Critical Chain Project Management - An introduction

Project management is full of good ideas and solid management methodologies that can be used to effectively manage projects from start to end. The project management style and process that works best will typically vary based on the focus of the situation and the skills of the individual running the project. Critical Chain Project Management ( CCPM ) is a mighty project management principle derived from the Theory of Constraints used to focus on getting your projects done in time and speed up the velocity by far.

What is CCPM?
CCPM is a management methodology in the vein of Critical Path Management, and is derived from the algorithms present in the Theory of Constraints. CCPM differs from other management techniques in that it attempts to focus on facilitating the preceding resources and terminal elements that are associated with a project. The belief is that the proactive management of these resources at the front end of the project will aid in minimizing the potential for exceeding both budgetary and financial constraints. Given the guiding principles stated in the Theory of Constraints we know that there are limiting factors associated with tasks and projects. The manager implementing a CCPM style will give consideration to those limiting factors and apply their knowledge of the Theory of Constraints to mitigate the potential impact of those known outer boundaries.

How does CCPM seek to mitigate risk?CCPM uses a multi-stepped process to provide assurance that delivery schedules and project budgets are not blown out of the water while pressing onward toward completion and focus on minimizing the impact of limits described in the Theory of Constraints.
  1. By analyzing resource dependencies the manager is able to understand the potential cause and effect relationship of their supply chain. This allows them to anticipate the impact of potential resource delays.
  2. Sometimes good enough is ok. The manager implementing this strategy does not spend an inordinate amount of time searching for the perfect solution, 80% is good enough (Pareto principle). This allows for an offset of the limiting factors defined by using the Theory of Constraints.
  3. The manager identifies where they can plan the insertion of buffers into the multiple processes to ensure there is plenty of time built into the schedule to absorb any delays.
  4. Management evaluates the progress of the project by looking at the rate that the buffers are being consumed; the less buffer time that is used, the healthier the project is.


Parkinson's law and the student syndrome

One of the secrets to working effectively on any project, regardless of whether it is a school paper or a multi-million dollar project, is planning. Business managers are in high demand because their certification attests to the fact that they understand project planning and management. This ability to manage tasks represents money to business owners. Sometimes business managers and workers alike are faced with difficult choices. Not all tasks take the allotted amount of time to complete. Project managers are no different in this regard. It is not uncommon to gauge a task initially and determine that it will take x number of hours to focus on it and complete the work surrounding it; only to find that the task was less complicated than expected and it only required two-thirds of the time initially estimated. Our first inclination is to stretch the work out to make our estimate look more legitimate; however this is a highly inefficient response. This is where Parkinson's Law comes in.

Parkinson's Law
According to the Theory of Constraints we always have some limiting factor. In this case, it simply is not time required to accomplish the task. Parkinson's Law states that when a task is accomplished, stop working on it. Don’t stretch it out and attempt to make it last longer. Use that extra time to apply to the next task. If this occurs frequently, maybe it is time to reevaluate the method you are using to gauge time estimates.

The Student Syndrome
Most of us have suffered from Student Syndrome at some point in our life. This syndrome merely represents the propensity for people to not focus on deliverable items until right before they are due. This syndrome derives its name from students because this is very commonly seen in schools across our nation. Most students will wait until the last possible moment to focus on assignments, thereby turning in sub-standard products most of the time. The reality of the situation is that most times, the habits we develop when we are young follow us into our adult lives. From a Theory of Constraints perspective, the inability of large portions of the workforce to effectively manage their assignments will create a bottleneck with a focus on impacting the efficiency of those individuals to accomplish their work. So, if we are following the Project Management Institute’s best practices, we would identify Student Syndrome using the Theory of Constraints to evaluate the potential impact on the organization and identify a solution.

My personal experiences
Once Parkinson's law and the Student Syndrome have been identified in an organization, they needs to be dealt with and can only be overcome by deliberate retraining on the part of the individual and the organization. Empower your team to stop working when things are "good enough"; this will minimize gold plating and the negative influences of Parkinson's law. Start your work always directly after all of your predecessors have finished their jobs to avoid the Student Syndrome.

In one of the upcoming posts I will tell you how Parkinson's law and the Student Syndrome can be avoided in projecty using the so called Critical Chain Project Management.
Sometimes business managers and workers alike are faced with difficult choices. Not all tasks take the allotted amount of time to complete. Project managers are no different in this regard. It is not uncommon to gauge a task initially and determine that it will take x number of hours to focus on it and complete the work surrounding it; only to find that the task was less complicated than expected and it only required two-thirds of the time initially estimated. Our first inclination is to stretch the work out to make our estimate look more legitimate; however this is a highly inefficient response. This is where Parkinson's Law comes in.

