compiled- critical chain
TRANSCRIPT
THE CRITICAL CHAIN
The Critical Chain
• A think-tank at Genemodem trying to reduce lead time of modem production from 2 years to 6 months
• Rick Silver, a business professor trying to achieve tenure
• Teaches Project Management to an EMBA class
Current problems at Genemodem
• Budget Overruns• Time Overruns
Greater dependence on vendors
• Uncertainty as nature of beasts• Project leader complaints– Revolves around Uncertainty of:
• Unrealistic schedule• Vendors are chosen according to cost and not reliability• Availability of plant equipment, hence late recruitment
• Uncertainties in projects – Mismanagement• For every step of the project there is a Time-estimate
CONCEPTS IN THE BOOK
Bell Curve• Popular name for
Normal Distribution (Gaussian Distribution) curve
• ‘The higher the uncertainty the longer tail of distribution’
PERT• Statistical tool used in project management• Used to analyze and represent tasks involved in
completing a project.• Identifies• Time needed to complete a task• Minimum time to complete a project
Critical Path
• Determines the maximum time for the completion of a project
• Any delay on CP will delay the completion of project
Gantt Chart
• Project scheduling chart• Involves decisions of the planner when to start
each path• Some choose late start where others chose early
start
Theory of Constraints
• New management philosophy• Introduction of research methods• Broad spectrum of robust applications
Theory of Constraints
1. Identify the system constraintsThe constraints are physical e.g. bottlenecksThe bottleneck can be overcome by adding more resources or by squeezing the maximum from the same
2. Exploit system constraints3. Subordinate everything else to the above decisions4. Elevate the systems constraints5. Inertia: Re-evaluate process to determine new
bottleneck
• Managers must control cost and protect throughputMust ensure that right products should reach right people
• Focus should be on local improvements in order to attain better results for the organizations
Linking chains
• The organization comprises of a network of linked chains and their linkages are very important in order to complete the whole process of producing something
• If one link fails to perform the whole process is disrupted
• The most weakest link is more important.
Focus
• Pareto principle• 80% benefits from solving 20% problems• Pareto is only applicable where the variables
are independent e.g. cost • It is not applicable where variables are
dependent like in throughput
• The goal of Critical Chain is to help projects finish on time, within budget, and without cutting scope.
Main points:• Cultural change in how to manage projects and evaluate
team members• Avoid multi-tasking while on the Critical Chain• Protect against uncertainty by aggregating all safety time
at the end of the project• Concentrate on the constraint of the project: the• Longest chain of dependent tasks or resources
Student SyndromeEstimation including Hidden Safety
Student Syndrome
Buffers
• Project buffers Buffer before the completion date
• Feeding buffer Cushion between two tasks
• Resource buffer Buffers of resource to complete a task
The Critical Chain
• Rick receives tenure• The lead time is reduced to 6 months
THANK YOU.