Contenu connexe Similaire à What would you do if government suddenly became a really demanding client? Oded Cohen (20) Plus de commonsenseLT (20) What would you do if government suddenly became a really demanding client? Oded Cohen1. Public Sector Efficiency
Conference
Contractors parallel session:
"What would you do if the government
suddenly became a really demanding
client?"
Vilnius, September 2012
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 1
2. Oded Cohen
Oded has nearly 35 years of experience in
developing, teaching and implementing TOC
methodology, solutions and implementation
processes working directly with Dr. Goldratt all
over the world. Among the countries to which
Oded brings his expertise are the USA, Canada,
Japan, India, China, the UK, Poland, Russia,
Ukraine, Colombia, Chile, Peru, Turkey and
many others.
Oded has authored multiple TOC articles and
contributed to several TOC books.
Oded in the is the author of Ever Improve – A
Guide to Managing Production the TOC Way,
published in June 2010. Oded co-authored the
book Deming & Goldratt: The Theory of
Constraints and the System of Profound oded.cohen.gs@gmail.com
Knowledge – The Decalogue. www.toc-strategicsolutions.com
Together with Jelena Fedurko Oded has co-
authored the book TOC Fundamentals, recently
published in Russian.
Copyright © 2012 by Oded Cohen 2
3. Supplying to the State/Government
• This session is for contractors that provide the State or the Government
deliverables that have the nature of projects.
• Typical projects are in construction, infrastructure, IT, new product
development, etc.
• As such contractors are expected to meet three conditions – the projects
that they are committed to fulfill should be:
On Time
Within Budget
According to the agreed specifications (promises)
• The Reality of projects is dominated by uncertainty. As such it is extremely
difficult and seems unrealistic to expect to meet the three conditions of
Time, Budget and Specifications.
• Nevertheless, it is likely that more and more State bodies may demand from
the contractors to meet these conditions.
Contractors may find such situations challenging.
Let’s see what TOC offers.
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 3
4. TOC Offer – CCPM
Critical Chain Project Management
CCPM Implementations in the Public
Sector Working with Contractors
• Defense -
MRO - Maintenance, Repair and Overhaul
New Product Development
• Infrastructure – Roads, Bridges, Railway, Buildings
• Utilities -
Air Control
Water, Electricity etc.
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 4
6. Results Summar y of many dif ferent
project companies
• Delivery Performance >95%
• Lead Time reduced by 30%
• Costs reduced by 15-20%
• Capacity increased by 30-50%
All without any significant investment – just
changing the rules, policies and measures
Results achieved within 6-9 months
Copyright © 2012 by Oded Cohen 6
7. What is unique about CCPM –
Critical Chain Project
Management?
TOC provides a managerial approach to better manage uncertainty that
dominates projects.
TOC recognizes that key constraint of projects is the Critical
Chain – the shortest chain of dependent activities while the
dependency is not only logical but also through the resource
availability.
Critical Chain is used for better planning and better controlling
the execution of projects plans.
• In Project Planning – CCPM promotes good and realistic project
plans with built-in protection – Project Buffers and Feeding Buffers.
• In Project Execution – CCPM promotes Buffer Management, Priority
setting, Early Warning and Recovery Actions.
• TOC Provides focus by setting the measurement for project
management – to be a reliable provider.
• Outstanding performance – reliability and competitive lead times can
bring the provider more sales.
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 7
8. Why is it so difficult to deliver on time
• There are too many uncertainties stemming from
the nature of the project (first time, new technology etc.),
the lack of control (customers’ instructions, bureaucracy, other contractors
etc.)
and Murphy – what can go wrong – will!
• Typical situations that can block the progress of State Projects:
There are too many cost overruns against budget – materials, resources etc.
Existing projects are disrupted by ‘extra work’
Many tasks (activities) take longer than planned
Progress payments are not received when expected
Revisions for late changes to scope hold us up
Too much rework
Too much overtime (especially before milestones and towards the end of the
project)
Too many resources are not available when needed (they have many
simultaneous tasks)
Priorities constantly shift
Top management under pressure to add more resources
Often scope or specifications are cut from a project
TOC claims that a Core Problem is responsible for the existence of the
majority of these problems.
Any solution must address the Core Problem.
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 8
9. Understanding the
Problem
Current Reality
B D Core Problem
A A conflict diagram - Core Cloud
C D’
B D
Ensure the project Take
is on-time corrective actions
and in full that compromise
(according to specs) project budget
A
commitments
Run projects
successfully
D’
C Do not take
corrective actions
Protect budget
that compromise
commitments
project budget
commitments
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 9
10. Analysis and solution application
What to change? What to
change to?
