Be Fast or Be Gone: Racing the Clock with Critical Chain
Project Management by Andreas Scherer
Last annotated on November 17, 2014
every company I’ve ever known has had timing problems. Almost everyone is
always running later than they want to be.
“During the planning phase we look for two things. First, tasks or
sequences of tasks that can be worked in parallel instead of in series. That’s
a huge source of speed. Second, we try to find the true touch time for
individual tasks—that’s the hands-on time that it takes to get something done.
Once we have that we’re able to come up with much more compact project
schedules.
“We also model the resources required to get the work done. This lets us
find the longest chain of tasks that takes task and resource constraints into account.
That is the Critical Chain. Then we work to shorten it. If your team has
identified the shortest possible Critical Chain, it has found the fastest way
to get a project done. We combine that with a week-to-week update process that
turns that plan into reality. That’s how we saved thirty-five percent of our
cycle time.
“Every week we identify those specific tasks that could delay the whole
project schedule. We call them “Critical Chain” tasks. By definition these
tasks drive the timeline. We ask any person working on one of these Critical
Chain tasks to work on it with as much focus as possible.
The best part is that the clear focus and priorities that come from the
schedules can help dramatically reduce multitasking, which means everyone can
be faster and more efficient. It’s almost like a relay race for knowledge
workers.”
“You’re always going to have stuff that comes up, problems you didn’t
anticipate. What we do is take some of that time we took from the individual
tasks and give it back to the overall schedule. We call it a ‘buffer.’ It’s
safety time that protects the whole project, not just one person or department.
When you make safety time explicit like that, and when you share it out through
the whole project, you can manage it and use it where it’s needed. Critical
Chain schedules provide fantastic on-time performance.”
If anything, we found at Versa that quality increases with this approach.
We want people to focus on their essential tasks. We want them to get it right
the first time. Doing things that way avoids expensive rework.
The principles are pretty fundamental. It’s really just about improving the
speed and consistency with which projects get executed.
give me two weeks. Let me get a close look at your processes, interview
your team, and create an initial project schedule. I call it a network build. I
would need the team to be all together in a room for about three days. We’ll
look into every corner of your processes. Then I can tell you what’s possible
here at Altus and what’s not.
“But when you’re in charge it drives you crazy. Instead of giving you the
bad news right when they get it and when there might be time to address the
problem by maybe borrowing some people from another project, your crew waits
around and everything gets later and later and more and more expensive.
You put a little extra time in so that the committees have something to
cut. When they cut that amount, you’re just fine. When they cut a little more,
you have to hustle or play a little Schedule Chicken. But sometimes you get
lucky and they cut less. And then you win the game right there. And everybody
knows they’re playing and nobody talks about it,
To allow for all the time we lose from the multitasking and switching of
priorities we just add more padding to our templates.
“And if they don’t cut you to the bone and you end up with a little extra
time, I bet nothing ever comes in early, because when something looks like it
will get done early there’s always something else to distract from it that
might be late. Some people call it Student Syndrome, because students always
seem to want to wait until the last minute and then scramble to put their stuff
together.”
The irony in this world was that most people met their commitments
individually but a significant number of projects were late.
I have a pretty good picture of how you run your project timelines. You
have these milestones for any project. They’re negotiated dates—very safe, very
conservative, because it counts against people if they don’t make them,
regardless of why. So, everyone makes sure that there is plenty of protection
for their individual tasks. There’s so much padding no one needs to push, and
no one’s ever early.”
If someone in a project gets a task done early, they probably don’t say a
word about it, because they don’t want to be expected to deliver that fast all
the time. No one wants to see their protection disappear. Also, since nobody’s
expecting anyone’s work to finish early, there is no advantage in the current
system even if part of a job does get finished faster.
Basically, if something good happens and you are ahead of time, then you
don’t have a way to take advantage of this early finish. And if something bad
happens, if things take longer and a milestone is pushed out, it ripples
through the entire project and you’re late.
What do you need from me?” “Just two things. I need your endorsement. Let’s
bring the team together and tell them you’re trying something new. You’re
thinking about piloting a new approach to Project Management. Then I need your
support in challenging the templates.”
Sometimes, there are tasks that are worked in series when there is no real
reason for it. If we find those, we can go ahead and ‘break’ the link between
them. If we do that whenever possible, we can save a lot of time.
We need to figure out what we call the ‘touch time’ for each task. What I
mean by touch time is the actual time it takes to get a task done if you do only
that task.
Instead of putting in our personal buffers on each task, we will create a
project buffer as a shared protection for the whole team to use.
The thing to get about it right now is that when you’re using Critical
Chain, no one is going to punish you if you don’t hit your task estimate
exactly. All you have to do is to work with as much focus as possible on tasks
that are crucial to the project.”
