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Critical Chain Method


Critical Chain Method Complex solutions do not work, the more complex the problem the simpler the solution must be. Eli Goldratt. These sides and note were prepared using – PowerPoint PPT presentation

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Title: Critical Chain Method

Critical Chain Method
Complex solutions do not work, the more complex
the problem the simpler the solution must
be. Eli Goldratt.
These sides and note were prepared using 1. The
book Streamlined Building Lean Supply Chain
Using the Theory of Constraints. Srinivasan.
McGraw-Hell. 2. The slides originally prepared by
Professor M. M. Srinivasan. 3. Presentation of
Dr. Daniel Walsh, Vector Strategies. Continuous
Process Improvement Summit. 2012, Northridge,
CA. 3. Presentation of Dr. Rob Richards, Stottler
Henke. Continuous Process Improvement Summit.
2012, Northridge, CA.
Predicting the Future
It is tough to make perdition, especially about
the future. Yogi (Lawrence P.) Berra, Baseball
catcher and manager, 1925.
The best way to predict the future is to create
it. Peter F. Druker. Writer and professor,
Why Projects are Late
  • Unavailability of resources.
  • Not high enough priorities
  • Murphy Law
  • ..
  • .
  • They ran out of time

Wrong Metrics - Gedanken
Courtesy of Dr. Daniel Walsh, Vector Strategies.
Project Management Problems Usually Faced
  • Task durations are highly variable. A lot of
    uncertainty involved in estimating task durations
  • Project is not clearly defined Known Work
    Known Unknown Work Unknown Work.
  • Existing project work is not complete before new
    projects shift priorities leading to
  • Problems in a project cascade into another
  • Constant pressure to increase staff for peak

Task Duration
  • An activity is composed of three types of work
    Known Work Known Unknown Work Unknown Work.
  • Due to unknowns, task durations are highly
    variable. People usually give a number that they
    expect to have a 10 chance or less of missing.
    There is 90 or more probability that the
    duration is less than the given number. Inflated
    task times reduce productivity and unnecessarily
    inflate budgets.
  • CCPM motivates people to give a number they have
    a high probability (50 or more) of missing. The
    idea is to pool task buffers and allow the tasks
    to use the buffer only if they need it.

Task Duration
  • The buffer for the critical chain is smaller than
    the sum of the buffers required for all the tasks
    on the critical chain.
  • Protecting task times with buffers will degrade
    on-time performance,
  • Providing specific due date to complete each
    specific task is against a systematic approach,
  • Aggressive-but-possible task times increase
    on-time completion of the projects.

Sequential Tasks
Task 1
Task 2
  • If each task has mean of 15 and StdDev of 5. With
    95 probability each task is completed in 25
    days. Project 50 days.
  • But Variance of the critical path is 252550,
    StsDev of 7.1
  • We can have duration of 15 for each task and a
    14.2 days project buffer. With 95 probability,
    the project is complete in 44.2 days.

Task 1
Task 2

How a Task is Done
Task Duration Syndromes
  • Parkinsons syndrome Work expands to fill the
    time available. People tend to continue working
    on a task that could have been completed earlier
    if they are given a pre-specified completion
  • Continue to Polish syndrome (aka the 3-Minute
    Egg Rule) Its not quality if its finished
    before time is up.
  • Student Syndrome When people feel there is
    plenty of time to complete a task, other things
    become important and they procrastinate on the

Managing Projects Under Uncertainty
Sequential Tasks
  • Consider a simple project with 2 tasks performed
    by 2 different operators.

Assume task durations are uniformly distributed
(5,25). On average 15 days.
Generate 1000 Projects
What is average project completion time?
30 days StdDev lt StdDev1 StdDev2
Merging Nodes
  • Consider a slightly more complex project.

What is the average project completion time?
33 days Task 3 Max(Task 1, Task2)
Merging Nodes
Probability of completing project in 30 days?
Merging Nodes and Resources
  • The affect of resource interdependencies on a
    simple project.

What is the average project duration? What is the
probability of competing the project in 45 days.
1000 Instances
1000 Instances
  • A projects most likely completion time is much
    larger than the sum of the averages of the tasks
    making up its longest path (due to
    synchronization or due to task dependencies).
  • So, how do we quote estimated completion time of
    the project?
  • Do people give a number that they know has a high
    (50 or more) chance of missing?

Task and Project Durations the Traditional Way
Task 1
Task 3
Task 5
Task 2
Task 4
So, the average task times are padded to
accommodate any possible delays. Instead of
specifying a 50 time estimate (which fails half
the time), a 98 confidence estimate is developed
for the tasks and project duration. 98 of 5,25
5.9820 519.6 24.6 What is
the chance the project will complete in 70 days?
Given CPM computation, the project will take 15
weeks, and all tasks are on the critical path.
If the project was scheduled for 20 weeks, there
is a 5 week project buffer.
Project Buffer and Feeding Buffers
a) Compute the project buffer. b) Compute and
identify the feeding buffer(s).
Fever Chart
Courtesy of Dr. Daniel Walsh, Vector Strategies.
Fever Chart
Courtesy of Dr. Daniel Walsh, Vector Strategies.
Buffer Management Allocate Resources to Tasks
Based on Buffer Burn Rate
Chain 1
20 buffer consumed
33 work completed
Chain 2
50 work completed
60 buffer consumed
Burn Rate of buffer consumed vs. of work
completed. Automatically calculated on an ongoing
basis to assess how much buffer is still
available for future uncertainties. Task
Priorities Tasks that lie on chains with less
safety remaining are given top priority. This
ensures that buffers are not wasted, and also
reduces pressure to multitask.
Multi Tasking
Pipelining Release Projects Based on Constraints
Instead of Starting ASAP
  • Most heavily loaded shared resource (constraint),
    determines throughput
  • Project starts are based on constraints
  • Pressure to multitask also comes down

Pipelining is more efficient than starting
projects ASAP
ã Realization Technologies, Inc.
What to Change?
  • Erroneous assumptions
  • Protecting task times with buffers will improve
    on-time performance (this is a biggie)
  • By finishing too soon, people hurt their future
    negotiating power.
  • Providing milestones for each task is good
  • It is good to induct work as soon as possible
  • Multitasking is beneficial

Summary Sources of Project Delays
  • Synchronization Delays
  • Integration (assembly) points
  • Resources and tasks
  • Delays due to Behavioral Effects
  • Parkinsons Law
  • Student Syndrome
  • Continue to Polish Syndrome
  • Queuing Delays
  • Induct work ahead of schedule
  • Multitasking

  • 50 chance od failure, not 1. Avoid the 3
  • Aggregation, project buffer, feeding buffers
  • Integrate the resources into the CPM.
  • Proactive, leading, how much of PB is consumed.
  • Not how many days have you worked on the task,
    but how many days do you need to complete the
  • Team work culture at the project level not
    individualism at task level
  • Managing by exception, fever chart, what are
    todays priorities?
  • Avoid multi-tasking, follow constraint recourse
    based release.
  • Avoid inducting work ahead of schedule (ASAP).
  • Do not switch the Critical Chain

Courtesy of Dr. Rob Richards, Stottler Henke
Courtesy of Dr. Rob Richards, Stottler Henke
Courtesy of Dr. Rob Richards, Stottler Henke
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