CRITICAL CHAIN PROJECT MANAGEMENT

(CCPM)

Let us start.
Common Feature in most Projects
Time and Cost Overruns

But Why?

Tight deadlines
T many complexities
Too
l iti
Too many uncertainties
Too many administrative hassles
Poor training..

How to solve?
Address these issues
Provide cushions

Reasons for variability

Natural causes
Artificial causes (perceived causes)
Lead time variability is more dangerous than long lead
times
Uncertain short deliveries leads to more buffers than
known long deliveries
A project with very high (and equal) asset utilisation &
tight planning will have more variability and cost

How to solve?
Treat Variability as the most important performance
measure
Develop systems that minimise variability

But
How much cushions we generally provide in
Projects?

How much buffer in project planning?

How do we estimate project duration?

Past Data
Top
p Down or Bottom up
p approach
pp
Cushions for uncertainty
Activity
ct ty p
precedence
ecede ce ((network
et o tec
technique)
que)

How much is the cushion you provide in each of

the activity??

How much buffer in project planning?

How confident do you feel about the task
estimates
ti t you made?
d ?
30% sure
50% sure
80% sure and so on
on

Most people would like to be atleast 80% sure

of delivering on their commitments
What
Wh t does
d
that
th t mean ffor ttaskk estimation?
ti ti ?

What does that mean for task estimation?

It means every ttaskk h
has some safety
f t
If you want your estimates to be reliable and career
safe then have safety incorporated in the activity
The greater uncertainty and risk associated with the
task, the greater safety is incorporated in your task.

This is What a Project Looks like?

Project Duration

10
Theory

12 14
8

What is the effect?

10

26

Actual

The effect is that the typical cushions you provide on

Each activity as high as 120120-180%

30

So.
Though the typical belief is that the time buffer
given during planning is only around 15-20%,
studies have shown that normallyy much higher
g
buffer even up to 200% is given

Where are those buffers?

Why projects delay even after these buffers?

Why Failures?

PROJECT
ORGANISATION

PROJECT

W t
Wastage

PROJECT
ORGANISATION

Reasons for wastage

Lack of internal cohesion
Also
Wrong choice
Completely unrelated to strategy & goals of organisation

Mismatch between market & process structure

Misalignment with organisational strategies
Behavioral issues

Behavioral Realities in Project Environment

Additive Rule & Excessive Multitasking
Commitments of duration and total cost of a project are based upon adding up the
duration and cost of individual tasks

Parkinsons
Parkinson s Law
Work expands to fill its time

3-Minute EGG Rule

Its
I not quality
li if it
i is
i finished
fi i h d before
b f
time
i
is
i up

SelfSelf-protection
People fail to report early finishes out of fear that management will adjust their future
standards
t d d

Dropped batons
Early finishes may not lead to the start of next activity as people assigned next activity
are engaged
d somewhere
h
else
l

Student syndrome
-

delay the start of tasks until you absolutely have to

Hockey Stick Syndrome

Waiting to start a task due to more important work at hand

Contradictions in Project Management

What we want...

...and what we actually do

To finish projects on time

We try to finish separate tasks on

time

To take more projects;

We try to make our people more

efficient

To decrease the time for project

accomplishment;

We try to decrease the time for task

accomplishment;

To keep projects within their budget;

We take risks related to

comparatively small costs;

To make customer happy;

We fight with each other on resource

conflicts;

In this column we have only

In this column we have

global, companylevel factors;

only local
factors!

Project Dilemma
Avoid Effect of
Parkinsons
Law
Minimise
Project
L dti
Leadtime
Manage
Project
Successfully

Schedule
without buffers
(safety)
co
nfl
ict

Ensure Project
Promise

Provide for
Murphy

Schedule with
adequate
Buffers

Modern Project Management :

Critical Chain Project Management
The TOC philosophy applied to project
management attempts to remove the
undesirable effects (late,
(late over-budget,
over budget and
under-performance projects) by attacking
individual measurements and uncertainty.
What is TOC Philosophy?

Theory of Constraints
A system improvement philosophy (as opposed
to a process improvement philosophy)
g
live or die as systems,
y
not as
Organizations
processes
Success or failure is a function of how well
diff
different
t componentt processes iinteract
t
t with
ith
one another

Theory of Constraints

Systems are analogous to chains, or

networks of chains
Like a chain, a systems performance is
limited by the performance of its weakest
link
The weakest link is the systems
constraint

Theory of Constraints
Another basic principle of TOC
A large number of undesirable effects will be caused
by
y a relatively
y small number of core drivers
Eliminating a very few core problems can result in a
huge improvement

TOC and Projects

How does all this relate to projects?
Repeating a basic principle of TOC
A large number of undesirable effects will be caused
by a relatively small number of core drivers
Eliminating a very few core problems can result in a
huge improvement

Critical Chain Project Management

Uncertainty always present it doesn
doesntt go away
Take the safety out of each of the critical path tasks and lump
them into a safety net at the end of the project
Identify constraints along the path and set up buffers in front of
tasks that can suffer from the constraint (constraints = time and
resources)
Allow tasks to start when predecessors are completed and
resources are available

Theory of Constraints
Five Focusing Steps
1.
2.
3.
4.
5.

Identify the system constraint

Decide how to exploit the constraint
Subordinate everything else
Elevate the constraint
Go back to Step 1, but beware of inertia

Revisiting activities

Why after all these cushions project get delayed?

