The Real Reason That Projects Fail and How to Fix it - An Introduction to Critical Chain Project Management

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Information about The Real Reason That Projects Fail and How to Fix it - An Introduction...
Business & Mgmt

Published on March 6, 2014

Author: assocpm

Source: slideshare.net

Description

Presentation by Gary Palmer to the Thames Valley Branch

Gary Palmer Critical Point Consulting 1

www.criticalpoint.co.uk Intellectual Property This document is the Intellectual Property of Critical Point Ltd This document is supplied for the personal use of the recipient and is not to be copied, edited, transmitted or broadcast in part or in whole without the prior permission of Critical Point Ltd. 2

Critical Point Consulting www.criticalpoint.co.uk What do we mean by ‘Project Failure’? Any one of: Late Over Budget Below Specification Below Quality 3

Critical Point Consulting www.criticalpoint.co.uk Why do we need to change? - 1 Because huge numbers of projects are: Late + Over Budget + Below Specification + Below Quality 4

Critical Point Consulting www.criticalpoint.co.uk Why do we need to change? - 2 Productivity & Throughput: Often Low Excessive Wastage Slow Progress Costly 5

Critical Point Consulting www.criticalpoint.co.uk Why do we need to change? - 3 Business Impact: Product Expensive Late to Market Customer Dissatisfaction Reputation Project Failure & Slow Costly Projects Cripples Business 6

Critical Point Consulting www.criticalpoint.co.uk What is the main driver for these failures? Late projects fuel other failures: Late Over Budget Below Specification Below Quality 7

Critical Point Consulting www.criticalpoint.co.uk What are the reasons for this? 1. The traditional methods in use, VIRTUALLY GUARANTEE these results. 2. We have not had a viable alternative. Until now… 8

Critical Point Consulting www.criticalpoint.co.uk Critical Chain Project Management CCPM Statistics: Project Delivery: 90%+ on time Project Completion: 20% - 50% Faster Productivity: 20% - 60% Increase Without increasing resources 9

Critical Point Consulting www.criticalpoint.co.uk How Does CCPM Deliver These Improvements? By resolving problems in our working methods that: 1. Slow everything down 2. Cause our contingency to be ineffective 3. Cause inefficiencies and wastage 10

Critical Point Consulting www.criticalpoint.co.uk What is CCPM? ‘A transportable set of interlinked techniques and tools that work individually and collaboratively to significantly improve the processes and operation of scheduling and execution in any* project, programme and portfolio environment’ 11

Critical Point Consulting www.criticalpoint.co.uk What is CCPM? ‘A transportable set of interlinked techniques and tools that work individually and collaboratively to significantly improve the processes and operation of scheduling and execution in any* project, programme and portfolio environment’ Transportable: Not industry / sector specific Applicable in any* project environment Works with existing project structures 12

Critical Point Consulting www.criticalpoint.co.uk What is CCPM? ‘A transportable set of interlinked techniques and tools that work individually and collaboratively to significantly improve the processes and operation of scheduling and execution in any* project, programme and portfolio environment’ Techniques: Working practices, Behaviours Tools: Processes, Software 13

Critical Point Consulting www.criticalpoint.co.uk What is CCPM? ‘A transportable set of interlinked techniques and tools that work individually and collaboratively to significantly improve the processes and operation of scheduling and execution in any* project, programme and portfolio environment’ Individually: Resolve a specific problem Collaboratively: In unison to support the whole 14

Critical Point Consulting www.criticalpoint.co.uk What is CCPM? ‘A transportable set of interlinked techniques and tools that work individually and collaboratively to significantly improve the processes and operation of scheduling and execution in any* project, programme and portfolio environment’ Improvements: Efficient processes Faster operation Better work environment 15

Critical Point Consulting www.criticalpoint.co.uk What is CCPM? ‘A transportable set of interlinked techniques and tools that work individually and collaboratively to significantly improve the processes and operation of scheduling and execution in any* project, programme and portfolio environment’ Scheduling: Optimum, realistic schedule Effective contingency protection Execution: Efficient working practices Excellent progress visibility, focus, control 16

Critical Point Consulting www.criticalpoint.co.uk What is CCPM? ‘A transportable set of interlinked techniques and tools that work individually and collaboratively to significantly improve the processes and operation of scheduling and execution in any * project, programme and portfolio environment’ Projects: Single projects Programme: Multi-project Portfolio: Enterprise-wide Any Sector 17

