gpe - autenticação · critical chain , eliyahu m. goldratt, 1997, north river press leach,...

GPEengineering project management

Project Management in an Engineering Context

Critical Chain Project Management(CCPM)

Theory of Constraints views systems as chainsThe weakest link is the constraint (bottleneck). It is the constraint that keeps the chain from doing any better at achieving its goal

• The Theory of Constraints is essentially about change– where is the constraint?– work on it– where did it change to?

• In order to be performing well the natural state of the system is changing. If a system doesn’t change it will die

• TOC is a systemic way of thinking– poses questions at the system-level– helps to establish the necessary conditions to reach the goal

CCPM and TOC

Cost versus ThroughputCost World• Optimizes the cost of development• Optimizes each link of the chain• Considers local improvements rewarding

Throughput World• Improving the weakest link improves and strengthens the entire chain• Local improvements are only rewarding on the bottleneck • System optimums is not the sum of local optima

CCPM and TOC

Those who make decisions on efficiency and productivity measurements based primarily on costs/expenses live in the "cost world" as opposed to those who measure by throughput (i.e. value, profitability and utility). Two paradigms (activities/system, machine/holistic, systemic view)

Throughput – is the rate at which a system generates value. For example, the amount of units per day a factory produces to meet customer orders. Units that go into inventory are not counted as part of throughput

CCPM and TOC

Leach,LawrenceP.,2005,CriticalChainProjectManagement,SecondEdition,ARTECHHOUSE,INC

Goldratt (1997)definedtheoldaccountingsystemastheCostWorldbecauseitoperatesontheassumptionthatproductcostistheprimarywaytounderstandvalueandmakebusinessdecisions

Laboratthetimewasmostlyappliedtoveryunskilledjobsand,therefore,plentifulandeasytoreplace.Therefore,itwaseasytovarytheworkforcewithdemand

Today,theskilledworkforceismuchlessvariable,andthetraditionalfixedcostsaremuchlessfixed

CCPM and TOC

CriticalChain,EliyahuM.Goldratt,1997,NorthRiverPressLeach,LawrenceP.,2005,CriticalChainProjectManagement,SecondEdition,ARTECHHOUSE,INC

CCPM and TOC


Goldratt’s businessmodelisbasedontwoprinciples

The first principle defines three ways to measure whether or not businesses isachieving the goal of making money. These three measurements areinterrelated and easy enough to apply to any process.

The three measurements are throughput, or “the rate at which the systemgenerates money through sales;” inventory, or “all the money that the systemhas invested in purchasing things that it intends to sell;” and operationexpense, or “all the money the system spends in order to turn inventory intothroughput” (Goldratt & Cox, 1992)

ThesecondprincipleofGoldratt’s modelrelatesdependenteventsandstatisticalfluctuations tothemanufacturingprocess.

Dependent events are processes that must first take place beforeother ones can begin (Goldratt & Cox, 1992).

Statistical fluctuations occur when one is unable to precisely predictevents or quantities (Goldratt & Cox, 1992). Look at this exampleillustrating this principle. Alex and Jonah sit in a restaurant and Jonahpoints out that they are able to precisely predict the capacity of therestaurant by counting the available seats. On the other hand, theyare unable to predict how long the waiter will need to fulfill theirorder (Goldratt & Cox, 1992). This uncertainty is referred to asstatistical fluctuations.

InTheTheoryofConstraints,Goldratt introducesmathematicalformulastohelporganizationsfurtherjudgetheirprocesses.Theseformulasare:

WilliamDettmer (1997)proposesthefollowinglistofprinciplesinhisbook

1 System thinking is preferable to analytical thinking in managing change and solvingproblems

2 An optimal system solution deteriorates after time as the system’s environmentchanges. A process of ongoing improvement is required to maintain, update orimprove the effectiveness of a solution

3 The system optimum is not the sum of the local optima

4 Systems are analogous to chains. Each system has a “weakest link” (constraint) thatultimately limits the success of the entire system

Dettmer,William,1997,EliyahuM.Goldratt’sTheTheoryofConstraints,ASystemsApproachtoContinuousImprovement,ASQQualityPress

CCPM and TOC

….5 Strengthening any link in the chain other than the weakest one does nothing toimprove the strength of the whole chain

6 Knowing what to change requires a thorough understanding of the system’scurrent reality, its goal, and the magnitude and direction of the difference betweenthe two

7 Most of the UDEs (undesired effects) within a system are caused by a few coreproblems

8 Core problems are almost never apparent. They manifest themselves through anumber of UDEs linked by a network of effect→ cause→ effect

9 Resolving individual UDEs gives a false sense of security while ignoring theunderlying core problem. Solutions based on local problems are likely to be short-lived

