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Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Is Critical Chain Project Management (CCPM) Management (CCPM) An All or None Deal? An All or None Deal? Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Dr. Russ Johnson, Jonah President, Improvement Quest, Inc. Loveland, CO 80538 970-581-0075 [email protected]

Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

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Page 1: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Is Critical Chain Project Is Critical Chain Project Management (CCPM)Management (CCPM)An All or None Deal?An All or None Deal?

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Dr. Russ Johnson, Jonah

President, Improvement Quest, Inc.

Loveland, CO 80538

970-581-0075

[email protected]

Page 2: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

What is a project? What is a project?

– A temporary endeavor undertaken to create a unique product or service (PMI-BOK 1996)

– Consists of three major efforts:• Planning

• Execution

• Management

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 3: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

• The application of knowledge, skills, tools, and techniques to project activities in order to meet or exceed stakeholder needs and expectations.

(PMI -BOK, 1996)

– A balancing act between the three project commitments• Scope• Time• Budget

– Common elements• A scheduling mechanism (software and rules)• Existing management paradigms • Human behavior

What is project What is project management?management?

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 4: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Project characteristicsProject characteristics

All projects have many things in common:

– They involve high uncertainty.

– They involve three different and perceptually opposing commitments:

Due date, budget, and content

– They require different levels of a variety of expertise and resources at different times and for different amounts of time

– They are impacted by variability within and between events

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 5: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Establishing some current Establishing some current reality reality

• Do we go back to resources and pressure them to reduce their time and/or cost estimates?

• Do we hold resources to the scheduled start and finish dates for activities?

• Do we sometimes miss entire activities or at least dependencies in the planning stages of the project?

• Do our projects quickly evolve to having multiple critical paths?

• Do our projects seem to always be behind?

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 6: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Are these are fairly typical?Are these are fairly typical?

• Existing project work is not complete before new projects require a shifting in priorities.

• The organization is too slow responding to important opportunities.

• Management feels constant pressure to increaseresources to handle peak project loads.

• Promised lead times are longer than desired.

• There are difficulties completing projects on time.

• There is too much rework activity.

Page 7: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Are these are fairly typical?Are these are fairly typical?

• There are difficulties completing projects within budget.

• Project scope/content is too often compromised to meet dates and/or budget.

• Some projects are abandoned or completed without the organization gaining the promised benefit.

• Project Managers and resource managers have frequent conflicts about priorities and resource commitments.

• Problems in one part of a project cascade into other parts of the project and/or into other projects.

Page 8: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

• Our reputation is important to us, and

• Our past experience has been a mixed bag that has often left our customers less than elated with our performance and shaken their confidence in us, and

• We need to be able to communicate status to a variety of people and be able to quickly and accurately predict the impact of change and resource availability and assignment issues, and

• Conditions and expectations today are fundamentally different than they were when the current formal project management approach was developed,– Resources are scarce and heavily shared– We are moving from competitive bid to design-build and negotiated

contracts– It is becoming more and more critical that we collaborate rather than

combat

If …If …

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 9: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

• Do we need to approach project management differently in terms of a formal planning, execution and monitoring/reporting process?

• Is there an alternative to the primary formal project management style or methodology we use today?

• If so, do we have the knowledge and experience we would need relative to these alternatives to be able to determine which one would be best for our needs and situation?

Then…Then…

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 10: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

A formal project A formal project management tool shouldmanagement tool should

Help us with:• Planning the project

• Executing the plan

• Managing the process

Set us up for success in both the current projects and future projects

Facilitate collaborative efforts and picking the best partners

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 11: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Even more fundamentally, the Even more fundamentally, the system we put in place should system we put in place should

……1. Improve flow (order to cash in hand

cycle time) as the primary objective

2. Be translatable into practical mechanisms that guides the operation when not to produce

3. Enable the need to abolish local efficiencies

4. Include a focusing process to balance flow

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 12: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Two basic approachesTwo basic approaches

• Traditional – two names same basic concepts– PERT (Program Evaluation & Review Technique)

– CPM (Critical Path Method)