Traditional Project Management The Five Elements of Failure So, what are the problems in Traditional Proj. Mgmt.? Deadline Schedule Task-Level Contingency Poor Measures & Control Critical Path Multi-tasking 18 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management The Five Elements of Failure Deadline Schedule Task-Level Contingency Poor Measures & Control Critical Path Multi-tasking 19 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management Task Deadline Scheduling – Planning to Fail 09/09 22/09 23/09 1/10 13/10 Planned Completion 13/09 1/09 09/09 10/09 10/09 22/09 14/09 15/09 14/09 15/09 23/09 22/09 23/09 20/09 21/09 03/10 04/10 30/09 1/10 09/10 13/10 15/10 06/10 07/10 13/10 Attempt to impose a Rigid construct on a Variable situation Actual dates will always change … and will need constant and continued updating 20 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management Task Deadline Scheduling – Planning to Fail Shouldn’t early and late finishes balance out? Usually not. 21 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management Task Deadline Scheduling – Planning to Fail Potential Early Finish Deadline Date Task Missed Time-Saving Parkinson’s Law – ‘Work expands to fill the time available’ 22 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management Task Deadline Scheduling – Planning to Fail Late Finish Adds Time Planned 5 days Early Finish Gain Lost 7 days ✓ 3d ✓ 3d 5 days ✓ 5 days 5 days ✓ 5 days 2 days added to schedule 5 days No benefit to schedule Parallel Converging Tasks tied to schedule dates Losses Accumulate - Gains Don’t …And the schedule moves out 23 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management Task Deadline Scheduling – Planning to Fail Q- What is the probability of all a project’s tasks finishing on time? Calculation: (Task Probability%^no. of tasks) With a 90% task probability: 10 tasks = 35% probability 20 tasks = 12% 50 tasks = 0.05% 100 tasks = 0.000026% Q? - How many tasks in your current project? 24 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management Task Deadline Scheduling – Planning to Fail Summary Dates attempt a rigid structure on a variable situation A ‘Train Timetable’ - when the trains never run on time Parkinson’s Law often prevents early finishes Losses increase time and costs, not offset by gains Schedule is guaranteed to require frequent changes Project end-date slip is almost inevitable 25 Critical Point Consulting www.criticalpoint.co.uk

Critical Chain Project Management The Five Elements of Success CCPM Schedule Task-Level Contingency Poor Measures & Control Critical Path Multi-tasking 26 Critical Point Consulting www.criticalpoint.co.uk

09/09 22/09 23/09 13/09 1/09 09/09 10/09 10/09 22/09 14/09 15/09 14/09 15/09 23/09 22/09 23/09 20/09 21/09 1/10 03/10 Critical Point Consulting www.criticalpoint.co.uk 13/10 04/10 30/09 1/10 09/10 13/10 15/10 06/10 07/10 13/10 Why have fixed dates if we know that they will change? 27

CCPM Schedule 09/09 13/09 1/09 19/10 30/12 10/09 Very few Internal Due Dates / Deadlines Schedule is used only as a Dependency Chart Each task completes asap and next task is started No schedule updating necessary 28 Critical Point Consulting www.criticalpoint.co.uk

CCPM Schedule Potential Early Finish Deadline Date Task So now, without deadlines to fuel Parkinson behaviours, 29 Critical Point Consulting www.criticalpoint.co.uk

CCPM Schedule Potential Early Finish Deadline Date Task So now, without deadlines to fuel Parkinson behaviours, Our potential Early Finish… 30 Critical Point Consulting www.criticalpoint.co.uk

CCPM Schedule Potential Early Finish Task So now, without deadlines to fuel Parkinson behaviours, Our potential Early Finish… 31 Critical Point Consulting www.criticalpoint.co.uk

CCPM Schedule Actual Early Finish Task …can become a reality. 32 Critical Point Consulting www.criticalpoint.co.uk

CCPM Schedule across the whole project 33 Critical Point Consulting www.criticalpoint.co.uk

CCPM Schedule Shorter Task Execution = Reduced Time & Costs Faster and Cheaper Projects 34 Critical Point Consulting www.criticalpoint.co.uk

CCPM Schedule Summary Very few internal due dates Work carried out on an ‘as soon as possible’ basis A ‘Relay Race’ (not a ‘Train Schedule’) Early finishes reduce timescales & cost Flexible structure for a variable environment Few due dates means few / no schedule updates CCPM values speed over working to fixed dates 35 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management The Five Elements of Failure CCPM Schedule Task-Level Contingency Poor Measures & Control Critical Path Multi-tasking 36 Critical Point Consulting www.criticalpoint.co.uk

www.criticalpoint.co.uk Task-Level Contingency Confidence in own ability Familiarity with technology Familiarity with task Interruptions Multi-tasking Complexity of the task How Much Contingency? Known Unknowns Specification Stability Easy Life Fear of Failure Estimate chopping Confidence in Spec. Unknown Unknowns 37

www.criticalpoint.co.uk Task-Level Contingency Confidence in own ability Familiarity with technology Familiarity with task Complexity of the task Interruptions Easy Life A Guess Fear of Failure Multi-tasking Known Unknowns Specification Stability Estimate chopping Confidence in Spec. Unknown Unknowns 38

Task-Level Contingency Effect 1- An Extended Schedule Self-protection (in blue) encourages fat estimates A project may contain > 50% embedded contingency 39 Critical Point Consulting www.criticalpoint.co.uk

Task-Level Contingency Effect 2 – Student Syndrome Scheduled Start Deadline Date Work Contingency Actual Start Initially plenty of contingency No incentive to start immediately Start deferred 40 Critical Point Consulting www.criticalpoint.co.uk

Task-Level Contingency Effect 2 – Student Syndrome Scheduled Start Deadline Date Work Actual Start Contingency decreased 41 Critical Point Consulting www.criticalpoint.co.uk

Task-Level Contingency Effect 2 – Student Syndrome Scheduled Start Deadline Date Work Other work Big Problem Maybe another task is required / preferred Now no contingency left and work is rushed Then a big problem surfaces… 42 Critical Point Consulting www.criticalpoint.co.uk