Dettmer,Willim,1997,EliyahuM.Goldratt’sTheTheoryofConstraints,ASystemsApproachtoContinuousImprovement,ASQQualityPress

CCPM and TOC

10 Core problems are usually perpetuated by a hidden or underlying conflict.Solution of core problems requires challenging the assumptions underlying theconflict

11 System constraints can be either physical, process dependent, or policy-based. Physical constraints are relatively easy to identify and simple to eliminate.Policy-based constraints are usually more difficult to identify and eliminate, butthey normally result in a larger degree of system improvement than theelimination of a physical constraint

12 Inertia is the worst enemy of a process of ongoing improvement. Resistance tochange is normally very strong

13 Ideas are not solutions

CCPM and TOC

Dettmer,Willim,1997,EliyahuM.Goldratt’sTheTheoryofConstraints,ASystemsApproachtoContinuousImprovement,ASQQualityPress

All systems have a (1) constraint that limits output (therefore, non-constraints haveexcess capacity…)

Goal = System Throughput

System optimum is not the sum of the local optima

Adopted measurement systems should– induce what is good for the whole (system optima = Goal)– direct managers to areas needing specific attention

CCPM and TOC Constraint, throughput, measurements

CCPM and TOC TOC – Theory of Constrains and optimal

Local optima and global optima don’t relate

• project throughput needs to be protected, but not with a local optima police

• we need to concentrate resources on the bottleneck (not to the the benefit of every task in the project)

TOC – Theory of Constrains five steps

1. Identify the constraint (IDENTIFY)

2. Decide how to exploit the constraint (EXPLOIT)

3. Subordinate and synchronize (align) everything else to the above decisions (SUBORDINATE)

To improve the performance of that same value-chain, continue

4. Elevate the performance of the constraint (ELEVATE)

5. If in any of the above steps the constraint has shifted, go back to Step 1 (PREVENT ENERTIA)

CCPM and TOC

Tirar partido

Aumentar desempenho

CCPM and TOC

1. Identify the System's constraintsThe system/process is analyzed so that a task or activity that limits the productivity of the entire systemcan be identified. A system constraint can be identified by a long queue of work or long processing times. Itcan be a resource (plant, team, …)

2. Decide how to exploit the system's constraintsIn this step, decisions must be made on how to modify or redesign the task or activity so that work can beperformed more effectively and efficiently. Explore installed capacity

3. Subordinate everything else to the above decisionNow, management directs all its efforts to improving the performance of the constraining task or activity andany other task or activity that directly affects the constraining task or activity. Focus on the problem

4. Elevate the system's constraintIn this step, we need additional capacity to increase (elevate) the overall output of the constraining task oractivity. This differs from step 2 in that the added output comes from additional purchased capacity, such asbuying a second machine tool or implementing a new information technology. In step 2 existing capacity isexploited

5. Go back to step one. In the previous step a constraint has been broken, and most likely the problemwas transferred to another resource (another constrain)

CCPM and TOC

WARNING

DO NOT LET INERTIA BECOME THE SYSTEM’S CONSTRAINT

…

CCPM and TOC

Constraints usually relate to

• MARKET• CAPACITY• RESOURCES (people)• PROCESS DESIGN• SUPPLIERS• FINANCE• KNOWLEDGE OR COMPETENCE• POLICIES

CCPM and TOC

In a project the Critical Chain is THE constraint

Goldratt argues that most of the time system constraints

trace back to a flawed policy

rather than to a physical constraint

CCPM and TOC


Activity schedule estimate

CCPM syndromes

Student syndromeCCPM syndromes

Parkinson’s Law

“WORK EXPANDS TO FILL THE TIME AVAILABLE”

CCPM syndromes

Murphy – AreferencetoMurphy’sLaw

“ifanythingbadcanhappen,itWILLhappen."

Inprojectmanagement,manyunexpectedproblemstendtooccur

Don’taskmeifitwilloccur,askmewhen!

Goldratt saysthatMurphyexists!- Always!!!

CCPM syndromes

Key point …… remove excess time

Everyone estimates ....“Student Syndrome”, “Parkinson’s Law”, …Functional managers protect their resourcesSenior management (& client) wants everything early (yesterday)!