Then we can use this software to compute what is called the Critical Chain.
This is the longest chain through a project network that takes into account all
task and all resource limitations.
We need to know which tasks you need to do in what order. We need to know
what resources they need and what their touch times are.
we can come up with a sequence of key tasks that gets us from A to B. We
will also have identified the true touch time for those key tasks. As a result
we’ll have a strong plan that keeps our focus where it needs to be as we go
into project execution.
“Then, we’ll meet on a weekly basis. We’ll discuss which tasks are on the
Critical Chain. Those tasks will need to be worked with high priority. Everyone
in this room will be given permission to focus on Critical Chain tasks until
they are done. That way the work can be handed to the next person who is
waiting for it. We’ll minimize multitasking.
“Then, last, there’s the project manager. It’s my job to help overcome
obstacles, run interference so that you can do your job, and screen the project
network. I’ll constantly look for any risks to tasks, in particular those that
are on the Critical Chain. Now, the PM will need your help identifying these
risks.
“Say I have
ten books to read, each with two hundred pages. If I read twenty pages per day
and I multitask, I’ll have read twenty pages of each book after ten days of
reading. And I probably won’t have a clue what’s happening in any of them.
After twenty days, I’ll be forty pages into each book, and I’ll finish them all
somewhere between days ninety-one and one hundred. And since I don’t have a
perfect memory, in all likelihood, I will have to go back to remind myself of
what I’ve read. Going back over material I’ve already read is what I call
switching costs. Switching costs in the real world can be even higher that.
They can easily make up twenty to thirty percent of the whole task.
“But, if I read in a focused way, I will have read all of my first book on
day ten. I will finish my second book on day twenty. At the end of day ninety I
will have read nine out of ten books and be ready to start my tenth. I won’t
have any redundant reading to do. I won’t have any switching costs.
“So, the first takeaway is: Reading in a focused way, I will have read nine
out of ten books on day ninety. By multitasking I won’t have completed any of
the books by then. It’s all still work in progress. That means I cannot fully
take advantage of the content of any of the books, nor can I pass any of the
books to someone else. Now, the switching costs are a big deal. The more books
I read in parallel, the harder it will be to keep track of where I am. If there
were a hundred books on my night stand, I would get nothing done. I would have
forgotten what was in the first twenty pages of the first book by the time I
finished the first twenty pages of the hundredth book. I would have to read it
all over again.”
“The typical project buffer is about 50% of the Critical Chain length. So, for Supragrel, we would add three months to the project schedule.
This methodology relies on three simple principles:
One: Aggressive but Realistic Schedules—Create the best possible schedule
to get a project from where we are to where we want to go, taking into account
the inevitable bumps in the road.
Two: Running the Relay Race—Apply focus on key tasks that are drivers of
the overall timeline. Get those tasks done quickly and move the results of the
work quickly to the next person. Have the mindset of a relay racer.
Three: Proactive Risk Management—Identify and address as early as possible
all key risks that might impact the project and its timeline negatively.
“We’re going to make it very easy to track how our race is going. Every
week we’ll update how far along each task is. Based on the input of each team
member, we’ll be able to calculate something called a fever chart. A fever
chart shows us how much work we have done, how much we have left to do, as well
as how much of our buffer we’ve used up and how much is left. This is what a
typical fever chart might look like. On the x-axis it shows us the percent of
the Critical Chain we have completed. On the y-axis it shows how much buffer
time we have used up. The colors show how much trouble we’re in: the more
buffer is used, the hotter the fever. Green means the project is on track for
an early finish. Yellow means the project is on track for an on-time finish,
but the team needs to watch out for additional buffer consumption. Red means:
Watch out; if the team doesn’t find ways to gain back some of the time, it will
be late. Being in the red does not mean that everything is lost. It just means
that the team needs to execute a buffer recovery plan.”
in this project as in every other project he’d worked on, some tasks that
weren’t formally on the Critical Chain were very close to it. Identifying those
and keeping an eye on them was essential.
7:30 A.M. Those meetings, scheduled so that all the team members could hit
the work week up-to-date and ready to run their lap of the relay, allowed the
team to work through the most immediate deadlines and to clarify who was doing
what. Most importantly, Mike always used the meeting to alert team members who
were about to receive input from other members who were ready to finish and
pass on their Critical Chain tasks. Managing these handoffs was crucial for
speed. With fair warning, people were able to reschedule personal and office
commitments so they could focus on their Critical Chain task when they got the baton.
People who had the baton on their desks received special treatment. They
were exempt from going to meetings that were not essential to their Critical
Chain task. They weren’t expected to return emails or phone calls right away.
The kind of focused work, creative thinking, and good humor that spurred
the use of a real baton was becoming a hallmark of Mike’s team.
