Critical ChainEliyahu M. Goldratt

Plot The main story in the book is about an associate professor named Rick Silver who is struggling to make it in the academic world. He is a very good teacher, but he wants tenure and is in need of publications. His area is project management and he wants the articles to make a difference in this field. The fact is that the theories applied to project management are not effective and projects are running late at high expenses. The work is moving very slow, but he gets the inspiration when he is assigned to teach a course in an Executive MBA course.

Plot During the course professor Silver and his students develop the concept of the “Critical Chain”. The teaching style of professor Silver is conversation with the students about different topics. The students get homework to do and in this course the homework tasks becomes case studies for the theories that they develop in the classes. He is also helped by the fact that three of his students are involved in a project at their company to develop a way to cut product development time.

The Critical Path The longest path to the finish of a project The Critical Path determines the time it will take to finish a project Any delay to the critical path will delay the completion of the project A manager has to make decision weather to start the non critical path early or late

Safety time (Because Murphy does exist) The difference between the median of the probability distribution and the actualestimate is the safety we put in.

Murphy’s Law- In any field of scientific endeavor, anything that can go wrong, will. - If the possibility exists of several things going wrong, the one that

will go wrong is the one that will do the most damage. - Everything will go wrong at one time.

- That time is always when you least expect it. - If nothing can go wrong, something will. - Nothing is as easy as it looks. - Everything takes longer than you think.

Murphy’s Law - Left to themselves, things always go from bad to worse. - Nature always sides with the hidden flaw. - Given the most inappropriate time for something to go wrong, that's

when it will occur. - If everything seems to be going well, you have obviously overlooked something. - If in any problem you find yourself doing an immense amount of work,

the answer can be obtained by simple inspection. - Never make anything simple and efficient when a way can be found to

make it complex and wonderful.

Theory of Constraints Identify the systems constraints

(that which prevents the organization from obtaining more of the goal in a unit of time) Decide how to exploit systems constraints

(how to get the most out of the constraint) Subordinate everything else to the above decision

(align the whole system or organization to support the decision made above) Elevate the systems constraints

(make other major changes needed to increase the constraint's capacity) Do not allow inertia, go to step 1 if a constraint is broken

Theory of Constraints “In order to mange well, managers must control cost, and at the same time,

throughput” We cannot be satisfied with one without the other Organizations traditionally are managed according to the ‘cost world’

Three Safety Insertion Mechanisms Time estimates are based on a pessimistic experience, the end of distribution curve The longer the number of management levels involved, the higher the total estimation Estimators also protect their estimations from a global cut.

Three Safety Wasting Mechanisms Student Syndrome Multi-tasking Dependencies between steps

“A delay in one step is passed, in full, to the next step. And advance made in one step is usually wasted”

Student Syndrome We first fight for safety time When we get it, we have enough time, so why hurry We sit down to do it at the last minute, that’s human nature

Multi-tasking Multitasking is probably the biggest killer of lead time.

A B C

A B C A B C

20

10 10 10

Buffers Project Buffer

Inserted between the last task and the completion date.Any delays in the project will consume some of the buffer.

Feeding BufferIt protects the critical path from delays occurring in the

corresponding noncritical paths Resource Buffer

To ensure the availability of people & skills for the critical chain tasks.

BuffersA1

1

B1 B2

2 3 4

FB

FB

Project Buffer

Thank You