SolutionReduce all activity estimate durations by 50% and place aggregated time buffers to protect project schedule and resource constraints

CCPM on the way

Key point …… manage to the constraint

Resources can be scarce because of other concurrent projects

Scarce resources comprise the “Critical Chain” (abrange, estão incluídas)

Critical Chain: The longest set of dependent activities, with explicit consideration of resource availability, to achieve a project goal

The Critical Chain does not equal the Critical Path. Critical Chain is the longest pass ofdependent activities, being the dependence an effect of either sequence or use of thesame resources. If there is no resource restriction Critical Chain is the Critical Path

CCPM on the way

Key point …… multi-tasking is inefficient

Spreads resources over several tasks at once

Loses focus

Restarts (set up times) = loses efficiency

Solution = “Roadrunner” Performance Focus 100% of resource’s time on one task until it is complete

CCPM on the way

Whenever I put down one task and pick up another, I lose productive time

How much time is loose switching depends on how deep the task in hand is

Putting a stop to multi-tasking effectively creates extra capacity

CCPM on the way Key point …… multi-tasking is inefficient

CCPM on the way Student syndrome dissolved

Jan, Shu-Hui & Ho, 2006, ISARC, CONSTRUCTION PROJECT BUFFER MANAGEMENT IN SCHEDULING PLANNING AND CONTROL

CCPM on the way Buffers

Resourcesmustfocusononetaskatatimeandpassontheresultsassoonasthetaskiscompleteimmediatelycontinuingwiththenext

CCPM on the way

Using CCPM we normally agree that the bottleneck is the critical chain. To protect it and increase its effectiveness (reduce waist of time) we use a Project Buffer (PB) at the end of CC (we use an overall safety to the project and not to the single activities)(remember we reduced the safety at the activity level using the 50% rule and remember what we said about local and system optima. PB should have a duration of 50% of about the duration of the CC)

We use the Feeding Buffer (FB) at the end of each non-critical path, when joining with the critical chain, to prevent repercussion of delays in this non critical branch. Even when delays are exceeded and are superior to the buffer (feeding) capacity, project buffer can still absorb delays. FB should have a duration of about 50% of the non-critical chain duration before it.

PF and FB are time buffers

With CCPM due date is a limit (we don’t think in terms of finishing dates as we are in throughput world). Like that we eliminate the students syndrome

Besides it is necessary to guaranty the redness of resources to activities in the critical chain. The Resource Buffer is a warning flag to prepare the resource


Broken Critical Chain, Oak Logic Consulting, Communications in Business

CCPM on the way Aggressive time estimates and Buffers

Broken Critical Chain, Oak Logic Consulting, Communications in Business

CCPM on the way Multitasking

CCPM on the way Multitasking

1. Identifythecriticalchain

- Thetasksmustestimatethemeantime-durationconversion(50–50time)andprimaryresourcerequirements.(Fortaskswithmultipleresources,identifytheprimaryresourceyoubelievewillbeaconstraint.Ifthereareseveralconstraintresources,breakthetaskupforeachprimaryresource)

- Ifyoudonothaveresourcecontentioninyourproject,gotothelaststep- Identifythecontentionyouwillresolvefirst.Thisshouldbethecontentionnearestto

projectcompletionortheonethatshowsthemostconflict.Ifseveralshowaboutthesameamountofpotentialconflict,choosethefirstoneyoucometoworkingbackwardsfromtheendoftheschedule

- Removeresourcecontentionbysequencingtasksearlierintime.(Donotworryaboutcreatingnewconflictswiththisstep;youwillresolvethoseinsequence)

- Returntotheendofthescheduleandfollowstep1.4forthenextresource.Asyouresolveconflictsforthenextresource,youmustmaintainthelackoftheconflictfortheresourcesyouresolvedearlier.Repeatuntilallidentifiedresourcetypesareresolved

- Identifythecriticalchainasthelongestchainofdependentevents

CCPM on the way


2 Exploitthecriticalchain-Reviewyourplantodetermineifsequencingcanshortentheoverallprojectduration.Ifso,doit.Donottrial-and-errorvarioussolutions-Addtheprojectbuffertotheendofthecriticalchain

3 Subordinate theothertasks,paths,andresourcestothecriticalchain-Protectthecriticalchainbyaddingfeedingbufferstoallchainsthatfeedthecriticalchain.Sizethesebuffersusingthelongestprecedingpath.(Note:Allnoncriticalchainsfeedthecriticalchaintocompletetheproject.Ifchainsgodirectlytotheprojectbuffer,theyalsoneedfeedingbuffers)-Resolveanyresourcecontentionscreatedbyaddingfeedingbuffersthroughsequencingtasksearlierintime-Movetoanearliertimeanydependenttasksprecedingthosemoved

4 Elevate (shorten)thelead-timeoftheprojectbyusingaddedproducingartifactsforcertainwindowsoftimetobreakcontention

5 Gobacktostepone.Donotallowinertiatobecometheconstraint

CCPM on the way


CCPM on the way 1-7

• A resource buffer isn’t a time buffer at all; it’s a flag to warn that a

particular resource will be needed soon

– So it’s an alarm clock!

• A resource buffer is established some time interval before the resource

is needed (1 week, a month, etc.)