P
Power
off A
Aggregation
ti

Remove safety time from individual activities

Safety buffers
Conventional Project Schedule
Job 1

Task buffers(safety time) are hidden

within individual activities

Job 2

Pooled buffers

J b3
Job
Job 4

Critical Chain Schedule

Buffers are pooled,
and made explicit

Project Buffer,

Project buffer is safety time added to the end of the critical chain
to protect the completion date of the project.

 Feeding buffer on the non-critical path

Critical Chain

Feeding
path

Project Buffer

Feeding Buffer
If Slack remains,
then schedule as
late as possible

Feeding buffers are designed to protect the critical chain from

delays on non-critical paths

 Resource buffers
a wakeup call to alert resources to be ready to work on
critical tasks
Scheduled idle time can provide better info about resources
availability (capacity)

Feeding
Buffer
C iti l Ch
Critical
Chain
i
Alert Wkr A

Alert Wkr B

Resource
Buffers

Alert Wkr C

Project
Buffer

Critical Chain Project Management

Critical Chain - set of tasks which determines overall project

duration, taking into account both precedence and resource
dependencies; improvement along Critical Chain will likely result
in improvements to the project as a whole; improvements
elsewhere will not

Project buffer - protects project commitment dates from

fluctuations on the Critical Chain

Feeding buffer - protects Critical Chain from fluctuations on

feeding tasks; provides the possibility for Critical Chain tasks to
start early

Resource buffer - protects the Critical Chain from lack of

availability of required resources; also provides the possibility for
Critical Chain tasks to start early

Critical Chain Project Management

Original Critical Path

Task 1

Original Critical Path with

Buffer
1

Project
j Buffer

(Safety removed from individual tasks)

Critical Chain Project Management

About Buffers
Identify the points at which to place project, feeding,
and resource buffers
Buffer sizes determined approximately, based either on
average task duration estimates, or a combination of
g and worst-case duration estimates
average
Individual buffer sizes can be adjusted based on
intuitive assessment of risk
Buffer insertion may cause the Critical Chain, and
hence the project completion date, to be pushed later

Critical Chain Project Management

The Critical Chain approach to scheduling
helps minimize project duration and WIP, and
maximize the chance of on-time completion
p

 Simple project with critical path

6
A

8
D

4
G

10
J

8
B
6
C

6
E
10
F

12
H
16
I

10
K
6
L

6
A

8
D

8
B
6
C

6
E
10
F

4
G

10
J

8
M
Calculated critical path is
C-F-I-L-M = 46 days

Activity H and I
cannot be done
simultaneously

8
12
10
Suppose H & I share a common
resource?
M
H
K
16
6
Calculated critical chain is
L
I
B-E-H-I-L-M = 56 days

 Simple project with critical path

6
A

8
D

4
G

10
J

8
B
6
C

6
E
10
F

12
H
16
I

10
K
6
L

Realistic critical chain for the project

6
8
4
10
A
D
G
J
8
B
6
C

6
E
10
F

12
H
16
I

10
K
6
L

8
M
Calculated critical path is
C-F-I-L-M = 46 days

Activity H and I
cannot be done
simultaneously

M
Calculated critical chain is
B-E-H-I-L-M = 56 days

Replacing safety time with Buffers

Critical chain with appropriate project and feeding
buffers
Goldratt suggests that a rough rule
3

A
4
B
3
C

D
3
E

Feeding
Buffer
=7 days

K
8

of thumb to assume safety time

equals about half of an activitys
completion time

Feeding
Buffer
=4 days

Slack = 1 days

13

Feeding
Buffer
=3
3 days

3
L

28
M

Project
Buffer
=14
14 days

Critical chain B-E-H-I-L-M = 28 days

P j t buffer
Project
b ff = 14 d
days
Project completion deadline = 42 days

Critical chain process

Aggressively
Aggressively estimate
estimate activities with 50/50 chance
of completion
Find the critical chain
Add project buffer at the end of the project.
Add feeder buffers where nonnon-critical paths merge
with the critical chain
Add resource buffers
Schedule nonnon-critical activities at their latest start

 Benefits
B
fit off C
Critical
iti l Ch
Chain
i
Better project status info allows managers to set clear
priorities
Buffer
B ff managementt h
helps
l resource manager tto allocate
ll
t
resources to those projects most in need
Focus on the key tasks and resources

Challenges
Ch ll
off Critical
C iti l Chain
Ch i
Doesnt provide any objective basis of determining buffer size
(include risk management)
Critical
C iti l Chain
Ch i project
j t managementt presented
t d as a
methodology
Culture change may be difficult
Incorporate those critical chain approach elements that are
applicable to your environment within border project
management methodology

THANKYOU

Air Control ProjectCritical Path Network

Air Control Project Gantt Chart

Air-control project - Resources

Rob
Carly
Ryan
Ryan
Lauren
Connor
Ryan
Dawn
Kevin

Issues?

8 -5

Air Control ProjectSchedule

With Resources Limited

Air Control Project

j
Schedule With Resources
Limited

Air Control ProjectCritical Chain Network

Aggressively estimate activities with 50/50 chance of completion

Air Control ProjectCritical Chain Network

Find
i d the
h criticall chain
h

Air Control ProjectCritical Chain Network

Add pproject
j buffer
ff at the end of the pproject.
j

Air Control ProjectCritical Chain Network

Add

ffeeder buffers
ff where non
non--critical ppaths merge
g with the critical chain

8 -8

Air Control ProjectCritical Chain Network