• Contemporary– Critical Chain

Lets examine the traditional Lets examine the traditional

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 13: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

TraditionalTraditional• PERT/CPM

– Developed in parallel in the 1950’s

– Needed a way to organize highly complex project (Polaris Missile)

– Money and resources were not a problem

– Many modifications over the years to try to accommodate the fact that money and resources are now a big issue

– Constantly increasing sophistication of software and hardware has perpetuated the idea that problems with the process can be solved if we can just get enough data and process it fast enough

– Tremendous inertia (50 years of common practice) and investment causes considerable resistance to different approaches

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 14: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Typical Work Breakdown Typical Work Breakdown Structure (WBS)Structure (WBS)

Spring home repair

Paint Inside

Replace Roof

Landscape Yard

Move Furniture

Cover Floors

Mask Windows

Paint Remove Dead Tree

Plant Shrubs

Install Sprinkler System

Select Paint

Mix Paint

Apply Paint

Activity to schedule Summary activity

Page 15: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

How a project looks graphically How a project looks graphically

What do all of these things represent?

Bar Chart (Gantt View)

Network (PERT View)

Page 16: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Initial Critical Path equals longestsequence of task and path dependenciesexclusive of resource dependencies

Projected Lead Time

Traditional (PERT/CPM) Traditional (PERT/CPM) – Mechanisms for building the

schedule•Assumption of infinite resource

availability before identifying the Critical Path

Page 17: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Projected Lead Time

Increase in Projected Lead Time with resource contentions resolved

Traditional (PERT/CPM) Traditional (PERT/CPM) – Resolving contentions (the real

CP)• Assumption of infinite resource availability

before identifying the critical path

• Resolving resource contentions from start of project to completion giving priority to Critical Path tasks

Page 18: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

+/-2+/-2 +/-2 +/-2 +/-2

20%20% 20% 20% 20%

50

+/-5

10%

10 10 10 1010

7 10 1313 2510% 50% 90%90% 90%

Assumptions that variation in Assumptions that variation in task times follow a normal task times follow a normal

distributiondistributionTotal series variation = square root

of thesum of the variances squared

Reality: the potential impact of bad things is much greater than the potential impact

of good

Page 19: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

10

10

10

1010

+/-2+/-2 +/-2 +/-2 +/-2

20%20% 20% 20% 20%

50

+/-5

10%

10 10 10 1010

What happens in each situation if a task is finished late? or early ?

Page 20: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

-2/+?

20%20% 20% 20% 20%

50

10%

10 10 10 1010

526 10 101212 1010

48486666 12121212 1010101010101010 1010

5210 10 1010 1212

Early/late

Late

No report

? ? ? ?? ?

Assumptions that variations of Assumptions that variations of actual task times will cancel each actual task times will cancel each other outother out

-2/+? -2/+? -2/+? -2/+? -5/+?

Page 21: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO10

10

10

1010

Assumptions that variations of Assumptions that variations of actual task times will cancel each actual task times will cancel each other outother out

Total path/integration variation =

Probability of event 1 * Probability of event 2 * Probability of event 3 *Probability of event 4

Probability of orange integration task

starting on time if all four feeding task time estimates are 90% is

66%(.9*.9*.9*.9)

Page 22: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Critical Path

Do we start these * tasks as soon as possible (ASAP), as late as

possible (ALAP), or somewhere in between?

* * *

* *Float

No consistent method for No consistent method for determining when tasks with determining when tasks with float should startfloat should start

Page 23: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

No mechanism for decoupling the No mechanism for decoupling the overall project from individual overall project from individual task and path variationstask and path variations

Today with schedule updated

for future

Page 24: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Traditional (PERT/CPM)Traditional (PERT/CPM)

– Managing the schedule• Panic sets in with the first late task

• Focus switches from the global perspective of the original project goals to a more local perspective of task completion

• At the task level, the focus switches from content, dependencies, and durations

to start and end dates

• We hold resources to the original schedule dates in place of the necessary conditions that define what is needed to start a task and the deliverables that define when a task is finished

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 25: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Traditional Project controlTraditional Project control

No reliable mechanisms to determine when a project is in trouble or to determine which activities can afford to wait awhile - No Visibility of the Impact of Decisions or Variability!

