Critical Chain A Novel by Eliyahu Goldratt

Product lifetimes are diminishing fast u Projects to create new products must be shortened drastically u Consider Modems, cellular telephones, VCR’s, PC’s, HDTV, 3D-HDTV, tablets, etc.

Frequently projects go awry u Budget overruns u Time (schedule) overruns u Compromising functionality or content

Questions u What is student syndrome? u Procrastination u What is multitasking? u Doing multiple tasks concurrently u What is safety? u Adding extra time to estimates, beyond what would make the estimate 50% probable

More Questions u What about measurements? u What about early start vs. late start? u Of how much value is a project status report? u What about project planning tools like MS project? u Let’s look at Goldratt’s recommendations

Task Duration Probability -- a Beta distribution

Everybody overestimates the time required to do their task u According to Goldratt u This is called SAFETY u Does anybody want to talk about how much safety they put into their estimates? u Is this true in software development? u It is if you have an expert doing the estimating, who really knows how long it will take him

What happens after that--a possible scenario u The team leader adds safety time to the task to cover his responsibilities u The project leader adds more safety time u The project manager may add still more safety time

Conclusion>>> u Most of the time we have built into our projects is …..

Safety u Safety is however much time is added on to a task beyond its mean time of completion

What about IT Types u IT Types tend to underestimate the time it takes them to do tasks, because u They have never done the task before u They tend to be intuitive/thinkers—MEANING THEY ARE OPTIMISTS u They have not been told to take their estimates and double them u Especially when the task is NEW to them u IT developer productivities vary by as much as 10 to 1

Probabilistic task durations u Late durations tend to accumulate and may increase the length of the project u Early durations do not show up u Recall Parkinson’s Law and all the reasons for it u This explains why safety disappears

More Measurements E D C B A

Other problems with safety u Is wasted by the “student syndrome” u Basically, this is procrastination u Is wasted by multitasking (a person who works on several tasks at the same time) u With each change of task, a set up is required u Is wasted by dependencies between steps u These dependencies cause delays to accumulate, but advances are wasted u Delays (late finishes) get passed on; advances (early finishes) don’t

Problems other than safety u Early start vs. late start u Goldratt does not like BCWP, BCWS, ACWP, CV, SV, CPI, SPI, BAC, EAC, etc. u Existing measurements are not very useful because they are based on a cost world mentality u Goldratt believes managers should ‘live’ in a throughput world mentality.

Multitasking A finishes

Early Start vs. Late Start

How much Safety is there likely to be? u Will project professionals admit how much safety they are putting into their estimates? u These professionals want to be 100% sure of getting finished on time u Therefore, the durations are likely to be twice as long as they should be u So CUT THEM IN HALF, Goldratt suggests

Solutions u Take the safety out of the individual tasks and put it at the end of the critical path in the time buffer, called a project buffer u This means making the tasks roughly % as long as they would otherwise be and placing the safety time that was removed in a PROJECT BUFFER at the end

Solution

More solutions u At the point where each feeding path intersects with the critical path, place another time buffer, called a feeding buffer. This feeding buffer protects the critical path from delays occurring in the corresponding non-critical paths that would make them critical. The feeding buffer duration should be half of the largest slack on that non- critical path. u You can now use a late start on all non-critical tasks, which Goldratt favors

Duration of Critical Path: 44 weeks A/8 B/16 C/8 D/6 E/6 F/14 G/6

Goldratt: Put Safety in a Project Buffer at the end A/4 B/8 C/4 D/3 E/3 F/7 G/3 Project Buffer/22

Insert Feeding Buffers and set their durations A/4 B/8 C/4 D/3 E/3 F/7 G/3 PB/22 FB/2 FB/2.5

A/4 B/8 C/4 D/3 E/3 F/7 G/3 PB/22 FB/2 FB/2.5

A/4 B/8 C/4 D/3 E/1 F/6 G/2 PB/22 FB/3 FB/2 FB/2.5 A Different Network

More solutions u When resources are needed on the critical path, these resources are advised ahead of time (3 days??) exactly when they must make themselves available, through use of RESOURCE FLAGS. When that time comes, they must drop everything else and do the required critical tasks— no multitasking or student syndrome—150% focus

This is …..