As a result, people in R&D were multitasking like crazy because they
didn’t want to be seen as uncooperative. No one at Altus Labs liked to say no.
“My team has some very talented and experienced project managers. I’d say
about ten percent of the group are rock stars. Everybody wants to have them
leading their projects. They get the job done. Then, I have about ten percent
in my group that I’d rather not have. Eighty percent are somewhere between okay
and good. They’re solid but not exceptional. What I need is more rock stars. We
keep buying new software, but I think we’re chasing the wrong problem. We don’t
need new tech. We need better processes, and we need people who can execute
them consistently.”
We need revenues to continue our research. The drugs that make it to market
don’t just need to recoup the investment we make in that particular drug. They
also need to recoup the investment in all the other drug projects that never
will be a product.”
He said that the entire industry has a cold but that Altus Labs has
pneumonia.
Altus Labs is obese, perhaps morbidly obese. We are not talking about XXL obese. We are talking being overweight by two hundred pounds. Altus can barely walk. It is on a diet of fast food, soda, and chocolate chip cookies. This needs to change. We need to put Altus Labs on a health plan to get it back on track. Altus Labs needs to learn how to eat healthy. Altus Labs need to exercise. There won’t be rest for anyone at Altus Labs. We are going to have to walk faster—even run—because otherwise we are not going to make it.”
you can’t even keep your commitments half the time. If we were an airline,
nobody would fly with us.”
When it comes down to it, the milestones and due dates you are using to
manage your work are nothing but negotiated timelines. For management, nothing can
be fast enough, so you try to get to aggressive commitments. For the people
doing the work, it’s important to hit commitment dates because that’s how they
make their annual bonuses. So they try to get the least aggressive commitments.
second major issue has to do with prioritization, or really with the lack
of it. You have introduced a vast number of new projects into your R&D
pipeline
“Here is the problem. Humans are not good at multitasking. If I asked you
to drive from here to Philadelphia at sixty-five miles per hour while having a
meaningful phone conversation with one of the Wall Street analysts, you would
probably do one of those things pretty poorly. If I asked you to do these
things and also write an email to your staff about their annual goals and
objectives, you would probably either give the wrong guidance to your
organization, mishandle an important call with a key analyst, or crash your
car. However, you routinely expect your scientists to juggle many projects.
They have no chance to stay focused on critical tasks, because they really
don’t know what is critical.”
“But if we don’t have milestones, how can we hold people accountable for
their timelines? How can we make sure that they do their job?”
We ask them to hit those, when possible, but to know that if they estimated
incorrectly, we’ve got some buffer built in to take care of them. By doing
that, we encourage people to finish early, and we can take advantage of that.
Since the whole project team owns the buffer, they work together to conserve
it. That way we have more accountability on the team level, in addition to the
increased visibility on the management level.
“Our teams need to have the ability to prioritize the work on their
project. If a task is on the Critical Chain, our teams need to have permission
to do anything they can to get that task done. If that means someone needs to
skip a non-essential meeting, then let it happen. If a team member is working
on multiple projects, she must be allowed to focus on Critical Chain tasks over
work that is not yet on the Critical Chain. If someone must choose between two
critical tasks, they need to be able to tell which belongs to the higher
priority project.
“I doubt that we’re going to be able to get all of our drugs perfectly
prioritized. How can we possibly prioritize correctly given all that uncertainty
in this industry?”
“You’re right. There will never be a perfect prioritization scheme. But
right now you have none. Each of the fifteen thousand employees in R&D can
develop his or her own priorities, and I guarantee you they won’t look the
same. As a result, you have a huge amount of multitasking. “What you need is
the relay race mentality
We will have the portfolio ranked and we will have a mechanism to
communicate our priorities.
I need the top ten PMs in the company to learn how to teach, learn how to
run projects, and learn how to go through team planning. It will take three to
six months to get this initial group ramped up. They’ll be trained on the job,
while we are putting Critical Chain plans in place for our key portfolio
projects. I think we’ll need about a year to convert the entire project
portfolio.
We need a combination of software and process that lets us support the
Critical Chain methodology and the ‘relay race’ for the whole company.
“Does your EPM system come with a process to take an organization from
nothing to a full rollout of a consistent project management process? Does it
have training and certification for project teams and project managers to
create an organization that can consistently execute good project management? Does
it allow you to communicate buffers and fever charts and identify the Critical
Chain of a project? Have any of their customers reported double-digit
cycle-time improvements in their lines and a ninety-five percent or higher
on-time delivery rate?”
make no mistake, the Critical Chain software is only the catalyst. This is
about changing your corporate culture. If we want to successfully turn into a
culture of diligent planning and stellar project management, then we need a
Senior Leadership Team that is engaged in the process. We need your critical
thinking, your endorsement, and your ability to lead change.”
we need to put a steering team in place that probably consists mostly of
your direct reports.