Parkinson's law
According to the Theory of Constraints we always have some limiting factor. In this case, it simply is not time required to accomplish the task. Parkinson's Law states that when a task is accomplished, stop working on it. Don’t stretch it out and attempt to make it last longer. Use that extra time to apply to the next task. If this occurs frequently, maybe it is time to reevaluate the method you are using to gauge time estimates, and also the Theory of Constraints may need to be revisited to see how they may be better applied to focus on the task at hand.


Getting things done

Time is always at a premium, there never seem to be enough hours in the day to accomplish all of the tasks that are at hand. Tasks have a way of accumulating throughout the day, and it is very easy to become overwhelmed with the items you were unable to accomplish today, and now must put off until tomorrow. The secret to being able to accomplish all of the tasks at hand is effective planning and prioritization.

Getting Things Done (GTD)
David Allen is well known for his “Getting Things Done” principal. The GTD focus is on grouping tasks into relevant bundles to accomplish all of them at the same time. On his website http://www.davidco.com/ David Allen presents the basis for the GTD concept stating that the human mind is not designed for reminding us of tasks and their due dates, instead it is ideally suited for executing tasks. Mr. Allen believes that GTD allows users to plan for task execution up front, group similar tasks together, and then fulfill the required tasks all at the same time. This logical pairing of tasks helps the mind to focus on the storage, tracking, and retrieval of all of the information that is required to see these tasks through to completion, instead of wasting resources trying to remember what needs to be done. Additionally, the costs for task switches are reduced to a minimum.

My personal experiences
David Allen presents the GTD method as one of many different approaches you can use to complete tasks. The various methods that are out there each have their own strengths and weaknesses. At the end of the day, the best method of getting things done is simply to focus on doing them and posses the discipline to keep at those tasks until they are completed.


Bad Multitasking

One of the primary aims of continuous process improvement methodologies is to realize additional efficiencies in the way tasks are accomplished. By simplifying the focus of the process and breaking it down into its most basic components businesses can reduce the time and resources required to produce products or implement services. Oftentimes in business today, the virtues of multitasking are espoused as a necessity. Furthermore, the ability to multitask is required in many organizations. The problem with multitasking is that you have to handle a setup time for every task switch, leading to so called bad multitasking which meens a reduction in proficiency when attempting to accomplish tasks.

What's so bad about multitasking?
The Theory of Constraints simply states that at some point within a process you will encounter a limiting factor to your productivity. At that time, the constraint will have to be identified and dealt with to minimize its impact on the efficiency of your business processes. Bad multitasking provides an excellent backdrop to examine the Theory of Constraints. Most individuals function best, and most profitably, when they are able to focus on a single task at a time. The reason for this is that they are able to bring all of their mental faculties to bear on the challenge at hand. When multitasking occurs, the singular attention an individual is able to give to handling a situation is now divided with only a portion of their intellectual capabilities being used on each problem. When more than two tasks are introduced, the focus of the individual is further diluted.

How to prevent multitasking
So when you are looking to implement a continuous process improvement initiative: Let your team members always concentrate on a single task at once. Consider that you will get the best efficiency when you claim the complete the resolution of one task before moving to the next one. On the other side, give your team the ability to concentrate on a single task and do not put new work into ongoing jobs. Severall methodologies have mighty tools to confine multitasking: Kanban has the principle of limitting the work in progress, in the agile method Scrum you have the so called "Definition of Done" which uses an exact definition to decide when a task is really completed, and the Theory of Constraints uses buffers to prevent specially the constraint from multitasking.
My personal experiences
Every task change will cost yourself about 15 minutes of setup time in complex environments like development or engineering. If you are working on 2-3 projects simultaneously, your efficieny factor will shrink down to less than 50%. Don't allow this! Focus on less things and work on them really concentrated. Start a new job only if the last one is completely done. You will have a much higher efficiency at the end of the day.


Kanban: An introduction

The term “kanban” is derived from a 17th century Japanese business practice wherein Japanese merchants used embossed or engraved signs to display one’s trade or expertise. In modern times, this term has come to be related to the streamlining of business processes.

Toyota and Kanban
Initially when Mr. Toyota, of Toyota Motor Company, developed the concept of kanban his focus was on how he could use some of the principles that were present in the Japanese mercantile stores in his factory. He made the observation that the focus of the supply chain business process in the mercantiles was triggered more by the action of the customer than by an action of the store. While the store had fully stocked shelves, that mere fact did not cause the supply chain to move. Instead, it was when the customer made a purchase and removed the item from the shelves that a trigger was activated that signaled to the store owners that it was time to restock the shelf. Mr. Toyota realized that this supply chain process could benefit the assembly processes at his motor plant by helping to limit work in progress that was initiated until orders were placed by customers. This in turn allowed him to stock fewer items in inventory and created real savings for his operation.