Importance is placed on achieving task or milestone conformance to scheduled start and completion dates rather than deliverables in an effort to insure or improve project on time performance.

When faced with conflicting task priorities and no clear way to determine how much safety remains in each task, resources and Resource Managers multi-task to try to minimize the harm to either task.

Page 26: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

How does this fit with our How does this fit with our fundamental needs of the fundamental needs of the

system?system?1. Improve flow (order to cash in hand

cycle time) as the primary objective

2. Be translatable into practical mechanisms that guide the operation when not to produce

3. Enable the need to abolish local efficiencies

4. Include a focusing process to balance flow

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 27: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

ContemporaryContemporary

• Critical Chain– Developed in the early 1990’s

– Utilized the Thought Process tools of the Theory of Constraints to analyze the situation and test the solution

– Started from scratch taking into account current realities of limited resources, money and time.

– Focused not only on the mechanical/software aspects of organizing the project but also looked heavily at the psychological and human behavioral issues of projects

• This includes the negative behaviors of years of experience and;• The desired behaviors

– Used aspects of traditional approaches where applicable

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 28: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

TOC’s View of Project TOC’s View of Project ManagementManagement

• Improving flow:– Minimize bad multi-tasking both within and between

projects

– Multi-project environment – Freeze about 25% of the projects to switch focus to finishing work rather than starting

– Individual projects

• Plan project from a necessity point of view – starting with desired outcome and working to beginning (Handoff)

• Separate safety from task time to get an aggressive but possible time to create a sense of urgency

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 29: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

TOC’s View of Project TOC’s View of Project ManagementManagement

• When not to work:– Aggregate ½ of the freed safety to create buffers

– Buffers correctly set tasks to the as late as possible position while still protecting the project due date form 95% of the uncertainty

– Relative status of buffers tells which task a resource should work on when there is more than one open task for that resource – this minimizes bad multi-tasking

– Full Kit concept delays start of task until all necessary inputs are available to minimize ineffective workarounds

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 30: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

TOC’s View of Project TOC’s View of Project ManagementManagement

• Abolish local efficiencies :– Focus is on completing work as fast and accurately

as possible and getting it handed off

– What constitutes “done” is clearly defined so that tasks can’t be drawn out to fill available time (Parkinson’s law and 3 minute egg rule)

– The only dates that are important are necessary milestones and the project completion promise – focus is on content not dates

– Review progress by asking how long to finish not what percent is complete

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 31: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

TOC’s View of Project TOC’s View of Project ManagementManagement

• Focusing process to balance flow – Buffer Management:

• Buffer status (Green, Yellow, Red) directs management as to when, and how, to react to individual disruptions to flow

• Causes for delays that result in buffer consumption are recorded and analyzed to target common offender disruptions to flow. (Pareto) This can be process/activity focused and/or resource focused

– Lean, Six-Sigma and other process improvement tools are utilized to systematically and continuously improve flow

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 32: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

– The assumption that the earlier we start a project/task, the earlier it will be finished

– How we estimate durations

– bad multi-tasking

– Missing tasks and/or dependencies in the planning stage

Flow killersFlow killers

Page 33: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Tactic – Freeze 25% of open projects

Multi-project fast laneMulti-project fast lane

Number of open projects or tasks

Rate

of

com

ple

tion

Safe Zone

X

Level o

f Manag

em

ent

involv

em

ent

Page 34: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

– Productive work time

– Nonproductive time

– Safety (insurance against uncertainty)

What is estimated task time What is estimated task time really composed of?really composed of?

Page 35: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

? ? ? ??

+/-2+/-2 +/-2 +/-2 +/-2

20%20% 20%

20% 20%

50

+/-5

10%

10 10 10 1010

?

