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Critical Chain Project Management Solving the 3 Biggest Problems in Project Management Prepared for PMI Montgomery Chapter April Chapter dinner April 4,

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Presentation on theme: "Critical Chain Project Management Solving the 3 Biggest Problems in Project Management Prepared for PMI Montgomery Chapter April Chapter dinner April 4,"— Presentation transcript:

1 Critical Chain Project Management Solving the 3 Biggest Problems in Project Management Prepared for PMI Montgomery Chapter April Chapter dinner April 4, 2012 Hilbert Robinson, Senior Program Manager Mike Hannan, VP, Public Sector

2 Common Project Stakeholder Complaints 2 Low Organizational productivity Long lead times De-scoped or cancelled projects Cost/budget overruns Unhappy stakeholders Poor due date reliability Missed opportunities

3 Common Project Management Complaints 3 Rework Errors Unpleasant Surprises Scope creep & spec changes Overloaded resources Frequent “fire drills” Unclear/competing Priorities High stress Frustration Low morale Burnout/ turnover Low productivity More reporting Meetings Poor coordination Severe and chronic multitasking

4 Productive effort Unrecoverable losses Current Potential Recoverable losses Other High Rework Many Open Issues Poor Coordination Severe Multitasking Missing Inputs P ERFORMANCE Operational Gap (1) 4 Other High Rework Many Open Issues Poor Coordination Severe Multitasking Missing Inputs Missing Inputs, Severe Multitasking, Poor Coordination, Many Open Issues, High Rework, Other Murphy Current Effective Capacity F UTURE C URRENT Future gains from reducing losses Increased Effective Capacity Murphy Increased Effective Capacity %%

5 Old Rule #1 5 Old Rule Problem 1 1 Plan each task as a highly reliable commitment. Task variability prevents reliable project commitments.

6 Estimate vs. Commitment 6 If we treat task-level estimates as commitments, Task Owners will build in hidden schedule buffers, and then have little incentive to finish early. If we treat task-level estimates as estimates, and pool schedule risk at the project level, we can allocate project-level schedule buffer to those tasks that need it, and only those tasks that need it. 10 Days 15 Days 10 Days 15 Days 10 Days 15 Days 10 Days 15 Days 10 Days Set of task-level estimates = 50 days Set of task-level commitments = 125 days 10 Days 2 Days Work : 1 Day Protection Project Buffer 15 Days

7 New Rule #1 7 1 1 Advantage Buffer Projects, Not Tasks Highly reliable project commitment. Old Rule Problem Plan each task as a highly reliable commitment. Task variability prevents reliable project commitments.

8 Old Rule #2 8 1 1 Advantage Buffer Projects, Not Tasks Highly reliable project commitment. Old Rule Problem Plan each task as a highly reliable commitment. Task variability prevents reliable project commitments. 2 2 Assign staff to multiple tasks, and start all projects as early as possible. Focusing staff on 1 task at a time results in low resource utilization, and holds up other projects.

9 9 The Overcommitted / Overloaded Organization Simple Example: Three person team:  A – Designer  B – Builder  C – Tester The sooner we start …. Three hot projects Seven weeks each 

10 10 The Illusion of Progress Delay High resource utilization Delay

11 Reasons to Multitask 11  Be responsive to demands/needs of others  Appease customers, stakeholders, PM, boss, etc.  Avoid idle time while waiting for input  Be efficient  Be busy  Impress others with how many projects you can juggle  …and many others.

12 The Hidden Cost of Multitasking  Loss of focus / more mistakes / rework  More open / unresolved issues / expediting  Disguises other process failures  Destroys the smooth flow of work  Increases need for (burden of) tracking and reporting  Wastes capacity [need for more overtime]  Longer project cycle time/lead time  Increases per unit cost  Fewer completions / higher burnout / lower morale  Dilutes managements attention and focus – Loss of control 12 Some negative effects of multi-tasking includes:

13 Simultaneous vs. Staggered Projects P4 13 8 6 4 Simultaneous Projects Staggered Projects

14 New Rule #2 14 1 1 Advantage Buffer Projects, Not Tasks Highly reliable project commitment. Old Rule Problem Plan each task as a highly reliable commitment. Task variability prevents reliable project commitments. 2 2 Assign staff to multiple tasks, and start all projects as early as possible. Focusing staff on 1 task at a time results in low resource utilization, and holds up other projects. Stagger Projects Maximize project completion rate and resource utilization.