Kanban in modern environments
One key component that is a primary focus of this process today is the premise of modifying existing processes rather than creating new ones. Prominent members of the continuous process improvement community feel there is huge value to reengineering a process that is already in place as opposed to creating a new one. The modification of the existing process minimizes upheaval within an organization and will not limit work in progress at the time of the change.

Implement process improvement with care
Kanban has many practical applications in today’s business marketplace. From creating an effective way to limit work in progress and minimize the associated costs of production that are not necessarily associated with product sales, businesses can use this process to help increase profitability. However, as with any new process improvement initiative that is undertaken management must ensure they have provided full disclosure to all stakeholders and done their best to get buy in from all parties affected by the newly implemented processes. Otherwise, new processes may be implemented that are not fully understood or endorsed by those having to execute them and may end up becoming more of a detriment to productivity than the old processes they replaced.

Kanban boards
To visualize the work in progress in severall states of the operational procedure in a company so called Kanban boards are used. A Kanban board is a table separated in several columns, where each of the columns represent one state. If a new job or task shall be performed, it can just enter the process if there is the ability to do this. Let's take an example: If you want to fix bugs in a software product you may have the following steps for every bug: analyze - implement/fix - test - release. The team who analyzes the bugs can only handle a small amount of bugs simultaneous; if they handle more than let's say 2 or 3 bugs than they will get stuck in bad multitasking and therefore will lose efficiency. So the maximum work in progress will be set to 3 in this example and will be marked on the Kanban board. If the team already handles 3 bugs and a new one arives, then this new bug will NOT be handled; the team even will not look at it. The same will be done for the columns implement/fix, test and release.

My personal experiences
Use Kanban and Kanban boards whenever you want to ensure that bad multitasking shall be prevented; this will be done efficiently by the strict limitation of the work in progress. Kanban performs especially good when applied in an external-event triggered environment where normal planning systems may come to their limits.


Theory of Constraints: The Thinking Process (2)

As I mentioned in the first part of this post about the thinking process, the first question to ask yourself is "What to change?". The Theory of constraints provides us with the "5 focusing steps" which help you to get clear what to change:

Five focusing steps
1. Identify the constraint that prevents the goal from happening.
2. Check how to exploit the constraint.
3. Subordinate all other tasks and processes to support the constraint.
4. Elevate the constraint to break through it.
5. Once the constraint has moved, return to Step 1 and continue making adjustments where needed.
The second Question of the thinking process
"To what to change to?" is the second important question of the thinking process of the Theory of Constraints. Organizations must look at ways to constantly evolve and continue changing to achieve full potential of their goals. By using the Theory of Constraints companies can focus on identifying these constraints, decide how to work the system to get the most out of it, adjust the rest of the system to support the solutions, make some more changes to break the constraint, and then start the process over. Starting over allows the organization to examine what changed and see what else needs to change to continue working towards its goals.

The third question of the thinking process
The third and last question is "How to cause the change?" The process of TOC understands that organizations are measured and controlled by variations of throughput (money or units made through sales), investment (money invested to sell goods and services), and operating expenses (all money spent to make investment into throughput). By understanding how the company operates, enables managers to understand where and how to improve production and profits.

Managing People's Resistance to Changes
Understanding what causes constraints helps managers to identify and initiate solutions for the constraints. Dr. Goldratt notes that change is not a happy process if not everyone does win in a situation, so companies have to consider all parties when deciding what to change. In some cases it could also be limited skills and mentality levels caused by practices within the company that can reduce production. Managers have to learn to work with and around these limitations by finding solutions that work for everyone and reducing the fear of changes.

My personal experience
Answering the first two questions may sometimes be hard, but often this section is the easier job because you can overlook your company more or less from "outside". The last step is mostly the hardest one because there you really have to take action and change your old habits. Don´t let yourself be controlled by fear in this phase: Aalways keep your goal in mind!

Suggestion: The original video lectures from Dr. Goldratt to the second and third question.


Lean Management: Why shall we optimize processes?

Use continuous process improvements to make your organization lean
Everybody use processes on a daily basis, most of us joust don’t focus on it. We have a process for getting ready in the morning, a process for going to bed at night, a process for driving to work, a process for driving home when we are done. I think you get the point: Our lives are full of processes. Businesses and organizations are no different. They are full of processes, some well defined and lean, others not.

