Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 1...
Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 2...
Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 3...
Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 4...
Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 5...
Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 6...
Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 7...
Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 8...
Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 9...
Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 1...
Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 1...
Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 1...
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  1. 1. Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 1Session 10Effort Perspective: Critical ChainSimulationDr. Thomas Lechler Babbio Center 636Phone: (201) 216-8174 FAX: (201) 216-5385email: tlechler@stevens.edu
  2. 2. Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 2Session 10: Course PointerShareholderValueOutputValueStakeholderValueEffortValueCriticalChain
  3. 3. Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 3Session 10: Evidence1. How to solve resource conflicts in a multi projectenvironment?2. What is the leverage to raise the efficiency in a multi projectenvironment?
  4. 4. Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 4Topics and Objectives• Understanding the basic problems in multi-project environment.• Understanding the impact of CCimplementation• Implementing the principles of TOC• Improving effort value
  5. 5. Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 5Session 10: Agenda1. Introduction2. Multi-Project Problems3. CC Impact4. Applying Critical Chain
  6. 6. Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 61. Multi-Project Problems: Success ImpactSamples: USA: 172 Projects (112 succ., 50 fail.)GER: 448 Projects (257 succ., 191 fail.)Correlation Coefficients Resource ConflictsSuccess Criteria GER USAEfficiency -.20 -.26Effectiveness -.15 -.19Customer Satisfaction -.21 -.21Business Results -.20 -.19MEANS 4.4 4.1• Many projects suffer under resource conflicts• Resource conflicts have negative impact
  7. 7. Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 71. Multi-Project Problems: Known ProblemsIt’s the system, stupid!“Pit a good person against a bad system and thesystem will win all the time.”Rummler and Brache, 2002Deming’s 85/15– 85% of faults are process related, and it ismanagement’s responsibility to solve them– 15% of faults are the responsibility of– individual employee’s– Most time management is focusing on the “15” ratherthan the “85”, trying to find the guilty person rather thanto improve the processDeming, W.E., “Out of the Crisis”, MIT, CIA, Massachussetts, 1986
  8. 8. Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 8On-time performance N CPM N CCGreater Than 90% 9 7% 8 53%80% To 90% 12 10% 3 20%70% To 80% 18 15% 1 7%60% To 70% 20 17% 0 050% To 60% 18 15% 1 7%40% To 50% 15 12% 0 0Less Than 40% 27 22% 0 0No Response 2 2% 2 14%Results from: http://www.pdinstitute.com/surveys/surveyresults.htmQuestion: On-time performance for theprojects of my organization is:CC promises higher due date performance!2. CC Impact: Reported Improvements
  9. 9. Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 92. CC Impact: Simulation ResultsGoldratt, Viewer Notes, 1999, pp.70Simulated Project Results10% chanceto complete50% chanceto complete90% chanceto completeDays untilprojectcompletionMultiTaskingCC MultiTaskingCC MultiTaskingCCProject 1 315 81 370 111 425 190Project 2 315 160 375 200 430 235Project 3 315 185 375 210 430 240
  10. 10. Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 10CC-Project Before AfterWarfighter SystemsTesting (US AirForce OperationalTest & EvaluationCenter)18 projects in sixmonths.On time deliveryunknown.26 projects in six months.75% projects on time;30% reduction in cycle time.Aircraft Repair andOverhaul (US NavalAviation Depot,Cherry Point)Average turnaroundtime (TAT) for H-46aircraft was 225 days.Throughput was 23 peryear.Reduced TAT to 167 days, a 25%reduction while work scope wasincreasing.Delivered 23 aircraft in six months(throughput of 46 per year).70% reduction in backlogSubmarineMaintenance andRepair (US NavalShipyard, PearlHarbor)Job Completion Rate =94%.On-time delivery lessthan 60%.Cost per job was$5,043.Job Completion Rate now 98%On-time delivery 95+%.Cost per job reduced 33%Overtime reduced by 49%$9M saving in first year.2. CC Impact: Cross Case Analysis
  11. 11. Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 112. CC Impact: Cross Case Analysis SummaryThe Impact of CC across many cases:– Increased systems throughput ~ 20%– Reduced project schedule ~ 15% - 40%– Increased on-time delivery ~ 93%– Reduced backlog ~ 30% - 70%– Reduced overtime ~ 20% - 50%CC shows dramatic performanceimprovements but…
  12. 12. Mgt 610 Strategic Perspectives on Project Management(c) 2013, Thomas Lechler. All rights reserved.For academic use only. 123. Applying Critical ChainApplying the Five steps of TOC to CC-Multi-ProjectManagement:1. IDENTIFY the system’s constraint.2. EXPLOIT the system’s constraint.3. SUBORDINATE everything else to the above decision.4. ELEVATE the constraint5. DON’T let inertia become the constraint(If the constraint is broken, go to 1)In-Class SimulationGoldratt, Viewer Notebook, 1999, pp.75
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