Task-Level Contingency Effect 2 – Student Syndrome Scheduled Start Deadline Date Work Other work Big Problem And now we have a task over-run… 43 Critical Point Consulting www.criticalpoint.co.uk

Task-Level Contingency Effect 3 – Unprotected Project End-Date Planned Completion Delayed Completion If on a Critical Path task = project over-run 44 Critical Point Consulting www.criticalpoint.co.uk

Task-Level Contingency Effect 4- Unmanaged Time Traditional contingency (shown in Blue) 45 Critical Point Consulting www.criticalpoint.co.uk

Task-Level Contingency Effect 4 – Unmanaged Time Project Manager’s View Where is the contingency? How do you measure and manage it? Maybe 50% of project time is not under control 46 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management Task-level Contingency Task-Level Contingency - Problem Cascade Self-Protection leads to Inflated ‘Localised’ Estimates which generate Long, Over-padded Schedules which encourages Parkinson’s Behaviours and Student Syndrome which results in Slow and Costly Projects which are still Unprotected From Delays and which have Hidden, Unmanaged Contingency 47 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management The Five Elements of Failure CCPM Schedule Task-Level Contingency Poor Measures & Control Critical Path Multi-tasking 48 Critical Point Consulting www.criticalpoint.co.uk

Critical Chain Project Management The Five Elements of Success CCPM Schedule Project-Level Contingency Poor Measures & Control Critical Path Multi-tasking 49 Critical Point Consulting www.criticalpoint.co.uk

CCPM Project-Level Contingency Traditional Task-Level Contingency (Review) High Levels of Embedded Contingency 50 Critical Point Consulting www.criticalpoint.co.uk

CCPM Project-Level Contingency Remove task-level contingency Remove task-level contingency 51 Critical Point Consulting www.criticalpoint.co.uk

CCPM Project-Level Contingency Remove task-level contingency Task Estimates have no in-built contingency Estimates are based on ‘Aggressive-but-possible’ task times 52 Critical Point Consulting www.criticalpoint.co.uk

CCPM Project-Level Contingency Remove task-level contingency Shorter Task Durations & much reduced timeline No space for Parkinson or Student Syndrome But where is our contingency now? 53 Critical Point Consulting www.criticalpoint.co.uk

CCPM Project-Level Contingency Aggregate Contingency Project Commit Date Project Buffer Buffer protects the Project – not individual tasks Provides the project Commit Date 54 Critical Point Consulting www.criticalpoint.co.uk

CCPM Project-Level Contingency Project Protection Project Commit Date Project Buffer Critical Task over-runs are absorbed by the Buffer The Project ’Schedule’ remains unchanged The Project Commit Date is not affected 55 Critical Point Consulting www.criticalpoint.co.uk

CCPM Project-Level Contingency Project Protection Project Commit Date Buffer Status Project Buffer Buffer Status shows the impact on contingency Now able to measure and manage our contingency 56 Critical Point Consulting www.criticalpoint.co.uk

CCPM Project-Level Contingency Project Protection Project Commit Date Buffer Status Project Buffer If a Critical Task finishes early… The time saved is ‘added back’ into our contingency Buffer Status always shows the latest position 57 Critical Point Consulting www.criticalpoint.co.uk

CCPM Project-Level Contingency Project-Level Contingency Cascade Aggregated Uncertainties are built into a Project Contingency which results in Streamlined Schedules with Visible, Manageable Contingency which prevents Parkinson’s Behaviours and Student Syndrome which results in Fast and Efficient Projects which are Protected From Delays 58 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management The Five Elements of Failure CCPM Schedule Project-Level Contingency Poor Measures & Control Critical Path Multi-tasking 59 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management Critical Path – A dangerous path to follow? Task E Task B Task G Task H Task A Task F Task I Task C Task D Task J Critical Path ignores resources Critical Path based ONLY on task dependency & duration Valid only in an environment without resource constraints But what happens if we have resource contentions? 60 Critical Point Consulting www.criticalpoint.co.uk

Critical Path Problems Resource Contentions Task A Task B Task F Task G Task H Task E Task I Task C Task D Task J Tasks F & C need the same resources, as do tasks G & I 61 Critical Point Consulting www.criticalpoint.co.uk

Critical Path Problems Post–CP Resource Levelling Task F Task E Task H Task A Task B Task I Task C Task D Task G Task J Levelling resolves the issue… but increases timescales And the vision of the Critical Path dominates …and so tactical manoeuvres soon start... 62 Critical Point Consulting www.criticalpoint.co.uk

Critical Path Problems 1- Multi-Tasking Task E Task H Task A Task B Task D Task J Quality may be reduced Predictability becomes less certain Work becomes fragmented and control less easy But because Multi-tasking takes longer… 63 Critical Point Consulting www.criticalpoint.co.uk

Critical Path Problems 2 - Overtime Task E Task H Task A Task B Task D Task J …Extra hours need to be worked Scheduling & Control becomes difficult 64 Critical Point Consulting www.criticalpoint.co.uk

Critical Path Problems Slippage Task E Task H Task A Task B Task D Task J Multi-tasking is high risk High potential for slippage Diminishing returns due to staff morale / burnout 65 Critical Point Consulting www.criticalpoint.co.uk

