At the DIA conference in Berlin this year, I spoke to a senior executive in the life science industry about Critical Chain. Based on the data seen in this and other industries, it is fair to say that a well implemented Critical Chain Project Management process can accelerate projects by fifteen percent (15%) in the first year. We have seen a peak improvement in execution speed of up to thirty five percent (35%). Also, it is very common for Critical Chain-ized organizations to get to a ninety five percent (95%) on-time delivery rate at the same time. This astonished him quite a bit, because at first glance the findings seem to be counter-intuitive. Why does Critical Chain Project Management achieve these high on-time delivery rates in industries known for being chronically late? How does it happen that all of a sudden projects come in even earlier than before? Why is Critical Chain enabling rapid and reliable project execution at the same time?
The key to these results are the behavioral changes induced by Critical Chain Project Management. There are two major aspects: Planning and execution.
1. Development of cross-functional schedules: Critical Chain Project Management emphasizes careful up-front planning. All major stakeholders within a project come together to define the work that needs to get done. During a schedule network built team members are systematically analyzing how the various company functions are able to optimize their collaborative work. The team goes systematically through all key activities analyzing which tasks really depend on each other. Those tasks need to be worked in sequence. Whenever teams are able to “break” links finding new ways to work tasks in parallel, we have an opportunity to get things done faster. If these activities are on the Critical Chain, then this is a great source of acceleration. The cross-functional dialog is key to identifying these opportunities.
2. 50/50 durations: Critical Chain teams use so called “50/50 durations” as a basis for their task duration estimates. A 50/50 duration is the time estimate for a task that can only be achieved on every second attempt. In other words: 50% of the time it takes longer to execute this task. The 50/50 duration is an aggressive task estimate. We are peeling all the protection off the estimate. This is a major difference to most other schedule approaches that use so called “padded durations”, which accounts for perceived uncertainty for all sorts of reasons such as multi-tasking, unforeseen issues etc. Of course, nobody likes to be rushed. We like to build protection into our estimates, so that we have a local buffer for the unexpected. However, we found that the use of “padded durations” is often a self fulfilling prophecy. For example, let’s say an engineer has two weeks to complete a design task. In most cases the task will be completed in that time frame (not earlier), because the engineer is not starting with the work before he gets reasonably close to the due date. This is known as the Student Syndrome. If something goes wrong, the actual task duration is longer. This also shows that conventional scheduling approaches are not well designed to encourage early deliveries. However, longer task durations almost always lead to delays in projects. In Critical Chain we account for uncertainty not on a task level but on the project level. Instead of having a buffer for each task – where we know it will be consumed regardless – Critical Chain uses project buffers.
During execution Critical Chain teams learn how to minimize the buffer consumption. How do they do that?
1. The Relay Race: In a well designed Critical Chain schedule it is one hundred percent (100%) transparent which tasks need to be focused on to complete a project in time. Without uncertainty, it can be determined which tasks are on the “Critical Chain” – the longest chain of tasks through a network, taking tasks and resource constraints into account. Any day of slippage on a Critical Chain task will cause slippage on the overall project. All a team has tolearn is how to minimize delays on tasks that are on the Critical Chain. They do this by completing the tasks as focused and as quickly as possible. Next, the output of such a task needs to be handedover to the next person wonign the follow-up task on the Critical Chain. We call this “running the relay race”. Software helps to identify these tasks and makes them visible. Establishing the mind set of a realy racer with all team mebers is the crucial part.
2. Early mitigation of downstream schedule risks: The second key behavior of a Critical Chain team during execution is the constant screening of downstream risks to the schedule. Successful teams learn how to identify those risks using the schedule as the basis for their analysis. They put mitigation plans together well before the actual risk occurs. That way they are prepared.
In summary, rapid and reliable project execution is not difficult conceptually. Critical Chain teams are trained to develop aggressive but doable project schedules. During execution teams use the Relay Race approach to minimize delays on tasks that are on the Critical Chain. In complex project environments (e.g. the R&D organizations in the pharma, semi conductor and/or aerospace industry) tiny deviations can easily add up to weeks, months or even years. So, it’s worth to aggressively avoid them. Also, Critical Chain-ized teams constantly look for downstream schedule risks. As a result, teams act upon the occurrence of such risks much better, and in a timely manner because they are well prepared. While the Relay Race creates the speed, the early risk mitigation produces reliability.