Duration 7 10 1313 45Probability 10% 50% 90%90% 90%

As risk or non-validaccountability

increases so will safety

Page 36: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

The Sixes GameThe Sixes Game

You work in my organization

You are rewarded according to your performance versus a standard

The standard is the maximum number of rolls it should take to get a 6

Your performance is based on your roll of the dice

You will be measured on the number of rolls it actually takes you to get a 6

Page 37: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

How we waste safetyHow we waste safety• Parkinson’s law - Work expands to fill the time

available (poor definition of DONE)

• Three minute egg rule - There is an implication of poor quality if done too soon as well as changed expectations regarding future estimates

• Student syndrome – Argue for extension of time estimate for all kinds of reasons then, Why do today what you can put off to tomorrow

• Multi-tasking - Increases lead time for any individual activity as there is unplanned time spent starting and stopping

Page 38: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

The time to complete each task consists of: • the time to perform the task,

• the time to set up to work on the task (finding everything and remembering where you left off)

again and again.

• the time to shut down or set down time.

• the time the task had to wait for the resource while the resource worked on other tasks.

Understanding the problem furtherUnderstanding the problem further Task completion timesTask completion times

Page 39: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Work on Task

Work on Task

Set Up

Work on Task

Set Up

Work on Task

Set Up

Elapsed Time

Touch Time

Set D o w n

Set D o w n

Set D o w n

Multi-taskingMulti-tasking

A

BC

How work was planned

How work was

performed

Actual resource time

A A A

B B B

C C C

A

B

C

A A A

B B B

C C C

Page 40: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

The multi-tasking The multi-tasking GameGame

Our job is to complete three tasks:

1.Write a column of numbers from 1-26

2.Write the letters of the alphabet from A to Z

3.Draw a repeating sequence of Square, circle, triangle until you have 26 objects

4.You must alternate columns as you complete your task (number, letter, shape)

We will time to see how long it takes

1 A

2 B

3 C

4 D

5 E

6 F

7 G

8 H

Page 41: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Is the buffer time already in the Is the buffer time already in the estimate?estimate?

Have we validated that uncertainty exists and that we need to protect ourselves from it?

Have we discovered that everyone protects themselves by adding significant amounts of safety time?

Is it true that the more project experience the more safety included?

Who has control of the safety? Who should?

Have we discovered that a significant amount of the safety that is built in to the tasks is, in the end, wasted?

Page 42: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Separating the work from the Separating the work from the safetysafety

• Traditional – Distributed safety time remains within the tasks and in the control of each resource. Everyone must protect themselves as we know Murphy will strike we just don’t know when and where.

• Critical Chain - Aggregated safety time is gathered and placed strategically in the control of the project manager but available to the resources when needed. We still don’t know when and where Murphy will strike but we control the insurance.

Buffer Freed safety

50 % for work

25% for insurance/buffer

25% freed

Page 43: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

NegotiationsNegotiationsTraditional

• Give plans and specs and ask for a price and duration

• Try to get their numbers to match your needs after the fact

• Each variable is now played against the otherLower cost=longer timeLess time=reduced scope

• The resource is in control of the negotiations

TOC – Critical Chain

• Confirm capability to perform scope and deliverables

• Determine prerequisites

• Get estimate of duration and first availability(90% skewed time likely)

• Split time 50:50

• Check fit to schedule

• Ask for cost reminding that others are bidding under same circumstances

Page 44: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Critical Chain Task Definition Critical Chain Task Definition and Building of the Project and Building of the Project

NetworkNetworkTask Definition and Building of the Project

Network (begin with the end in mind)– Clear identification of deliverables needed to

accomplish project goals stated in terms of expected outcomes for, or impacts to, the organization

– Clear identification of expectations of project plan and management is included in the project goals definition

– The tasks are defined from the end (future) of the project to the beginning (current time)

– Task definition is complete when all starting tasks have either already begun or their required inputs are already available

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 45: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Defining tasks and relationships Defining tasks and relationships simultaneouslysimultaneously

Need orobstacle

Clearly statedobjectives of theproject and the

project plan

Need orobstacle

Need orobstacle

Task thataccomplishesthe need or overcomesthe obstacle

Tasks are defined by starting with the project goal(s) and then working earlier in time until currently occurring activities are reached by asking:

In order to… I must immediately have completed

When branches occur, one branch is completed before starting another

Page 46: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Determining the who, what, and how longDetermining the who, what, and how long

Tasks definition is complete when the starting tasks are either already in process or all inputs needed to begin them are available.