Scope Cut Scope Cut Critical Path Problems Scope Cut Task E Task A Task B Scope Cut Task H Task D Task J Last resort to hit target date is a Scope Cut May cause work in other areas Further degrades quality ‘Project Meltdown’ 66 Critical Point Consulting www.criticalpoint.co.uk

Critical Path Cascade Traditional Project Management Critical Path Problems Ignoring Resources Contentions leads to an Incorrect Dependency Path often with Unrealistic Completion Dates and Misleading Priorities which encourages a spiral of Fire-fighting tactics which leads to an Out of Control Project with an Unstable Schedule 67 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management The Five Elements of Failure CCPM Schedule Project-Level Contingency Poor Measures & Control Critical Path Multi-tasking 68 Critical Point Consulting www.criticalpoint.co.uk

Critical Chain Project Management The Five Elements of Success CCPM Schedule Project-Level Contingency Poor Measures & Control Critical Chain Multi-tasking 69 Critical Point Consulting www.criticalpoint.co.uk

CCPM Critical Chain 1. Build Dependency Network As Normal Task A Task B Task F Task G Task H Task E Task I Task C Task D Task J Include Resource Requirements - right at the start 70 Critical Point Consulting www.criticalpoint.co.uk

CCPM Critical Chain 2. CCPM Software - Resource Levelling Task E Task H Task A Task G Task F Task B Task I Task C Task D Task J Resource-levelling the schedule… Prevents over-allocation of resources 71 Critical Point Consulting www.criticalpoint.co.uk

CCPM Critical Chain 3. CCPM Software - Identify the Critical Chain Task E Task H Task A Task G Task F Task B Task I Task C Task D Task J CCPM treats Resource Constraints as dependencies… Priority sequence also goes to resource dependent tasks A realistic critical sequence – The Critical Chain 72 Critical Point Consulting www.criticalpoint.co.uk

Critical Chain / Critical Path Comparison Task E Task H Task A Task G Task F Task B Task E Task I Task C Task F Critical Chain Task D Task J Task G Critical Path Task H Task A Task B Task C Task I Task D Task J Irrespective of what you draw in the CP schedule, the real situation will be driven by the realities of resource constraints 73 Critical Point Consulting www.criticalpoint.co.uk

Critical Chain / Critical Path Comparison Task A Task B Task E Task F Task G Task H Task E Task I Task C Task F Task D Critical Chain Task J Task G Critical Path Task H Task A Task B Task C Task I Task D Task J If there are no resource clashes, the Critical Chain will be the same as the Critical Path 74 Critical Point Consulting www.criticalpoint.co.uk

CCPM Critical Chain Critical Chain Cascade Including Resources Contentions leads to a Correct Dependency Path with Realistic Project Duration and Realistic Priorities which provides a Project Under Control with a Stable Schedule 75 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management The Five Elements of Failure CCPM Schedule Project-Level Contingency Poor Measures & Control Critical Chain Multi-tasking 76 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management Multi-tasking: The Illusion of being productive Time Without Multi-tasking: Task 1: 9 days With Multi-tasking: 3d 3d Task 2: 9 days Task 3: 9 days Day 9 3d 27 Days Day 24 3d 3d 3d 3d 3d 3d 31 Days • Nothing gets completed until day 24. Task 1: + 15 days late(+165%) Task 2: + 8 days late (+47%) Task 3: + 2 days late (+22%) • Speed – Everything is delayed • Quality – Likely to be less • Productivity - Reduced 77 Critical Point Consulting www.criticalpoint.co.uk

Summary Traditional Project Management Multi-tasking: The Illusion of being productive It slows everything down It reduces quality It wastes time and costs more It is bad for morale It complicates scheduling & control It removes planning predictability It causes delivery delays Multi-tasking; The SINGLE best way… …to screw up TWO JOBS. 78 Critical Point Consulting www.criticalpoint.co.uk

Critical Chain Project Management The Five Elements of Success CCPM Schedule Project-Level Contingency Poor Measures & Control Critical Chain Single-tasking 79 Critical Point Consulting www.criticalpoint.co.uk

CCPM - Task Management Single Tasking One task only worked on at a time No interruptions Dedicated work until task complete 80 Critical Point Consulting www.criticalpoint.co.uk

CCPM Single Tasking The reality of being productive Time Without Multi-tasking: Task 1: 9 days Task 2: 9 days Task 3: 9 days 27 Days Return to effective and efficient working Critical Point Consulting www.criticalpoint.co.uk

CCPM Single Tasking Can Multi-tasking be removed? ‘Good’ Multi-Tasking Non-Project / background, no dependencies or deadlines. Training/education. QA tasks. Flexi-time. ‘Bad’ Multi-Tasking ‘Double-booked’ on overlapping tasks. Covering Additional / Support roles. ‘Ugly’ Multi-Tasking Personnel allocated simultaneous project tasks. Endemic, cultural. 82 Critical Point Consulting www.criticalpoint.co.uk

