What if there were a way to speed project completion dates for engineering firms?

1. PDI
Tony Rizzo
+1.908.930.0411
pm_tools@icloud.com
Fast Matrix
Engineering Applied To Business
© 2014 Product Development Institute, Inc.
For Engineering
Companies
The Value of Speed
1

2. Throughput. The amount that we keep.T ≡
time
money
(=)
time
money
(=)R Revenues.≡
dimensionless(=)The fraction that we spend.v ≡
The fraction that we don’t spend.=(1 – v) dimensionless(=)
T = (1 – v) • R time
money
(=)
mean rate of completionn ≡
time
projects
(=)
Mean throughput per project.T P ≡
project
money
(=)
T ÷ NT P =
project
money
(=)
Throughput. The amount that we keep.T ≡
time
money
(=)
time
money
(=)R Revenues.≡
dimensionless(=)The fraction that we spend.v ≡
The fraction that we don’t spend.=(1 – v) dimensionless(=)
= (1 – v) • R time
money
(=)
Mean rate of completionn ≡
time
projects
(=)
Mean throughput per projectT P ≡
project
money
(=)
T ÷ nT P =
project
money
(=)
2
Throughput per Project

3. © 2014 Product Development Institute, Inc.
Increasing the rate of completion, from 60 projects per year
to just 70 projects per year, increases the profits by $500,000.
!
Is it really possible to finish more project per year,
without hiring more people?
What Does It Mean?
3

4. It’s Been Done Multiple Times (Confluence, 2002)
4
Finish-to-Finish(days)
0
23
45
68
90
M
ar9,2004
Jun
20,2005
O
ct2,2006
Jan
13,2008
Apr26,2009
29 days
13 days
Data provided by Kirk Botula, COO
W/ multitasking W/o multitasking
! Mean Rate of Completion (projects / year) ➔
29 ! Mean Spacing Interval (dob finish-to-finish) ➔ 13
Zero new hires
9 20
© 2014 Product Development Institute, Inc.

5. Duration also Improves
0
100
200
300
400
500
600
0 50 100 150 200 250 300 350
Duration at Completion (days of business)
ActualScope(staff-daysofeffort)
Delayed by the customer.
Data provided by Kirk Botula, COO
Equal heights indicate equal scope.
Confluence develops software for the mutual-fund industry.
Mean
Std Dev
87
140 145
92
w/
multitasking
w/o
multitasking
Scope
(staff-days of effort)
5© 2014 Product Development Institute, Inc.

6. “has the units”
Si1
Measuring the Rate of Completion
1 i
1A
1G
1J
1B 1C 1D 1E
3A
3 i
3G
3J
3B 3C 3D 3E
2 i
2H
2G
2A
2J
2B 2C 2D 2E 2F
4A
4 i
4G
4H
4J
4B 4C 4D 4E 4F
Time
Finished
Projects
Mean Spacing Interval, MSi
Si2 …Si3
MSi
260
Sik∑
k=1
n
1
n
Mean Rate of Completion, N
≡
≡ (=)
year
dob
project
dob
project
dob
(=)
year
projects
* 260 is the number of days of business per year, for businesses that operate Monday through Friday.
*
6
Average no. of days of business
(dob) from the finish of one
project to the finish of the next.
(=)
© 2014 Product Development Institute, Inc.