The resources needed to perform the tasks can now be brought in to help verify that no tasks or needed inputs or requirements have been missed. This includes adding detail where what is needed is uncertain (outsourced activity).

Once the work is defined, the times to complete the work can be determined.

?

Page 47: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

• There is no need to convert WBS scheduled activities to PERT view (precedence diagram) to determine task dependencies (task to task and paths/integrations) as this was done simultaneously with task identification– This information does still need to be entered into

our scheduling software

• The network view must still be converted to the Gantt view to determine time relationships to allow us to identify the Critical Chain and immunize the schedule from variability– The software does this for us

Converting to the Gantt viewConverting to the Gantt view

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 48: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

How a project looks graphically How a project looks graphically

Bar Chart (Gantt View)

Network View

?

The need and obstacle elements of the network view disappear in the Bar Chart (Gantt View) as they do not contain elements of work or time

Page 49: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Mechanisms for immunizing Mechanisms for immunizing the schedulethe schedule

–TOC - Critical Chain•Task, path, and resource dependencies are all

considered prior to identifying the “Critical Chain”

•Resource contentions are resolved from project completion toward start

•Strategically sized and placed buffers allow decoupling of the overall project from individual task and path variations

– Buffer = 1/3 of total path time (task + Buffer)

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 50: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Identifying the Critical ChainIdentifying the Critical Chain

Move all tasks to as late as possible and all dependencies are taken into account (task, path and resource)

Page 51: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Begin resolving resource contentions by moving competing task to earlier time

Identifying the Critical ChainIdentifying the Critical Chain

Page 52: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Continue resolving resource

contentions from the end of the project to the beginning.

The Critical Chain (CC)is the longest path of continuous dependent events including resource, task and path dependencies.

(CC)

Identifying the Critical ChainIdentifying the Critical Chain

Page 53: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

The project completion buffer (PCB) acts as a variation absorber and is equal to 50% of the total task time along the Critical Chain making it 1/3 of the total project lead time.

(CC)

PCB

Immunizing the project from Immunizing the project from variation along the Critical Chain:variation along the Critical Chain:

Sizing and placing the project completion buffer (PCB)

Page 54: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Identify locations where activities feed into (integrate with) the Critical Chain.

The feeding may be due to task dependencies*, path dependencies** or resource dependencies ***

(CC)

*****

*****

Immunizing the Critical Chain:Immunizing the Critical Chain:Sizing and placing the feeding buffers (FB)

PCB

Page 55: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

The feeding buffers* (FB) act as variation isolators between non Critical Chain activities and the Critical Chain.

They are also equal to 50% of the total task time along the chain of tasks they are isolating.

This may result in gaps in the Critical Chain and/or the need to start a non-Critical Chain activity before the Critical Chain.

Immunizing the Critical Chain:Immunizing the Critical Chain:

Sizing and placing the feeding buffers (FB)

**

* *

(CC)PCB

FBFB

FB

FB

Page 56: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Project lead time

(CC)PCB

This Feeding Buffer creates a new resource

conflict but it is not resolved as all times are

estimates so there may or may not be a conflict

during actual execution and if so the buffer will

address it

The actual project start or end date is

relative to time needs of the project: Drop

Dead or Open Ended

FB

FB FB

FB

Page 57: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Project lead time

(CC)PCB

FB

FB FB

FB

When not to produceWhen not to produce

The feeding buffers tell us the right time (not too early or late) to start non-critical tasks

Page 58: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Critical Chain

PERT/CPM

Promised project lead time

FB

(CC)PCB

FB

FB

FB

20%-25% time advantage

Page 59: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Using a drum, key resource, to stagger projects

What about a multiple project What about a multiple project environment?environment?