CCPM Single Tasking Summary It improves quality It reduces time & money spent It simplifies scheduling & control It enables planning predictability It is good for morale It speeds everything up 83 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management The Five Elements of Failure CCPM Schedule Project-Level Contingency Poor Measures & Control Critical Chain Single-tasking Multi-tasking 84 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management Progress Measurement Use of ‘Percentage Complete’: Report to expectation – no bad news to give Can’t be challenged – only task owner knows Often simply aligned with time used Optimism that time can be pulled back Infrequent reporting gives psychological cushion Reality is often ignored - An easy place to hide 85 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management Progress Measurement Measurements - Percentage Complete, Time / money used / left Position against base line, Milestones achieved… What do they tell us? How much time/money used - Retrospective What do they tell us about the future? Very little… What is the Only Question PM’s get asked? 86 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management Progress Measurement ‘Are you on target?’ What do we really need to know? How exposed are we? Have we got enough safety in hand? Is there a trend? Is it upward or downward? Should we be taking any action? Where should we be taking action? 87 Critical Point Consulting www.criticalpoint.co.uk

Summary Traditional Project Management Progress Measurement Often not a true / realistic picture Real Status / safety contingency is hidden False sense of schedule security Leads to persisting ‘90% complete’ / late-emerging issues Can cause major / incorrect re-scheduling Doesn’t answer the Big Question 88 Critical Point Consulting www.criticalpoint.co.uk

Critical Chain Project Management The Five Elements of Success CCPM Schedule Project-Level Contingency Good Measures Visible Control Critical Chain Single-tasking Multi-tasking 89 Critical Point Consulting www.criticalpoint.co.uk

CCPM Progress Measurement CCPM Progress Reporting: Frequency: Often When any significant change occurs Questions: Is task complete? If not, how much task-time left remaining? 90 Critical Point Consulting www.criticalpoint.co.uk

CCPM Progress Measurement ‘Critical Chain’ Completed ✓ A E B C ✓ F ✓ D Critical Chain completed reported into CCPM software 91 Critical Point Consulting www.criticalpoint.co.uk

CCPM Progress Measurement Contingency Buffer Usage A E F +3 B C +3 D ✓ 92 Critical Point Consulting www.criticalpoint.co.uk

CCPM Progress Measurement Contingency Buffer Usage Buffer Used Buffer Remaining +3 +3 A E F +3 B C +3 D ✓ Task C has no effect on buffer 93 Critical Point Consulting www.criticalpoint.co.uk

CCPM Progress Measurement Seeing into the Future Buffer Used Buffer Remaining +3 +3 +5 A E F +3 B C D +5 +3 Early Report Immediate report from task D that an extra 5 days will be required This report immediately shows in Buffer Usage Provides ‘view ahead’ notification of future position 94 Critical Point Consulting www.criticalpoint.co.uk

CCPM Progress Measurement Now we have two key measurements: Amount of critical work completed: Critical Chain How much contingency remaining: Project Buffer Put these two together… 95 Critical Point Consulting www.criticalpoint.co.uk

CCPM Progress Measurement The Fever Chart Singular Objective Predictive Easily interpreted Auto constructed Up-to-date Immediate 96 Critical Point Consulting www.criticalpoint.co.uk

CCPM Progress Measurement Summary - 1 Frequent Reporting: Progress is always up-to-date Project position is always up-to-date 97 Critical Point Consulting www.criticalpoint.co.uk

CCPM Progress Measurement Summary - 2 ‘Remaining Duration’ Reporting: More accurate / realistic picture Focusses the task worker Real Status / safety contingency is visible Persisting ‘90% complete’ syndrome banished Prevents late-emerging issues 98 Critical Point Consulting www.criticalpoint.co.uk

CCPM Progress Measurement Summary - 3 Fever Chart: Combined view of progress and contingency Trends provide early warning Objective, singular, visual, always available Prevents unnecessary schedule changes Answers the Big Question! 99 Critical Point Consulting www.criticalpoint.co.uk

Critical Chain Project Management The Five Elements of Success So, have we fixed all of the problems? CCPM Schedule Project-Level Contingency Good Measures Visible Control Critical Chain Single-tasking Multi-tasking Yes – but not just these; CCPM fixes a bigger problem and the reason that past improvements have not succeeded 100 Critical Point Consulting www.criticalpoint.co.uk

Vicious Circles 101 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management The Five Problems Task-Level Contingency Poor Measures & Control Deadline Schedule Critical Path Multi-tasking What problem is also caused by these five issues? 102 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management Schedule Instability Schedule Changes Task-Level Contingency Schedule Changes Poor Measures & Control Deadline Schedule Critical Path Schedule Changes Schedule Changes Multi-tasking Schedule Changes Each individual issue causes schedule changes 103 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management Problem Self-Perpetuation Schedule Changes Task-Level Contingency Schedule Changes Poor Measures & Control Deadline Schedule Critical Path Schedule Changes Schedule Changes Multi-tasking Schedule Changes And Schedule changes cause other problems and…104 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management Problem Self-Perpetuation Schedule Changes Task-Level Contingency Schedule Changes Poor Measures & Control Deadline Schedule Critical Path Schedule Changes Schedule Changes Multi-tasking Schedule Changes Each individual problem area perpetuates others 105 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management Problem Self-Perpetuation Schedule Changes Task-Level Contingency Schedule Changes Poor Measures & Control Deadline Schedule Schedule Changes Critical Path Schedule Changes Multi-tasking Schedule Changes Locked-in, self-perpetuating, systemic failure 106 Critical Point Consulting www.criticalpoint.co.uk