The project manager must stay focused u Or the project will not be finished on time, within budget u This means applying the Pareto principle u 80% of the benefit comes from 20% of the activities u By the time progress reports indicate something is wrong, its usually too late u Progress reports tell you that 90% of the project is finished in 90% of the required time. u However, another equal period of time is required to complete the remaining “10%,” in many cases

It is hard to stay focused when: u There are too many project paths on-going, in parallel u There are many critical or near critical paths

Figure Example of Critical Chain Scheduling 31

Measurements are a major problem with projects u Measurements should induce the parts to do what is good for the system as a whole u Measurements should direct managers to the point that needs their attention u So often it occurs that we measure the wrong thing. u The wrong measure leads to wrong behavior u Tell me how you measure me and I will show you how I behave

More Measurements

Measurements u Goldratt likes UNUSED BUFFER DAYS as a measure u Goldratt does not like: u Lines of code created per hour u BCWP, BCWS, ACWP, CV, SV, CI, SI u EAC (Estimated cost at completion)

Projects are like chains u Each task in sequence is a link in a chain u Each link has two things u weight, to which cost is analogous u strength, to which throughput is analogous

Cost vs Throughput u Goldratt maintains that management in the cost world is a mirage u efficiency becomes paramount u local improvements are necessary to get global ones u Goldratt suggests that managers should manage in the throughput world, a totally different paradigm u must find the constraint--the weakest link u concentrate on that u By the way, what is the ultimate constraint???

Remember the five steps of TOC u IDENTIFY the project constraint--the critical path u Decide how to EXPLOIT that constraint u SUBORDINATE everything to that decision u ELEVATE the systems’ constraint u Go back to step 1, and find another constraint

Which is not one of the five steps in the TOC? u IDENTIFY the project constraint--the critical path u Decide how to EXPLOIT that constraint u SUBORDINATE that decision to everything else u ELEVATE the systems’ constraint u Go back to step 1, and find another constraint

Conflicts u Based on faulty assumptions u Use evaporating cloud to surface the assumptions u Then question every one of them u A bad assumption leads to a breakthrough solution or injection u When resources are needed on the critical path, these resources are advised ahead of time exactly when they must make themselves available. When that time comes, they must drop everything else and do the required critical tasks.

Measurement solutions u Measure progress only on the critical path; what percent of the critical path we have already completed. This is all we care about!! u Have a project leader measure progress on a non critical path in terms of unused buffer days

Shrinking the task time: Effects u There is less procrastination u There is much more focus u There is less multitasking

More Suggestions u Put your “BEST” people on the critical path u Watch out for critical chains

What are the ramifications of a delayed software product, intended for commercial sale? u Less market share u Less profit; maybe no profit u Lower analyst profit expectations u Declining share price u Out of business? u How many firms has Microsoft driven out of business? u Ask the Borland founder what the implications of getting a product late to the marketplace are

What about Procurement?? u Most firms enter into LOSE/LOSE Strategies u A fixed-price lowest bidder contract is LOSE/LOSE Strategy u This forces Contractors to under bid their costs, hoping to make it back on the changes to the requirements that the customer will have to pay for u Instead, Contractors should be induced to deliver product on time, with as much functionality as possible u How would you do this?

Shrinking task time—upon further review??? u Not recommended for creative activity u Some studies show that the added duress causes more frustration u More mistakes, more rework, more fixes u Source: “Deadline,” by Tom Demarco

Time Batching--Another Time Waster u Analysis paralysis u Approval cycles u Formal document release u Regularly scheduled meetings u Planning cycles u Work queues

Fast Tracking and Reduced Time Batching

That’s all, Folks