Buffers

CCPM on the way

Q

If in a project, during execution, you achieved 60% of project buffer, what does this mean (it is ok, or not)?

CCPM on the wayBuffer Management

% of critical chain to execute

/% of project buffer to consume

BUFFER

OK WATCH& PLAN ACT

RemainingProject Buffer:

20 15 14 8 7 0

RemainingFeeding Buffer:

8 7 6 4 3 0

Buffers Provide Focus and Early Warning

Buffers to Monitor Project Status

%CBR/%CCR >=1

%CBR/%CCR 1>2/3

%CBR/%CCR 2/3>

CCR - Critical Chain RemainingCBR – Completion Buffer Remaining

Corrective Action

We compare the percentage of the Completion Buffer Remaining(%CBR) with the percentage of the Critical Chain Remaining(%CCR)

We set trigger points for corrective action, for example:

•When the ratio %CBR / %CCR is 1 or more, Project status isGREEN - Watch•When %CBR / %CCR is between 1 and 2/3, Project status isAMBER - Prepare a recovery plan•When %CBR / %CCR is less than 2/3, Project status is RED -Implement recovery plan

Measures in 2-D

100 %

100 % 0 %

0 %

Critical Chain Remaining

Com

plet

ion

Buffe

r Rem

aini

ng

CRITICAL PATH / CRITICAL CHAIN

• Places high value on the completion of tasks on time

• Employs techniques to minimise slack or float

• Uses the amount of slack or float to set priorities

• Places low value on tasks being completed on time

• Inserts buffers even on paths that are not critical

• Manages buffers to minimise unplanned expediting, overtime and other costly deviations from schedule.

CCPM differences

• Resources are given due dates• No buffer, later tasks are forced to make up any slide• Local optimization is not systemic• Management attention on all tasks• Resources not de-conflicted• Judge resources on whether they completed by due date and quality of work

CRITICAL PATH / CRITICAL CHAIN

CCPM differences

• Cultural change in how to manage projects and evaluate team members

• Avoid multi-tasking • 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

“Goodenough” isanimportantideaindevelopingcritical-chainprojectplans.Formathematicalreasons,itisimpossibletobuildapreciseoptimizingalgorithmforresourceleveling.Theproceduretodevelopthecritical-chainplanensuresthattheplanyoubuildwillbe“goodenough.”Thismeansthattheoveralllengthoftheschedulewillbe,withinasmallpartofthelengthoftheprojectbuffer,nearlytheshortestoroptimumschedulepath.Sincerealitywillchangemanyassumptions,andwecannotexplicitlypredicttheresultsofstatisticalfluctuations,thisisgoodenough

CCPM differences

Leach,LawrenceP.,2005,CriticalChainProjectManagement,SecondEdition,ARTECHHOUSE,INCSTOP HERE

Scarcity of Resources

Task C – 10 d

Task B – 10 d

Task A – 10 d

Project Time required - 20 d

Task C depends on both A and BEach task uses a different resource

Scarcity of Resources

Task C – 10 d

Task B – 10 d

Task A – 10 d

Task C depends on both A and B, Both A and B need exclusive use of the same resource

Project Time required - 30 d

Resource conflict

Task C

Task B

Task A Completion Buffer

Completion Buffer

Committed end date

Don't overreact to buffer erosion

• We expect our buffer to be used up over the course of the Project

• Our date is not threatened if the buffer is used up in proportion to progress– If we have 2/3 of the completion buffer left and only 1/3 of the Project to

do we are doing fine

• Our date is threatened if the buffer is used up disproportionately– If we have 2/3 of the Project still to do but have only 1/3 of the

completion buffer left we have a problem

Buffer Management Meeting

Attendees: Project Manager, Project Sponsor / Owner, Task Managers, Resource Managers

Agenda:1. Reminder of what tasks are on the Critical Chain.2. Review Project status ( % Critical Chain outstanding).3. Review Completion buffer status (Red, Amber, Green).

If necessary, initiate corrective actions.4. Review Feeding buffers status (Red, Amber, Green). If

necessary, initiate corrective actions.5. Review tasks in progress to ensure earliest completion in full.6. Review tasks not started to ensure earliest start where

appropriate.

Using Buffer Management to drive ongoing improvement

• Buffer Management measures are fact-based and objective

• Buffer Management meetings highlight buffer erosion / Project delays

• Preventing the causes of delay will speed up your Projects

• Your process of ongoing improvement is simply to eliminate the causes of delay by following up on the issues highlighted in Buffer Management meetings

• As your Projects run faster and more reliably, continue to eliminate more and more causes of delay

gpe - autenticação · critical chain , eliyahu m. goldratt, 1997, north river press leach,...

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