CCPM Solutions Schedule Changes Project-Level Contingency Schedule Changes Rem. Duration Visible Control CCPM Schedule Critical Chain Schedule Changes Schedule Changes Single-tasking Schedule Changes Fixing the internal problems removes vicious circles: 107 Critical Point Consulting www.criticalpoint.co.uk

CCPM Schedule Stability Schedule Changes Project-Level Contingency Schedule Changes Rem. Duration Visible Control CCPM Schedule Critical Chain Schedule Changes Schedule Changes Single-tasking Schedule Changes And the causes of schedule changes and their impact 108 Critical Point Consulting www.criticalpoint.co.uk

CCPM Schedule Stability Project-Level Contingency Rem. Duration Visible Control CCPM Schedule Critical Chain Single-tasking CCPM removes the causes of problem perpetuation schedule changes and systemic failure 109 Critical Point Consulting www.criticalpoint.co.uk

Seven Problems of Traditional PM… …and the Seven Solutions of CCPM Traditional Problems: Deadline Scheduling Task-Level Contingency Critical Path Multi-tasking Poor Measures & Control Schedule Volatility Problem Perpetuation Poor Work Environment = ‘Terminal Mediocrity’ CCPM Solutions: Flexible Scheduling Project-Level Contingency Critical Chain Single-tasking Good Measures & Control Schedule Stability Solution Constancy Good Work Environment = ‘Progressive Excellence’ 110 Critical Point Consulting www.criticalpoint.co.uk

Programme & Portfolio Myth Achieving Terminal Mediocrity on a Large Scale 111 Critical Point Consulting www.criticalpoint.co.uk

CCPM in Programme and Portfolio The Programme & Portfolio Myth 1. That the more projects you start, the more you will get done 112 Critical Point Consulting www.criticalpoint.co.uk

Overloaded Programme 1. Project Time-Slicing Project 1: 9mths Project 2: 9mths Project3: 9mths 27 mths mth 9 mth 23 Project Fragmentation: 3mths 3mths 3mths 3mths 3mths 3mths 3mths 3mths 3mths 30 mths If projects have to time-slice, Fragmentation will delay all projects Driven by edict for all projects to be shown as started 113 Critical Point Consulting www.criticalpoint.co.uk

Overloaded Programme 1. Project Time-Slicing Project 1: 9 mths Project 2: 9mths Project3: 9mths 27 mths 9 mths 21 mths 3mths 3mths 3mths 3mths 3mths 3mths 3mths 3mths 3mths 30 mths Longer elapsed time gives more exposure time for changes Changes generate more work and extend projects further Meanwhile unfinished work gets ‘rusty’ 114 Critical Point Consulting www.criticalpoint.co.uk

Project 1 Project 2 Project 3 Project 4 Project 5 Project 6 Frequently great pressure to start more projects Often ignoring the realities of resource capacity 115 Critical Point Consulting Overloaded Programme 2. Simultaneous Projects www.criticalpoint.co.uk

Exterior View Overloaded Programme 2. Simultaneous Projects Reality at Working Level Project 1 Project 2 Project 3 Project 4 Project 5 Project 6 Insufficient resource causes Cross-Project Reallocations ‘Who shouts loudest’ gets the resources 116 All projects suffer and get delayed Critical Point Consulting www.criticalpoint.co.uk

Exterior View Overloaded Programme Reality at Working Level Project 1 Project 2 Project 3 Project 4 Project 5 Project 6 Gaps left in projects fuel Multi-tasking 117 Critical Point Consulting www.criticalpoint.co.uk

Exterior View Overloaded Programme Reality at Working Level Project 1 Project 2 Project 3 Project 4 Project 5 Project 6 Gaps + multi-tasking delay all projects Constant changes make schedules volatile / unworkable 118 Critical Point Consulting www.criticalpoint.co.uk

Overloaded Programme Exterior View Reality at Working Level Project 1 Project 2 Project 3 . . . .? . . . .? . .? Project 4 . .? Project 5 Project 6 . .? Major impact is that completion becomes unpredictable 119 Critical Point Consulting www.criticalpoint.co.uk

Traditional Project Management Overloaded Programme Summary An Overloaded system causes: Fighting over Insufficient Resources Volatile / Unworkable Schedules Fuels Multi-tasking Delays Loss of Completion Predictability 120 Critical Point Consulting Critical Point Consulting www.criticalpoint.co.uk

Critical Point Consulting www.criticalpoint.co.uk The Programme & Portfolio Myth 1. That the more projects you start, the more you will get done … You won’t So what can we do to improve this? 121

Overloaded Programme Exterior View Reality at Working Level Project 1 Project 2 Project 3 . . . .? . . . .? . .? Project 4 Project 5 Project 6 . .? . . .? How did we got here? 122 Critical Point Consulting www.criticalpoint.co.uk

Overloaded Programme Exterior View Reality at Working Level Project 1 Project 2 Project 3 . . . .? . . . .? . .? Project 4 Project 5 Project 6 . .? . . .? Belief that ‘More Work In = More Work Out’ Lack of Real Priorities (‘It’s all Top Priority!’) 123 Lack of regime to prevent overloading Critical Point Consulting www.criticalpoint.co.uk

CCPM in Multi-Project Environment: Maximising Throughput Problem 1: ‘More Work In = More Work Out’ Forcing work in over capacity slows throughput Working within capacity speeds up throughput Solution: Convince management of the above realities Stop feeding in more than system can manage 124 Critical Point Consulting www.criticalpoint.co.uk

