Chain Project Management As Presented By Goldratt

The Critical Chain Project Management (CCPM) is a method of scheduling and managing projects by giving maximum emphasis on the resources that are required and involved in project execution. It was developed and presented by Eliyahu M. Goldratt and the concept was introduced in 1997 in his novel Critical Chain. When CCPM is applied in a correct manner, case studies reveal that it provides a high rate of on-time and on-budget completion of projects.

This method was originally derived from his Theory of Constraints and is in contrast to the other conventional and popular methods such as Critical Path and PERT which gives emphasis on the order of tasks and strict scheduling.

 

The Critical Chain Project network will be liable to have the resources evenly loaded but will also necessitate them to be flexible in their start times and promptly switch between tasks and task chains in order that the whole project runs efficiently on schedule.

 

The Critical Path refers to the longest sequence of activities in a project plan that must be completed on schedule for the entire project to be on schedule. Terminal elements are items (activity or deliverable) projected in terms of resource requirements, budget and time in a Work breakdown structure and which cannot be further divided.

 

They are associated by dependencies and scheduled.

The Critical Chain is the series of both precedence and resource dependent terminal elements that does not allow projects to be completed in a shorter time frame by the fact that there are finite resources. If the resources are always abundant then the project’s critical chain will be similar to its critical path.

 

CCPM uses the concept of buffer management to evaluate the performance of a project. It aggregates the large quantity of safety time supplemented to sub projects in project buffers to prevent wastage of this through bad multitasking and to avoid slippage on due-date performance. The methodology is executed by the Planning, Execution and Monitoring phases.

 

In the Planning phase a project plan is created same as with Critical Path method. From the completion date the plan is worked backward with each task starting as late as feasible. There are two durations allocated for each task. One is fifty per cent probability duration called as “best guess” and the other is with higher probably duration for completion called as the “safe”.

 

Resources are allocated to each task and leveled by means of the fifty per cent estimates. The Critical Chain will be the longest sequence of resource leveled tasks that lead from initiation to the finish of project. The rationalization for using the fifty per cent estimates is that half the tasks will finish early and the other half late so that the variance will account to zero.

 

Buffers are used to finalize dates for deliverables. The extra duration for each task (the difference between 50% probability duration and safe duration) is consolidated in a buffer at the end of the project. Similarly buffers are gathered at the end of each series of tasks that provide for the critical chain and a baseline is finally established. The Project Manager is also at a liberty to use probability based quantification of duration by means of Monte Carlo Simulation method.

 

In the execution phase the project network is fixed and the buffer’s size cannot be altered. The resources on the critical chain path are supposed to work only on the critical chain task and not to give in to the tendency of either delay or doing extra. There is pressure exerted on them to complete at the earliest.

 

In the monitoring phase the buffers that were created during the planning stage are monitored. A graph is created to show the utilization of buffer as a function of project completion. If the rate of buffer utilization is slow the project is on the right track.

 

If the rate of consumption is high and there is likelihood of being minimal or no buffer towards the end of the project then corrective actions must be put in place for recovery of loss.

 

There is software available in the market which companies use to support Critical Chain Project Management. For example Aurora-CCPM by Stottler-Henke , ProChain by ProChain Solutions , CCPM+ by Advanced Projects and many others.

 

These soft wares help to do CCPM plans by helping to identify the Critical Chain to focus on, by automatic generation of buffer reports, by helping to plan and execute buffer recovery.

 

The main difference between traditional and Critical Chain project management methods lies on how the uncertainty factor is managed. Used properly it can provide an extremely efficient way to gain more predictability and productivity in project planning.

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