Low Performance High Performance
Measurements Measurements
Future Reality
• Elements of the
Current Reality
GAPS solution
and • Closing the Gaps
Gap Analysis
• Logic of the solution
• Benefits
Core TOC direction of solution
Problem PIVOT
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 10
11. The TOC Pivot – Managing Constraints
Lift
The
PIVOT GAP
TOC
Block
THE PAST TODAY THE FUTURE
What is the constraint of the project management?
When does the system create value for the goal of making more money?
The shorter is the time to complete the project – the better!
At the completion of the project – Throughput is generated and money
invested is starting to be returned!
Conclusion: Projects have the TIME constraint.
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 11
12. TOC Direction of Solution
CCPM –
Critical Chain Project Management:
The TIME constraint of the project is
Future Reality
presented through the Critical
Chain – the longest chain of
dependent activities. Managing the
project through the CC is geared
to finish the project in a safe and
quick way.
TOC direction of
solution
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 12
13. Overview of the TOC Solution
for Project Management
CCPM
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 13
14. TOC Solution for Single Project
Management
Strategy:
The Project is On Time, In Full & Within Budget
Tactics:
The Project organization implements Critical Chain project management
Mindset:
Projects to Customers Planning Execution Control
are the Injections 2-4 Injections 5-9
Prime Driver – the Drum
Injection 1
The Prime
Measurement
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 14
15. CCPM – Injection 1
Achievement of the delivery
commitments is established as a
Prime Measurement for managing
project environment
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 15
16. CCPM – Injection 1
DE Achievement of the delivery commitments is
E
established as a Prime Measurement for
N
D
B
U
R managing project environment
Inj
Measuring On Time Delivery
1. Reliability - The number of projects that were delivered on-time (or
early) versus the total number of projects within time “buckets” (e.g.
month, quarter, year). [Percentage]
2. For internal use: The amount of money that has been delivered on time
or early versus the total value of the projects within time buckets
[Percentage].
3. Also for internal use : The financial impact of the late delivery – T$D –
Throughput Dollar Days. [the amount of money delayed multiplied by
the number of days late]
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 16
17. Project Planning the TOC Way
CCPM - Injections 2-4
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 17
18. TOC Solution for Single Project
Management
Tactics:
The Project organization implements Critical Chain project management
Mindset:
Projects to Customers Planning Execution
are the Injections 2-4 Control
Prime Driver – the Drum Injections 5-9
Injection 1
Injection 2 Injection 3 Injection 4
Project Planning Critical Chain
Diagrams Plan Buffers
Criteria for a Good Project Plan:
• Provide Financial Benefits
• Realistic
• Immunized against Disruptions
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 18
19. CCPM – Injection 2
Project Planning Diagrams are in place
with tasks resourced and estimated for
duration – while estimates of durations are
challenging but achievable
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 19
20. CCPM – Injection 2
DE
E Project Planning Diagrams are in place
N
D
with tasks resourced and estimated for duration – while
B
U
Inj R estimates of durations are challenging but achievable
Project Planning Diagram
Build a diagram of task dependencies and check its quality in accordance
with the following criteria:
Completeness – No more than 400 tasks
All dependencies are identified
The deliverables ("output") of each task clearly known
All tasks are connected "Finish-Start”
Feasibility
Required resource(s) – main resources, no fractional and no specific names
Duration of tasks – no forced dates
CCPM-Injection 2 establishes a mechanism and procedures to develop a quality
diagram of the project plan, with duration of the tasks to be
set “Challenging, but achievable“.
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 20
21. CCPM – Injection 2
DE Project Planning Diagrams are in place
E with tasks resourced and estimated for duration – while
N
D
B
U
R
Inj estimates of durations are challenging but achievable
Estimation times – Current reality in projects
Why? Because of
Task duration - Behavioral reasons
the behaviour of
for 80% probability distribution
managers –
in planning phase
managers ask for
•Students syndrome estimations
in execution –
• Parkinson’s Law
they treat
Probability of
• Bad multitasking estimations as
completion
justified
commitments
Tasks contain a
lot of safety! 50% 80% Time
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 21
22. CCPM – Injection 2
DE
Project Planning Diagrams are in place
E
with tasks resourced and estimated for duration – while
N
D
B
U
R
Inj estimates of durations are challenging but achievable
Task duration – Behavior
Estimation times – must go through a challenging process
Probability of
Probability of
completion
50%80% Time completion 50% 80% Time
TOC approach – estimates of duration should be challenging but achievable!