CCPM in Multi-Project Environment: Maximising Throughput Problem 2: Lack of Priorities Not having clear prioritisation slows throughput Having priorities speeds up throughput Solution: Priorities are mandatory ‘It’s all Top Priority!’ is banned All decisions start with Priorities Priorities need to be business-based 125 Critical Point Consulting www.criticalpoint.co.uk

CCPM in Multi-Project Environment: Maximising Throughput Problem 3: Lack of regime to prevent overloading No loading rules = No control = Overloading Solution: Start new projects only when capacity allows ‘Stagger’ new projects starts to avoid major issues 126 Critical Point Consulting www.criticalpoint.co.uk

CCPM in Multi-Project Environment: Maximising Throughput Solution Summary: • Prioritise ! • ‘Stagger’ project starts to avoid major contention • Start new projects only when capacity allows 127 Critical Point Consulting www.criticalpoint.co.uk

Project A CCPM in Multi-Project Environment: Prioritise! Priority 4 Project B Priority 5 Project C Priority 3 Project D Priority 2 Priority 1 Project E Project F Priority 6 128 Critical Point Consulting www.criticalpoint.co.uk

CCPM in the Multi-Project Environment: Priority 1 Project 1 Project 2 Priority 2 Project 3 Priority 3 Project 4 Priority 4 Project 5 Project 6 Priority 5 Priority 6 129 Critical Point Consulting www.criticalpoint.co.uk

CCPM in the Multi-Project Environment: Project 1 Project 2 Project 3 Project 4 ?= Project 5 Project 6 130 Critical Point Consulting www.criticalpoint.co.uk

CCPM in the Multi-Project Environment: Project 1 Project 2 Project 3 Project 4 ?= Project 5 Project 6 131 Critical Point Consulting www.criticalpoint.co.uk

CCPM in Multi-Project Environment: Project 1 Project 2 Project 3 Project 4 ? Project 5 Project 6 132 Critical Point Consulting www.criticalpoint.co.uk

CCPM in Multi-Project Environment: KR KR KR ? KR KR KR 133 Critical Point Consulting www.criticalpoint.co.uk

KR KR KR KR Critical Point Consulting CCPM in Multi-Project Environment: www.criticalpoint.co.uk

KR KR KR KR KR KR 135 Critical Point Consulting CCPM in Multi-Project Environment: www.criticalpoint.co.uk

KR KR KR KR 136 Critical Point Consulting CCPM in Multi-Project Environment: What’s the new picture look like? www.criticalpoint.co.uk

Critical Point Consulting www.criticalpoint.co.uk It’s what you finish… …not what you start. 137

CCPM Programme Management The Programme Fever Chart Multi-project Fever Chart 100% 90% Percentage of Buffer Used 80% Proj C 70% Proj A 60% 50% 40% 30% Proj E Proj B 20% Proj F 10% 0% 0% 10% 20% 30% 40% 50% 60% 70% Percentage of Critical Chain Completed 80% 90% 100% Programme Fever Chart focusses on projects that need attention 138 Critical Point Consulting www.criticalpoint.co.uk

The Evidence for CCPM 139 Critical Point Consulting www.criticalpoint.co.uk

Companies Using CCPM - 1 High Tech 3M Advasense Technologies Agilent Technologie AMCC AMD Avaya Avitronics Barco Bell Canada BT Radianz Computer Sciences Corp Cray, Inc. ECI Telecom Ltd. Eclozion Informatique Ericsson Estonian Telephone Fairchild Semiconductor Graftech Hewlett Packard Hitachi Computer Products Honeywell IBM Ismeca Europe Semiconductor ITT Canon L-3 Communication Systems LSI Logic Lucent Technologies Marvell High Tech / Medtronic, Inc. Microsoft Motorola Numonyx Philips Semiconductors Pioneer Qualcomm RSA Security SanDisk Sapient Seagate Technology LLC Sony Ericsson Spirent Communications Sprint Sun Microsystems Symbian Tadiran Spectralink Tektronix TT Technologies Tundra Semiconductor Workscape Xerox Corporation Business Education Ashridge Management College Project Management Institute London Business School + Over 160 Universities Life Sciences Abbott Labs Adirondack Surgery AHIS-St. Vincent Health AMGEN Andover Healthcare Inc. Arterain Medical Baxter Boston Scientific Central Dupage Health Bovis Pharmaceuticals Converge Medical Inc. Cytori Therapeutics, Inc. Edwards Lifescience Ethicon Gambro Healthcare GlaxoSmithKline Johnson & Johnson Medtronic Merck Medco Managed Care Pfizer Pharmacia Roche Diagnostics Spectranetics Tenet Health Care Tyco Healthcare United Behavioral Health Vascore Medical 140 Ventana Critical Point Consulting www.criticalpoint.co.uk