15 Old Rule #3 15 1 1 Advantage Buffer Projects, Not Tasks Highly reliable project commitment. Old Rule Problem Plan each task as a highly reliable commitment. Task variability prevents reliable project commitments. 2 2 Assign staff to multiple tasks, and start all projects as early as possible. Focusing staff on 1 task at a time results in low resource utilization, and holds up other projects. Stagger Projects Maximize project completion rate and resource utilization. 3 3 Each PM lobbies the PMO for critical resources. Priorities across projects shift, resulting in persistent conflicts over resources.

16 To Which Project Should I Assign the Critical Staff Resource? 16 15 Days 10 Days 15 Days 10 Days 25 Days 15 Days 10 Days 15 Days 10 Days 15 Days 10 Days 25 Days Project A Project B Today Two identical tasks, only one person with the required skill

17 Urgent Field Problem versus a New Design Engineering Congress Regulators Irate Customer Project Manager Golf Partner Executive Sponsor Respond to Whomever Shouts the Loudest? 17

18 To Which Project Should I Assign the Critical Staff Resource? 18 15 Days 10 Days 15 Days 10 Days 25 Days 15 Days 10 Days 15 Days 10 Days 15 Days 10 Days 25 Days Project A Project B Today Two identical tasks, only one person with the required skill Project Buffer To Project B, because it is further from completion than Project A, and because it has less project buffer remaining.

19 19 D C BPI Based Prioritization Metric All projects and tasks are prioritized according to their current BPI

20 Single Project Buffer Trend Chart 20 Watch Plan Recover

21 Portfolio Dashboard Real Time Organization-wide Prioritization 21 All decisions are evaluated according to their predicted impact on BPI Watch Plan Recover

22 New Rule #3 22 1 1 Advantage Buffer Projects, Not Tasks Highly reliable project commitment. Old Rule Problem Plan each task as a highly reliable commitment. Task variability prevents reliable project commitments. 2 2 Assign staff to multiple tasks, and start all projects as early as possible. Focusing staff on 1 task at a time results in low resource utilization, and holds up other projects. Stagger Projects Maximize project completion rate and resource utilization. 3 3 Each PM lobbies the PMO for critical resources. Priorities across projects shift, resulting in persistent conflicts over resources. Protect Project Buffers That Need It Most Clarity, commonly agreed priorities, stronger cooperation among PMs

23 Current Potential Productive effort Future Potential Unrecoverable losses Recoverable losses Other High Rework Many Open Issues Poor Coordination Severe Multitasking Missing Inputs The Whole is Greater… 23 Other High Rework Many Open Issues Poor Coordination Severe Multitasking Missing Inputs Missing Inputs, Severe Multitasking, Poor Coordination, Many Open Issues, High Rework, Other Murphy More Effective Teamwork, Reduced Learning Curve, etc. Murphy Gains from reducing losses P ERFORMANCE F UTURE C URRENT

24 Expected Stakeholder Benefits 24 Long lead times De-scoped or cancelled projects Cost/budget overruns Unhappy stakeholders Poor due date reliability Missed opportunities Shorter lead times More stable scope fewer cancelled projects Effective cost/budget controls Happier / satisfied stakeholders Fewer missed opportunities Highly reliable due dates Much higher organizational productivity Low Organizational Productivity Strong Foundation for Growth

25 Documented Benefits of Critical Chain 25

26 Sample Results  18 months vs. 60 months,  IT department first then drug development – CEO: “100% due date performance”  Warner Robbins – Iraq War – Expanded C-5 air lift capacity by 8 million ton-miles  Iraq War – One extra submarine in steaming days  Satellite Division – Turned around the business  Engine Division – partially funded Northwest acquisition  Software delivered 5 months early, 33% cost reduction 26

27 What if We’re Not an Advanced Project Management Organization? 27  CCPM is simple in concept—it turns common sense into common practice.  Introducing CCPM will help any project right away, regardless of how sophisticated and disciplined your project-management practices are (or aren’t).  Some “high-discipline” PM organizations take longer to realize CCPM benefits, because they have a harder time letting go of the “Old Rules.”  Many “low-discipline” PM organizations have an easier time adopting CCPM, because the “Old Rules” are not as deeply embedded.


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