finished before deadline



Project finished in less hours than baselines



Project finished under budget



Requirements for a succesful implemenation:

1. Enthusiastic, professional, believing Project Manager

2. Co-operating, open-minded team members

3. Not too much external dependencies

4. Reliable enough estimates

5. “Full Kit” preparations

6. Tooling


CCPM in a single project

Multi-project CCPM


Staggering:

• Single CCPM planned projects

• Projects in order of finish date (or other priority)

• Indentify drum tasks/resources (= key resources)

• Remove resource contention of key resources on drum tasks

• Replan all tasks of all projects before and after tasks of key resources, but onlymove the buffers of the newly released project

Priorities:

Only an algorithm can determine the right priority of the tasks and projects in execution


Multi project CCPM planning


Single CCPM planned projects



Staggering step 1:Identify drum tasks/resources



Staggering step 2: Remove resource contention of keyresources on drum tasks



Staggering step 3: Replan all tasks of all projectsbefore/after tasks of key resources



• Project organization with competence pools:

• Taskmanagers are working for more than 1 project

• Resources are working for a taskmanager

• Unambigous priority rules

• Highest priority for task which causes highest penetration of the projectbuffer of the project with the highest priority

• Highest priority for project with highest penetration of its projectbuffer in relation to itscompleteness of the Critical Chain

• The project waiting with the highest priority (decided by humans, instead of the abovepriority algorithm for projects in execution) in the pipeline is only to be started when the drum assignments of one of the projects in execution is finished


Multi-project CCPM execution



• Reducing WIP








Highest prority for which project ?


T1 T2 T3

PBProject W18: 60% penetration

T1

PB Project W14: 90% penetration

T2


Overview of portfolio (fever chart)

W18


Frans Jan Buters: “do not wait for drum assignments of a project to be finished, but simply wait to release a new project until another one is ready”

Michel Stijlen: “indeed: ‘one out, one in’ but also use, when choosing which project to release, the forecasted resource load as an extra criterium do decide uponpriority”

Jan Willem Tromp: “do not stagger and reschedule, release a new project wheneverthe CEO wants, but if the forecasted resource load predicts expected delays beyondthe buffers: pause another project”

Kees Vermeulen: “stagger and reschedule based on more identified key resource groups”

Jan Willem Tromp: “do not focus on due date performance and lead time reductiondirectly, but focus on output improvement of resources”

Harry Barendse: “consider Agile/SCRUM sprints as tasks in a CCPM planning, whilescheduling the rest of the tasks in the planning as well”


Other additions to Eli’s heritage

Summary


• Plan projects with buffers (feed buffers and project buffers)

• Reducing WIP (starting tasks ALAP)


• Monitoring the right points of attention (with buffermanagement)



Every day:

How much time is needed to complete this task in progress?

No progress? Where is this task waiting on?


How does CCPM work ? (summary)


Buffermanagement is the key element


Okay Plan Act

0% 33% 66% 100%

Percentage Use of Buffer

Percentage (Non) Critical Chain to go

100% 67% 33% 0%

Traffic light status Buffers in combination with %-CC to go

x x

?


No wait time on the Critical Chain

Only safety where it is neededDo not question the priority algorithm

Right mindset

Preferred implementation for single-project CCPM:

• Estimates and safety in consultation with team members (e.g. tasks have only 50% chance to finish on time)

• Reward the right performance (which is not always finishing your task on the time estimated on a 50% chance to do that!)

Preferred implementation for multi-project CCPM:

• Take 50% safety from tasks, put 50% of this safety in buffers• Consider portfolio performance as achievement of all the resources


Focus on the project/portfolio, noton the tasks


• If you keep believing “this is too good to be true”

• With the attitude “not invented here”

• Because companies generally do not want/need to change

• Not enough sense of urgency

• If there is no business need for project due date performance improvements and project lead time reductions

• Because CCPM needs professional planning practises to start with

• No reliable enough estimates

• No “Full Kit” preparations

• No adequate tooling

• Too slow implementation process

• Not enough committment from management


When or why does CCPM not work ?


Saving time and money:

Projects theoretically always ready on due date or earlier

On-site observed average due date performance: 80%

Theoretical lead time reduction is 33%

On-site observed average lead time reduction: 25%


Results after breaking the layers of resistance


Logica project managed by Marten Schröder: “Inname en Mengerij Denkavit Frankrijk”, realised margin 41,2%, planned margin 15,6%, delivery 3 weeks earlier than planned

Implementations by partner Blue Jonah, most impressive (see figures last slide): Nationale Nederlanden IT divison (http://www.bluejonah.com)

Implementations by software company Realization (Concerto tooling) (http://www.realization.com)

Implementations by consulting and software company ProChain

(http://www.prochain.com)

Numerous other implementations to be found on the internet


References


1) Say what you will do, do what you have promised and show that you have donewhat you have said that you would do

2) Implement Project (Portfolio) Management processes and tools !

E.g. using the EPM tooling:

• Microsoft’s PPM Solution EPM (Enterprise Project Management), consisting of MS Project server and SharePoint

• ASP/hosted/SaaS/Cloud delivered by Perrit, branding by Kwantitijd: EPM-AAA, supplemented with documentation, training, coaching-on-the-job, helpdesk services, and Extra Features

• Necessary Extra Features represent condensed expertise since 2004 with i-BMS, the former Logica internal implementation of EPM


Professional planning practices ?


Professional planning practises ? (continued)

3) Discipline !


• Lynx (supplied by [email protected])

• Flow MPM (supplied by Glow Management)

• Concerto (supplied by Realization)

• Prochain

• PS8 (supplied by Sciforma)


Recommended CCPM software

mailto:[email protected]


• Read “The billion dollar solution” by Newbold

• Follow the CCPM Webcasts on TOC TV

• Join LinkedIn groups “CriticalChain” and “Critical Chain Professional”

• Follow training at the TOC Academy (http://www.tocacademy.nl)


Interested in more ?

Thank you

Business

Saving time with CCPM