In majority of the cases the duration with 50% probability equals HALF the
duration with 80% probability.
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 22
23. CCPM – Injection 3
Critical Chain determined through
resolving resource contention
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 23
24. DE CCPM – Injection 3
E Critical Chain determined through resolving
N
D
B
U
resource contention
R
Inj
Making the project plan realistic means that we identify and
address resource contention situation. This is
happening when the plan calls for the same resource to
perform more than one task at the same time.
Two mechanisms are used to handle the situations:
1. By re-assigning resources that are likely to be available
when needed by the plan
2. By sequencing the tasks by creating dependence
between tasks due to availability of resources – this is
the Critical Chain
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 24
25. DE CCPM – Injection 3
E Critical Chain determined through resolving
N
D
B
U
resource contention
R
Inj
Sorting out Resource Contention:
The Critical Chain is the chain of dependent events - one
that takes into consideration all dependencies (including
resource dependency).
Critical Path Promise = 56 days
G10 B10 M16
Letter and M16 - Resource contention! C20 Finish
Colour = Resource
W16 M16
Critical Chain G10 B10 M16
C20 Finish
W16 M16 68 days
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 25
26. DE CCPM – Injection 3
E Critical Chain determined through resolving
N
D
B
U
resource contention
R
Inj
The role of Critical Chain in managing projects
The Critical Chain is the chain of task and resource
dependencies that prevents the project from being
planned in a shorter interval, given finite resources.
The Critical Chain provides the major focus and back bone
for the planning. It plays even more important role in
controlling the execution of the plan.
Hence – the name of the solution - CCPM
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 26
27. CCPM – Injection 4
Buffers are inserted in strategic
points
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 27
28. E
DE CCPM – Injection 4
N
D
Buffers are inserted in strategic points
B
U
R
Inj
Reality in projects – Working to task due dates
What happens if it takes more than 10 days -
Plan 10 10 16
Actual > 10 (15) 10 16
RESULT - The delay of 5 days is passed on - the project is
”said to have “moved to the right
What happens if it takes less than 10 days -
Plan 10 10 16
Actual <10 (6) 10 16
Because of working to task due dates
the positive variation is not passed on (usually)
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 28
29. CCPM – Injection 4
DE
E Buffers are inserted in strategic points
N
D
B
U
R
Inj
Buffer – is a protection mechanism
The Critical Chain of each project is being protected by the
placing of sufficient time buffers at strategic points within
the flow of tasks:
Project Completion Buffer (PB)
Feeding Buffers (FB)
Feeding
Buffer - Project Completion
FB Buffer - PB
G10 B10 M16
C20
W16 M16
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 29
30. Execution Control
the TOC Way
CCPM - Injections 5-9
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 30
31. TOC Solution for Single Project
Management
Tactics:
The Project organization implements Critical Chain project management
Mindset: Planning
Projects to Customers
Execution Control
are the Injections 2-4 Injections 5-9
Prime Driver – the Drum
Injection 1
Injection 5 Injection 6 Injection 7 Injection 8 Injection 9
Reporting Resource Recovery POOGI Critical
Buffer Management
Priority
availability Actions Resources
Criteria for Good Execution Control : Priority, Recovery, POOGI
The Reality of the Project Execution – DELAYS!
The TOC Way means: Manage through the Buffers!
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 31
32. Introduction to Execution Control
Buffer Status
The penetration to the buffer states the amount of days
consumed from the buffer.
Buffer is split into three parts and the consumption zone is
colored by a relevant color – green, yellow, and red.
The planned size 100%
of the buffer project
completion Buffer
consumption
The buffer status is used for Self-expediting, Priority of assigning
of resources and for Prompting management actions and
decisions
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 32
33. CCPM - Injection 5
Tasks are performed according to the
status of their corresponding buffers
through using Buffer Management.
Resources inform daily how much time it
will take them to complete the task.
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 33
34. CCPM-Injection 5
Tasks are performed according to the status of their
corresponding buffers through using Buffer Management.
Resources inform daily how much time it will take them to
complete the task.
Buffers Status
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 34
35. CCPM-Injection 6
Resource Availability is monitored in
anticipation of a new planned task
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 35
36. E
DE CCPM-Injection 6
Resource Availability is monitored in
N
D
B
U
R
Inj
anticipation of a new planned task
In order to ensure resources for the tasks in CC
– look ahead!
The length of the project is determined by the CC.
