1. Copyright © 2013 Pearson Education, Inc. Publishing as Prentice Hall o P.I.I.M.T o American University of Leadership Ahmed Hanane, MBA, Eng, CMA, Partner email: ahanane360@gmail.com

2. Critical Chain Project Scheduling 11-02

3. After completing this chapter, students will be able to: Understand the differences between common cause and special cause variation in organizations. Recognize the three ways in which project teams inflate the amount of safety for all project tasks. Understand the four ways in which additional project task safety can be wasted. 11-03

4. After completing this chapter, students will be able to: Distinguish between critical path and critical chain project scheduling techniques. Understand how critical chain methodology resolves project resource conflicts. Apply critical chain project management to project priorities. 11-04

5. A constraint limits any system’s output. The Goal – Goldratt TOC Methodology 1. Identify the constraint 2. Exploit the constraint 3. Subordinate the system 4. Elevate the constraint 5. Repeat the process 11-05

6. FIGURE 11.2 Five Key Steps in Theory of Constraint Methodology 11-06 Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall

7. Common Cause Inherent in the system Special Cause Due to a special circumstance Managers should Understand the difference between the two types Not adjust the process if variation is common cause Not include special cause variation in risk simulation Not aggregate discrete project risks 11-07

8. How safety is added to project activities 1. Individual activities overestimated 2. Project manager safety margin 3. Anticipating expected cuts from management time 25% 50% 80% 90% Gaussian (lognormal) Distribution 11-08

9. 1. The Student Syndrome a. Immediate deadlines b. Padded estimates c. High demand 2. Failure to pass along positive variation a. Other tasks b. Overestimation penalty c. Perfectionism 3. Multitasking 4. Path Merging 11-09

10. FIGURE 11.6 11-10 Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall

11. 11-11 FIGURE 11.7 Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall

12. FIGURE 11.8 11-12 Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall

13.  Central Limit Theorem  Activity durations estimated at 50% level  Buffer reapplied at project level o Goldratt rule of thumb (50%) o Newbold formula  Feeder buffers for non-critical paths 11-13

14.  Due dates & milestones eliminated  Realistic estimates – 50% level not 90%  “No blame” culture  Subcontractor deliveries & work scheduled ES  Non critical activities scheduled LS  Factor the effects of resource contention  Critical chain usually not the critical path  Solve resource conflicts with minimal disruption 11-14

15. Bob Feeder Buffer Project Buffer Bob Buffers protect constraints and prevent delays 11-15

16. Drum – system-wide constraint that sets the beat for the firm’s throughput o company policy o one person o a department/work unit o a resource o Capacity constraint buffer – safety margin between projects o Drum buffer – extra safety before the constraint 11-16

17. 1. Identify the drum 2. Exploit the drum a. Prepare a schedule for each project b. Determine priority for the drum c. Create the drum schedule 3. Subordinate the project schedules (next slide) 4. Elevate the capacity of the drum 5. Go back to step 2 11-17

18. Schedule projects based on drum Designate critical chain Insert capacity constraint buffers Resolve any conflicts Insert drum buffers so the constraint is not starved 11-18

19.  No milestones used  Not significantly different from PERT  Unproven at the portfolio level  Anecdotal support only  Incomplete solution  Overestimation of activity duration padding  Cultural changes unattainable 11-19