Critical ChainCritical Chain

Chapters 4-6Chapters 4-6

What is a project?What is a project?

Textbook definition:Textbook definition:

“ “ A set of activities aimed to achieve a A set of activities aimed to achieve a specific objective and have a clear start, specific objective and have a clear start,

middle and end”. middle and end”.

Professor Silver’s definition:Professor Silver’s definition:

A complex initiative that needs pictures, A complex initiative that needs pictures, diagrams, time charts, or showing diagrams, time charts, or showing

sequential or parallel steps in order to sequential or parallel steps in order to manage it. manage it.

General Project ProblemsGeneral Project Problems

Regardless of industry or project type, there Regardless of industry or project type, there are three common problems to all projects:are three common problems to all projects:

Budget overrunsBudget overruns

Time overrunsTime overruns

Compromising contentCompromising content

Conflicts - The MeetingConflicts - The Meeting

B.J Von Braun - B.J Von Braun -

President of UniversityPresident of University

Saturating demand for new Saturating demand for new MBAsMBAs

Overextending capacityOverextending capacity

Large fixed overhead for Large fixed overhead for business program that business program that might potentially decline might potentially decline

Christopher Page –Christopher Page –

Dean of Business SchoolDean of Business School

Demand will not taper offDemand will not taper off

Need investments to Need investments to maintain talent in the maintain talent in the business schoolsbusiness schools

Talent will bring increase Talent will bring increase reputation and increase reputation and increase demanddemand

Meeting AdjournsMeeting Adjourns

Agreements: Agreements:

Ability of graduates to get jobs as Ability of graduates to get jobs as indicators of demandindicators of demand

Use of survey tool as measurementUse of survey tool as measurement

BJ VonBraun already has the results – she BJ VonBraun already has the results – she gets Page to agree to the decision-making gets Page to agree to the decision-making conditions, then shares results with him.conditions, then shares results with him.

Class Example – New Production Class Example – New Production Facility Built in MalaysiaFacility Built in Malaysia

Sacred cow project for CEOSacred cow project for CEO

Project is grossly over budget and significantly Project is grossly over budget and significantly latelate

Payback period pushed from 3 to 5 years, which Payback period pushed from 3 to 5 years, which still seems unrealisticstill seems unrealistic

All use uncertainty as reasons for delay - Upper All use uncertainty as reasons for delay - Upper management blames external environment and management blames external environment and lower ranks blames internal sourceslower ranks blames internal sources

ConclusionsConclusions

Most problems in projects are direct or Most problems in projects are direct or indirect results of uncertaintyindirect results of uncertainty

Most individuals add a safety margin to Most individuals add a safety margin to any deadline, usually around 80%any deadline, usually around 80%