Any delay on CC can bring the whole project to be late.
When a resource is not available for a task on CC and the task has to
wait for the resource – it causes delays on CC.
In order to prevent such situations – project manager must ensure that
all resources assigned for CC were available when they are needed.
This can be achieved through early check and early warning.
This is like a “wake-up call” for a resource on CC.
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 36
37. CCPM-Injection 7
BM for recovery actions is in place
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 37
38. DE
CCPM-Injection 7
E BM for corrective actions
N
D
B
U
R
Inj
(expediting) is in place
Restoring the level of the Buffers
The reality of the project is DELAYS!
The penetration to the buffer presents a risk to the
expected completion of the project.
When the trend of Buffer Consumption is too high or
when the remaining level of buffer is below
Low(=RED!), managers are expected to come with
ideas of how to restore the buffer to higher level.
These ideas are discussed and actions agreed.
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 38
39. CCPM-Injection 8
Buffer penetration reasons are
reviewed periodically for POOGI
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 39
40. DE
CCPM-Injection 8
E Buffer penetration reasons are
N
D
B
U
reviewed periodically for POOGI
R
Inj
Buffer Management Statistics
The commitment to POOGI is performed through collecting
statistics of major reasons for delays while the buffers
are depleted. The reasons are collected and used for
statistical analysis.
A periodically meeting to review the statistics of the
reasons for buffer penetration is held.
The meeting is used to decide on the necessary actions to
eliminate causes for buffer penetration. Improvement
initiatives are agreed and the progress of implementing
these initiatives is monitored by the Buffer Management
Committee assigned.
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 40
41. CCPM-Injection 9
Resources are monitored as potential
CR – Critical Resources
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 41
42. DE
CCPM-Injection 9
E Resources are monitored as potential
N
D
B
U
Inj R CR – Critical Resources
Please note that in reality there is a pressure to dedicate
resources to projects. This stems from the demand for
resources to be available when needed (as per the
evolution of the original plan). Nevertheless – resources
can be used in more than one leg of the project and
hence can become critical.
Even though the Critical Chain mechanism ensures that
there is no resource conflicts and contentions in the plan
– the unfolding reality can cause resource contention
and highly utilized resources can cause delays and
penetration to the buffer.
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 42
43. CCPM Implementation Map
Deliverables for starting the next phase
Phase 1 Phase 2 Phase 3
Mindset: Planning Execution Tactical Strategic
Customer Systemic Control technical deliverable:
orders are the approach to & deliverable:
Prime Driver project plan Global Projects are
for managing diagrams CCPM for delivered on time
improvements
projects – planning and within budget and
The Drum execution according to
control is in original promises
place
Deliverable: Top Deliverable: There is a
management accepts good enough plan that
the business serves as a base for the
opportunity associated proactive execution
with on-time delivery control
Copyright © 2012 by Oded Cohen Oded Cohen – TOC For Contractors 43
Notes de l'éditeur Программа Стратегиские Решения - Модуль 1 Управление производством по ТОС 23-26 ноября 2009 Москва Программа Стратегиские Решения - Модуль 1 Управление производством по ТОС 23-26 ноября 2009 Москва Программа Стратегиские Решения - Модуль 1 Управление производством по ТОС 23-26 ноября 2009 Москва Программа Стратегиские Решения - Модуль 1 Управление производством по ТОС 23-26 ноября 2009 Москва Программа Стратегиские Решения - Модуль 1 Управление производством по ТОС 23-26 ноября 2009 Москва Even though the term Throughput is used – we actually refer to the cash payment associated with the order. Wording of injections 5 and 7: To avoid confusion we have to establish a clear cut between the two injections. Injection 5 for resource allocation only . This is done through the use of BM for assigning priorities to tasks. This is nearly automatic procedure – task are given priorities according to the buffer penetration levels. The procedure for resource allocation follows from the priority assigned to the task. Injection 7 is activated when the resource allocation is not enough in order to guarantee the on time completion of the project. Usually, we should be concerned when the project completion buffer is in the red. Therefore, it is expected that project management will consider, suggest and take some drastic actions that will lead to recovery of the buffer. Recovery means that the buffer is not depleted to the extent that the on time delivery is at significant risk. In injection 7 we are looking for actions that beyond just assigning resources. Many times we look for taking actions on tasks of the critical chain that will end up by reducing the duration of a task or several tasks on the critical chain. Not always such actions are within the authority of the project manager or any of the resource managers – and a part of the process includes the thinking, suggestion and obtaining permission and funds for the recovery actions. Figure 12