PCBPCBFBFB

FBFB

The start of the next project would be based on the placement of the last drum task in the current schedule and the first drum task in the next project with a buffer between the last and first respectively

Page 60: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

If the red resource is the drumIf the red resource is the drum

PCBPCBFBFB

FBFB

PCBPCBFBFB

FBFB

DBDB

Project One

Project Two

DBDB

Page 61: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Managing the schedule Managing the schedule • TOC - Critical Chain - Buffer Management

•Focus remains on the global perspective of the original project goals

•Progress is reported based on buffer status and estimated time for remaining tasks

•At the task level, the focus is on getting the job done as soon as possible while maintaining original content

•The buffers allow time to plan and react appropriately to variation in the schedule

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 62: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Buffers are used to provide focus and early warning to protect the critical chain and due date

RemainingProject Buffer:

100% 67% 67% 33% 33% 0%

BUFFER MANAGEMENT

OKZone 3

WATCH& PLAN

Zone 2

ACTZone 1

Page 63: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

The mechanism for gathering data provides us a glimpse into the future - so we can take action before we are in trouble while also allowing us time to not be pressured to act when actions are not necessary.

The organization gathers the information for the status of the buffers in the following way:

Each resource that is working on the project gives a “daily” status of the time they estimate they still need to work until the task is complete. That information is used to calculate whether any buffer time would be gained or lost if these time estimates proved true.

This “daily” interaction is key to reinforce new behaviors and to provide opportunities to mentor resources.

Project Control - Buffer Project Control - Buffer ManagementManagement

Page 64: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Project Control - Buffer Project Control - Buffer ManagementManagement

Day Task To Go Buffer 1 217 10 90 35 168 5 69 51 143 8 55 59 143 11 44 85 122 15 51

111 32 4 69

ACTWATCH & PLANOK

101 122 20 30

Project Buffer Status

Page 65: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Do we have a way to determine how much safety is leftif there is a conflict for the resources?

Yes - The Project Buffers!

We apply Buffer Management via comparing buffer statusas our control mechanism.

CCPM Project Control:CCPM Project Control:When and where to work and When and where to work and when and where to intervenewhen and where to intervene

Page 66: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Who gets the scarce resource?Who gets the scarce resource?

Buffer status report

*Project A PCB Status

OK WATCH & PLAN ACT

Project A FB1 Status ** Project A FB2 Status * Project A FB3 Status

Project B PCB Status Project B FB1 Status ** Project B FB2 Status Project B FB3 Status

Tasks competing for same resource * **

Page 67: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Process of Ongoing Process of Ongoing Improvement (POOGI) Improvement (POOGI) Evaluating ResourcesEvaluating Resources

• Buffer impact (should track +, -, and average)– Number of charged or credited times they impact the buffer

– Charged duration of the impacts

(Should be viewed from both absolute and relative perspectives)

• Causes for charged impacts– Same problem over and over

– Different issues from time to time• Poor at identifying potential problems• Constantly understaffing project• High levels of rework

• Ability to consistently reduce the cost and time to do similar work from project to project

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 68: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

How does this fit with our How does this fit with our fundamental needs of the fundamental needs of the

system?system?1. Improve flow (order to cash in hand

cycle time) as the primary objective

2. Be translatable into practical mechanisms that guide the operation when not to produce

3. Enable the need to abolish local efficiencies

4. Include a focusing process to balance flow

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 69: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

Buffer ManagementBuffer Management

Here is a project that has a Critical Chain of 85 days, a Project Buffer of 43 days and a total lead time of 128 days.

15

10

30 10

20Project Buffer

43

3 2 1

Project DueDate

85 days 43 days

Page 70: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

Buffer ManagementBuffer ManagementThe first task completes 5 days early, but the second task takes 25 days to complete. Buffer Management shows the Project Buffer to be in Zone 3. Net schedule variance +10 days. What action should the Project Manager take?

15 ->10

10 -> 25

30 10

Project Buffer43

3 2 1

20

60 days 33 days

Project DueDate

Today

Planned -> actual

Page 71: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

Buffer ManagementBuffer ManagementAfter 20 days of work, the resource assigned to the third task is projecting completion in 20 days. Buffer Management shows the Project Buffer to be in Zone 2. What action should the Project Manager take?