With the prioritization scheme set, and with the state of the pipeline out
there for everyone in management to see, it was time to get serious about
fixing the things that had allowed the problems at Altus to get this far.
“The consultants will show you how to lead a team through an effective
network build. It’s your job to learn how to help teams build tight networks.
They’ll also show you how to move a team into using Critical Chain behaviors.
Once we’re done with the twenty-six Eagles, the consultants are out of here. So
use every minute of their time. You need to learn the process, and you need to
learn the software. This is a huge opportunity, but it’s not one you can afford
to screw up.”
“The consultants are going to be able to help you a lot with buy-in. They have the tools to prepare you for in-depth questions, and they have solid process expertise to lead teams through the planning and execution cycle. But you’re right to be concerned. This is a change in the way we conduct business here. Some people will get right in line with this, some will take more time, others might even resist.
So, all the Eagle teams will have an executive sponsor. That means you can
expect that Graham, Stephen, or one of their direct reports will show up for
kickoff sessions. They will personally explain to the team why this approach is
so critical to the company. That ought to help, but if we can’t overcome buy-in
issues quickly, please let me know about them right away.”
Critical Chain wasn’t one more improvement initiative at Altus Labs
anymore. It was “the way we do it from here on out.”
We did a bottleneck analysis based on the existing Critical Chain
schedules. It seems we have strong evidence that Clinical is driving the
timeline for most projects.”
That’s how you create capacity. Kill a few projects. And pretty soon, we’ll
find out where we’re getting held up and we’ll know where to put all those
extra people you’ve just found.”
We are going to be able to reduce the front end of our clinical trial process significantly. This means we will be able to start the enrollment process faster for hundreds of studies every year. This is huge. Turns out that with the new process clinical operations is on the Critical Chain only forty-two percent of the time. Manufacturing and other functions show up more on the Critical Chain now, too. Mike and I were talking, and we think it’s time to call the other functional VPs. This kind of targeted analysis would make sense for their areas too. What happened with clinical operations is not a one-off thing, and it’s not limited to that particular function. It looks like we’ll be able to repeat that kind of improvement on any process from here on out.”
knew that you want Critical Chain to be a priority and that you care about
their work situation as well. Ultimately, success will breed success. Let people
hear what we’re getting out of this. Let them see what they’ll get out of it.
Make it known.”
Implementation Phases
A Critical Chain implementation is done in two major phases: The Pilot
Phase and the Rollout Phase. Each of these phases contains a Learn phase and a
Confirm phase. The key objective of the Learn phase is to understand the causes
and effects of suboptimal project execution. In the Confirm phase, the team
uses the Critical Chain Project Management processes to overcome these
deficiencies.
Phase I: The Pilot
The main objective of the Pilot is to learn how the principles of Critical
Chain and the Critical Chain Project Management processes and tools apply in
the particular organization. The Pilot also shows the efficacy of the overall
approach.
Phase II: The Rollout
utilizes the “Learn and Confirm” approach at an organizational level. In
the Learn phase the implementation team completes their understanding of all
key objectives of the executive stakeholders. They develop a cause and effect
analysis that is based on the Pilot and on additional findings made during the
interviews for the Rollout. The burning platform of the Rollout is based on
strategic issues that are relevant to the entire organization. Typically, it
revolves around a combination of time-to-market, on-time delivery rate, or
quality of execution. The Confirm phase of a Rollout includes a number of key elements. There is a senior-level steering team overseeing the implementation. Its role is to establish the vision of the rollout as well as monitoring its ongoing progress. There is a communication plan that ensures that people within the organization understand the importance of the rollout and its objectives, and are kept informed about ongoing developments. This can also include communication with external stakeholders (e.g., shareholders, scientific community, etc.).
During a rollout, it is critical for an organization to move its entire
portfolio to the Critical Chain project management methodology. That helps
minimize the disconnects that can come from different ways of working and helps
maintain momentum toward adopting the new approach. In addition, as project
schedules are developed for the entire portfolio, the organization and its
internal experts gain important knowledge about the approach, ensuring that the
organization can independently execute the Critical Chain methodology. The
certification approach ensures that projects are planned and managed on a
weekly basis in a consistent way. Project teams are following a consistent
process and report status based on a common set of indicators.
We strongly advise our clients to capture on an ongoing basis key metrics
such as on-time delivery rates and cycle times. As the organization
increasingly understands what processes are holding up its work, improvement
initiatives—so-called “enabling projects”—are launched to further improve the
operation. Ultimately, the Critical Chain approach becomes the lynchpin of the
new relay race approach that brings not just the immediate benefits experienced
by Altus Labs, but more and more benefits into the future.
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