TOC Overview

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The TOC Centre of Australia
Resource Optimisation Using Critical Chain Buffer
Management in the Multi Project
Environment Presented by David V Hodes
Tel 02 9293
2844 Mobile
0409 789 034
Fax [phone]
E-Mail david_at_tocca.com.au
www.tocca.com.au
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The TOC Centre of Australia Product Suite
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Critical Chain Projects
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Some Critical Chain Results

• The first time out, we took 26 days out of a
  71-day hypermarket re-fit, a 37 increase in
  capacity
• Matador Refrigeration
• The industry standard to get the plant up and
  running to 90 capacity is about 46 months. The
  plant was recently completed and is up to 90
  production in 13 months
• Harris Semiconductor
• We succeeded in dropping our average turnaround
  time per aircraft visit from three months to two
  weeks
• Israel Aircraft Industries
• We originally scheduled to take 13 months to
  deliver and the team did it in six months
• Honeywell DAS

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The Idea Factory
The Idea
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The Cash Flow Of An Idea

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When Ideas Become Projects

• They are late
• They are over budget
• They frequently change in scope
• Standish Group (www.standishgroup.com )
• 30 of projects canceled before finished
• 75 of completed projects are late
• Average cost overruns are 189
• Average time overruns are 222

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What About The Measures?

• Show me how you measure me, and Ill show you
  how I perform. Measure me in an illogical way,
  and dont be surprised if I behave illogically
• Dr Eli Goldratt
• Is the goal task conformance or project
  performance?

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Global Versus Local Optima

• What we want to do is
• Finish projects on time
• Finish projects on budget
• Finish projects on scope
• Shorten project lead times
• Finish more projects

• What we do is
• Manage to finish tasks on time
• Measure resources on utilisation
• Micromanage task flow
• Detailed risk analyses
• Detailed specifications

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Uncertainty Is At The Heart Of The Problem

• Vendor performance is unreliable
• Required tasks are not fully known
• Time to complete any given task varies
• Delivery of needed tools, equipment, and material
  is uncertain
• Resource availability cannot be guaranteed

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The Issue of Duration Risk
10 probability
50 probability
95 probability
BC is not necessarily 2xAB
Task Duration
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How Risk Relates To How We Are Measured
When we put safety into each task

• Projects seem to be longer than necessary
• Parkinsons Law work expands to fill the time
  available
• Tasks seldom finish early
• Student syndrome prevails 2/3 of work done
  in last 1/3 of time

Activity
Task start
Task end
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The Effect Of Multi-tasking
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Unlevelled Schedule
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Load to Capacity of C
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Critical Chain

• The definition of the Critical Chain is the
  longest set of dependent steps, taking task
  precedence and resource contention into account.

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Identify Critical Chain

• Load levelled (finite capacity)
• Critical Chain identified

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Managing The Critical Chain

• Shrink the times to 50 probability of completion
  aggregate protection in the feeding and project
  buffers

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Types Of Buffers

• Project buffer
• Placed before the customer, to protect our
  commitment to the customer (the external
  constraint)
• Feeding buffer
• Placed at each point where non-critical tasks
  join the critical chain, to protect against
  precedence conflicts on non-critical tasks

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CC, Fb and Pb

• Project buffer task 13
• Feeding buffers tasks 3 and 8

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Critical Ratio
work to completion time to completion (workbuffer
)

• Critical Ratio

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Scenario 1

• Status date represented by red line (8am Sunday
  4th November)
• Purple bars represent projected start and finish
  times
• Project buffer (Pb) penetrated
• Feeding buffer (Fb) task 8 penetrated
• Resource buffer (Rb) tasks 5 and10 scheduled
  against expected start
• Task 4 most critical to work on, as a delay here
  causes immediate Pb penetration

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But How Do We Manage The Complex, Multi-Project
Environment?

• Analyse
• Resource
• Decide

Project Pipeline
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The Classic Multi-Project
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Classic Multi-Project Statistics
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TOC Critical Chain, Drum and Buffer Management
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TOC Statistics
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Test Results
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So Whats the Choice?

• You manage the constraint

• Or the constraint manages you