30 -> 40 10

Project Buffer43

3 2 1

20

50 days 23 days

Project DueDate

Today

15 ->10

10 -> 25

Planned -> actual

Page 72: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

Buffer ManagementBuffer ManagementAfter 30 days of work, the resource assigned to the third task is still projecting completion in 20 days. Buffer Management shows the Project Buffer to be in Zone 1. What action should the Project Manager take?

30 -> 50

Project Buffer43

3 2 1

20

50 days 13 days

Project DueDate

Today

10

15 ->10

10 -> 25

Planned -> actual

Page 73: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

Buffer ManagementBuffer Management

15

10

30 10

20Project Buffer

43

3 2 1

Project DueDate

85 days 43 days

Today

FB - 151515

Here is a project has a Critical Chain of 85 days, a Project Buffer of 43 days and a total lead time of 128 days.

Page 74: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

Buffer ManagementBuffer ManagementThe first task completes 5 days early, but the second task takes 25 days to complete. Buffer Management shows the Project Buffer to be in Zone 3. The first task of the feeding path is accomplished in the duration time. What action should the Project Manager take?

15 ->10

10 -> 25

30 10

Project Buffer43

3 2 1

20

60 days 33 days

Project DueDate

Today

FB - 151515

Planned -> actual

Page 75: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

Buffer ManagementBuffer ManagementAfter 20 days of work, the resource assigned to the third task is projecting completion in 20 days. Buffer Management shows the Project Buffer to be in Zone 2. The second task of the feeding buffer is projecting completion in another 10 days. What action should the Project Manager take?

30 -> 40 10

Project Buffer43

3 2 1

20

50 days 23 days

Project DueDate

Today

15 ->10

10 -> 25

FB- 5

15 -> 2515

Page 76: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

Buffer ManagementBuffer ManagementAfter 30 days of work, the resource assigned to the third task is still projecting completion in 20 days. Buffer Management shows the Project Buffer to be in Zone 1. What action should the Project Manager take?

30 -> 50

Project Buffer43

3 2 1

20

50 days 13 days

Project DueDate

Today

10

15 ->10

10 -> 25

FB - 5

15 -> 3515

Page 77: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Organizational Cultural Organizational Cultural ChangesChanges

• Resulting Effects – Surges or peak demands on resources are

minimized or non existent

– Natural human behaviors are used to create an environment of continuous improvement

– Projects are consistently delivered on or before committed dates, often under budget, and with all original scope objectives in place

– More projects can be accomplished within the same time and with the same resources

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 78: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Key tactics of CCPM that could Key tactics of CCPM that could be used without full be used without full

implementationimplementation• Necessity approach to Network building

• Negotiation process

• Critical Chain/path identification from end to beginning

• Tracking progress by asking how long to finish

• Minimize multi-tasking – can make a conscious effort but will not have buffers to direct and enforce

• Modification of buffer based priority – Each activity you make a commitment to has a due date. The time between making the commitment and the due dale = 100%. You can work whatever task has used the highest % of its assigned buffer

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 79: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

CCPM as a growth strategyCCPM as a growth strategy

• Critical Chain offers a new and refreshing approach and solution for the undesirable effects project managers and organizations can no longer afford to suffer from

• Critical Chain is a complete solution that deals with both the algorithms of scheduling and the impacts of, and on, human behavior

• It is a solution that identifies the correct data processing needed to support schedule creation and management

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

Page 80: Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO Is Critical Chain Project Management (CCPM) An All or None Deal? Dr. Russ Johnson, President

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO

ConclusionsConclusions

• Critical Chain offers a new and refreshing approach and solution for the undesirable effects project managers and organizations can no longer afford to suffer from

• Critical Chain is a complete solution that deals with both the algorithms of scheduling and the impacts of, and on, human behavior

• It is a solution that identifies the correct data processing needed to support schedule creation and management

•Dr. Russ Johnson, President Improvement Quest, Inc Loveland, CO