The secret to success is to get lean
I believe that one of the biggest factors between businesses that are successful and those that aren’t is that the successful ones know and understand what their business processes are and focus on the improvements of those processes. The reason that the understanding of these business processes is so powerful is that the organization that understands how it gets things done can also focus on how to improve the efficiency surrounding that process, minimize costs, and increase profits. That is a powerful tool. It is easy to see how a firm grasp of your processes can help you to increase the efficiency of your business model, thereby making the actions required to execute the processes lean in nature.

Efficiency studies and what they mean today
Around the turn of the last century massive studies whose focus where the efficiency of workers and the processes in the plants they worked in began to help business owners understand that slight modifications of even the smallest step in a production process could net significant increases in productivity. The focus of lean process improvement is similar to these early studies in that it seeks to identify possible bottlenecks and constraints within established processes and minimize or eliminate them where possible. Consider the impact on a production line where a bucket of bolts is placed just out of arms reach where the mechanic may require a full second to reach the bucket, retrieve a bolt, and place it in the designated product. Now consider identifying that as a constraint on the production time of that particular product and as a result moving the bucket of bolts closer to the mechanic. This move cuts the time it takes him to get the bolt in half. For one bolt this may not seem significant, but over the course of 100,000 bolts the company saves nearly 14 hours. By making all processes lean, production time is greatly reduced, more products are made, and more profits are generated.


Six Sigma: An overwiew

The Value of Six Sigma
Six Sigma, and its counterpart Lean Six Sigma, have been buzz words for quite some time. Still, when most business people are asked they can’t quite pinpoint what it represents. First and foremost individuals that are seeking to implement the process must focus on learning what Six Sigma is. Contrary to what many folks have been led to believe, it is not a magic pill that will eliminate the problems your organization may have overnight. Six Sigma is as much of a culture as it is a system. The primary tenets of the program focus on impacting the culture of an organization and how they focus on problems, as opposed to using some system of mathematical equations to fix your process flows.

What Six Sigma Is
The Six Sigma process places a sharp focus on how things get done. Typically I recommend beginning the evaluation of a process by implementing either an Ishikawa Diagram or by performing a root cause analysis. These techniques are beneficial in that they allow me to look at the very basic processes that organizations have and then begin to evaluate the processes that evolve as an event unfolds. Regardless of what the event is, it must have a beginning, middle, and an end. By using the Fishbone Diagram I am able to evaluate the many pieces of the process I am examining and begin to focus on bottlenecks or constraints within the process that introduce inefficiencies into the workflow. By evaluating these processes early on, I can begin to identify steps in the workflow process that have a higher likelihood of introducing variability into the process. By isolating and then minimizing these instances of process variability I can then make recommendations regarding ways to increase the overall efficiency of the process and reduce variability.

What Six Sigma Is Not
Six Sigma is no silver bullet. Once all of the analysis has been performed, and the steps within the process that introduce heightened variability have been identified it is still the responsibility of management to put these findings to use. Without the commitment to implement the recommended methods to minimize variability, the evaluation of the entire process is merely a waste of time and resources.


Theory of Constraints - The Thinking Process (1)

The Theory of Constraints (TOC) was introduced to the world in 1985 in a book entitled "The Goal" by renown Dr. Eliyahu M. Goldratt. The TOC is a model of verifiable philosophy: by understanding how people think, leads us to understand the world around us, and because we understand it we can improve. The theory of constraints provides answers to three simple questions: What to change, to what to change to and how to cause the change.

1) First question of the thinking process
One of the most important questions of the Theory of Constraints is: "What to Change?" TOC is a method of practice for organizations to focus on ways of making the company run more efficiently thus increasing productivity and profits by figuring out where the constraints are in the system and finding ways to dissolve them..

What are constraints?
Constraints are anything that stops an organization from achieving the highest potential of its goals. Constraints may be inside of an company (internal) or outside of it (external). Internal constraints can come from the equipment being limited to not producing enough saleable goods and services. The written or unwritten policies of the organization can also prevent all the systems within from producing enough product. One of the biggest constraints that Dr. Goldratt talks about is people's resistance to change when the solution is not a win-win situation. Solutions around this constraint must create a situation in the organization that everyone can win with and increase job security, otherwise people will resist and fight the change. Other types of internal constraints are the policies of the company and the equipment, both of which can limit a system from producing more goods or services. We talk about an external constraint when the organization is producing more goods or services than the market can handle. To handle constraints, TOC provides the "5 focusing steps" which I will talk about in one of the next posts.

Suggestion: Watch the original video lectures of Dr. Goldratt.

Continue reading with the second part of this article.