Companies Using CCPM - 2 Aerospace and Defense Aerojet Corporation Air Force Institute of Tech. BAE Systems The Boeing Company General Dynamics Halliburton ITT Space Systems Lockheed NASA Northrop Grumman Portsmouth Naval Shipyard Puget Sound Naval Shipyard Raytheon SAAB Avionics US Air Force Consumer Products Coca-Cola Colgate Palmolive Del Monte Foods Fonterra Gillette Heineken IKEA Kraft Foods McKee Foods Nike Philip Morris Industrial ABB Accoat Advanced Energy Technology Alcan Alfa Lava American Rubber Products Applied Plasmonics AREVA Atomic Energy of Canada . Balfour Beatty Bimba Manufacturing Bosal Bosch Rexroth Ltda. Brice Manufacturing BVR Technologies Company C.F. Roark Welding. Callaway Golf Celite Corporation s Conoco Corning Cable Systems Cueros Industrializados DaimlerChrysler UK Danfoss Delta Faucet Company Detroit Diesel Reman-West DuPont Eastman Kodak Company Industrial/ ExxonMobil Chemical Fisher Controls Fluid Brasil Sistemas Fluke Corporation Fuel Cell Energy GE Industrial Systems Hach Honda ITT Corporation Kawasaki Heavy Industries, M&M Precision Systems Marshall Industries Merichem Chemicals Milwaukee Forge Rail care Raychem Rolls Royce Siemens Sylvania Unilever Tata UPC Technology Volvo Source:TOC International, Gatlinburg, TN. 141 Critical Point Consulting www.criticalpoint.co.uk

Critical Point Consulting www.criticalpoint.co.uk Results: Japanese Government After having used it in 2,523 public works projects in 2007 and over 4,000 projects in 2008, the Japanese government now requires that CCPM be used on all public works projects (approximately 20,000 projects per year).” CCPM Software - ProChain Inc. ProChain is an industry-leading US-based CCPM software developer and implementer. Here are some client quotes from various case studies using ProChain products: • • • • • • • • ‘Reduced first project more than 10 months (approx. 50%)’ ‘Between 25 - 50 % reduction on first 10 projects’ ‘On-time completion of projects increased from 22% to well above 90%’ ‘On-time completion of projects now at 100%’ ‘Average project length reduced by more than 50%’ ‘On-time delivery of projects went from 40% to nearly 100%’ ‘More than doubled project throughput’ ‘Return on investment conservatively 500:1’ Source: ProChain Inc. http://www.prochain.com/clients/results.html Copyright © 2013 by ProChain Solutions, Inc. All rights reserved. 142

Critical Point Consulting www.criticalpoint.co.uk Professional Recognition Association for Project Management APM Body of Knowledge. "An alternative to creating networks based on activity dependencies is to use a technique called critical chain. This method considers the availability of resources and the interdependencies between resources.“ - APM Body of Knowledge 6th edition (2012) p 155 Project Management Institute PMI Body of Knowledge “Critical chain is a schedule network analysis technique that modifies the project schedule to account for limited resources. Initially, the project schedule network diagram is built using duration estimates with required dependencies and defined constraints as inputs. The critical path is then calculated. After the critical path is identified, resource availability is entered and the resource-limited schedule result is determined. The resulting schedule often has an altered critical path.” PMI BoK 4th edition. Ch 6 Time Management p.155 143

Critical Point Consulting www.criticalpoint.co.uk Professional Recognition Conference Presentation Critical Chain Project Management using Microsoft Project and Prochain: Implementing Project Portfolio Management. The Theory of Constraints International Certification Organization (TOCICO) is a global not-for-profit certification organization for TOC practitioners, consultants and academics to develop and administer certification standards, and facilitate the exchange of latest developments. TOCICO has run an international conference for the past 11 years. 144

The Theory of Constraints & CCPM - 30yrs in the making: The work and books of Eli Goldratt Retail Isn’t It Obvious? TOC & Business Strategy Viable Vision TOC & Technology Necessary But Not Sufficient Project Management Critical Chain Distribution, Marketing, Management It’s Not Luck The Thinking Process The Jonah Program, The Choice Manufacturing, Accounting, Production The Goal, The Race, The Haystack Syndrome 1985 1990 1995 2000 2005 2010 145 Critical Point Consulting www.criticalpoint.co.uk

CCPM Potted History Development: Result of many years of continuous development Based on Theory of Constraints (TOC) 1980’s – 1990’s Needed software to be truly viable Software too slow to develop Software now mature & robust (see ProChain.com) Key Publications by Eliyahu Goldratt: 1984 'The Goal' – TOC in manufacturing 1997 ‘Critical Chain’ - Applying TOC to project management 146 Critical Point Consulting www.criticalpoint.co.uk

Last Word ‘Critical Chain Project Management presents us with an opportunity to plan projects well for maybe the very first time. We should make sure that we break with our old traditions of how we have done things in the past, and replan our projects from scratch. But planning is only half the story. The real power of CCPM comes from the control afforded during the execution or deployment of the job. Buffer status and buffer management allows us unprecedented feedback on the progress of the project and where to focus attention and where not. And maybe this is the most important factor in the whole approach. We have a totally new and systemic way to manage projects. We should make the very most of this opportunity.’ Dr. Kelvin Youngman 147 Critical Point Consulting www.criticalpoint.co.uk

Critical Point Consulting Over 15 years experience of implementing CCPM in Multiple companies / Multiple industries info@criticalpoint.co.uk www.criticalpoint.co.uk UK: 01892 506881 | Intl: +44 1892 506881 148 Critical Point Consulting www.criticalpoint.co.uk

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